China has successfully created an image as the world’s largest manufacturing hub. This development has attracted several Multinational Companies (MNCs) and international investors to the Asian nation (Rowley and Oh, 2019). They have different motivations for expanding into this market, but exploiting the relatively low cost of labor in the country has been a key attraction (Łasak and van der Linden, 2019). As global and local businesses interact with one another within this globalized system of commerce, the pursuit of successful business outcomes remains a core desire for many foreign business leaders (Bu et al., 2021). In this regard, they are encouraged to understand prevailing business cultures and traditions in their host countries to avoid the operational and administrative risks of operating in unfamiliar markets (Rowley and Oh, 2019). This concern is poignant among international investors who subscribe to a different business culture from that practiced in the host country.
The need to understand the importance of cultural diversity in corporate governance emerges when foreign and local investors interact in a global market. In business, this goal is enshrined in the quest for companies to implement good corporate management and leadership practices for enhanced productivity (Rowley and Oh, 2019). The main idea advanced in this quest is to harness existing business traditions and culture to implement effective corporate management and leadership practices (Bu et al., 2021). In this document, the concept of corporate management refers to processes associated with leading or directing a company’s core activities (Rowley and Oh, 2019). Several areas of businesses are influenced by the implementation of sound corporate management principles, including planning, decision-making, and strategy implementation (Hela, 2021). Therefore, it is crucial to acknowledge the powerful role of culture and traditions in influencing business outcomes.
In this document, the relationship between culture and traditions is examined in a Chinese business context. The review is juxtaposed against the need to understand the importance of leadership effectiveness in corporate management. In this context of the review, leadership is closely associated with corporate governance because it helps managers to make strategic decisions aimed at leading employees within a company (Demirtas, 2020). At the same time, the impact of leadership on business outcomes is analyzed within the boundaries of cultural development to understand how culture and business traditions affected corporate success. This document outlines a plan to conduct a study aimed at analyzing Chinese corporate management and leadership practices to improve investor relations between foreign and local business players.
Objectives of Study
A preliminary investigation of the research topic highlighted cultural typologies, Confucianism, and knowledge management as three main areas underpinning the proposed investigation. These findings were relevant in developing the objectives of the study, which seek to understand dominant cultural types, the philosophical underpinning of cultural development in China, knowledge management practices adopted in the state, and models of leaders embraced by the locals. A list of the main objectives of the investigation appears below.
The research objectives guiding the study are as follows:
- To identify leadership models that underpin Chinese business traditions and culture
- To describe the dominant business culture in China
- To investigate the importance of Confucianism on the evolution of Chinese business culture and leadership practices
- To investigate the impact of Chinese business culture and leadership models on knowledge management in China
The above-mentioned critical areas of analysis will be used to anchor the investigation in scholarly texts.
Justification of Study
Examining the influence of culture and leadership models on business performance is important in enhancing the relationship between local and international investors in China. The current analysis seeks to identify unique cultural dynamics and leadership practices of China that impact investor relations in the country. The analysis is relevant to our understanding of the growth of international trade between China and other countries because cultures and traditions change like trends (Rowley and Oh, 2019). The direction of the research is aimed at identifying the most dominant cultural practices and leadership models adopted in China. Gaining this knowledge is useful in promoting investor relations and improving employee relations in the workplace (Łasak and van der Linden, 2019). It is also relevant in promoting diversity in the workplace because employees who understand each other’s cultures and traditions are likely to be tolerant of one another (Hela, 2021). Thus, the current investigation will help in boosting business-to-business and business-to-customer relations in China.
Dominant Business Cultures and Leadership Models in China
Business leaders often subscribe to dominant cultures and models of governance to make decisions affecting how people relate in the workplace. Thus, it is important to understand dominant business cultures and leadership models adopted in a country because they may indicate the kind of practices adopted by most companies (Patey, 2021). Stemming from this objective, different countries subscribe to various cultures, depending on their religious, political, or economic affiliations (Patey, 2021). Understanding these differences could help in identifying common leadership practices that shape business cultures and traditions in a company or society (Rowley and Oh, 2019). Therefore, recognizing the dominant business culture and leadership model that is practiced in a country makes it easier to predict norms, traditions, and values that shape employee behavior in a company (Łasak and van der Linden, 2019). This background explains the importance of investigating the dominant business culture and leadership style in China.
The review will help in explaining why certain leadership models are more commonly accepted in China than others are. The same analysis will be relevant in explaining why specific business cultures are embraced as the national standard of doing business, while others are not (Patey, 2021). In these discussions, a business culture refers to a pattern of actions or activities in an organization that is implemented decisively and rarely questioned. These standardized practices form a critical part of developing business traditions because customs influence decision-making processes at various levels of management (Łasak and van der Linden, 2019). In this framework of review, business cultures and leadership models share a close relationship because both concepts are useful in shaping business traditions (Jiang and Kim, 2020). Therefore, a leadership model provides a theoretical framework for managing employees. It guides behaviors that shape how people and businesses interact with one another in an organization or workplace setting (Jiang and Kim, 2020). Therefore, culture and leadership play an important part in building and sustaining traditions that have been followed across generations of employees.
Scholars have mentioned different leadership models, such as action-centered leadership, competing values framework, charismatic leadership, and Kurt-Lewin’s leadership style as some of the most commonly adopted models in modern corporate governance (Caredda, 2022). For purposes of this investigation, a critical analysis of these leadership models will be done to understand the unique properties that make them acceptable or unacceptable to Chinese companies. This analysis will provide the basis for understanding the dominance of one cultural type or leadership model over another. The findings will make it possible to predict the actions of Chinese companies when interacting with international investors.
