Cross Cultural Management: An International Journal

Emerald Article: A cross-cultural investigation of work values among young executives in China and the USA Yue Pan, Xuebao Song, Ayalla Goldschmidt, Warren French

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To cite this document: Yue Pan, Xuebao Song, Ayalla Goldschmidt, Warren French, (2010),"A cross-cultural investigation of work values among young executives in China and the USA", Cross Cultural Management: An International Journal, Vol. 17 Iss: 3 pp. 283 - 298 Permanent link to this document: http://dx.doi.org/10.1108/13527601011068379 Downloaded on: 30-04-2012 References: This document contains references to 62 other documents To copy this document: permissions@emeraldinsight.com This document has been downloaded 1827 times.

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A cross-cultural investigation of work values among young executives in China and the USA
Yue Pan
University of Dayton, Dayton, Ohio, USA

Work values among young executives 283

Xuebao Song
School of Economics and Management, Tsinghua University, Beijing, Peoples Republic of China

Ayalla Goldschmidt
IBM Digital Media Solutions Marketing, Raleigh, North Carolina, USA, and

Warren French
University of Georgia, Athens, Georgia, USA
Abstract
Purpose The purpose of the study is to investigate what values are now important to young American and Chinese managers, since they profile the direction in which their country is headed. It aims to explore if the ethical values of young executives in different countries are converging to a common global business culture. It also aims to argue that the individualism-collectivism value dimension by itself does not capture the differences between the Chinese and American sample members. The vertical-horizontal dimension, in contrast, seems to better delineate the value orientations among young executives in the two countries. Design/methodology/approach In this two-phase study, both attitudinal and scenario-based measurements are applied to assess the strength of work value orientations among similar subjects in China and the USA. Findings In study 1, Chinese respondents score significantly higher on a hierarchical-vertical dimension than do the Americans, although the two groups do not differ significantly on the collectivism-individualism dimension. In study 2, which entails resolving an ethical dilemma, the American subjects apply Egalitarianism as their most frequent expressed value, reflecting their horizontal perspective. The Chinese subjects, in contrast, rely strongly on a traditional vertical value system to resolve the ethical dilemma. Although both American and Chinese negotiators show a collectivist as well as an individualist orientation, their focuses are fundamentally different. Originality/value The well-established collectivism/individualism cultural dimension has been heavily used in cross-cultural studies, sometimes without much discretion. This study was undertaken as a preliminary attempt to outline the cultural patterns observed among young managers in America and China. The paper argues that cross-cultural differences underlying ethical conflicts should not be reduced to the single value dimension of individualism/collectivism. Keywords Individual behaviour, Collectivism, Confucianism, Employee attitudes, China, United States of America Paper type Research paper

Introduction
The size of Chinas displacement of the world is such that the world must find a new balance in 30 or 40 years. It is not possible to pretend that this is just another big player. This is the biggest player in the history of man.

The preceding observation by Lee Kuan Yew, the guiding hand behind Singapores economic success, has strong implications for the future of business transactions with the Peoples Republic of China (PRC), and the ethical underpinning of those transactions.

Cross Cultural Management: An International Journal Vol. 17 No. 3, 2010 pp. 283-298 # Emerald Group Publishing Limited 1352-7606 DOI 10.1108/13527601011068379

