LUẬN văn THẠC sĩ (KINH tế) the implications of culture in irish chinese business transactions

3.10 Conclusion...394 Analysis,FindingsandDiscussion...40 4.1 Introduction...40 4.2 BackgroundofRespondentsQuantitativeData...41 4.3 PerceivedCharacteristicsofGuanxiQuantitativeData...45

ListofTables 4

ListofFigures 4

Acknowledgements 5

Abstract 6

1 Introduction 7

1.1 ResearchQuestion 9

1.2 ResearchObjectives 9

2 LiteratureReview 10

2.1 WhatisCulture 10

2.2 NationalCultureandMajorCulturalFrameworks 11

2.3 ImpactofChineseCultureonBusinessTransactions 18

2.4 ChineseCultureandtheConceptofGuanxi 19

2.4.1 WhatisGuanxi? 19

2.4.2 IsGuanxiRelevant? 21

2.4.3 BuildingandMaintainingGuanxi 21

2.4.4 TrustandGuanxi 22

2.4.5 GuanxiintheWest? 23

2.4.6 BenefitsandRisksofGuanxi 25

2.5 LiteratureReviewConclusion 26

3 ResearchMethodology 27

3.1 Introduction 27

3.2 ResearchPhilosophy 28

3.3 ResearchApproach 30

3.4 ResearchStrategy 30

3.5 ResearchChoice 32

3.6 TimeHorizon 32

3.7 DataCollection 32

3.7.1 SecondaryDataCollection 32

3.7.2 PrimaryQualitativeDataCollection 33

3.7.3 PrimaryQuantitativeDataCollection 34

3.7.4 DataAnalysis 36

3.8 PopulationandSample 37

3.9 EthicalIssues 39

3.10 Conclusion 39

4 Analysis,FindingsandDiscussion 40

4.1 Introduction 40

4.2 BackgroundofRespondents(QuantitativeData) 41

4.3 PerceivedCharacteristicsofGuanxi(QuantitativeData) 45

4.4 PerceivedCharacteristicsofGuanxi(QualitativeData) 48

4.4.1 PersonalRelationships 49

4.4.2 GivingFace(Respect) 50

4.4.3 Trust 51

4.4.4 Hierarchy 53

4.5 Survey Groupings 55

4.6 Guanxiand theMarketingMix 59

4.7 PerceivedBenefitsandDisadvantagesofGuanxi(QuantitativeData) 60

4.8 PerceivedBenefitsandDisadvantagesofGuanxi(QualitativeData) 62

4.9 Correlation Analysis 66

5 Conclusion,RecommendationsandLimitations 68

5.1 LimitationsofthisResearch 70

5.2 AreasforFurtherResearch 71

6 Self-Reflection 73

6.1 Introduction 73

6.2 Learning TheoriesandStyles 73

6.3 Process 75

6.4 UseofSources 76

6.5 Dissertation Formulation 76

6.6 Own Learning 77

6.7 ActionPlan 78

BibliographyandReferences 79

Appendices 87

Appendix1:ThemeSheetfromSemi-StructuredInterviews 87

Appendix2:SurveyQuestionnaire 88

Appendix3:EmailstoFockand Woo 91

Appendix4:RepliesfromFockand Woo 91

Appendix5:SurveyInvitation Email 92

Appendix6:SurveyReminderEmail 93

ListofTables Table2-1:Hofstede’sIndicesforIreland&China 13

Table2-2:ComparativeCharacteristicsof aCulture 16

Table2-3:DimensionsfromtheGeneric FrameworkofCulture 18

Table2-4:TraitsofGuanxi 20

Table3-1:CodingSummaryfromSemi-Structured Interviews 37

Table4-1-Coding SummaryfromSemi-Structured Interviews 40

Table4-2:SexofRespondent 41

Table4-3:RespondentAge 42

Table4-4:CompanySize 43

Table4-5:Education 44

Table4-6:ExperienceinChina 45

Table4-7-RelativeImportanceofGuanxiCharacteristics 46

Table4-8:CharacteristicsofGuanxi(Mean Rating) 48

Table4-9:DemographicProfileofClusters 56

Table4-10:ClusterAnalysisonPerceptionofGuanxi 58

Table4-11:RelativeImportanceofGuanxiand StrategiesoftheMarketingMix 59

Table4-12:BenefitsandDisadvantagesofGuanxi 60

Table4-13:PerceptionsonBenefitsand DisadvantagesofGuanxi(withStandardDeviations) 62