Confucianism, Chinese Business Culture, and Leadership Models
Over the years, Chinese business traditions and leadership practices have evolved because of different stimuli. Demographic changes, government policies, and global economic trends have received the highest mentions (Xie et al., 2021). However, these changes only highlight part of the story of the evolution of business traditions and leadership practices in China. Current scholarly research on the field is still underdeveloped, but it is crucial to understand the philosophical underpinning of the dominant Chinese business culture to comprehend its influence on business traditions and practices. This analysis is critical in understanding the philosophical basis for which corporate cultures and leadership practices in China are formed.
In China, Confucianism is the most commonly recognized philosophical basis for which the country’s norms, traditions, and social systems are built (Xie et al., 2021). The business cultures adopted by corporate leaders are subject to the same philosophical influences because employee behaviors and practices in China are products of the same philosophy (Spijkman and de Jong, 2020). Relative to this statement, researchers have mentioned Confucianism as the main philosophical framework inspiring the development of Chinese corporate culture and leadership practices (Santander Trade, 2021). Drawn from its influence in Chinese business circles, it is crucial to investigate the extent that Confucianism has played in shaping business traditions in China. The investigation is useful in determining the limits that foreign companies have to comply with business practices or values that are consistent with Confucianism. Consequently, in the proposed study, we will seek to determine the extent to which Confucianism has influenced Chinese business culture and leadership practices.
Impact of Chinese Business Culture and Leadership Practices on Knowledge Management in China
Knowledge management is an important concept of corporate governance. Its significance to this study stems from the importance of gaining access to valuable information in today’s fast-paced society. Scholars affirm that information access and utility are critical processes to the success of contemporary firms because we live in an information age and access to data could determine the success or failure of a company (Xiao, 2020). Relative to its importance in corporate governance, effective knowledge management will be used to determine the extent to which business cultures and leadership practices in China affect corporate governance outcomes.
Many people believe that business success is anchored in the commitment of managers to abide by core principles of doing business and making money for their shareholders. This thinking has negated business culture, traditions, and leadership to the periphery of ordinary considerations for corporate success. Their impact on knowledge management is rarely studied despite its importance in maintaining the success of contemporary firms in today’s information age (Xiaoping and Tao, 2021). Therefore, knowledge management emerges as a determiner of corporate governance success, while business traditions and leadership practices are moderators of this relationship. To this end, in this study, business cultures and leadership practices adopted in China will be used to assess corporate governance outcomes from a knowledge management perspective. The analysis matters to business growth and development because people prefer to do business with those that they like, trust, or share similar values (Demirtas, 2020; Santander Trade, 2021). Business traditions, culture, and leadership determine how investors address these issues because they will explain the nature of core activities that will be undertaken in an organization, including business protocol development, decision-making, employee management tasks, marketing decisions, the propensity to take risks, and the pace of business growth (Bu et al., 2021). Therefore, the relationship between business traditions and corporate governance will be analyzed from a knowledge management perspective.
The proposed study will comprise five chapters, which include an introduction, literature review, methodology, findings, and conclusion. The introduction section will describe the research problem, objectives of the investigation, and justification for the study. The second chapter will be the literature review section, which will contain an analysis of existing scholarly research on the study area. The third chapter will be the methodology section and it will include discussions of the techniques adopted by the researcher to complete the investigation. The fourth section of the dissertation will contain a description and analysis of the findings, while the last chapter will summarize the main findings of the study and outline a set of issues that foreign players should be aware of when doing business with Chinese companies.
Techniques to be used by the researcher in the proposed study will be designed to meet the objectives of the investigation. Subject to this goal, a mixed-methods research framework will be used to undertake the study because of the need to evaluate both the quantitative characteristics of corporate management indices and the qualitative nature of leadership as a sub-segment of corporate management practices (Operational Delivery Profession, 2020). Primary data will be obtained from employees working in Chinese companies using the questionnaire survey method.
Additionally, the researcher will recruit participants using the simple random sampling method because of its unbiased nature (Kim et al., 2018). At the end of the data collection process, the Statistical Packages for the Social Sciences (SPSS) software will provide the main analytical framework for analyzing primary data because of its rich history in social science applications (van Wingerde and van Ginkel, 2021). Furthermore, secondary data will be obtained from reports published by consulting firms, Chinese companies, and government agencies. Academic articles available on internet search engines and newspaper excerpts will also be included in the review.
Business cultures and leadership practices are critical to the realization of positive corporate governance outcomes. In this paper, a proposal is made to analyze the impact of culture and leadership practices on business traditions in China. The aim is to understand the unique characteristics of contemporary business traditions that may affect foreign relations. The objectives of the proposed study are designed to enhance relationships between foreign and local investors in China. This objective may be achieved by identifying dominant business cultures and leadership models adopted in China and assessing their philosophical roots and effects on knowledge management. The objectives of the study are intended to explain the philosophical basis for the development of Chinese cultures and business traditions.
The findings of the proposed study will be relevant to the field of global corporate management where different MNCs interact in a diverse business environment. Particularly, the findings will be pivotal in fostering international trade for global companies intending to do business in China. The discussion will also contribute to the expansion of the body of literature on corporate management. This way, it is possible to expand scholarly literature on Chinese business practices and their effects on investor relations. Broadly, these insights are relevant in today’s global business environment where Chinese companies play a critical role in world trade.
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