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THE JAPANESE JOURNAL OF

ADMINISTRATIVE SCIENCEJune, 2001 (Vol. 15, No. 1)

Edited by

THE JAPANESE ASSOCIATION OF ADMINISTRATIVE SCIENCE

President : Toshihiro Kanai, Kobe University

Editor : Kiyoshi Takahashi, Nanzan University

Associate Editors :

?v- Yasuo Hoshino, University of Tsukuba

Hiroyuki Noguchi, Nagoya University

Haruo Takagi, Keio University

Yutaka Toshima, Nihon University

Hiroshi Yamamoto, Aoyama Gakuin University

CONTENTS

REVIEW

Organizational Citizenship Behavior: Measurement Scales, Similar Concepts,Related Concepts, and Its Determinants 1

Ken'ichiro TANAKA

ARTICLES

Continuous Learning as a Mediator of the Relationship between Personalityand Sales Performance: An Empirical Study on a Japanese InformationSystem Company 29

Naoto TSURU, Yuichiro KANAZAWA, and Shinichiro WATANABE

Career Anchors of Female Temporary Employees: An Exploratory Study 47Shoko MATSUE

Applicants' Self-Presentation and Nonverbal Behaviors in Job Interviews 57Kazumi YAMAGUCHI

Expatriate Managers and Local Employees: Cases in Japanese Wholly-OwnedVentures in and around Shenzen, China 73

Aki NAKAMURA

CASE STUDY

Comparative Case-Study on the Global Marketing Activities of Acer Groupin Taiwan and Samsung Electronics Co. in South Korea 93

Takaharu OKUDA

THE JAPANESE ASSOCIATION OF ADMINISTRATIVE SCIENCE

Department of Business Administration, Aichi-Gakuin University, 12 Araike, Iwasaki,Nisshin 470-0131, Aichi, Japan (Phone: +81-5617-3-1111 (Ex.380) ; Fax: +81-5617-4-2420)

E-mail: [email protected] Page: http://www.aichi-gakuin.ac.jp/~matsu/JAAS/

Japanese Journal of Administrative ScienceVolume 15, No. 1, 2001, 1 - 28.g«ff»f4^*15«* 1 ^, 2001, 1-28.

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Organizational Citizenship Behavior:Measurement Scales, Similar Concepts, Related Concepts, and Its Determinants

Ken'ichiro TANAKA

(Hiroshima Prefectural University)

The purpose of the present study was to review the studies on the measurementsof organizational citizenship behavior (OCB), determinants of them, the similarand the related concepts of OCB. Several major definitions of OCB were indicatedand compared with similar concept (i.e., prosocial organizational behavior,organizational spontaneity, extra-role behavior, contextual performance), andrelated concepts, i.e., whistle blowing, organizational retaliatory behavior. Theauthor commented on the various OCB scales used in the previous studies, e.g.,Smith et al. (1983) and Podsakoff, et al. (1990). Factors affected on OCB wereexamined: organizational justice (procedural justice, interactional justice,distributive justice), supervisor's leadership, job satisfaction, organizationalsupport, organizational commitment, mood in workplace, personality factors,and demographic factors, and the reasons people performed OCB wereexamined. Finally, the future direction of studies on OCB was discussed.

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Japanese Journal of Administrative ScienceVolume 15, No. 1, 2001, 29 - 45.mnmn^mismmm, 2001, 29-45.

Continuous Learning as a Mediator of the Relationshipbetween Personality and Sales Performance:

An Empirical Study on a Japanese

Information System Company

Naoto TSURU, Yuichiro KANAZAWA,and Shinichiro WATANABE*

(University of Tsukuba)

The importance of continuous learning for achieving sales success inever-changing competitive environment is increasingly being recognized. In thepresent study, we hypothesized that the positive relationship between conscientiousness and sales performance, which had already been recognized in severalliteratures, would be mediated by continuous learning. We tested the hypothesisby the structural equation model with latent variable using the data gatheredfrom the 139 sales representatives working for a large Japanese informationsystem company listed on the Tokyo Stock Exchange, Part I. We found thatconscientiousness significantly affected on continuous learning, but thatcontinuous learning did not significantly influence sales performance. Thesefindings indicated that our hypothesis was not supported by the data. We alsofound that openness to experience and the degree of the sales representative'sperception of competitiveness in the market environment were positivelycorrelated with continuous learning. We discuss implications of the study andgive suggestions for future research.

SC

1 Introduction

The importance of continuous learning for

achieving sales success in ever-changing competi

tive environment is increasingly being recognized.

Especially in high-tech industries, new products

and services are unceasingly developed and put on

the market, and their paces of vicissitude are

becoming more rapid. Furthermore, new auto-

* Naoto Tsuru is Analyst, Tokyo Consulting Inc., Yuichiro

Kanazawa is Associate Professor of Statistics, and Shinichiro

Watanabe is Assistant Professor of Organizational Behavior

at the Institute of Policy and Planning Sciences, the Univer

sity of Tsukuba.

Correspondence concerning this article should be addressed

to Yuichiro Kanazawa, Institute of Policy and Planning

Sciences, the University of Tsukuba, 1-1-1 Ten-noh-dai,

Tsukuba, Ibaraki 305-8573, Japan.

His e-mail address is [email protected].

matic channels such as the Internet have appeared

and become competing with sales representatives'

traditional channels. In order to survive in such

an environment, sales representatives must move

away from "selling" toward "serving" as cus

tomer consultants and business partners. This

means they must continuously acquire not only

up-to-the-minute knowledge about their products

and services but also must be continuously aware

of their customer's changing needs. That is to

say, they must "continuously learn." An exten

sive literature exists that establishes the direct

relationship between the sales performance and

some of the personality variables. The main

objective of this study is to investigate if this

relationship is mediated by continuous learning

behavior on the part of sales representatives work

ing for a large Japanese company that designs,

manufactures, and markets information systems.

•29-

mwnmn^msmm 1 ^

This article is organized as follows. Sections 2

and 3 are, respectively, devoted to the review of the

past research and the formulation of hypotheses

based on the literature review. Explained in

section 4 are the subjects and data used, and the

methodology employed in the present study. The

research results are presented in section 5. Fi

nally, section 6 is devoted for the discussion of

theoretical and practical implications of our

findings and suggestions for future research.

2 Determinants of sales performance

Over the past several decades, a considerable

number of studies have been conducted in the hope

of finding determinants of the sales performance.

According to the large-scale meta-analysis con

ducted by Vinchur, Schippmann, Switzer, and

Roth (1998), there exist eighty-two published and

sixteen unpublished studies dealing with determi

nants of sales performance from 1918 to 1996.

Some individual difference variables have been

shown to be valid predictors of sales performance.

Above all, direct relationships between sales

performance and some of the Big Five personali

ties were well documented.

Barrick and Mount (1991) in their large-scale

meta-analysis investigated the relation of the Big

Five personality dimensions to the three job per

formance criteria for five occupation groups.

Although there is some disagreement regarding

the names and content of the Big Five personality

dimensions (see Goldberg, 1993, for example), the

definition given by Barrick and Mount after

Digman (1990) has been used by many research

ers. They found that there were statistically

significant and positive correlations between sales

performance and two dimensions of the Big Five

personalities —conscientiousness and extraversion.

Their result was confirmed by the Vinchur,

Schippmann, Switzer, and Roth's (1998) meta

analysis focusing on the predictor of the sales

performance. In the 129 independent samples, they

selected 85 that were in accordance with their

framework and found that conscientiousness and

extraversion were significantly correlated with

sales performance.

Various hypotheses with more complex struc

tures have since been examined in several studies

to better understand the latent structures in the

relationship between the sales performance and

the two relevant dimensions of the Big Five per

sonality. McManus and Kelly (1999) examined the

effects of the Big Five personality and biodata

measures in predicting sales performance valid

ity. They found significant correlations between

the biodata and the task rating; as for the person

ality measures, however, extraversion, but not

conscientiousness, was significantly correlated to

the criterion. They reasoned that this is due to

their "weak measure of conscientiousness." They

also found that no dimensions of the Big Five

personality traits could significantly increase the

amounts of variance explained in the task rating

over or above that was explained by the biodata

alone. The results strongly indicated that the Big

Five personality could not be regarded as the

predictor of the sales performance in the presence

of the biodata.

Stewart (1996) examined a hypothesis that the

reward structure of management would moderate

the effects of extraversion and conscientiousness

on sales performance. He used a sample consist

ing of two groups. One was primarily rewarded

for obtaining new sales, and another primarily

for retaining customers. He found that

extraversion was positively associated with the

dimension of performance that was explicitly

rewarded but not with the nonrewarded dimen

sion. He also found that conscientiousness was

significantly and positively correlated with new

sales but not with customer retention, but the

moderating effect of the reward structure was not

observed in either case. His results implied that

the extraversion might be a stronger predictor of

sales performance when it was used together with

the reward structure.

Stewart (1999) also examined the relationships

between sales performance of employees at differ

ent stages of tenure (newly hired employees and

veteran employees) and two narrower subtraits of

conscientiousness (order and achievement). He

found that order was correlated more strongly

-30-

Continuous Learning as a Mediator of the Relationship between Personality and Sales

with sales performance of the newly hired employ

ees, while achievement was correlated more

strongly with that of the veteran employees. He

also found that "in the respected samples, order

and achievement also provided incremental valid

ity beyond conscientiousness."

Although each of the above three studies dealt

with more complex hypotheses between some

dimensions of the Big Five personality and derived

informative results, what seems to be lacking and

more interesting is a consideration of the outer

most layer structure, namely the structure consist

ing of the path from the personality to behavior

and the path from the behavior to the result or

outcomes. In fact, Mount, Barrick, and Strauss

(1993) already examined the mediating effects of

goal setting and goal commitment behaviors on

the relationship between conscientiousness and

sales performance. They concluded that these

behaviors could partially mediate the relationship

between conscientiousness and sales performance,

but not completely. There could be other behav

ioral factors that can mediate the relationship

between conscientiousness and sales performance.

3 Hypotheses

In this study, we entertain a possibility of "con

tinuous learning" as a mediator of the effect of

conscientiousness on sales performance. We de

fine continuous learning after London and Mone

(Ilgen & Pulakos Ed., 1999): "continuous learning

is the process by which one acquires knowledge,

skills, and abilities throughout one's career in

reaction to, and in anticipation of, changing

environment of performance requirements." To

establish the mediation, we hypothesize two

models—unmediated and mediated models, fol

lowing the steps recommended by Baron and

Kenny (1986) and Judd and Kenny (1981).

Unmediated Model (Model 1). First, we hypothe

size the unmediated model (Model 1) in order to

establish that there exists an effect that may be

mediated. As mentioned previously, Barrick,

Mount, and Strauss (1993) points out: "Research

has indicated that the Big Five personality dimen

sions are quite robust, as demonstrated by longi

tudinal and across-observer studies; in different

age, sex, race, and language groups; and across

different theoretical perspectives." In other words,

it has been widely recognized that there exists a

direct path from conscientiousness to sales per

formance. Thus we hypothesize that conscien

tiousness will be positively related to sales per-

Main Hypotheses

Figure 1 : Path diagram of the unmediated model (Model 1). The manifest variables are in boxes and thelatent variables are in ovals. All effects are hypothesized to be positive. Correlations amongconscientiousness and the three control variables are admitted.

-31-

IS » fe-gnmn^msmm 1 #

formance (H 1 : conscientiousness -* sales per

formance). The model 1 is shown in Figure. 1

We control the effects of several variables on

sales performance. First we accept a direct effect

of extraversion on sales performance for the same

reason of accepting the path from conscientious

ness to sales performance. We would have pre

ferred to use extraversion with reward structure as

moderating factor taking into consideration the

result of Stewart (1996). The taxonomy of the

reward structure, however, was not available in

the organization used in our study. Thus only the

direct effect of extraversion will be controlled (C 1

: extraversion -* sales performance).

We add a path from sales experience to sales

performance because an experienced sales repre

sentative may have higher levels of sales skill to

accomplish the higher performance (C 2 : sales

experience -* sales performance).

Also controlled is a variable measuring the

levels of consideration sales people have usually

exhibited to their supervisors. In this study, we

use as the performance ratings of the sales people

Control Variables

evaluations by their immediate supervisors,

which might not be objective enough. Inclusion of

the consideration factor would presumably be

able to control any biases shown by the supervi

sors in the ratings. We call this factor as "consid

eration to supervisor" for the rest of this article (C

3 : consideration to supervisor -* sales perform

ance) .

We also control the effects of gender and educa

tion levels on sales performance by concentrating

on male college-educated sales representatives —

an overwhelming (86%) majority in our data- as

the subjects of the study. Finally we admit the

existence of correlations among conscientious

ness, extraversion, and consideration to supervi

sor.