ListofFigures Figure2-1:Hofstede’sIndicesforIreland&China 13

Figure2-2:TheGeneric FrameworkofCulture 17

Figure3-1:TheResearch'Onion' 28

Figure4-1-ChartMalevsFemale 42

Figure4-2:RespondentAge 43

Figure4-3:CompanySize 44

Figure4-4:ExperienceinChina 45

Figure4-5:RelativeImportanceofGuanxi 46

Figure4-6:ClusterQuality 55

Figure4-7:DemographicProfileofClusters 57

Figure4-8:RelativeImportanceofGuanxiand StrategiesoftheMarketingMix(AllRespondents) 59Figure4-9:Benefitsand DisadvantagesofGuanxi 61

Figure6-1:Kolb’sLearningStylesIncluding HoneyandMumfords 74

Firstly,I wouldlike tothank alloftheMBAlecturesinDublin BusinessSchoolforalloftheirhelpthroughoutthecourse.IthasbeenachallengingyetrewardingcourseandIhavet r u l y enjoyedtheexperience

Inp a r t i c u l a r I w o u l d l i k e t o expressmygratitudet o myresearchs u p e r v i s o r Dr.Shakeel

S i d d i q u i , forhishelp,valuableguidance,supportandconstructivefeedbackduringthedevelopmentof thisdissertation

IwouldliketothankmybrotherandMBAclassmatefor

hissupportandencouragementovert h e 2 yearso f t h e c o u r s e andp a r t i c u l a r l y d u r i n

g t h e dissertationp r o c e s s HehasbeeninstrumentalinkeepingmemotivatedwhilealsomakingtheMBAexperienceanevenmoreenjoyableone

Mygreatestappreciationistomyfiancée(ourweddingis1weekafterthesubmissionofthist h e s i s) Sharonforhersupport,comfortandencouragementoverthelast2yearswhereI’vebeenjugglingtheMBAprogramme,workcommitments andconstantoverseastravelwhile alsotryingto

find timeto be aDad.Thisthesisisdedicatedtoyou.

TherehasundoubtedlybeenrapideconomicgrowthinChinaoverthelastfewdecadesandt h e importanceoftheChinesemarketfortheaviationindustryhasgreatlyincreasedasChinaopensupitsskiestotheWest.OneofthekeychallengesforanyforeignexecutiveconductingbusinessinChinaistounderstandhowculturaldifferencescanimpactonbusinessdeals.Thereforethis

studyaddressedtheinterestingquestion

ofhowChinesecultureandinparticularthetraditionalconceptofguanxicanimpactIrishexecutives

intheaviationi n d u s t r y whenconductingbusinessinChina.ThiswasinvestigatedthroughtheexperiencesandperceptionsofhowIrishexecutivesintheaviationindustryestablishbusinessrel

orperceivedascorruptionhavesignificantlyreduced

chain, with workers in the industry unusually productive; the €38,250 (CNY327,000) generated by the average air transport services employee is 6.4 times higher than the overall average (International Air Transport Association, 2012).Growth in the Chinese aviation market has been so strong that it has tripled in size over the

past 10 years and over the next 20 years Chinese airlines will need nearly 6,000 new airplanes, valued at €565bn, accounting for more than 40% of forecast deliveries to the Asia

1 Introduction

The21stC e n tu r ymarketplacestretchesaroundt h e globeandi t i s e s t i m a t e d t h a t by2 0 4 0 C h i

n a willhavethelargesteconomy inthe world(Meraz,2011).AstheChinese economyexp

theaviationindustrycoupledw i t h t h e staggeringgrowtho f aviationi n C h i n a hasresultedi n ani

ncreasedn e c e s s i t y andf r e q u e n c y ofIrishcompanies andIrishpeopletodealwithChin

udiesthatassessIrishattitudestoChinesecultureandexaminetheimpactthatt h e s e haveonbusinesstransactionsforIrishcompaniesthatconductbusiness with China.

