talented young managers lost per year. In our five-year study, among
those most valued by the company, 48 percent of those with poor
leaders quit their companies andonly 24 percent of those with good
leaders did so (Graen, Hui, and Gu, 2005 ).
My colleagues at Procter and Gamble (P&G) are amazed at these
percentages, because they were training Chinese managers very early
in Deng’s open-door period and claimed to have lost not one young
Chinese manager who they really wanted to keep. It can be done.
Western college-educated leaders can be trained to do true cultural
bonding with their Chinese managers. Wal*Mart with the assistance
of P&G trainers is currently in the process of learning true cultural
bonding in China (M. R. Graen, 2007 ).
Research in China (Aryce and Chen, 2006 ; Chen, 2006 ; Chen, 1996 ;
Chen, Lam, and Zhong, 2007 ; Cheng and Rosett, 1991 ; Cheng and
Farh, 2001 ) has generated findings compatible with those in America
regarding the usefulness of the genotypic model of leader–member
exchange (LMX) with sharing network leadership (LMX SNL).
What is sharing network leadership?
Leading private business ventures in both China and the United States
employ different organizational structures for different environ-
mental conditions. For relatively routine and stable conditions of
production or service, the well-known bureaucratic structure is used
for a variety of sound reasons; however, for relatively complex and
dynamic conditions, the more complex leadership sharing model is
employed. For most business conditions, the bureaucratic structures of
scientific management are protected from environmental turbulence
as much as possible. Only when the turbulence becomes disruptive
to routine and stable operations is the backstop system called the
complex sharing network leadership model used to change the bureau-
cratic system, or to change some aspect of the environment, or both,
so that routine and stable operations may continue unabated.
Procedures for building and running bureaucratic structures are
well known and are adaptable to accepting new technologies with
a minimum of help from the leadership system. Unfortunately, organ-
izational executives cannot predict when their routine and stable
process may be disrupted by environmental events and must be pre-
pared for them as much as possible in order to fulfill their due
288 George Bear Graen