Mediated Model (Model 2). We next hypothesize

the mediated model (Model 2 ) including continu

ous learning as a variable transmitting the effect

of conscientiousness on sales performance (See

Figure 2). According to Barrick and Mount

(1991), traits frequently associated with conscien-

Main Hypotheses

Figure 2 : Path diagram of the mediated model (Model 2). The manifest variables are in boxes and thelatent variables are in ovals. All effects are hypothesized to be positive. Correlations amongconscientiousness and the five control variables are admitted.

•32-


tiousness include being careful, thorough, respon

sible, organized, hardworking, achievement-

oriented, and persevering. Therefore it is reason

able to hypothesize, on the exploratory basis, that

an organized, hardworking, and achievement-

oriented and thus conscientious sales representa

tive tends to "continuously learn" (H 2 : conscien

tiousness -* continuous learning).

As discussed previously, in high-tech industries

with rapid product turnovers and in a new com

petitive market environment where sales represen

tatives need to "serve" as customer consultants,

successful sales representatives must continuously

acquire up-to-the-minute knowledge on their

products and services, being aware of changing

customer's business needs. Therefore we hypothe

size that sales representatives who "continuously

learn" will perform better (H 3 : continuous learn

ing sales performance).

It is, however, not sufficient just to correlate

continuous learning with sales performance in

order to establish the mediation; continuous

learning and sales performance may be correlated

because they are both caused by conscientious

ness. Thus, conscientiousness must be controlled

in testing the mediating effect of continuous learn

ing on sales performance (HI': conscientiousness

-*• sales performance). If the path coefficient of

HI' is reduced in absolute size compared with that

of HI, but is still different from zero statistically,

continuous learning will be a "partial mediator."

On the other hand, if the path coefficient of HI' is

zero, then continuous learning will be a "complete

mediator."

We control the effect of other variables on con

tinuous learning. We control the effect of openness

to experience on continuous learning. According

to Barrick and Mount (1991), traits frequently

associated with openness to experience include

being imaginable, cultured, curious, original,

broad-minded, intelligent, and artistically sensi

tive. It seems quite likely that a sales representa

tive with high levels of these traits will have a

tendency to learn continuously (C 4 : openness to

experience continuous learning).

Also, a sales representative finding or

perceiving his market environment as very com

petitive will be more likely to be committed to

continuous learning to survive. We control the

degree of the sales representative's "perception of

market competitiveness" on continuous learning

(C 5 : perception of competitiveness continuous

learning). We also admit the existence of

correlations among conscientiousness and the five

control variables.

4 Method

Sample. The participants for this study were

sales representatives working for a large Japanese

company that designs, manufactures, and mar

kets information systems, power and industrial

systems as well as business systems. The com

pany is listed on the Tokyo Stock Exchange, Part

I. We selected the study site, because their prod

ucts and services are continuously evolving and

requires customization. These features are more

likely to make its sales representatives committed

to continuously learn about their products and

services. We distributed 217 questionnaire sets

made up of two mutually exclusive parts, ones

designed to be filled out by sales representatives

and the other by their immediate supervisors. The

questionnaire for the sales representatives con

sists of a demographic-data form, a personality

test, a self-evaluation on two behavioral factors —

continuous learning and consideration to supervi

sor, while the questionnaire for supervisors asks

multi-dimensional as well as overall performance

ratings of the sales representatives under their

immediate supervision. Of the 217 sets distributed,

166 were completed and mailed back to us (76.5%

response rate). Of the 166 respondents, approxi

mately 91% were male; 93% had college degrees;

42% were either sectional chiefs or managers;

their ages distributed from 23 to 56, and the me

dian age was 32; their sales experiences ranged

from 6 months to 25 years, and the average was 9.8

years. Of the 143 male college-educated sales

representatives, we selected 139 whose records

were complete.

Measures. All measurement items composing

•33-

ec m gs?rfi**¥*i5«* i •

the questionnaire are translated into English in

Appendix A.

Sales Performance. We used overall ratings of

sales representatives on a three-point scale: the

high performer (3), the average performer (2),

and the low performer (1). These overall ratings

assess sales representatives' performance on

various aspects: (a) how much revenues was he

able to generate?; (b) how many products and

services was he able to sell?; (c) how much profits

was he able to generate?; (d) was he able to in

crease the market share of their products and

services?; (e) was he able to add new customers?;

(f) was he able to retain his regular customers?;

and (g) was he able to earn customer's trusts?; (h)

factors other than those listed above. The overall

ratings were strongly influenced by two of the

individual ratings, (a) revenue and (d) market

share. See appendix B for detail.

Personality. To measure conscientiousness,

extraversion, and openness to experience factors

of personality, we extracted 37 measures from

McCrae and Costa's (1985) eighty bipolar adjec

tive scales on the basis of the results of their factor

analytic study. The ten to thirteen trait descrip

tors with the highest factor loadings were selected

to represent each of the three personality factors.

Next, we converted those bipolar adjective scales

into five-point Likert scales, ranging from

strongly disagree (coded as 1) to strongly agree

(coded as 5). For example, a bipolar adjective

scale to assess the level of conscientiousness,

"hardworking vs. lazy" was modified to "I work

hard." Conscientiousness was measured with

thirteen items, extraversion with eleven items, and

openness to experience with ten. The Cronbach's

(1951) coefficient alphas are .90, .88, and .82 re

spectively. These all exceeded the .70 level recom

mended by Nunnally (1978).

Continuous Learning. As discussed previously,

continuous learning refers to the process by which

one acquires knowledge, skills, and abilities

throughout one's career to keep up with changing

performance requirements (see, London & Mone,

1999). In accordance with this conceptualization,

seven items were formulated to measure the levels

of sales representative's continuous learning (see

Appendix A). Each of the items included five

response alternatives ranging from 1 (strongly

disagree) to 3 (neither) to 5 (strongly agree).

Sample items included "I spontaneously acquire

the knowledge and skill required in my job," and

"I continuously update the knowledge, throughout

the experience of working." It is important to note

that the items were written based on our inter

views with several sales representatives with over

20 years of sales experience on the research site..

The Cronbach's alpha for the scale was .83.

Consideration to Supervisor. We developed

three items to measure consideration to supervisor

(see Appendix A). Each of the items included five

response alternatives ranging from 1 (strongly

disagree) to 3 (neither) to 5 (strongly agree). The

Cronbach's coefficient alpha was .73.

Perception of Competitiveness. Each of the sales

representatives evaluated competitiveness in his

market environment in five-point ordinal scale

ranging form very competitive (5) to almost no

competition (1).

Sales Experience. Each of the sales representa

tives was asked how many years he was involved

in sales activity in the demographic-data form.

We converted years into months.

5 Results

We tested Model 1 and Model 2 by using the

structural equation model with latent variables in

the LISREL 8.10 (Joreskog & Sorbom, 1993). We

simultaneously estimated both parameters for the

measurement models and the structural equation

models by maximum likelihood (ML) method

using correlation matrix of the manifest vari

ables.

Pre-analytical Procedure. The ML method needs

an assumption that a set of manifest variables

forms the multivariate normal samples. Sales

performance ratings were measured on three-

point ordinal scale. One way to analyze such data

is the weighted least square methods with the

polychoric or polyserial correlations and the

asymptotic covariance matrix (see Aish &

34-


Joreskog, 1990; Joreskog, 1990 for reviews).

Estimating the asymptotic covariance matrix,

however, needs so large a sample that we could

not employ the method. Instead, we checked the

skewness and kurtosis for the variables using the

PRELIS 2.10 (Joreskog & Sorbom, 1992). When

some of the variables were found heavily skewed,

we transformed them so that we were able to meet

the assumption and avoid biased estimation. We

found that no variable registered kurtosis signifi

cantly different from that obtained from the nor

mal distribution after the transformation.

In this analysis, we set the variances of the

measurement errors for the sales performance, the

sales experience and the perception of competitive

ness to be zero, because they were manifest vari

ables.

Test of Model 1. We tested Model 1 (Unmediated

Model) as shown in Figure 1 in order to establish

that there exists an effect of conscientiousness on

sales performance that may be mediated. We first

set all covariances between the measurement

errors to be zero. We then modified the model by

relaxing the restrictions of no correlations on the

measurement errors according to the modifica

tion indices in LISREL for the following reason: If

the correlations among the measurement items

are induced by a set of latent variables, then when

all latent variables are accounted for, the meas

urement errors will be uncorrelated. Since we

assume one latent variable for a group of meas

urement items, it is expected that the measurement

errors are likely to be correlated.

We report the completely standardized esti

mates of loadings (A ), ^-values, and R2 for the

measurement models of latent variables shown in

Table 1. As shown in the table, all measurement

items were significant (p<0.01). We judged that

the three latent variables — conscientiousness,

extraversion, and consideration to supervisor —

were well measured.

Having checked the results of the measurement

models, we then focused on the result of the struc

tural equation model. We report the completely

standardized estimates of the path coefficients and

the overall goodness-of-fit statistics in Figure 3.

As shown in the figure, the path coefficient from

conscientiousness to sales performance (HI) was

.37 and significant (lvalue = 3.42 andp<.01). On

the other hand, none of the coefficients for the

three control paths —CI from extraversion, C 2

from sales experience, and C 3 from consideration

to supervisor —was significant (£-values = .17, -.18,

and -.60, respectively; and p>.10 for all). Only

one of the overall goodness-of-fit statistics, corn-

Table 1 : Completely standardized estimates of loadings (A), t-values, and R2 for the measurement model in the test of Model 1

Latent Variables Item A (t-value) R2

Conscientiousness c-i .75 (10.09)- .57

C-2 .67 (8.62)- .45

C-3 .46 (5.48)- .21

C-4 .58 (7.57)- .35

C-5 .52 (6.34)- .27

C-6 .58 (7.23)- .34

C-7 .74 (9.77)- .54

C-8 ,70 (9.29)- .49

C-9 .67 (8.64)- .45

C-10 .61 (7.81)- .38

C-ll .76 (10.19)- .58\ C-12 .65 (8.38)- .43

C-13 .46 (5.48)- .21

Nete. X.05. X.01


Extraversion E- 1 .73 (9.60) - .53

E-2 .70 (9.03) - .47

E-3 .67 (8.63) - .45

E-4 .67 (8.62) - .44

E-5 .73 (9.66) - .54

E-6 .82 (11.40)- .68

E-7 .54 (6.51) - .29

E-8 .65 (8.17)- .42

E-9 .52 (6.61) - .28

E-10 .40 (4.61) - .16

E-ll .39 (4.59) - .16

Consideation cs-i .47 (5.44) - .22

to Supervisor CS-2 .92 (11.15)- .85

CS-3 .76 (9.04) - .58

-35-

mnmn^msmm 1 ^

Main Hypotheses

Figure 3

Overall Goodness-of-fit Statistics

Root Mean Square Error of Approximation (RMSEA) = .058Comparative Fit Index (CFI) = .90Goodness of Fit Index (GFI) = .81

y2(361) =528.34 (p = .00)Note, *p<.05. "p<.01.

Completely standardized estimates of the path coefficients and the overall goodness-of-fitstatistics in the test of Model 1

parative fit index, significantly supported the

model (CFI = .90).

We found that sales experience did not affect

sales performance. This is probably due to the

fact that, when an immediate supervisors rated his

sales representatives, he took into consideration

their sale experiences. In other words, the supervi

sory expectation of his subordinates increased

with sales experience. We also found that consid

eration to supervisor was not significantly related

to sales performance. As seen in Appendix B, the

overall sales performance rating of a sales repre

sentative were significantly affected only by the

amount of revenue he was able to generate and by

the market share he was able to increase. Since

these figures —revenue and market share —are

easy to quantify, we could argue that the supervi

sory ratings were objectively given and thus were

not affected by the variables measuring considera

tion to supervisor.

We then modified Model 1 by removing the three

insignificant control paths —C 1, C 2, and C 3. We

call the modified model as Model 1'. We report the

completely standardized estimates of loadings A ,

^-values, and R2 in Table 2. As shown in the table,

there were no notable changes, and all measure

ment items were significant.


mates of the path coefficients and the overall-of-fit

Table 2 : Completely standardized estimates of loadings ( A), lvalues, and R2 for the measurement model in the test of Model V

Latent Variables Item A (lvalue) R2

Conscientiousness c- 1 .76 (10.16)** .58

C-2 .67 (8.65)** .46

C-3 .45 (5.34)** .20

C-4 .61 (7.64)** .38

C-5 .52 (6.34)** .27

C-6 .58 (7.21)** .34

C-7 .74 (9.79)** .55

C-8 .70 (9.17)** .50

C-9 .68 (8.70)** .46

C-10 .62 (7.71)** .38

C-ll .76 (10.24)** .58

C-12 .64 (8.01)** .40

C-13 .41 (4.76)** .17

Nete. *p<.05. ~p<.01

36-


ConscientiousnessHI Sales

Performance.36"



X2(74) =97.57 (p = .035)Note, *p<.05. "p<.01.