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Huntington (1996) foresees problems when Westerners deal with the Chinese. He worries about the application of a Confucian ethic in China an ethic that stresses values of authority, hierarchy, the subordination of individual rights and interests. He believes that the Chinese culture is marked with values opposed to those found in the West, particularly those in America. For instance, the goal of maintaining relationships usually takes precedence over deductive reasoning, and even over legal regulations, when the Chinese make business decisions. Cultural differences create challenges for multinational companies doing business in China. For instance, soon after Robust, a Chinese food and beverage brand, and the Danone Group formed a joint venture in 2000, the partnership went sour. The European management of Danone took on a role that was at odds with Chinese business norms. The Chinese executives were used to a centralized (vertical) organizational structure, whereas their foreign partners were relatively more decentralized (horizontal). Coming from a high power distance culture, Chinese managers value authority and adopt the nonparticipatory approach to decisionmaking. Final decisions are usually made by higher level superiors without consulting their subordinates. The conflicts in work-related values were so severe that the five founders of Robust resigned after a major restructuring of the company (He, 2002). Car manufacturer, PSA Peugeot Citroen ran into similar problems in China, which eventually forced the company to forsake its joint venture in 1997 (Sino Foreign Management, 2004). It is well-documented that many of the countries bordering the North Atlantic are characterized by an individualistic value system, whereas the Chinese are considered to be collectivists (e.g. Hofstede and Bond, 1984; Hsu, 1981; Hui et al., 2004; Lee et al., 1994; Oyserman et al., 2002; Singelis, 1994; Trompenaars and HampdenTurner, 1997). To what extent does this comparison still hold true, now that both regions have been impacted by a rapidly globalized business environment? Is the economic reform that has taken place in the PRC since 1979 changing the social value system? Chinas open-door policy, especially in light of recent World Trade Organization acceptance, leaves the country accessible to foreign influences. New value systems and lifestyles may well take shape as China integrates into world markets. Yet, as the cradle of Confucianism, will China hold to its cultural inheritance, a fear expressed by Huntington (1996), and not be swayed by the changing external environment? Of particular interest is what values are now important to younger Chinese managers, since they profile the direction in which a country is headed. It is important to differentiate the behaviors of these individuals from those of older functionaries who are less representative of their countrys future direction. Furthermore, we are especially interested in the values exhibited in a work domain. Are the ethical values of young executives in different countries converging to a common global business culture? How do work values in the PRC compare to those in the USA at the present time? The study described below was undertaken as a preliminary attempt to answer these questions. The study is structured as follows. We first outline the cultural patterns observed among young managers in America and the PRC. Then, we examine the proclivities toward specific cultural values in the two countries through a two-phase study (one study based on attitudinal value measurement, the other on the values underlying the reasoning used to justify a managerial decision about an ethical dilemma). We then conclude with a discussion of the implications of our findings.

Reflections on the value systems in each country Many cross-cultural researchers assume that one of the most informative classifying characteristics for contrasting Western (e.g. the USA) and Eastern (e.g. China) cultures is the widely accepted individualism-collectivism dimension (e.g. Chan, 1967; Tse et al., 1988). Previous research has viewed individualism-collectivism as a single dimension (Aaker and Maheswaran, 1997; Han and Shavitt, 1994). However, more recent research indicates that this construct is multidimensional, and specific dimensions must be identified to account for observed cultural differences (Gurhan-Canli and Maheswaran, 2000; Triandis, 1995; Triandis and Gelfand, 1998). Individualism and collectivism can be categorized as either horizontal (with an emphasis on equality) or vertical (with an emphasis on hierarchy). Triandis (1995) typology highlights four types of cultural patterns: horizontal individualism (the self is independent and is the same as the others), vertical individualism (the self is independent and different from the others), horizontal collectivism (the self is interdependent and the same as the others), and vertical collectivism (the self is interdependent and different from the others). The verticalhorizontal dimension captures the equality/inequality among people. The individualismcollectivism dimension measures the relative priority given to the individuals goals and preferences (Triandis, 1995). Triandis (1995) suggests that vertical collectivism and horizontal individualism are the dominant cultural profiles around the world. But, there may be an evolutionary relation between these two categories, since he also suggests that decreasing external threats move a culture from vertical collectivism toward horizontal individualism. Vertical collectivists see themselves as part of an in-group, but members in the in-group vary in terms of status (Thomas and Au, 2002). This cultural syndrome is characterized by social relationships with an emphasis on communal sharing and ranking authority. Inequality is the accepted norm, and sacrifices for the in-group interest are expected (Thomas and Au, 2002). In horizontal individualism, social systems emphasize both the values of equality and individual freedom (Rokeach, 1973). Collectivism vs individualism in China and the USA It is widely accepted that individualism is emphasized as a core value in American culture. This assumption certainly holds true when Hofstede (1980) classifies his American sample at the high end of his individualism dimension. He attributes this to the mobility and affluence found in the USA. In truth, heterogeneous societies (e.g. the USA) are often found to be individualistic (Triandis, 1995). The Chinese culture, with its roots in Confucianism, emphasizes a persons position in relation to ones social group. Individual identities are defined as part of a network of relations with other people. Although Chinese culture is considered more collectivistic than individualistic, the concern of the Chinese people for collectivistic interests seldom extends beyond their in-group or significant others (Lew, 1998; Tse et al., 1994). Ones need for social affiliations is fully satisfied within already established groups (Hwang, 1987). An ethic of caring, a Confucian demonstration of jen or beneficence, is limited to familial and social networks (Ma, 1988). An ethic of justice, an attribute of individualistic cultures, is also present in Confucian thought. However, it is directed toward the pragmatic goal of achieving harmony. In the past, the selective collectivism of the Chinese has made Westerners attempts to resolve problems with them somewhat difficult (Leung, 1988). Chinese have been suspicious of out-groups with whom relationships have not been established (Yau, 1988). However, the rapid economic growth has changed the country from a traditional

