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Expatriate managers in China
The People's Republic of China was a relatively closed society from 1949 to 1976. Under the leadership of Hua Guo-Feng and later Deng Xiao-Ping, China opened its doors to tourists, foreign businessmen and joint-venture partners. One of the results of the "Four Modernizations" (of industry, service and technology, agriculture and national defence) as articulated in the 1978 "Ten-Year Economic Plan" and the "Ten Principles" of Premier Zhao Zi-Yang in 1981, was an increase in business, finance and trade links with the rest of the world (Kirkbride and Tang, 1995). Despite the abundant pool of labour in China, skilled workers and managers versed in modern business practices are scarce. Though many vocational training schools have been set up in the last ten years, China's ability to educate and train young people has still not kept pace with the influx of foreign investment. Most companies have to employ managers from abroad to start up their operations. For many new expatriate managers and for those with previous Asia experience, China is a stimulating and demanding environment in which to live and work.
Studies have found that between 16 and 40 per cent of all expatriate managers end their foreign assignments early because of their poor performance or their inability to adjust to the foreign environment (Black, 1988). Furthermore, as many as 50 per cent of those who do not return early function at a low level of effectiveness. The literature on cross-cultural management in multi-national firms cites instances where incongruity between the values of host country workers and their expatriate managers has caused the latter to be sometimes paranoid (Badar et al., 1982). An inability of expatriate managers to adjust to the new environment is costly in terms of employment expenses, poor management and poor productivity. The average cost per failure to the parent company was estimated to lie between $65,000 and $300,000, depending on various factors (Mendenhall and Oddou, 1985; Zeira and Banai, 1985).
Of the 68 joint-venture hotels in Beijing, 19 currently have international hotel management chains to manage their hotels in order to gain access to technology, management expertise and training. Expatriate managers are often hired specifically for start-up operations in joint-venture hotels managed by international hotel chains. Employment contracts are usually for two years. Selection criteria emphasize technical aspects of the work and little concern has been given to aspects of cultural adaptability on the part of expatriate managers. An increasing number of these expatriate managers are third-country nationals. This hiring policy provides a greater pool of qualified applicants and it can also be cost-effective. Another reason for using Asians instead of Westerners is their better understanding of Chinese religious and political systems and language. The posts they fill in Beijing hotels are usually at head of department level, covering key functions such as accounting, purchasing, front office, marketing, food and beverage, housekeeping, engineering and personnel. They set strategic plans, objectives and procedures for their departments and their combined efforts determine the success of a hotel.
Characterizing Chinese culture and communication
Hofstede's seminal study (Hofstede, 1980) showed that culture could be regarded as "a collective programming of the mind" which determines values, attitudes and behaviours. Accordingly, cultural differences have profound implications for management and restrict the extent to which management theories and practices can be generalized across national boundaries. Hofstede's four dimensions provide a useful characterization of Chinese culture. The individualism-collectivism dimension characterizes Chinese culture as collectivist, where there is a tight social framework in which people seek fulfilment and happiness in the harmony of the group. The power distance dimension characterizes Chinese culture as high power distance. Thus obedience, conformity, autocratic decision making and close supervision characterize superior-subordinate relationships. On the uncertainty avoidance dimension, Chinese culture can be characterized as medium to low uncertainty avoidance. Thus Chinese people are usually comfortable with ambiguity and not likely to be emotional and intolerant of change. The fourth dimension, masculinity-femininity, provides a less clear characterization of Chinese people. Traditional male traits of assertiveness, competitiveness and ambition are present together with traditional female traits of emotion, compassion and nurture of the needy.
Since communication is crucial in management, the characterization provided by Hall (1976) is helpful. Chinese culture is characterized by high-context communication in which relatively little information is contained in the coded, explicit part of the message. Much information is in the physical context or internalized in the person. Cultural variables that can affect the communication process by influencing a person's perceptions have been discussed by Harris and Moran (1991). The language barrier is a most obvious factor encountered by Western expatriates. The written Chinese language is composed of three- and four-character idioms which derive an extended meaning from the history and philosophy with which they are associated. To be literate in Chinese, one must understand the implicit meaning and significance of the characters. Further, one must know the spoken pronunciation system in which there are four tones and a change of tone signifies a change of meaning. Without a Chinese language skill, expatriate managers must …