Givent h a t culturei s s o m e t h i n g t h a t manyacademicsfeelcannotbel e a r n t , ratheronlyexperienced,t h e researcherfeelst h a t i t w o u l d b e helpfult o e x a m i n e theimplicationso f C

Lee andEllis, 2000;ParkandLuo,2001;SuandLittlefield,2001)

Whilsttherei s extensiveliteratureo n h o w t o d o businessi n China(Sheer& Chen,2 0 0 3 ; Meraz,2011; Volmer,2013) aswellasChinese businessetiquette,thereislittleconsensusaboutwhethert r

a d i t i o n a l culturaldynamicss u c h asguanxis t i l l prevailw h i l s t conductingbusinessinmode

rndayChina.Inaddressingthisquestionthisresearchspecificallyfocusesu p o n t h e experiencesandperceptionsofIrishexecutivesint h e aviationindustryd o i n g businessinChinaandexploreshowtheyh a v e builtrelationshipsandformedbusinessnetworksin China

Theresearcherisemployedinaninternationalsales capacity inthea v i a t i o n andaerospacei n

d u s t r y i n Irelandbya s u b s i d i a r y o f Boeing,t h e world’slargestaerospaceandd e f e n c econtractor.Theresearchersbusinessis

toprovidehostedsoftwaresolutionstoaircraftlessors,airlinesandMaintenanceandRepairOrganisations(MROs)thatfacilitatethemanagementofhighvalueaircraftassets.TheresearcherplanstoentertheChinesemarketoverthenext12m o n t h s andhasalreadybegunprospectingChineselessorsandairlines.Throughresearchingt h e pastexperiencesandperceptionso f Irishexecutivesw h ohaveconductedbusinessi n C h i n a , t h e researcheri n t e n d s t o facilitateanu n d e r s t a n d i n

g o f h o w C h i n e s e c u l t u r e andi n particularthepracticeofguanxiwillimpactonthese dealings.

5 Comparet h e p e r c e p t i o n s o f guanxibetweenIrishaviationexecutivesandt h e Fockand

Woo(1998) researchof HongKongexecutives

t i t i s d i f f i c u l t t o define:eachs c h o l a r s e e m s t o havea s e p a r a t e definition”.

Craig&Douglas(2006,p.323)positthat“cultureisapervasiveinfluencewhichunderliesallfacetsofsocialbehaviour andinteractionanditis evidentinthe values andnormsthat governsociety”.Chang(2003,p.567),whileagreeingthatcultureisdisplayedinthevaluesandn o r m s

o f society,l a r g e l y e x p a n d s o n C r a i g & Douglas(2006,p 3 2 3 ) definitionbydefiningcultureas“theuniquecharacteristicofasocialgroup;thevaluesandnormssharedbyitsmemberssetitapartfromothersocialgroups.Andcultureisconcernedwitheconomic,political,socialstructure,religion,education,andlanguage”.A c c o r d i n g t o anthropologicalconcept,culturerelatestoasharedsystemofbeliefs,attitudes,possessions,attributescustomsandvaluesthatdefinegroupbehaviour(Chang,2003)