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agrarian economy to an agrarian-industrial one. Such social evolution is likely to bring changes in the personality structure as well as in the social behavior of Chinese people (Hwang, 1987). The transition from a manipulated, planned economy to a more marketdriven economy was accompanied by an influx of Western enterprises, bringing with them new business systems and management behavior once unfamiliar to the Chinese. After China joined WTO in December 2001, the country witnessed more frequent encounters with Western values, beliefs, and customs. As a result, modern (Western) values are beginning to gain acceptance. Work values may be changing, particularly among younger managers, who have grown to adulthood since Chinas Open Door Policy in 1979 (Holt, 1997). Members of the younger generation seem to be more egoistic and individualistic than their elders (Lew, 1998). Some empirical studies have revealed that Chinese values have indeed changed. For instance, Holt (1997) finds no differences between US and Chinese entrepreneurs on the values associated with individualism. Yang (1986) concurs with this assessment. Americans, in contrast to the Chinese, fail to form an in-group-out-group distinction (Probst et al., 1999). However, within what has been assumed to be the highly individualistic American culture, many people appear to be much less self-reliant, selfcontained, or self-sufficient than the prevailing cultural stereotype suggests that they should be (Lew, 1998). Verticality vs horizontality in China and the USA Triandis et al. (1988) note that collectivists prefer a vertical (or hierarchical) to a horizontal (or egalitarian) approach in the decision-making process. Consistent with this notion, Williams (1970) notes that the Americans tend to adopt the horizontal or collegial approach to interpersonal relations, whereas vertical interpersonal relations are pervasive in China. One key element of Confucian tradition is that the stability of society is based on status differential and ordering relationships between people. Society is seen as a hierarchical structure of roles that entails fairly well-established norms governing how people should behave in relation to people in other roles. For instance, junior/subordinate parties owe senior/higher-ranking parties respect and obedience; senior/higher-ranking parties owe junior/subordinate parties protection and consideration (Hofstede and Bond, 1988). A reflection of such unequal relationships in workplace is deference to authority. We do not deny the important role of social hierarchy in contemporary Western societies. However, social hierarchy in the West is seen as more suspect and potentially illegitimate. It imposes on peoples lives, especially if it cannot be clearly linked to individual achievements (Hofstede and Bond, 1988; Wheeler et al., 1989). Chinese managers are more likely to adhere to authority than American managers (Holt, 1997). Compliance with others, especially with seniors or people of a high-ranking position, is more apparent in China than in the USA. In summary, the differences between American and Chinese value systems seem to be real and significant. However, will this cultural divide be gradually narrowing in an age of economic globalization, especially among young executives in these two countries? This perspective is largely overlooked or ignored in previous research. Questions about American and Chinese young managers hierarchical and collectivist value orientations merit investigation. Research questions What values are important to a new generation of Chinese managers? How do values among Chinese managers compare to those of American managers? Are there, indeed,

differences in cultural patterns between younger American and Chinese managers with respect to their work values? Our study does not posit specific research hypotheses. Rather, it is structured to answer the following research questions: RQ1. Does partitioning the individualism-collectivism value dimension by the horizontal-vertical dimension capture current cultural differences between young businesspeople in America and China? RQ2. Are these cultural differences reflected in ethical argumentation? If so, how? We address these questions through a two-phase study. In Study 1, attitudinal value measurements are taken from a sample of American and Chinese businesspeople. In Study 2, we analyze the discourse about an ethical dilemma between a set of American and Chinese businesspeople to pinpoint cultural value differences reflected in their negotiation styles. Study 1: the vertical and horizontal aspects of collectivism and individualism Sample and research instrument A total of 140 businesspeople from the USA (70) and PRC (70) participated in the first study. To compare groups who differ in culture yet are relatively similar otherwise, we recruited respondents from a set of college graduates with business experience who had sought additional executive training within a university setting in each country. In all, 198 questionnaires were distributed, with 149 returned. Nine were discarded because of incomplete responses, resulting in a response rate of 70.7 percent. Of the remaining 140 respondents, 62 (44.3 percent) are women and 78 (55.7 percent) are men, with their age ranging from 24 to 40. The sample we chose is considered appropriate for the study for two reasons. First, the respondents have 3-15 years of work experience. They can provide useful insights into work values espoused by Chinese vs American executives. Second, they represent the emerging managerial cadre in the two countries. Since they are likely to profile the direction in which both countries are headed, it is important to be able to differentiate the behaviors of these individuals from older executives who are perhaps less representative of the future direction of the countries. We used Singelis et al.s (1995) 32-item SINDICOL scale to measure these two dimensions: vertical-horizontal and collectivism-individualism. These joint constructs are considered to be especially appropriate for isolating major differences in crosscultural behavior (Kurman and Sriram, 2002; Nelson and Shavitt, 2002). The respondents rated the extent to which they agreed with the statements on a scale from 1, indicating strongly disagree, to 9, indicating strongly agree. The participants earn four scores that classify them according to two dimensions (i.e. vertical-horizontal and collectivism-individualism): horizontal individualism (HI), vertical individualism (VI), horizontal collectivism (HC), and vertical collectivism (VC). The English version of the SINDICOL scale was used in the USA. For the Chinese sample, the instrument was first translated into Chinese by a research assistant who spoke the native language, and was then back-translated into English by an outside bilingual. The back-translated version was compared with the original instrument. Following a discussion among the researchers, corrections were made to reconcile major discrepancies. Results One way to think of an individuals value orientation is to construct a profile of these four tendencies (Triandis, 1996). For instance, an individual might have a profile such