Figure4 : Completely standardized estimates of the path coefficients and the overall goodness of fitstatistics in the test of Model 1'

Table 3 : Completely standardized estimates of loadings (A), lvalues, and R2 and coefficientalphas for the measurement model in the test of Model 2

Latent Variables Item A (i-value) R2

Conscientiousness c-i .75 (10.11)- .57

C-2 .66 (8.37)- .43

C-3 .44 (5.52)- .19

C-4 .62 (7.80)- .39

C-5 .54 (6.61)- .29

C-6 .57 (7.09)- .33

C-7 .73 (9.83)- .54

C-8 .69 (9.13)- .48

C-9 .67 (8.58)- .45

C-10 .63 (8.09)- .41

C-ll .77 (10.60)- .59

C-12 .66 (8.37)- .43

C-13 .44 (5.20)- .19

Nete. X.05. X.01

statistics in Figure 4. As shown in the figure, the

path coefficient of HI was .36 and significant (t

-value = 4.19 and p<.01). Chi-Square test sup

ported Model 1' (x2 (74) =97.57 and p=.035).

Goodness-of-Fit Index reached an adequate level

(GFI = .91). The Root Mean Square Error of

Approximation (RMSEA) was .048. According to

Browne and Cudeck (1993. p. 144), the RMSEA of

about .05 or less would indicate a close fit of the

model. Comparative Fit Index (CFI) was .97, an

adequate level in our judgment. We judged that

Model V reasonably supported by the data and


Openness o- 1 .46 (5.29)- .21

to Experience 0-2 .65 (8.25)- .42

0-3 .19 (2.11)- .04

0-4 .64 (8.02)- .42

0-5 .67 (8.15)- .45

0-6 .72 (8.99)- .51

0-7 .64 (7.73)- .40

0-8 .58 (6.97)** .33

0-9 .49 (5.95)- .24

o-io .72 (9.29)- .50

Continuous CL-1 .74 (9.00)- .55

Learning CL-2 .57 (6.71)- .33

CL-3 .77 (9.35)- .59

CL-4 .68 (8.05)- .46

CL-2 .62 (7.39)- .38

CL-3 .47 (5.35)- .22

CL-4 .71 (8.56)- .51

that there existed a significant effect of conscien

tiousness on sales performance that may be medi

ated.

Test of Model 2. We next tested Model 2 (Medi

ated Model) as shown in Figure 2. We excluded

the three control paths to sales performance —C 1,

C 2, and C 3, because they were found insignificant

in Model 1\ We report the completely standard

ized estimates of loadings (A ), i-values, R2 for

the measurement models in Table 3. As shown in

the table, all measurement items were significant

•37-

^nnmn^mismm 1 ^

Main Hypotheses

Overall Goodness-of-fit StatisticsRoot Mean Square Error of Approximation (RMSEA) = .048

Comparative Fit Index (CFI) = .92Goodness of Fit Index (GFI) = .81

X2(436) =573.88 (p = .00)Note, *p<.05. "p<.01.

Figure5 : Completely standardized estimates of the path coefficients and the overall goodness-of-fitstatistics in the test of Model 2

Main Hypotheses



X2(436) =573.88 (p= .00)Note, *p<.05. "p<.01.

Figure6 : Completely standardized estimates of the path coefficients and the overall goodness-of-fitstatistics in the test of Model 2

•38-


at thep<0.05 level. We judged that the three latent

variables - conscientiousness, continuous learn

ing, and openness to experience —were well meas

ured.


mates of the path coefficients and the overall

goodness-of-fit statistics in Figure 5. As shown in

the figure, the path coefficient from conscientious

ness to continuous learning (H 2) was .33 and

significant (t-value = 3.52 and p<.01), while that

from continuous learning to sales performance (H

3) was .001 and not significant (i-value = .011 and

p>.10). The unmediated path coefficient from

conscientiousness to sales performance (HI') was

.37 (lvalues = 3.66 and p<.01) and was not re

duced in absolute size. These findings indicate

that continuous learning does not transmit the

effect of conscientiousness to sales performance.

The path coefficient from openness to experience

to continuous learning (C 4) was .33 (i-value =

3.42; p<.01), and that from perception of competi

tiveness to continuous learning (C5) was .23 (t

-value = 2.86;p<.01).

Two of the overall-of-fit statistics - RMSEA =

.048 and CFI = .92—supported Model 2, while the

other two- x 2(436) = 573.88 withp = .00 and GFI

= .81 —did not. In Model 2, however, we used

many manifest variables for the measurement

model and the degree of freedom was large. In

such a case, x 2 test and GFI might not always be

appropriate fit indices. We tentatively accept

Model 2.

Finally we show modified Model 2 by removing

the non-significant path from continuous learning

to sales performance in Figure 6. As shown in the

figure, there is no notable changes other than the

degree of freedom.

6 Discussion

As quoted in determinants of sales performance

section, some authors have argued that conscien

tiousness was a significant and positive direct

predictor of sales performance (Barrick & Mount,

1991; Vinchur, Schippmann, Switzer, and Roth,

1998). Our Model V supported their results. The

implication is that since conscientiousness is

relatively fixed and it is possible to identify people

who are high on this personality trait, the best

opportunity organizations have to increase the

sales performance of its employees can be pro

vided by the selection process. It would be a better

approach for organizations to select people who

are high on the levels of conscientiousness than

trying to change the levels of their conscientious

ness once they enter the organizations. Also, the

company should provide them with training

opportunities, seminars, and self-improving

educational opportunities on the regular basis in

order for it to stay competitive and to be able to

retain and continuously attract conscientious

sales forces.

Mount, Barrick, and Strauss (1993) found that

goal setting and goal commitment could partially

mediate the relationship between conscientious

ness and sales performance. In the present study,

we did not find, contrary to our expectation, that

continuous learning functioned as an additional

mediating behavioral factor. Instead, we found

that conscientiousness was significantly related to

continuous learning, but that the path from con

tinuous learning to sales performance was very

weak at most when the direct effect of conscien

tiousness on sales performance was controlled.

What happened is the following. Many of the

participants in this study did continuously learn

and those who continuously learn tended to be

evaluated as high performers in terms of sales

performance. It is just that their sales perform

ances correlated more with conscientiousness

scores than with their continuous learning behav

ior scores, rendering the latter to be insignificant

in the presence of the former. This is evidenced by

the fact that without HI' path or conscientious

ness -*• sales performance path, H3 path or con

tinuous learning -* sales performance would be

highly significant in Figure 5.

Another possible reason for our not finding a

mediating effect in continuous learning lies in the

fact that we measured the relationship at one point

in time rather than serially in this study. Continu

ous learning could affect sales performance but

with some time lag. Its effect on sales perform-

-39-

R «S7T»f45**15*» 1"%

ance could also be cumulative in the sense that

how long a sales representative has been commit

ted to continuous learning affects the sale per

formance. Some researchers already started

examining sales performance as dynamic crite

rion by time series analysis (Hofmann, Jacobs, &

Baratta, 1993; Harrison, Virick, & William, 1996;

Ployhart & Hakel, 1999). It is worth examining

the effect of continuous learning on sales perform

ance similarly in future research.

The present study extends the London and

Mone's theory by offering actual predictors of

continuous learning, which they have mentioned

but on whose existence they did not give empirical

evidences. As we expected, openness to experience

was significantly and positively related to con

tinuous learning. Barrick and Mount's (1991)

explained that, in finding a valid predictor of

training proficiency, "individuals who score high

on this dimension (e.g., intelligent, curious,

broad-minded, and cultured) are more likely to

have positive attitudes toward learning experi

ences in general." The same explanation may

also be adopted to the relationship between open

ness to experience and continuous learning. We

also revealed that perception of competitiveness

was positively related to continuous learning.

This indicates that sales representatives recogniz

ing their market environment as very competitive

will be more likely to acquire new knowledge and

skills by their continuous learning behavior.

In this study, we examined some control paths

to sales performance. Contrary to the results of

two meta-analyses (Barrick & Mount, 1991;

Vinchur, Schippmann, Switzer, & Roth, 1998), we

did not find significant direct effect of extraversion

on sales performance. There exist two possible

reasons for not finding a significant effect of

extraversion on sales performance. First, since

our study site designs, manufactures, and markets

information systems, its sales representatives are

required to have broad technical skills and knowl

edge in computer programming, system engineer

ing as well as familiarity with clients' business

needs. In these environments, traits frequently

associated with extraversion such as being socia

ble, gregarious, assertive, and talkative (Barrick

and Mount, 1991) may not be as important a factor

in generating sales as these technical skills and

knowledge. Second, our study site is a Japanese

company, while the above meta-analyses were on

American companies. The difference in the na

tional characters may account for this lack of

relationship between extraversion and sales per

formance on the part of the Japanese sales repre

sentative. More research is needed to examine the

differences across cultures. Research that ad

dresses the cultural differences will be also a

valuable addition to the literature.

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-42-

T


Appendix A Measurement Items Composing the Questionnaires

Items Evaluated by the Sales Representatives

The items for personality, continuous learning,

and consideration to supervisor are evaluated in

five-point Likert scales anchored: strongly agree

(5), agree (4), neither (3), disagree (2), and

strongly disagree (1). The item for perception of

competitiveness is evaluated in five-point Likert

scales anchored: very competitive (5), competitive

(4), undecided (3), a little competition (2), and

strongly disagree (1).

Conscientiousness

C-1. I make thorough preparations.

C-2. I do things methodically.

C-3. I am diligent.

C-4. Others would describe me as reliable and

dependable.

C-5. I am self-disciplined.

C-6. I never fail to organize my thoughts before

making a speech.

C-7. When struggling to do something, I pay

attention to the details.

C-8. Others would describe me as planful.

C-9. I tend to use a systematic approach to

guide thinking.

C-10. I tend to summarize the underlying rela

tionships among separate issues accord

ing to established rules and principles.

C-11. I put effort into ensuring that I do not miss

anything.

C-12. I tend to synthesize a variety of issues and

phenomena according to established rules

and principles.

C-13. When faced with a strange phenomenon, I

always try to evaluate it in relation to

existing frames of reference.

Extraversion

E-1. I am friendly with anyone even at the first

meeting.

E-2. I am very talkative.

E-3. I make people around me happy.

E-4. I like social functions such as parties very

much.

E-5. I am cheerful.

E-6. I am sociable.

E-7. I am relatively sympathetic with others.

E-8. I always interact with others in a friendly

manner.

E-9. I am said to be active.

E-10. I am more comfortable in others' com

pany than in solitude.

E-11. I spontaneously do things.

Openness to Experience

0-1. I have various interests, knowledge and

information on matters not directly con

nected to my job.

0-2. I am interested in many things.

0-3. I respect the others' opinion and values

that are consistent with mine.

0-4. I can see things from different perspec

tive.

0-5. I often come up with original ideas using

my imagination.

0-6. I always come up with creative and novel

ideas by disregarding generally accepted

norm.

0-7. I like an environment in which I can show

my creativeness.

0-8. I like variety.

0-9. I have great interests on novelties and

unknowns.

0-10. I am bold and adventurous.

Continuous Learning

CL-1. I tend to acquire job-related knowledge

and skills on a voluntary basis.

CL-2. I continuously improve my knowledge

through work experiences.

CL-3. I usually look ahead to see possible

performance requirements and make

effort to fill gaps, if any, between the

requirements and my present

-43-

m * m^nmn^mi^mm 1 *§•

knowledge, skills and abilities.

CL-4. I make effort regularly in order to be

well versed in new skills.

CL-5. I would like a generous self-investment

to enlighten myself.

C L-6. I always think about what I have learned

from both daily activities and peculiar

events and try to apply the knowledge to

my job.

CL-7. I endeavor to improve my job perform

ance by training and enlightening my

self.

Consideration to Supervisor

CS-1. I demonstrate compassion toward my

immediate supervisor.

CS-2. I behave with concerns for my supervi

sor's feelings and expectations.

CS-3. I speak with concerns for my supervi

sor's feelings and expectations.

Performance Ratings Evaluated by theSupervisors

The seven individual ratings

We asked the supervisors to evaluate the follow

ing seven aspects of sales performance for their

immediate subordinates on three-point ordinal

scale: the high performer (3), the average per

former (2), and the low performer (1). If an aspect

was not applicable, his supervisor checked unot

applicable."

(a) How much revenues were he able to gener

ate?

(b) How many products and services was he

able to sell?

(c) How much profits was he able to generate?

(d) Was he able to increase the market share of

the products and services?

(e) Was he able to add new customers?

(f) Was he able to retain his regular custom

ers?

(g) Was he able to cultivate customer's trusts?