FuturologistHermanKahnsawhimselfasa“culturist”:LikeHofstedeandBond(1988),heheldt h ebelieft h a t s p e c i f i c actionshaves p e c i f i c culturalt r a i t st h a t are“rathers t i c k y anddifficultt

o changei n a n y basicfashion,althoughtheycanoftenb e modified”.Hofstede(1984,1 9 8 8 , 1 9 9 1and2 0 1 0 ) likest o definec ul tu re as“thecollectiveprogrammingoft he m i n d thatdistinguishesthemembersofonecategoryofpeoplefromthoseofanother”.Thisstressesthatcultureis:(i)acollective,notanindividualattribute;(ii)notdirectlyvisiblebutmanifestedin behaviours;and(iii)commonto some, but not allpeople

Thereisalsoa starkcontrastinthe researchmethods usedinthe studyofculturebetweenanthropologistssuchasGeertz(1993)andKluckhohn(1951),astheyoftenengagedinaverydetailedmeaningfuldescriptionofhumanlives,byusingqualitativeresearchmethods.This i s i n contrastt o

s o m e oft h e studiesconductedbyHofstede(1984,1 9 8 8 , 1 9 9 1 ) andHall(1960,1976),whomainlyfocusedondimensionsofvaluesandbeliefsbyusingquantitativemeasures

2.2 NationalCultureandMajorCulturalFrameworks

Torres(2010)detailstherelevantculturalframeworksthatmustbeunderstoodwhenconductingbusinesswiththeChineseas:Hofstede’spowerdistance,uncertaintyavoidance,individualism

andcollectivismcultures,Hall’slowandhighcontextculturesandConfuciusvaluessuchasguanx

i.Thischapterwillevaluateandcontrasttheliteratureontheseculturalframeworksinrelationtob

oth ChineseandIrishculture

Withthegoalofhelpingindividualsdistinguishthevariousculturaldifferencesofcountries,Hofstede(1980)introducedhisseminaltheoryoffourculturaldimensionsbasedonhisstudyo f workrelatedvalueso f IBMemployees.T h e s t u d y wasbasedo n over1 1 6 , 0 0 0 questionnairesin

20differentlanguagesfrom72 countries(Hofstede,2010)

Thist h e o r y identifiesf o u r m aj or cu l tu ra l d i m e n s i o n s o n whichv a r i o u s c o u n t r i e s /culturesdiffered.AstheculturesofIrelandandChinaaresofarapartwhenusingHofstede’sindices,i

t i s v e r y interesting andrelevantfor thisresearchtocompareandcontrastthem:

1 Power distancewhichlooksatthequalitiesofpowerandwealthwithin asociety.

Chinai s a highpowerdistanceculture,wheret h e dependencei s higho f subordinateso n b o s s e

s andsuperiorsandsubordinatesarenotequal.There isacentralization ofpowerands a l a r

y canshowwidegapsbetweentopandbottom.Alsoprivilegesandstatussymbolsareacceptedandsubordinatesexpectto betoldwhatto do(Hofstede,1991)

Irelandi s a l o w p o w e r distanceculture,w h e r e subordinatescane a s i l y m o v e towardanddisagreewiththeirbosses.Decentralizationispopularandthesalaryrangeisnarrow.Democraticb o

s s e s a r e seenasi d e a l andt h e r e i s n o t m u c h p e r c e i v e d h i e r a r c h y i n organizations(Hofstede,1 9 9 1 ) Hofstede& B o n d (1988,p 1 0 ) definepowerdistanceas“thee x t e n t t o whicht h e

l e s s powerfulmemberso f institutionsandorganizationswithina c o u n t r y expectandacceptthatpowerisdistributedunequally”

2 Individualismversuscollectivismdescribest h e relationshipsbetweeni n d i v i d u a l s ando

o t h countriesareh i g h l y successorientatedanddriven.InC h i n a t h i s needt o ensuresuccessc

a n b e exemplifiedbythefactt h a t m a n y Chinese wi ll sacrificel e i s u r e andf a m i l y t i m e toworkwhereastheIrishareproudoftheirsuccessesandachievementsinlife,anditoffersabasisforhiringandpromotiondecisionsintheworkplace.Conflictsareresolvedatt h e individualleveland thegoalis to win(Hofstede,1991)

