Leadership and Management in China: Philosophies, Theories, and Practices

(Jacob Rumans) #1

From the executives’ perspective, being sincere means keeping promises,
not telling lies, being tolerant of others, taking care of employees’
welfare, keeping speaking and behavior consistent, and being self-
disciplined. The targetof sincerity includes dealingswith both employees
(internal) and business partners (external).
According to the interviewed executives,sincerity is essentialis
extremely important and beneficial to the company. It creates trust
in the management by employees and it builds a good reputation for
both the executives and their firms. It also helps the firm establish
cooperative relations with other enterprises. An interviewed executive
from a state-owned company reported that he had been highly trusted
by others because he had always kept his promises in dealing with
them. For example, in China, it is common that state-owned com-
panies borrow money from state-owned banks and do not repay the
loans on time because both the company and the bank are state-owned
and such a delay incurs no serious penalty. But this CEO said that
despite tremendous difficulties, he always made sure that the loans
were repaid on time. Similarly, in dealing with customers, his com-
pany always compensated for any losses without making excuses.
Being honest and sincere in China can often be costly because of the
lack of effective regulations. As the market economy is relatively new
in China, business norms and rules are not well established. On many
occasions, business people can act wrongfully without suffering any
legal penalty. In such circumstances, if one person is honest while
others are not, the honest one will be put at a disadvantage. Despite
the potential risk of being exploited for being honest, more than half


Table 8.1.Frequencies of management philosophical notions mentioned
by the thirty-five interviewed business leaders.


Philosophical notions Frequency


Sincerity is essential 23
Pursuit of excellence 21
Social responsibility 16
Harmony is precious 13
The Golden Mean (Acting in the middle way) 11
Specialization 11
Scientific management 11


244 Zhi-xue Zhanget al.

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