The overall ratings

We also asked them to provide the overall rat

ings for their subordinates on three-point scale

considering the above aspects and factors other

than them.

•44-


Appendix B The Multiple Logistic Regression of the Overall

Performance Ratings on the Seven Individual Ratings

To understand how the seven individual ratings

affected the overall rating, we conducted the

multinomial logistic regression of the overall

rating on the individual ratings. Of the 143 cases

selected, we used 114 cases completed in both the

individual ratings and overall rating. The depend

ent variable or response Y (the overall perform

ance rating) is measured in three-point ordinal

scale. This eliminates the possibility of applying

ordinal least squares (OLS). The standard ap

proach (McCullagh and Nelder, 1989) is to trans

form the cumulative response probabilities

Tj = Pr(7 < j), where j = 1,...,/ is the number of

categories, rather than the category probabilities

7tj = Pr( Y = j) , by the logistic function

log{r;/(l —7,)} and regress them on the explanatory variables Xk-t k = 1,..., K (the individual

ratings), where in our case J = 3 and K = 7.

The model we employed is referred as the

proportional-odds model and involves parallel

regressions on the chosen ordinal scale

\og[rj(X)/{\-rj(X)n = 0,-/3% j = 1 /-I,

where 7j(X) = Pr( Y < j \X) is the cumulative

probability up to including category j, when the

independent variable vector is X. We reported the

estimates of the intercepts - 0 i and 6 2, and the

coefficients for the seven individual ratings and t

-values in Table 4. As shown in the table, the

overall rating was not a well-balanced sum

through the seven individual ratings but was so

strongly affected by the two individual ratings —

(a) revenue and (d) market share.

Table 4 : The result of the logistic regression. The estimates of the intercepts- 0 1 and 0 2, and thecoefficients for the seven individual ratings and the ^-values are reported.

Estimates

(t-values)

0i (a) (b) (c) (d) (e) (f) (g)13.37 19.87 -2.92 0.17 -1.15 -2.24 -1.04 -0.9 -0.47

(5.88)" (6.56)~ (-4.11)** (0.26) (-1.99)* (-3.27)- (-1.96)* (-1.58) (-0.75)

Note. *p<.05. **p<.01.

45-

Japanese Journal of Administrative ScienceVolume 15, No. 1, 2001, 47 - 56.««ff»*4^*15#* 1 ^. 2001, 47-56.

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Career Anchors of Female Temporary Employees: An Exploratory Study

Shoko MATSUE

(Nanzan University)

This study investigates female temporary workers who have increased in thelabor market. Focusing on variables such as family status and career anchors,this study analyzes their relationships to the reasons of quitting full-timeemployment, reasons of choosing temporary employment, and the selectionstandards of temporary service agencies. Result showed the following threefindings: 1) necessity of child-rearing is relation to different reasons of quittingfull-time employment and of choosing temporary employment, yet has norelation to the choice of service agencies; 2) reasons of quitting full-timeemployment, reasons of choosing temporary employment, and selectionstandards of service agencies varied among career anchors such as technical/functional competence, security, and autonomy; and 3) the length of service as atemporary worker did not affect types of career anchors.

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Applicants' Self-Presentation and Nonverbal Behaviors in Job Interviews

Kazumi YAMAGUCHI

(Rikkyo University)

This paper reviews literature concerning an applicant's self-presentation(ingratiation, self-promotion, exemplification) and nonverbal behaviors, e.g.,eye contact, smiling behavior, and head nodding, and discusses the significanceof these behaviors in job interviews. The extent to which a person engages inthese nonverbal behaviors is influenced by gender, status, and personality. In thecontext of a job interview, these behaviors affect person perception, interpersonal attraction, and perceived job aptitude. These attributes of nonverbalbehavior were associated with specific functions: there are an intimacy-expressing function of eye contact and smiling behavior, a reaction-feedbackfunction of eye contact, an impression management function of smilingbehavior, and a reinforcing function of head nodding. I propose that thesenonverbal behaviors affected the interview as follows: these could be used for

ingratiation, which provided a positive feeling to interviewers, self-promotion,which emphasized the competence of the applicants, or exemplification, whichindicated the integrity of the applicants. Consequently, these results suggestedthat eye contact, smiling behavior, and head nodding by an applicant couldaffect the hiring decision.

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-57-

Japanese Journal of Administrative ScienceVolume 15, No. 1, 2001, 73 - 91.mnfi*4^iii5g!g i •*§•, 2ooi, 73-91. m

Expatriate Managers and Local Employees:

Cases in Japanese Wholly-Owned Ventures in and around Shenzen, China

Aki NAKAMURA(Nagoya University)

This paper investigates problems and conflicts which managers andemployees of Japanese wholly owned ventures in the PRC face. Four type ofgaps which seem to be causing the conflicts are discussed, which are: 1)Behavioral gaps, 2) Cross-cultural gaps, 3) Core value gaps, and 4) Ethnocentricgaps. From the interview data, the author concludes that in order to narrowthese gaps, there needs to be efforts from both Japanese managers and Chineseemployees to study and analyze the differences in their core values. Referring toone of the cases reported by interviewees, the author further suggests thatintegration of Third Culture or Charismatic Corporate Culture to existing "Two-Cultures" environment may be alternative solutions to the on-goingproblems which threaten effective operations of the wholly owned ventures.

Introduction

Despite claims by the PRC government that

China will hold onto a Communist one party

system, almost two decades of continuous libera

tion and reform of economic policies which re

mained unaffected even after the Tienanmen crack

down in 1989, have provided foreign corporations

with many opportunities to invest in China. After

China's Joint Venture Law was established in

1979, the total number of foreign invested projects

approved by the PRC government amounted to

over 200,000 by the end of fiscal year 1994, and

these investments contributed a total contractual

capital of a little over 300 billion U.S. dollars (Lu,

Child, and Yan, 1997). It is evident that one of the

challenges that foreign companies must face once

they launched operations in China is cultural

differences. Since China began implementing its

Four Modernization Program in 1979, possible

conflicts caused by cultural differences have been

frequently discussed.

Copeland (1985) warns that those who have no

experience doing business in China may be devas

tated by the enormous expense and obstacles

involved in launching a business there. He further

states that successful enterprises must develop

China-specific criteria and efficient personnel

functions that closely correspond to the expecta

tions and needs of the Chinese workforce and

government officials. John Child asserts that

differences in cultures and management styles of

different business systems are one of the prime

causes of foreign managers having difficulty in

managing their enterprises (Child, 1994).

Japanese companies are no exception. Japan is

one of the leading countries which have invested

most heavily in China over the years. By 1993, the

amount of investment exceeded 10 billion dollars.

In 1994, Japan, investing in excess of 7 billion U.S.

dollars, ranked fourth in terms of the amount of

direct investment that foreign countries had made

in the PRC (Imai, 1995). Despite ongoing in

creases in the number of wholly owned Japanese

ventures operating in mainland China, the reputa

tions of Japanese companies are generally poor.

Recent studies suggest that Chinese employees

working for Japanese companies generally con

sider Japanese managers to be too rigorous, too

arrogant, too emotional, and concerned only

about themselves (Imai, 1995). From the Japanese

side, there would be counter-views raised by

-73-

IS mrfmm^mism 1 ^

practitioners who have dealt directly with a large

number of Chinese employees over the years.

Japanese scholars and business experts specializ

ing in studying foreign ventures operating in the

PRC, list cultural and behavioral differences

between the Japanese and Chinese as major prob

lems in Japanese companies operating in China.

Imai states that many of the issues seem to be

closely related to the disputes between the Japa

nese and the Chinese regarding how to operate

production facilities (Imai, 1995). Sonoda also

points out that differences in perceptions regard

ing business management are one of the major

problems in Japanese-Chinese joint ventures

(Sonoda, 1994). He explains that Chinese employ

ees expect managers to be benevolent, impartial

and sometimes to play a role of counselors in the

family-like atomosphere by taking care of private

issues for each employee, while the Japanese do

not consider such attributes important for being

effective managers.

Another problem is the importance of guanxi

(relations) with Chinese government bureaucrats

in doing business. Exchanging favors with Chi

nese bureaucrats in public offices must be consid

ered one of the important variables for doing

business in China. Many Japanese managers,

however, are opposed to such social behaviors.

Another problem originates from differences in

expectations held by Chinese workers before being

hired and reactions afer experiencing the work.

When expectations are not met due to poor work

ing conditions and low benefits, Chinese workers

are overwhelmed with despair. Many Chinese

workers, therefore, come to believe that Japanese

managers are cunning and greedy and that they

treat Chinese workers badly (Sonoda, 1994).

Satow and Wang (1994) assert that the two keys to

achieving successful Japanese-Chinese business

relations are to promote understanding of cultural

differences between the Chinese and Japanese, and

to improve coordination between Chinese and

Japanese managers or employees.

For this study, wholly owned Japanese ventures

in mainland China are explored with three specific

objectives: 1) to learn how the difference in culture

between Japanese and Chinese affects attitudes,

commitment and motivation of Japanese manag

ers and Chinese employees; 2) to find out if there is

any conflict in expectations between Japanese

managers and Chinese employees, and whether or

not the observed conflict is due to cultural differ

ences; and 3) to propose suggestions that will help

the wholly owned Japanese ventures establish a

cooperative management-employee partnership in

their facilities.

In establishing the hypotheses for this study, a

theoretical framework for analyzing the differ

ences between Japanese and Chinese in culture and

ways of thinking as discussed above must first be

explored in depth first.

The Definition of Culture

In order to analyze the cultural differences

between China and the Japan, discussions on what

'culture' is must be re-visited. Researchers, repre

senting different disciplines have defined 'culture'

in different ways. However, for the initial step, it

is important for the present study to understand

the meaning of culture by studying how culture

emerged and developed in various societies around

the world, especially in the PRC and Japan. For

studying the origin of culture, one must go back to

Sumner's theory on folkways. Sumner argues that

the most fundamental drive of humankind is

survival (Sumner, 1906). He further states that

human beings, through numerous instances of

trial and error, try to pass down only the best

ways to survive in a given external environment to

a succeeding generation. Then, such struggle to

maintain one's existence is carried on as a coop

erative effort with others who have the same

objectives in their lives. Thus, groups are organ

ized

Each member of the group, subsequently, prof

its from the other members' experiences, and

eventually adopts what seem to be the most effi

cient ways to cope with the external environment.

In time, all members in the group tend to "adopt

the same way for the same purpose" (Sumner,

1906). When these ways evolve and become uni

form and universal patterns of behaviors which

•74-


Source: Black S,H. GregersenandM. Mendenhall. Global

Assignments: Successfullyexpatrating andrepatratinginternational managers.San Francisco: Jossey-BassPublishers. 1992, p. 34.

Artifacts

These are visible

behaviors, clothings,arts, building and so on.

Figure 1 The Iceberg of Culture

distinguish the members of the group from the

people in other groups, what Sumner calls 'folk

ways' arise. Because folkways, in general, are

like products of natural forces which men uncon

sciously set in operation, they are one of the major

forces by which a society is made to be what it is

(Sumner, 1906). In short, folkways are a set of

habitual patterns of behaviors created for coping

with the uncertainties of the external environment

at a subconscious level. Since folkways are seldom

developed within a short period of time, they are

generally taken for granted by member of the

group. Folkways, therefore, are sets of values,

modes of thinking and patterns of behaviors which

are taken for granted, but are also the central

elements by which people are judged and meas

ured.

Development of folkways plays a crucial role in

the development of culture. Despite their invisibil

ity as intangible elements of culture, folkways

have a strong influence over the minds of people.

Virtually all tangible elements of a culture, in

cluding religious or philosophical teachings

which are indigenous to the groups of a particular

region, are strongly influenced and shaped by

folkways. Values or teachings which are absorbed

from outside group are gradually modified and

adopted to be compatible and more closely corre

spond to the modes of thinking and standard of

behavior set by existing folkways. In a sense,

folkways are the core of the culture which influ

ence virtually all of the cultural elements which

emerge from a group.

The middle layer is composed of elements that

are neither visible nor audible; however, they are

decipherable by people from both inside and

outside of given culture. These include traditional

values, mottoes, and credos. At the most superfi

cial level, there are visible or audible cultural

elements such as language, architecture, music,

etc. Culture, then, consists of three elements: core

elements (folkways), intangible but decipherable

elements, and tangible but superficial elements.

Black, Gregersen, and Mendenhall assert that the

structure of these three elements of culture can be

compared to that of an iceberg (Black, Gregersen

& Mendenhall, 1992). As shown in Figure 1,

although the most visible elements of a culture are

more obvious to others, they are only the tip of the

iceberg. The important core dimensions lie be

neath the surface beyond what is directly visible.

In other words, intangible dimensions, especially

core values of culture, are more important than

the visible dimensions of culture, in the sense that

-75-

m m-ga-wm^mismm 1 *%

Intertribal Sector

Source : Sahlins, Stone age economic.New York: A. E. Sharp. 1969.

NegativeReciprocity

Figure 2 Relationships between Reciprocity Types and Kinship Residential Sectors

they are more deeply held and shared among

people in a particular cultural realm.

Chinese and Japanese Culture: Similarities and

Differences

Since culture consists of three elements in which

the core exerts stronger influence than any other

element, having similar religious, philosophical,

or socio-political backgrounds, values, and ide

ologies may not necessarily lead to having the

same folkway among the people. This is more so

where groups of people coming from different

external environments interact and try to find

some commonalties among them. Thus, despite

the fact that Chinese and Japanese share similar

religious and philosophical influences as well as

similar socio-political origins, their sets of values

or modes of thinking can be, in fact, very different.

First, the similarities between Japanese and

Chinese will be discussed followed by the differ

ences.

Chinese and Japanese share similar socio

political origins as they both originated from

mainly agrarian societies. Their rural farming

communities developed extensive reciprocity

based on residential and lineage relationships as

they considered reciprocity as "the classic vehicle

of the peace and alliance contract." (Shalins, 1972)

These relationships form hierarchical levels of

integration. Figure 2 displays "a series of concen

tric circles" (Shalins, 1972) that keeps a household

as the most important central sector. The inner

circle represents more genuinely reciprocity-

based relationships. Moving outward, this circle

denotes neutral relationships where giving and

taking must be completely balanced and then

become more opportunistic or negative. Both in

China and Japan, rural villages were tradition

ally composed of small farmers; therefore, it was

virtually impossible for them to sustain their lives

without closely cooperating with each other.

Farmhouses were clustered together in hamlets

and members of each household in the hamlet

usually participated in extensive reciprocity -

based relationships (Fukutake, 1968). One ele

ment that united the members of the hamlet to

gether was their staple food. In both societies, rice

was one of the vital sources of nutrition. The

efforts of one household were not sufficient for

adequate maintenance, because rice paddies re

quired such extensive irrigation, systems. The

people, therefore, had to join their efforts to

ensure that these elaborate systems were always

operational. Furthermore, during planting and

76-


Table 1 Reciprocity Based Relationships in China and Japan

China Japan

Generalized Reciprocity House House

Extended family Immediate family living in a close area

Sibling groups Neighboring groups

Clan and kinships Organizational Unit (i.e. Buraku)

Balanced Reciprocity Federation of lineage group Village sectorLineage groups living in distance

Alliance among the same surnames Regional based sector

Negative Reciprocity The people with no connection Outsiders

Created by the author based on the model conceived by Sahlins (1969)

harvesting seasons, interdependency and coopera

tion on a reciprocal basis were absolutely neces

sary for increasing the productivity to the required

level.

A family structure in both societies was patriar

chal and patrilineal with the father as a head of

the household. In most cases, relationships of

genuine reciprocity were practiced among the

members of the family, as well as their close

relatives. Different living environments, however,

gradually changed to emphasize aspects of

reciprocity-based relationships in which they

interact.

Chinese vs. Japanese Collectivism

Although initially, the family-kinship network

formed as a small system, the large amount of

cultivable land in China and mobility of people

allowed these networks to expand greatly over the

years. Family and kinship systems, particularly

in the southern part of China, eventually became a

large intricate human network. These reciprocity-

based relationships with an emphasis on such an

extended family network led Chinese to embrace

collectivism based on family and lineage groups.

Having such a concept, an individual was per

ceived to exist only in terms of his/her immediate

family network. The definition of family, thus,

encompassed its property, reputation, tradition,

ancestors, and future posterity (Redding, 1990). In

short, individuality exists only with the family; if

the family line is cut, the individual will lose his/

her identity without an individual.

As shown in Table 1, a lack of tight control by

the state authority, such as by the Imperial Gov

ernment in Japan further.strengthened family and

lineage relationships among Chinese. Particularly

among larger lineage groups, the organizations

were so extensive and influential that the members

neither feared nor felt dependent upon the govern

ment for work or securities. The first organization

from which they would seek assistance in time of

trouble was, therefore, their own lineage group,

because the Chinese trusted their family and

lineage groups absolutely (Redding, 1990). Conse

quently, a sub-culture was formed and developed

among particular lineage groups, resulting in

strong social and moral bonds among each mem

ber in the lineage as a collective whole, but weak

bonds in relations with non-lineage group mem

bers.

Unlike Chinese whose collectivism has been

mostly based upon family and lineage relation

ships, Japanese instead tended to stress the impor

tance of collectivism based on loyalty and spatial

closeness in the organizational context. Living on

a small chain of islands, the Japanese were unable

to develop strong territorial divisions solely on the

basis of family and blood lines. Instead, the

Japanese had to share limited cultivable areas

with their neighbors and to work cooperatively in

order to receive maximum output from their

collaborative group organizations. Under such

circumstances, cooperation and maintaining

harmonious relationships with members of the

organization (village, corporation, company and

-77-

mwrfmn^msmm 1 •

CHINESE

THIRD CULTURE/

CHARISMATIC

ORGANIZATIONAL CULTUREJAPANESE

Opinion about own (Chinese) behavior (CI) and others' (Japanese) behavior (C2)

Behavior of

JapaneseBased on their core

values

Opinion about own (Japanese) behavior (Jl) and others' (Chinese) behavior (J2)

0 Behavioral Gap : •Cross-cultural Gap: -

Cross-cultural Gap:

Core Value Gap : —

Ethnocentric Behavioral Gap : •

BJ x BC Gap (Surface Conflict)

Jl x C2 Gap (Cross-cultural Conflict)CI x J2 Gap (Cross-cultural Conflict)

Jl x CI Gap (Deeply rooted Conflict)

J2 xC2 Gap (Cross-cultural Conflict)

Figure 3 Values and Behavioral Level Conflicts Emerging from Ethnocentric Perception BetweenChinese Employees and Japanese Managers

etc) was important. The Japanese emphasis on

collectivism was even more firmly established

during the Tokugawa era. After the katanagari

(Sword Hunt) policy in which the samurai col

lected all weaponry items from the non-samurai

classes, non-samurai people became defenseless

when facing the ruling class. Realizing it would

be useless to resist orders issued by the govern

ment, the Japanese people decided to become

mutually dependent upon each other, rather than

resist the government and perish in vain. Thus, the

principal belief in the virtue of enduring and

following the consensus of the group gradually

emerged. Simultaneously, finding personal bene

fit and individual satisfaction in the prosperity of

the organization and the importance of self-

sacrifice for the sake of it became highly valued

The creation of these values eventually bound a set

of individuals into one group based on mutual

interests or attributes rather than based on family

and lineage relationships. (Nakane, 1972). Fur

thermore, in an attempt to prevent the non-ruling

classes from increasing the power of lineage and

kinship groups, the ruling class prohibited com

moners to take a surname until the Meiji Restora

tion. Because of the lack of this important compo

nent, most of the Japanese had no way to keep

track of everyone in their lineage groups, particu

larly those who lived far apart or who were dis

tant cousins. Thus, the ability to develop extensive

reciprocity relationships based on lineage groups

was diluted, except for a small portion of the elite,

the nobility and the ruling classes. As a result,

reciprocity based on the organizational, not the

lineage, environment became the customary prac

tices observable throughout Japan.

Although both societies developed from

reciprocity-based social relationships, differences

in the external environment, in particular in the

living and political environments, molded and

changed the fundamental values of respective

groups: one strongly emphasized the importance

of family and lineage relationships while the other

spatial and organizational closeness within a

given human network. Such core values, in spite

of dramatic changes in various aspects of their

-78-


living environments, still exist within the minds of

both Chinese and Japanese today.

Processes of Cross-Cultural Conflict and Mecha

nisms to Solve Them

In the previous section, an attempt was made to

demonstrate that there exist fundamental differ

ences between Chinese and Japanese in terms of

core values and assumptions that each of them

embrace. The present study expects that these

differences will affect motivation, attitudes and

behavior of Chinese employees and Japanese

managers when they are assigned to the collective

work in the organization. Since people tend to

become highly ethnocentric about their own core

values and assumptions, Chinese employees and

Japanese managers may have a difficult time

understanding such core values and behaviors

originating from these ethnocentric elements.

Their difficulties in understanding each other may

lead them to either isolate themselves from each

other or ignore the needs and requests from others

whom they perceive do not 'belong to' their group.

Thus, there may be a gap and a conflict between

Japanese managers and Chinese employees in

understanding the cause, and thus meanings, of

behaviors in the work setting as shown in Figure

3. Such gaps can be categorized into several types

as follows. 1) Behavioral Gap: Gaps in this cate

gory are caused by differences in behavior between

two parties. Such differences are generally quite

obvious as they usually occur at the surface level.

This category of gaps covers a wide range of

conflicts from different manners and habits, to

work ethics and negotiation strategies. 2) Cross-

cultural Gap: Gaps in this category are caused by

differences between the motive of behaviors of one

party and what the other party perceives as the

motive of such behaviors. For the present study,

both (1) misinterpretation by Chinese employees

of the motive of Japanese managers' behaviors

and (2) erroneous assumptions of Japanese man

agers regarding the motive of Chinese employees'

behaviors may fall under this category. 3) Core

Value Gap: Gaps falling into this category are

caused by the differences between core values

embraced by these parties. Such deep-rooted

conflicts may be extremely difficult to discern

especially for members within the organization to

which they belong, because in general they do not

even know such differences actually exist between

them. The gaps may initially be detected as simple

misunderstanding of other parties or as misinter

pretation of other party's feelings. However, they

may eventually evolve into unknown feelings of

anxiety and frustration, then to feelings of mutual

distrust between them. Those gaps, which evolve

into feelings of distrust are considered going

beyond the present category, because such

evolvement is not possible unless each party are

very ethnocentric about its own point of view.

Thus, the final category would be as follows. 4)

Ethnocentric Behavioral Gap: Finally and most

important, there is a category called ethnocentric

behavioral gap. Gaps falling into this category

are prevalent in cross-cultural relations in many

Japanese wholly owned ventures as well as joint

ventures. Additionally, they are usually consid

ered by members within these organizations as

major problems. One clear example of a gap

falling under this category is the overt and ex

pressed feeling of mutual distrust between the two

parties. As was noted earlier in this section, such

a gap is a final output derived from all other gaps

between the two parties. In other words, observing

the feelings of mutual distrust should imply that

there would be many more gaps between them.

In order to narrow these gaps, successfully

integrating core values embraced by each party is

mandatory. In other words, creating either 'Third

Culture' or 'Charismatic Corporate Culture' may

be urgently needed for these organizations with

problems derived from the limit in gap structure

involving values and behaviors. "Third Culture"

can be conceived through creating a new value

system by which two sets of core values may be

integrated and merged within the organization

(Graen and Wakabayashi, 1994). As a result of

this merger, having a 'Third Culture' may lead the

organization to have a set of standards which

everyone can agree on and can use as a benchmark

of organizational behavior.

-79-

13 * S^T»*45**15S* 1 -t

'Charismatic Organizational Culture' on the

other hand, may likely replace the importance of

existing core values with a new set of values within

the organization to which both parties belong. In

each organization, there exists a unique set of

folkways, which is usually explained with the

term "organizational culture" ( Schein, 1985). In

general, such organizational cultures are strongly

influenced by the national culture in which organi

zations are established. Since, core values of the

national culture would be completely merged as a

part of organizational culture, it is quite likely

that the foreign subsidiaries would embrace "two

cultures" within their corporation (Graen,

Wakabayashi, & Hui 1999), then these two cultures

become standards by which behaviors of two

different cultural groups get energized and evalu

ated within the organization. However, since most

of taken-for-granted core values hide behind any

of visible phenomena, the two-value business

ventures tend to create all sorts of cross-cultural

problems. Charismatic Organizational Culture

may come into reality when a charismatic leader

or a group of such key people within the organiza

tion strongly believe that solely relying on values

of their national origin may eventually lead to a

break down of communication. Charismatic

leaders can be defined as those whose attributes

are highly respected by members of the group.

They are risk takers and consistent in their do

ings, having higher standards in most of the

essential variables which enable the growth of

organizations such as total quality management,

cost reduction, innovating products development,

and etc (Burns, 1979; Bass, 1985). Thus, for these

leaders, creating an overwhelming, stronger value

system is indispensable in order to merge two core

values within their foreign subsidiary for generat

ing collaborate work relations and a cohesive

organizational system, producing high quality

products, and achieving cost reductions. As they

continue to accomplish various tasks successfully

and more people are convinced that new values

created by the value-integrating leaders actually

are effective, the new values, regardless of the

degree of their correlations with national values

will become an integral part of the organizations.

In other words, so long as members of organiza

tions have strong convictions that newly created

values are the only ways by which they could

survive and prosper, members of organization

will be likely to neglect whatever values they used

to embrace in national settings and try to educate

themselves to fit into the new 'organizational'

values. It is especially so if such values are

strongly associated with task behavior and per

formance in workers' jobs but not necessary

applied to regular personal living situations. Such

issues include quality management, cost reduc

tion thinking, and injections of creative thinking

into new product developments, etc. The existence

of charismatic organizational culture preached

and sustained by strong leaders may allow both

Japanese managers and Chinese employees to go

beyond their differences and work cooperatively,

with support of newly learned core values as

standards for their judgement and behavior.

Although Third Culture and Charismatic Organ

izational Culture may have different kinds of

impact on employees, the implementation of such

strategies may assist both Japanese expatriates

and local managers and employees in maintain

ing better business relationships as they will avoid

relying solely on old core values of their native

origins.

Hypothesis

Based on the cross-cultural conflict model

shown in Figure 3, hypotheses to be examined for

this study are stated as follows,

Hypothesis 1 (HI): Japanese managers with

little or no understanding of Chinese core values

may tend to isolate Chinese from the decision

making process (BJxBCgap).

Hypothesis 2 (H2): Chinese employees (middle-

class local managers in particular) may have the

opinion that Japanese managers do not allow

Chinese to participate in crucial business deci

sions (BJ) as they perceive that the Japanesemanagement team does not trust Chinese (C2),

(BJxC2gap).

Hypothesis 3 (H3): Japanese managers with

-80-


Table 2 Brief Background on the Companies Being Investigated

Main Prorducts

Sales Revenue in their

head quarters(as of 1995) in Yen

Establishement Date

of Plants in ChinaRemarks

AMicro- motors

DC Brushless motors

34.4 Billion 1991 Company originally established in 1918

BTerminal Printers

Stepping motorsNot diclosed

1985One of the major manuracturers of colorlaser printers

C Micro-motors Not diclosed 1994A child company of one of the major homeelectroinc appliances companies in Japan

D Screws for electronic devices 24 Billion 1994

E

Razors Not disclosed 1990 Including OEM products line, the companycontrols 25 % of blades and elctronic andconventioal razors market in the US.

little or no understanding of Chinese value-

behavioral linkage tend to erroneously judge

Chinese employees due to their behaviors, atti

tudes and business practices (BC) which are

different from those of Japanese (J2), (BC x J2

gap).

Hypothesis 4 (H4): Japanese managers with

little or no understanding of Chinese culture may

tend to be ethnocentric with regard to their own

perspectives (J2) and reject opinions of Chinese

employees which may be influenced by the core

values of Chinese people (CI), (J2 x Clgap).

Hypothesis 5 (H5): Chinese employees with little

or no understanding of Japanese culture may tend

to mis-interpret behaviors, attitudes, and motives

of Japanese managers toward Chinese employees

(C2), leading them to widen the gap between their

interpretations and Japanese managers' behav

iors (BJ), (C2xBJgap)

Hypothesis 6 (H6): Corporate culture that may

work to modify and merge behaviors and percep

tions of two cultural groups by creating 'Third

Culture' or replace two cultural values with a

series of values conceived as 'Charismatic Organ

izational Culture' within the organization will be

more acceptable by both parties than the "Two

Culture" situations where each party stresses the

values derived from its own home culture (Graen,

etal.,99).

Method

Five Japanese wholly owned ventures located in

and around Shenzhen City, China were selected as

subjects of the present research. The businesses

were different from one company to another with

regard to products and industrial fields. There

fore, in order to limit comparison to the relation

ships between Japanese expatriate managers and

Chinese employees, efforts were made to eliminate

all possible variables which might inhibit this

comparative analysis. With this aim, all of the

companies selected for this study were in manu

facturing. The business strategies were also found

to be smiliar; the goods were manufactured there

and exported to adavanced nations such as Japan,

the United States or Europe. No company names

are disclosed due to the pledge of confidentiality.

Only a set of key variables illustrated in Table 1

were analyzed intensively with less attention paid

to other vraibles. The brief background on these

companies is discribed in Table 2. For conven

ience, these five companies are called Company A,

B, C, D, and E.

A total of 32 Chinese employees and 10 Japanese

managers were interviewed in these 5 companies.

At Company A, interviewees were a factory man

ager, a general manager, and two technical assis

tant engineers for the Japanese side, and for the

Chinese side, an assistant subsection leader of

quality control management, two supervisors, a

line leader and two workers. At the Hong Kong

office, a general manager from the Japanese, and

a personnel section manager, an accounting

section manager, and two secretaries from Hong

-81-

IS mnmn^mibmm 1 •

Kong Chinese were also interviewed.

As for the remaining four companies, a Japanese general manager and several Chinese em

ployees were interviewed in Shenzhenrespectively.At the Hong Kong branches of these companies,only one or two Japanese general managers wereto be interviewedin each company. Beforevisitingthe factories in China and Hong Kong,headquarter visits to each company in Japan were

made, and interviews with personnel managerswere condcuted. In interview sessions, interviews

were semi-structured with some variations in

questions.'A structured inverviews were conducted

with personnel or administrative managers asrepresentatives of each company in order to deter

mine the precise personnel and administrative

policies of each company.

Results

This study was designed to reveal various inci

dents and conflicts which seemed to be caused bythe gaps created between the two parties in inter

national cooperation. In this section, an attemptwill be made to list some of the incidents described

by Japanese and Chinese interviewees as evidence

to examine a series of hypothesis for this study

1) H1: BJ x BC Gap, Japanese Managers' Behaviors Conflicting with Those of Chinese Employees

Several Chinese employees, especially higherranked employees, mentioned that Japaneseexpatriates tend to isolate themselves from Chi

nese employees. The following comments represent their feelings.

The Japanese seems to isolate themselves from Chinese.There are quite a lot of Japanese people workinghere. Sothey are always together ... By beingalways together, theJapanese isolate themselves from other Chinese. (A,Employee 1)

I cannot feel anything from them so I have no ideawhether or not they trust us or not. There are somecommunications between Japanese managers and us butother than business related matters, communicating withJapanese is rare (B, Employee 2).

Such social separation and avoidence of commu

nication efforts in the eyes of Chinese was found

prevalent throughout most of the companies

visited. Interviews with lower ranking employeesfurther confirmed this hypothesis.

It is difficult to determine [the weaknesses of the Japanesemanagers] because usually we do not deal with them alall." (A, Employee 4 )

I do not know what to say about [ Japanese managers]But I have heard that they are very systematic."( BEmployee 1).

As indicated by Chinese employees commments,the result of ther interview study not only confirmed Japanese separation to Chinese employees, it also revealed the unity among Japaneseexpatriate managers and employees regardless oi

their ranks to the exclusion of Chinese employees.This is most apparent during the lunchtime. In

most of the companies visited, the lunch menus as

well as the dining areas were separated accordingto the employee for Chinese employees. However,

the Japanese, regardless of their ranks or status

sat together at the same table and all ate Japanese

food. Other examples were indicated by Japaneseinterviewees in regards to their off-hours recrea

tional activities.

This could be one of the clear indications that

social behaviors among Japanese expatriates

were formed based on nationality, loyalty and

spatial closeness, i.e. elements associated with

their core values. In this case, loyalty indicates

their loyalty to parent companies rather than to

local operations to which their Chinese employeesalso belong. In other words, they would consider

those who have loyalties to their parent companiesas insiders while those who have little or no at

tachment to them are outsiders. This interpretation of loyalty was further strengthened by the factthat lower ranking Chinese employees who

seemed to share nothing with parent companieshad little or no association with Japanese expatriates. Furthermore, an extreme lack of interactions

between Japanese managers and Chinese employees with lower ranks as revealed by interviews

creates all sort of gaps between Japanese managers and Chinese employees. Such behaviors of

Japanese expatriates found in Chinese affliates

signifanctly contradicts Japanese norms ex

pounded by much literature in which Japanese

-82-


managers' frequent interactions with lower rank

ing employees are reported (Abegglen, 1958;

Yoshino, 1968; Nakane, 1970; Rohlen, 1974; Dore,

1975; Ouchi & Jaeger, 1978; Itami, 1987; Durlabhji

& Marks, 1993). They may not interact with each

other all the time, but Japanese leaders usually

manage to get to know their subordinates in

Japan. In many cases, even president of company

in Japan visits the shop floor all by himself and

interacts with the lowest ranking employees,

trying to close the communication gap between

them. Such behaviors of Japanese leaders are

often mentioned as indicative of the collectivist

tendency found in Japanese organizations based

on loyalty and spatial closeness. But Chinese

employees commented during interviews that

Japanese managers only exhibit concerns about

fellow Japanese expatriates and about the com

pany profit that the Chinese factory generates, but

no concern about Chinese employees working for

their factory. From the eyes of Chinese employees,

they seemed mostly concerned about the members

of 'their' group (fellow Japanese expatriates) and

contributions to 'their' parent companies by

profit.

2) H2: BJ x C2 Gap, Japanese Dominance in

Decision-Making Processes and Chinese Interpre

tations

For the Chinese employees who were positioned

as middle managers and, therefore had more

chances to interact with Japanese managers, their

negative feelings toward Japanese managers were

even more evident. Their frustrations in interact

ing with Japanese managers were seen in their

confessions that Japanese managers completely

dominated decision-making processes.

One of the supervisors stated the following:

"As for management, the Japanese side and the Chineseside are totally separated. They rarely exchange their ideaswith us. Additionally, they do not let us know exactlywhat they are doing. I know little about current businessstrategies, particularly in the management aspect." (A,Employee 2)

In many Japanese wholly owned ventures sam

pled for the study, Japanese managers tended to

make crucial decisions without including Chinese

employees in their decision-making processes.

Japanese managers expect the Chinese employees

to simply follow directions given to them by their

Japanese superiors without any questions. Such a

trend was most apparent in Company A.

"As for the Japanese management, they have a meetingevery Friday morning. After these discussions, things aredecided and are transferred to appropriate functions forimplementation A few Japanese people make alldecisions." (A, Employee 2)

The lower-middle managers of Company A

seemed to substantiate the above statements by

commenting as follows:

"There has been less communication between Japanese andChinese employees. It seems that the Japanese are the onesto make decisions and we [the Chinese employees] aresupposed to follow what they tell us. Such a relationshipis very monotonous When important issues come up,they dscuss the issues together. The Chinese employees,however, are excluded from the discussion. The importantdecisions are always made by the Japanese. These decisionsare then handed down to us. So we are expected to obeywhat they tell us. If they do things like that all the time,there will always be some errors in their directions viewedfrom the Chinese cultural context. Some of their decisions

are rooted in Japanese culture so deeply that there is noway that their decisions can be put into practice hereeffectively." (A, Employee 1).

The employees of Company A in the Hong Kong

branch office made similar comments. During the

interview, one of the Chinese managers made the

following statements, illustrating gaps between

Japanese managers' behaviors and how he inter

prets them:

"We do not know much about this company. It seems thatmany things are strictly confidential and are not exposedto Hong Kong employees. We do not dare to ask aboutsuch issues and data ... We only work here. We are not toallowed to make any decisions about our work. Decisionsare made by the Japanese directors. There is no suchperson as a general manager in this branch. The realmanagers reside in Japan. The general manager as suchexists in names only here, because ultimate decisions aremade by managers in Japan" (A, Hong Kong Employee1).

The Japanese dominance in decision-making

processes was also prevalent among the other

Japanese companies. However it was evident from

this research that a company which had been

operating in China for a longer period like Com

pany C was found to be more flexible and provided

83-

* ^nmn^mbmm 1 -*§-

the Chinese personnel with more authority. In

Company C, Chinese personnel seemed to be

somewhat more involved than those in Company

A which has been in China only for a few years. In

Company C, the factory manager and the vice

factory manager who were both Chinese nation

als, and attended executive meetings regularly.

Likewise in Company B, the vice factory manager

who was a Chinese national and was also fluent in

Japanese, had been placed in the position of

second in command. The same situation was

found in Company D. An assistant to the general

manager was a Chinese national who had ob

tained a Ph D in Engineering from one of the most

prestigious universities in Japan. In Company E,

the general manager was a Hong Kong Chinese,

and was also a graduate of Hong Kong University

and a Graduate School in Nagoya Japan.

This evidence seems to indicate that substantial

localization efforts in China have been attempted

in many of the Japanese wholly owned ventures.

In reality, however, the interviews by the present

author in these companies revealed otherwise;

localization had taken place only at a superficial

level. Even in those companies which appeared to

be more localized, the Japanese were still the ones

who were making all of the strategic decisions,

while the Chinese were essentially placed in little

more than supportive roles. Exemplifying this

situation is a remark made by one of employees

working for Company C,

"There are some problems with the Japanese leadershipstyle. In order to do everything in their own way, [theJapanese managers] do not care about local regulationsand sometimes they disregard regulations in order to getthings done. They only care about their ways." (C,Employee 6).

When the interviewee was asked about the differ

ences between Japanese and Chinese ways of

management, he quickly responded with the

following,

"The Japanese way focuses on efficiency and subordinateobedience The Japanese require us to do whatever theytell us to do. In Chinese companies, subordinates candisobey orders from superiors if they think that theseorders are unreasonable. In Japanese companies, ifsubordinates do not obey orders from their superiors,subordinates will have problems. They should never

question orders given by their Japanese superiors." (C,Employee 6)

The above comments indicate that Japanese ways

of behaving are seen to be following "the Japanese

ways" by Chinese managers, suggesting a deep BJ

x C2 gap between Japanese and Chinese manag

ers. The following remarks by another Chinese

manager further indicate the same gap problem.

He said,

"In Company D, although the assistant to the generalmanagers is Chinese, all authority is concentrated in theJapanese general manager. The power is more equallyallocated among managers. But in this company, allauthority is in the general manager's hands, in Bucho's."(D, Employee 3).

Another employee in Company D supported the

above statement. He said that one of the Japanese

influences that can be seen in his company is the

mode of allocating power and decision making

authority. With regard to this matter, he made the

following remark:

"There are some Japanese influences in this company. Inmany cases, we just do what the Japanese managers tell usto do, and we must obey what they say. That's howthings work around here" (D, Employee 4).

When the interviewee was further asked how he

felt about the Chinese collegve managers in Com

pany D, his response was surprising. He immedi

ately responded by saying,

"No. we have only Japanese managers. That's all!!"

This comment seemed to indicate that virtually all

authority is seen to reside in the hands of the

Japanese managers.

Even in Company E, where the general manager

is a Chinese Hong Kong, one of the employees

admitted that the Japanese ultimately made most

of the decisions. He stated as follows.

"I think there are problems in our company's management.The decision- making processes are too complicated.Before, when we had a Japanese as a general manager, hewas allowed to make decisions without consensus from the

headquarters. But after a Chinese manager was promotedto the general manager position, we had to report everything to the headquarters through him and then wait fora response." ( E, Employee 1)

Many Japanese managers during interview

sessions revealed that they intended to localize the

-84-


operations in China as soon as possible. However,

the fact that Japanese expatriate managers who

seem to remaining consistent with Japanese-style

management practices are perceived to be quite

ethnocentric by Chinese managers and employees.

Based on this evidence, it is concluded that these

findings from the present interview study basi

cally support Hypothesis 2, stating the BJ x C2

gap.

3) H3: BC x J2 Gap: Difficulties of Japanese

Managers in Understanding Behaviors of Chinese

One of the most obvious problems that emerged

from this study , which seemed to support the 3rd

hypothesis was that many Japanese managers

lack even a fundamental understanding of Chinese

culture. It was known that little or no cultural

training was provided to Japanese expatriates

interviewed for the present study prior to their

assignments to China. Surely, lack of this invest

ment in cross-cultural training for expatriate

personnel significantly contributed to their defi

cient understanding of Chinese employees and

their behaviors in all companies visited.

Many Chinese interviewees agreed that most of

their Japanese managers knew very little about

them or their national culture. They further in

sisted that the Japanese managers' lack of under

standing of the Chinese people caused serious

miscommunication between them. The following

comments made by the Chinese employees exem

plify this view point, supporting the existence of a

BC x J2 Gap:

"The Japanese managers do not understand us very well.Most of them do not speak Chinese ... They do notunderstand our culture, the Chinese way of thinking, andmany traditions and customs. Under such circumstances, itis very difficult for the Japanese to determine exactly howthey could manage the factory here. Most of the Japanesepeople go back to Japan in three years. Some of them evencome and go within one or two years ... So, when they tryto manage us [the Chinese employees], certainly there arecommunication problems" (A, Employee 1).

The vice factory manager of Company B stated

that one of the reasons that Japanese managers

cannot fully comprehend the Chinese people is that

they do not stay in China long enough. Her com

ments are the following,

"Mostly, the Japanese managers stay here for only a shortperiod of time. There was one Japanese manager whostayed here for five years. During his stay, he studiedsocial and political issues in the PRC. He understood a lotabout us. I personally think that it. would take at leastfive years in order to understand the Chinese people. Butunfortunately, most of the Japanese managers stay herefor a period of two to three years."

With regard to this matter, the vice factory man

ager in Company C made a similar statement.

"Most of [the Japanese managers] stay here for only afew years and then they leave. By the time they get used tothe new environment and understand the people, they haveto go back to their home country. When a new managercomes, they have to go through the process of culturalreadjustment all over again ... From the Chinese perspective, by the time the Chinese personnel become used to onemanager's leadership style, it is about time for the manager to leave. So, we have to make a quick adjustment toa new manager again. It is very difficult for us to gothrough frequent adjustment processes. In a way, we haveto take care of [newly arrived Japanese managers] untilthey get used to the new environment. But new managerscontinuously come from the Japanese headquarter, so ithas become too much of a burden for Chinese employees to

entertain them."

The same situation was reported by an em

ployee from Company D. He stated that adjusting

to a leadership style of the new manager is a

painful process, because the Japanese managerial

structure is extremely hierarchical, and all of the

burden for adjustment and adaptation falls upon

shoulders of the local Chinese. These comments

seemed to indicate that although there were some

Japanese managers who were willing to learn

about China and its people, the majority of the

Japanese managers had little or no understanding

of Chinese culture, thus creating a perpetuating

BC x J2 gap.. Interviews with the Japanese man

agers seemed to further reveal that their serious

lack of understanding of culture and behavior of

Chinese people led them to have erroneous as

sumptions about Chinese employees, which led

them to behave offensively to their Chinese subor

dinates.

4) H4: C1XJ1 Gap, Part 1: Chinese Collectivism

Based on Family and Lineage Group vs. Japanese

Managers' Loyalty to Their Organization

The existence of BC x Jl gap further revealed

that there also exists CI x Jl gap. The following

85-

mnmn^mismm 1 -*§•

are some Chinese cultural aspects that Japanese

expatriates are most likely to fail to understand.

These aspects reveal the evidence of the existence of

a CI x Jl gap. Interview results revealed that the

Chinese concept of teamwork was substantially

different from that of Japanese. Because of this

difference, the Japanese managers came to believe

strongly that the Chinese were not trustworthy as

team members. This constitutes a problematic CI

x Jl gap situation. In fact, many Japanese man

agers interviewed strongly believed that the Chi

nese are generally individualistic. This was one of

the evidences that the concept of collectivism from

the Japanese perspective was quite different from

the meaning of "collectivism" understood by most

Chinese people. The Chinese people's tendency not

to trust unconditionally people other than mem

bers of their own lineage group was erroneously

interpreted by the Japanese as an indication of

individualism. For example, the Japanese regard

the Chinese employee's unwillingness to share

vital information with others as a sign of the

Chinese being individualists. One of the Japanese

general managers stated like the following,

"The problems with Chinese engineers is that they do notwant to share their knowledge with others. Once theymaster how to maintain machinery etc., they do not wantto tell their subordinates how to do so. Thus, their

subordinates will not improve the skills and knowledge inclose proximity to the level of their supervisors, becausethe supervisors are not willing to teach anything to theirsubordinates."(C, the general manager).

From the perspective of the Chinese employees,

however, it is not necessary to share all of the

information they have obtained through their own

endeavors, because their first priority is to secure

their job position not for their own sake but for the

sake of their families. Furthermore, because there

is no guarantee that Chinese employees will be

employed for their lifetime, then there is always

the possibility of being laid off, once the company

finds someone who has more skills than them

selves. Thus, fearing that others might get ahead,

Chinese employees tend to conceal valuable ideas

and protect skills and know-how they learned as

their personal property. For Japanese, on the

other hand, cooperation within the group is vital

not only for making operations more productive,

but also for increasing future potentials, because

the capacities of managers are often judged ac

cording to their capabilities to train subordinates.

In other words, for Japanese managers, informa

tion sharing and cooperation are important

credits for advancement along one's career path,

because they are employed under the premise oi

lifetime employment. Thus, any behavior that

hinders smooth operations of their firm's business

is considered to be contributing to incompetence

from the Japanese managers' perspective. Thus,

failing to share vital information with others is

naturally considered to be a sign of individualism

and incompentence. The Japanese understanding

of collectism as illustrated above is indeed quite

different from the Chinese mode of thinking in

which the knowledge discovered by oneself is

considered to be one's own personal property and,

therefore, to be kept strictly for the benefit of

oneself. This behavior has nothing to do with

collectism from the Chinese point of view.

The lack of a flow of information resulting from

the unique mode of the Chinese ways of informa

tion sharing seems to be quite annoying for Japa

nese managers who believe that such a behavior

causes the products manufactured in Chinese

factories likely to be less than high-quality rela

tive to those manufactured by their Japanese

counterparts.

C1XJ1 Gap, Part 2, Chinese Collectivism and

Sense of Loyalty from a Japanese Managers'

Perspective

Many Japanese stated during interviews with

the author that most of their Chinese employees

pretended to obey what they were told by the

Japanese superiors, but in actuality they hardly

ever put the directives and instructions they re

ceived into practice. To Japanese managers, it

appeared that Chinese employees in general were

neither loyal to their general managers nor to the

company which they work for. For example, when

the author mentioned to one of the Japanese

managers in Company A that many Chinese had

expressed the desire to contribute to Company A

-86-


during the interview session, he responded with

the following remarks,

"You just mentioned that many Chinese employees statedthat they wanted to contribute to the company, but theyare just saying that because it sounds nice. In reality, atleast from my perspective, none of them act that way. Iguess this is because they want to save face by saying so.That's how the entire Chinese society is structured".

Another Japanese employee at company A agreed

with this statement. He said the following,

"When I asked some of the employees to do certain tasks,they told me that they could do it. But when I asked thema few days later whether or not tasks were done, theysaid, "No." I always got confused because they wouldalways say they could do it regardless of whether or notthey could actually accomplish what was requested".

Such disparities in expectation between Japanese

and Chinese in their work performance may

pertain to the differences in the awareness of

loyalty to their companies. From a Japanese

perspective, core values themselves are based on

loyalty to a company. The example of deep loy

alty for Japanese employees to companies can be

observed from the way by which Japanese manag

ers put the companies orders first. Many of them

said that they were assigned to the Chinese office

on a few weeks notice. Also, they said that one

should never expect Chinese people to be loyal to

their company to the extent of sacrificing their

personal interests or those of their families to the

company as Japanese are doing. They will do so

only when they believe that such actions may

ultimately honor the names of families and blood

lineage, because from a Chinese perspective,

loyalty goes first to the family and lineage group.

The fact that the Japanese manager in Company A

did not believe in the loyalty of Chinese employees

implies that he judged and evaluated the level of

Chinese employees' loyalty based only on his

ethnocentric orientation. This incidence may

illustrate a tendency of Japanese with little or no

understanding of Chinese culture to be ethnocen

tric. This also seemed to imply that the Japanese

managers with little or no understanding of Chi

nese culture were self-centered in evaluating Chi

nese employees and their behaviors. In addition,

Japanese managers' inability to mis understand

Chinese culture often led them to understand

certain behaviors of Chinese employees originat

ing from core values of Chinese culture. Likewise,

for Chinese employees, the deep sense of companyloyalty felt by Japanese managers may be beyond

their imagination; thus, a gap in core values

(C1XJ1 gap) is very likely to prevail.

5) H5: C2 x J2 Gap: Misunderstanding That

Causes a Lack of Trust Between Chinese Employ

ees and Japanese Managers

Considering responses from Chinese employees

and Japanese managers, a fundamental problem

became salient; there exists a lack of trust between

them as a general tendency due to misunderstand

ing of mutual behaviors. Indeed, many Chinese

employees reported that they cannot help but to

believe Japanese managers do not trust their

Chinese employees truly. They further main

tained that the Japanese inability to fully trust

their Chinese partners is leading Japanese to

dominate the decision-making process. The fun

damental reason for distrust lies in the biased way

to interpret the other party's behaviors. Although

the degree of distrust probably varies from com

pany to company, a general trend of a perception

gap due to biased views of other's behaviors seems

to prevail in all companies interviewed for the

present study.