4 Uncertaintyavoidancei s ani n d e x t h a t t a p s a feelingo f discomforti n unstructuredo r unus

ualcircumstances,whileitsinverseshowstoleranceofneworambiguouscircumstances(Franke,Hofstede& Bond,1991).BothChina andIrelandscorelowinuncerta inty avoidance.InC h i n a t r

u t h m a y ber e l a t i v e , thoughi n t h e immediatesocialcirclestherei s concernforitandrules(butnotnecessarilylaws)abound.Nonetheless,adherencetolawsandrulesmaybef l e x i b l e t o s u i t t

h e actuals i t u a t i o n andpragmatismi s a facto f life.T h e C h i n e s e arecomfortablewithambiguity;theChineselanguageisfullofambiguousmeaningst h a t canbedifficultforWesternpeopletofollow

InIrelandideasa r e i m p o r t a n t , beingimaginativei s appreciated.Irishb u s i n e s s e s embracec

r e a t i v i t y andarealwayslookingfornewwaystoapproachproblems.Makingapointwithpracticalfactsi s m o r e appreciatedt h a n t h e u s e o f t o o m u c h technicallanguage(Hofstede,1991)

Hofstedes u b s e q u e n t l y addeda fifthculturaldimension,whichh e called“ConfucianDynamism

”(alsoreferred to in theliteratureaslong-termversusshort-termorientation)

5

Confuciandynamismwasaddedasaresultofasecondcross-culturalvaluemeasurementprojectcalledChineseValuesSurvey(CVS),whichwasundertakentoidentifyvaluesmore

typicalofAsianc u l t u r e s andcomprisedo f u n i q u e itemsassociatedw i t h t h e t h i n k i n g andp

Individualism Masculinity Uncertainty

Avoidance

TermOrient ation

Source: http://geert-hofstede.com/national-culture.html

WhileHofstede’sworkisseenasakeytounderstandingcultureitisnotwithoutits’critics.Hofstedehimselfp o i n t s o u t t h a t h i s samplewasp r e d o m i n a n t l y m i d d l e -

c l a s s andthereforem a y n o t b e representativeo f allemployeesi n t h e countriesconcerned(Hofstede,1 9 8 4 ) Black(1994),w h e n d i s c u s s i n g Hofstede’sw o rk,furtherp o i n t s o u t t h a t

w e w o u l d expectculturaldifferencesamongcountriestobegreateroutsidethecorporationthentheywouldbei n s i d e itandalsothatHofstede’sdatamaybesomewhatoutdatedasitwascollectedbetween1 9 6 7 and1973.ThisisbackedupfurtherbyBulowandKumar(2011)whoidentifiedseverall i m i t a t i o n s , includingthecriticismthatitisincorrecttogeneralizeanationwithonesingleculture,asoftenacountrywillbecompromisedofseveralregionsandethnicgroupswithino n

e country.BaseduponBulowandKumar’sperspectiveitcouldbearguedthatthereisnosuchcultureas‘theChineseculture’,insteaditisacompositeofitsregionslikeHongKong,Taiwanandprovinc

ofChina,whoasindependentgroupswilld i s p l a y differentvalues andbehaviour

EdwardHallwasanotherauthorwhoattemptedtoconstruct‘cultureclusters’.However,Halldistinguishedbetweencultureso n t h e basiso f communicationandu n d e r s t a n d i n g (ManraiandManrai,2010).Hall(1960)identifiesfiveareaspertinenttointernationalbusinesswhichh e describesasthe“silentlanguagesofculture”.Theseare;thelanguageoftime,thelanguageofspace,t h e languageo fthings,t h e languageo f friendshipa n d t h e languageofagreements.AccordingtoAlbaumandDuerr(2008,p.127)thesefivedimensionscanformt h e basisof

5 Treatmentof timeasfixed orelastic

Thesilentlanguageo f spaceexamplest e l l u s t h a t

cross-culturaldifferencese x i s t i n t h e symbolicmeaningattributed to: