Business Leadership Development in China

Shuang Ren, Robert Wood, Ying Zhu

• Publisher: Taylor & Francis
• Year: 2015
• Print ISBN: 9780415747196
• eBook ISBN: 9781317752776
• Edition: 1
• Topic: Betriebswirtschaft
• Subtopic: Leadership

This book argues that China's businesses, and hence China's future economic development, face a huge crisis in that there is a considerable "leadership gap" in China, with a shortage of competent business leaders, at a time when new leadership skills are required urgently, as China's businesses evolve rapidly and engage ever more with the global economy. Moreover, the book argues, training is an undervalued and often marginalised activity in Chinese companies. The book outlines the nature of this problem, and goes on to demonstrate that there is a new breed of manager emerging in China, aware of the need to upgrade management skills, moving away from skills appropriate in traditional industrial firms, and emphasising more flexibility, positive engagement with workers, and competence in the market economy. The book includes an evaluation of different management approaches in China, reports on extensive original research, including interviews with practising managers, and sets out how self-development in widespread, deep and important.

1 Introduction

Reworking leadership development in the context of China’s transition

Foreign observers are often over-impressed by the magnitude of China’s problems and under-impressed by China’s capacity to recognize and deal with the problems.

(Pieter Bottelier, 2007, p. 34)

What is the most likely future for China? What determines China’s prospects? With China’s second transition looming large on the horizon, the expectations for China’s transition from a low-tech, labour-intensive economy to one that is modern, innovative and value-adding are high. Various predictions regarding this transition have been offered covering economic, labour, political and cultural factors (e.g. Dobbs et al., 2013; Gorrie, 2013; Warner, 2013). Will China continue to promise future prosperity, as it has outperformed even the most optimistic predictions over the past 35 years of the ‘gai ge kai fang’ (economic reforms and opening-up)? Or is China’s economy sprinting towards a breakdown, as suggested in James R. Gorrie’s latest thought-provoking book The China Crisis: how China’s economic collapse will lead to a global depression?

Studies of China’s prospects for sustained development have highlighted many challenges during the country’s ongoing reform process. These include macroeconomic reforms, sectoral and regional disparity, and cultural value changes. Other challenges include organisational restructuring and changing mindsets. Against the backdrop of these often interwoven challenges, the sustainability of economic growth depends on the existence of a well-trained workforce (Benson, Gospel and Zhu, 2013). However, systematic and comprehensive understanding of the infrastructure and activities of training and development in China is largely undocumented.

Continued economic reforms and industrial transformation have impacted significantly on the labour market in general and the demand for managerial leadership in particular (Benson et al., 2013). Competency requirements for business leadership have changed dramatically in China, leading to an increasingly insufficient supply of qualified managers with the necessary leadership competencies to navigate the ‘sea change’ in the economic and social spheres of society (Zhu and Warner, 2013). On the one hand, traditional sectors have shrunk and are being replaced by new sectors, thus making previously acquired competencies rapidly ill-suited for the navigation of emerging challenges, and, in many cases, obsolete. On the other hand, China’s short history of exposure to the market, exacerbated by the increasingly competitive globalised economy, makes it difficult to predict the repertoire of competencies that would be required to sustain competitive advantage (OECD, 2011, 2012).

Statistics indicate that both Chinese organisations and foreign nationals struggle to recruit sufficient managers to provide the leadership needed to grow in this large but ever-changing and competitive environment. China has vowed that by 2020 it will have completed the second wave of its transition from a labour-intensive growth mode to one that is talent-driven, and increased its talent pool of managers (The Central People’s Government of the People’s Republic of China, 2010). For most companies, however, the problem is more immediate and the question for them is: how can we develop a pool of capable leaders in a timely, flexible and cost-effective manner?

The complex and interconnected nature of the challenges and the rate of change identified above make it difficult to separate the actual facts and trends from the hype in discussions of leader development in China. Our aim in this book is to help outsiders understand the challenge of business leadership development and the fundamental issues related to this challenge from insider perspectives.

Thematic focus of this book

A prerequisite to fully understanding leader development is a solid and systematic examination of what business leadership means within a given context. For this reason, we focus on two major themes in the book, namely business leadership (Chapters 2, 3 and 4) and leader development (Chapter 5, 6, 7), and ground both themes in the Chinese context. We often use leadership and management interchangeably in this book, not because we do not acknowledge the differences between the two concepts, but because the distinction between management and leadership is not always clear in practice (Rost, 1993) and companies use them interchangeably (Heifetz, 1994; Nicholson, 2013). Another rationale is to provide a wider coverage than previous studies. We analyse broader issues related to training and development conducted by managers in general, and the learning experience aimed at leadership acquisition and improvement in particular.

Business leadership has generated many explicit theories to describe and explain the behaviours that leaders exhibit. However, empirical research is yet to consolidate these theories into a workable structure that provides guidance on the management of diverse expectations within a globalised business environment (Mintzberg, 2004). Part of the problem is an insufficient understanding and/or application of the fact that leadership is context-bound. Contextual factors such as cultural values, norms, worldviews and lifestyle influence the deliberate and spontaneous level of information processing related to leadership perception, attribution and practice. Implicit leadership theories have developed over the years to investigate covert cognitive models people use to understand and practise leadership (e.g. Lord, Foti and Phillips, 1982; Lord, Foti and De Vader, 1984). However, while there is a growing body of research on explicit leadership theories, the content of implicit leadership theories and how they inform the practice of leadership in China has attracted little attention.

We seek to tap implicit theories of leadership through our analysis of the set of beliefs developed in China about the characteristics and behaviours of effective business leaders. The mental representations of these leaders are influenced by different cultural values and norms, including traditional Chinese philosophical thinking, Communist ideology and Western culture as introduced via several social movements in China’s history. Understanding implicit theories of leadership in China is important, because the evaluation of business leadership is based on the fit between an observed manager’s behaviours and attributes with the perceiver’s implicit ideas of leader-like characteristics (Offermann, Kennedy and Wirtz, 1994).

Understanding of context and implicit models is also relevant to analysis and discussion of the theme of leader development. China does not have the same infrastructure that provides the context for studies of training and development in typical Western countries. For Chinese managers, beliefs about the nature and role of training and development have been shaped by a context different from the context in many Western countries.

Over the past three years, we have been working with managers, exploring strategies for reducing the leadership gap that is restricting many Chinese organisations. Many senior executives would like a greater number of their managers to take the initiative to self-develop leadership skills while deployed in their jobs. Self-development strategies are cost efficient, do not take the manager away from his or her role and can provide more relevant leadership skills for the current environment than some formal leadership training programmes. However, there are many unanswered questions regarding self-development of leadership competencies in China. Why do managers do it? How do they do it? Or more broadly, what constitutes an effective development model of leadership competencies vis-à-vis China’s current transition stage? What is the role of individuals in a transition in which the impetus comes mainly from the state in a top-down authoritarian manner? What conclusions can we draw about the interaction between China’s transition from a centrally planned economy to a market-oriented economy, and the leader development initiated by the individual managers? Our contribution lies in identifying and analysing an alternative form of leader development that is in contrast to the more common formal training approach that is organised, planned and prepared by others rather than the learners themselves.

The acute shortage of capable managers and the urgent need for sustaining China’s growth, coupled with the dynamic and complex nature of a transition the destiny of which is largely unknown provides a rich set of forces for and against self-development. Our data collection and analysis were guided by a series of questions – questions about the strategies managers use to improve their leadership, the foci they target in development activities, and the connection between their experience of pressure, changing attitudes, perceptions of work, and their developmental actions.

Our analytical perspective

Leader development in general, and self-development in particular, are under-explored areas of research in China. To better understand how the self-development of leadership competencies occurs in China, we contextualise self-development within the complex web of economic, social and cultural forces that are both the drivers and the products of China’s transition process. Our general aim is to enrich the understanding of the underlying mechanisms and behavioural manifestations associated with self-development of leadership competencies in China. Specifically, we have several aims, including:

1 to present a theoretical view of self-development that describes the motivations and actions of initiatives in the context of China, including the changes in economic, social and organisational areas;

2 to develop theories about the mediating mechanisms that guide different types of self-development;

3 to present an empirical analysis of the individual characteristics and organisational context in which traditional Chinese values and cultures are embedded; and

4 to identify and empirically evaluate the consequences of self-development and the conditions under which self-development is most effective.

To fulfil these aims, we conducted focus groups, interviews and surveys with over 500 Chinese managers. The comparison and integration of findings from different strategies of enquiry provides a more holistic understanding of business leadership development and adds to the rigour and relevance of conclusions reached.

Our conclusion from the fieldwork is that self-development can contribute to a reduction in the leadership gap in Chinese organisations but there are several enablers and inhibitors that need to be taken into account. By elaborating on these analyses, the book tackles a number of important, but unanswered, questions.

First, how do Chinese managers in a system that is transitioning from a planned economy to a free market economy, view the self-directed form of leader development? Relatedly: have Chinese managers cast off the mindsets of the traditional state-controlled economy in which leader development was given scant attention?

Second, what are the personal and organisational enablers or inhibitors of self-development activities in the Chinese context? This is a question of theoretical significance in that it requires some insight into the underlying mechanisms through which individual contingencies and environmental conditions influence self-development....

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• List of figures
• List of tables
• Acknowledgements
• List of abbreviations
• 1 Introduction: reworking leadership development in the context of China’s transition
• 2 Chinese implicit theories of leadership: traditional roots
• 3 Chinese implicit theories of leadership: transitional context
• 4 Analytical fallacies in the framing of business leadership in China
• 5 The evolution of training and development
• 6 Patterns of self-development: why and how?
• 7 Patterns of self-development: what and so what?
• 8 Concluding remarks
• Index