During the course of interviews conducted at

Company A, some practical causes of mutual

distrust were presented as shown below,

"When the Japanese ask us to accomplish certain tasks,they only have 50 percent confidence that we will be ableto accomplish them. So when the Japanese ask us to dosomething, they worry that we might fail. I believe,however, mutual trust between the Japanese and theChinese can be developed only through a certain process.It is natural that the Japanese look at our ability withskepticism in the beginning. If we were truly able toaccomplish what they tell us to do every time, then, theywould eventually trust us. This type of gradual development, I believe is necessary, particularly at a newlyestablished factory like ours. Right now our factory is inthe developing stage. So being a little skeptical of ourability is acceptable." (A, Employee 1)

Then, responding to my question regarding

whether mutual trusts exists between Japanese

and Chinese employees in this workplace,

-87-

mnnmn^mimm 1

"This, I do not know. It seems that the Japanese do not

trust Chinese employees in some aspects. Possibly they donot believe in our ability to do things right. The Japanesemanagers probably do not believe that the Chinese havethe capacity to solve complex problems. One of the reasonsmay be because of their national characteristic of living ina homogeneous society where everybody can do the samework. Another major reason might be that our companystarted just a few years ago; therefore, it is difficult for usto cultivate mutual trust relations. Our company is at astage where mutual trust is not fully developed. Afterworking together for a while, we will get to know eachother. Only then, will we be able to feel mutual trust.Right now we have not earned their trust." (A, Employee4)

Thus, although some Chinese employees felt

there is not enough mutual trust existing in be

tween Japanese managers and the Chinese em

ployees due to different views on work behaviors

of Chinese people, they tended to be optimistic

about the future courses of events, since they

seemed to believe that the both parties would

eventually develop more trusting relations

through conscious endeavors.

Similar results were found through interviews

conducted in Company B. One of the interviewees

confirmed that mutual trust relationships between

Chinese employees and Japanese managers have

been developed and enhanced over the past years of

cooperative efforts.

"In the past, the majority of top managers at Company Bwere native Hong Kong Chinese. But after 1992, thenumber of Hong Kong Chinese working in Shenzhenfactories was reduced and mainland Chinese employeesbegan to take over these positions. So it seems that theintent of the Japanese headquarter is to gradually localizethe factory in Shenzhen. I think it will take five more yearsfor localization. But it is possible" (C, Employee 4).

These comments indicate that the relationship

between the Chinese and the Japanese seems to be

moving in a positive direction as the Chinese

employees were allowed to have more authority

over time. Some Japanese managers in Company

B even seemed eager to learn more about the

Chinese people. However, interestingly, many

Chinese employees who have been working in the

Japanese wholly owned ventures for substantially

longer periods, are not so optimistic about the

development of better relationships between Chi

nese employees and Japanese managers. The

following comment made by a Chinese vice

factory manager in Company C still indicated

there were improvements yet to be made for the

increased trust relationship between Japanese

managers and Chinese people.

"One thing that the Japanese managers should do is tolearn how to trust Chinese managers. By learning how totrust us and delegating more responsibilities to us, we willbe able to develop our talents and, thus, become moreeffective managers. When I talked to Chinese managers inother Japanese companies, they agreed with my ideas.Many believe that Japanese managers do not trust us.They let us do something, but they do not believe in ourabilities. It hurts. I am not the only one who is thinkingthis way. Many friends in other companies believe thatJapanese managers do not trust us. They should let ushave responsibilities and see how we handle the situations.The Japanese are the ones who made the decision to investin China in the first place. But, all employees here areChinese, so unless you understand Chinese people, it isdifficult to manage them. After all, having Chinesemanage Chinese is the most effective way. So, believe in us.If the Japanese can believe in our abilities, we will be ableto contribute."

Conclusions

Interviews conducted with Japanese managers

and Chinese employees working for the five Japa

nese wholly-owned ventures in and around

Shenzhen revealed that there are in fact various

types of gaps between Japanese managers and

Chinese employees in understanding causes and

meanings of behaviors in the work settings. In

order to test the hypotheses for the present study,

interview data were subjected to critical analyses.

Summaries of results are found in Table 3. Find

ings based on interview -surveys seemed to con

firm there exist all types of gaps involving values,

opinions and behaviors between Japanese manag

ers and Chinese employees, affirming the validity

of the stated hypotheses. However, the most

important fact found in this study is that for all of

companies investigated, there exists a fundamen

tal problem which seems to be the root cause of all

other problems. Namely, there exist two different

core values within the single organization. One

core is what Japanese managers embraced re

garding collectivism leading to the loyalty based

on organizational belonging, while another core

value is the one embraced by Chinese regarding

collectivism based on the family and lineage

groups. The analyses of interview data and


Table 3 A Summary of Research Results

HypothesisJapanese "correct" Japanese view of

IssueChinese view of Chinese "correct"

ways to Respond Chinese attittde Japanese attitude ways to Respond

Hl-.BJxBCGap Treat fellow expatriate No hesitation in treating Japanese Japanese isolate them Treat all workers imparJapanese like a family Chinese like outsiders Isolation selves from Chinese tially as colleagues

H2: BJ x C2 Gap Decisions should be madeAs outsiders, Chinese have

not earned the right toJapanese Only Japanese have rights Decisions should be made

among insiders Dominance to make decisions among those who areIn Decision

Makingqualified by rank

H3: BC x J2 Gap As a part of the collective Chinese are too individual Chinese are too Japanese work very hard Experience is for ownsharing of resource is istic from Japanese per selfish- They work as a team benefit, not the collective's

needed spective. They keep the rather than trying to resource

Chinese do not share know-how only Stand out.

know-how to their fellow to themselves

workers

H4: J2 x C2 Gap As a part of collective, be Even if Chinese verbally Loyalty Japanese are extremely We dedicate ourselves so

ing loyal requires strict express their willingness to diligent and it is some that we can make career

obedience and often self- contribute, they would do thing we should learn advancement to bring ansacrifice nothing actually. from them.

Japanese are sometimes

too emotional about the

organization.

honor for ourselves and

family

H5: C2 x C2 Gap Being trust-worthy re Chinese employees cannot Trust Trnsting Chinese is crucial Trust should be earned

quires dedication, self- be trusted unless they for operating in China. through accumulatedsacrifice and time learn Japanese ways thor Thus Japanese should give achievement of given

oughly Chinese a try. tasks. Thus, it must be

tested first.

various secondary data collected further revealed

that the mode of thinking and values by which

Japanese managers and Chinese employees

judged behaviors of the other party as well as their

own behaviors seemed to originate from these core

values. Results of hypothesis testing involving H3

and H4 as listed in Table 3 are particularly rele

vant to this notion. Summary results shown in

Table 3 seem to further clarify the differences in

motivations and behaviors to respond to various

issues between Japanese and Chinese.

The problem lies with the fact that the exchange

of information regarding these differences rarely

take place, allowing very different values and

ideas ("two-value" situations) to co-exist within

the same organization. This leads both Japanese

managers and Chinese employees to unintention

ally hold onto different expectations regarding

each others. Interview data used to validate hy

pothesis 3 and 4 can be considered as addressing

significant differences in definitions of being

"loyal" and in the meaning of being "coopera

tive". Widening gaps and the inability of both

parties to decipher the differences further

complicate the situations, allowing the feeling of

distrust to emerge. Such distrust continue to swell

to the degree that Japanese would rarely consider

to allow Chinese employees to participate as

members of their collective, not to mention the

possibility of letting Chinese employees join the

decision making processes.

Solutions to the problems mentioned above may

be found in implementation of ideas provided in

hypothesis 6. However, none of the companies

investigated in the present study shop to be suc

cessful in establishing third culture or charismatic

culture. Although it was impossible to verify its

validity, some evidence exists to allow a preview

of what would be to come if H6 were to operate.

At company B, both Japanese expatriates and

local managers and employees have made con

tinuous efforts to educate their employees on

implementing Genba-ism (Seems floor-ism). As

employees explain it, *3G principles' are prevalent

among all organizational ranks at Company B,

emphasizing the importance of constantly check

ing and examining Genba (shop floor), Genjibuts

(On-going Products), and Genjitsu (Real Situa-

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&sffwm^mimm 1 -t

tions) all the times. All employees at Company B

are thoroughly trained to focus their attentions on

if any problem involving 3Gs which occurs. Every

employee, both Japanese expatriates and Chinese

employees indicated how impressed they were

with the effectiveness and efficiency that the imple

mentation of the 3G principles brought. Some of

the employees stated as follows:

The Japanese management process, particularly the 3Gprinciple is extremely practical... The Japanese haveeffective concepts on how to produce products...I havelearned a lot from their production process...the quality isthe prime objective of our company (B, Employee 2)

I was most attracted to Japanese ways of controlling theproduction management process (B, Employee 3).

The Japanese are more prompt in their actions. Using the3G principle, they can quickly solve various problems theyface in production processes. Because of the 3G principle,our factory workers can quickly respond to any defectswhen such things occur. (B, Employees 4)

These are excerpts from comments by three em

ployees, each being a part of significantly differ

ent levels of Company B's hierarchy from the

lowest to the vice factory manager. The fact that

they had training on the 3G principles from the

first day of their employment helped them greatly

in quickly capturing the essence of these principles

and adopting them to get jobs done properly.

Although no conclusive statement can be made

from this example, it may be suffice to say that

there might be a way for Japanese companies

sampled for this study to improve better business

relationships between Japanese expatriate and

local managers and employees, if they further

develop and nurture umbrella values embracing

them together like the 3G principles at Company B

did.

As shown in Figure 3, 3G principles, as a third

corporate culture in this case, could substituted all

core values and assumptions held by Japanese and

Chinese, since neither side initially embraces such

concepts. Repeated training and education could

eventually succeed in eliminating ethnocentric

views of the both sides and allow them to adopt the

third way to prioritize what actions to take, given

the importance of quality products for Company

B. Thus, by providing employees with alternative

values in regard to quality excellence that would

go beyond either Japanese or Chinese ones, both

parties succeeded in using a similar frame of

reference, jargon, and priorities to attack the

same issues and narrow gaps in perceptions

toward each other. In this case, the alternative

values, 3G principles, along with appropriate

behaviors and standards of judgement on quality

issues seemed to have been integrated into the

value systems of both Japanese managers and

Chinese employees at Company B. By using newly

integrated values and trying to put old practices

aside for the sake of quality productions, mem

bers of Company B regardless of ranks or na

tional origins, were able to effectively carry out

various strategies which allow them to detect and

resolve production problems in a swift manner.

However for this study, no evidence was available

whether or not a charismatic leader had actually

been working for generating integrated new values

set, asin the case as Wakabayashi and Graen

(1993) observed in one Japanese venture in the

U.S.A.. Further studies are required to under

stand the emerging process of third culture in

Japanese ventures in China. Nonetheless, as this

case indicates, continuous efforts to fill the gaps

between them by the creation of new values such as

3G principles may be crucial in order for Japanese

wholly owned ventures in China to increase their

efficiency and effectiveness. In this endeavor,

however, the Japanese side alone cannot work by

itself: working things out together through mutual

trust is the one and only way to establish better

and more cooperative business relationships.

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Acknowledgement

This research was made possible by the funding

from David M. Kennedy Center at Brigham Young

University.

The author wishes to thank Mitsuru

Wakabayashi, Graduate School of International

Development at Nagoya University for his con

tinuous encouragement and various suggestions

which contributed substantially in building theo

retical frameworks for this study. Thanks, too, to

Christopher B. Meek, Department of Organiza

tional Strategy and Leadership at Marriott School

of Management at Brigham Young University for

his suggestions and comments while I was con

ducting the field study in the People's Republic of

China.

Correspondence concerning this article should

be addressed to Aki Nakamura at No. 5 Oh-nishi

Apartment, Kiyosumi 17, Chikusa-Ku, Nagoya-

City Nagoya 464-0034. Electronic mail should be

sent to [email protected]

Received May 21, 2001

Accepted June 10, 2001

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Comparative Case-Study on the Global Marketing Activitiesof Acer Group in Taiwan and Samsung Electronics Co. in South Korea

Takaharu OKUDA

(Bunkyo University)

This paper analyzes the global marketing activities of electronics industryenterprises in Asian Newly Industrializing Economies (A-NIES), by comparingcase-study of Acer Group in Taiwan and Samsung Electronics in South Korea,both of which have been successfully catching up with Japanese and UScorporations and developing into the global players. The prevalence ofinformation technologies due to the IT revolution has enabled some of theA-NIES' enterprises to react promptly to diversifying and fluctuating consumersdemands in the global market. Acer Group has achieved to establish the flexibleand decentralized marketing model by restructuring its organizations enough tocope with these new demands. Samsung Electronics is seeking to be the biggestDRAM producer in coordination with the trend of establishing worldwidesupply chain among the leading corporations by developing open-architecturedproduction system. Concentrating its management resources on DRAMproduction, Samsung can become one of the most influential enterprises in theglobal semiconductor market. This study shows the importance of corporatereorganization to meet consumers needs and productive specialization. At thesame time, however, both enterprises face some technological or financialdifficulties. They need to renovate their marketing strategies in order to becomemore sophisticated or profitable players in the contemporary global market.

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