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as 61 percent HI, 5 percent VI, 24 percent HC, and 10 percent VC. These four tendencies can be combined to generate the individuals individualism-collectivism and horizontalvertical value dimension (readers are referred to Triandis (1996) for an example). To answer RQ1, the individualism-collectivism value dimension, by itself, does not capture differences between the Chinese and American sample members (see Table I). There is no statistically significant difference between the Chinese and American scores on this value dimension. What is more worthy of attention is the equal importance attributed to individualism and collectivism by both the Chinese (MInd 0.5, MCol 0.5, ns) and American managers (MInd 0.505, MCol 0.495, ns). This finding does not match the stereotypical image portrayed in studies of the general populations in the two countries, but does reinforce some researchers (e.g. Holt, 1997; Lew, 1998; Yang, 1986) assertion that the Chinese are becoming increasingly individualistic. The vertical-horizontal dimension, in contrast, captures some difference between the Chinese and American sample members. The Chinese, in line with their Confucian heritage, scored higher on the vertical dimension and lower on the horizontal dimension than did the Americans, as previous research findings would lead us to expect. A greater proportion of Americans, as contrasted to the Chinese, viewed the vertical dimension, especially vertical collectivism, in a negative light. In fact, additional analysis shows that over 33 percent of the Americans rated the vertical values negatively, as contrasted to less than 10 percent of the Chinese sample. Does this emphasis on the horizontal as opposed to the vertical approach to others by younger managers in China, as evidenced by our test scores, hold up under the pressures of resolving difficult ethical conflicts? Schwartz (1996) has shown that general orientations, as evidenced by test scores, are often sacrificed in value tradeoffs when people are faced with specific choices in actual situations. To investigate the validity of our findings, we undertook a follow-up study. Study 2: an analysis of negotiations Sample and research instrument As Gelfand et al. (2007) notice, much of the research in cross-cultural organizational behavior is focused on intracultural comparisons. Far less attention has been paid to the dynamics of culture in intercultural encounters (aka cross-cultural interfaces). The authors call for more research on cross-cultural interfaces. Study 2 is designed to fill that void. Here, we attempt to identify cultural values reflected in ethical argumentation, and see if they confirm those found in the attitudinal value measurement. In the meantime, we examine how cultural differences actually affect intercultural encounters. Our second study was conducted under the assumption of rational decision-making model. That is, according to Tse et al.s (1994) finding, executives will not assume
Cultural values Individualism-collectivisma Nation PRC USA PRC USA n 70 70 70 70 Mean 0.500 0.505 0.521 0.562 Standard deviation 0.039 0.064 0.030 0.052 t 0.484 5.682*

Table I. Means, standard deviations, and t statistics of scores on the two bipolar dimensions

Horizontal-verticalb

Notes: Study 1; *p < 0.01; ahigher value indicates more individualistic (and less collectivist) orientation; bhigher value indicates more horizontal (and less vertical) orientation

different negotiation styles with parties of another culture to seek greater cooperation. Negotiators from different cultures are motivated by the same underlying factors (e.g. trying to achieve a business goal) regardless of the culture of the potential partner. Therefore, they will not adopt behavioral patterns similar to the other party. Hence, we assume that Chinese negotiators cultural values remain intact when negotiating with partners from another culture (i.e. America) and vice versa. Guan and Dodder (2001) found that Chinese visitors to the USA may begin to show different value orientations after they have been away from China for two years. While the negotiations were conducted in the USA, none of the Chinese sample members had been in the country long enough for a natural acclimation of values to occur. To capture the negotiators values, the scenario judgment method was used. This research method has been validated as a tool in such situations (e.g. Tse et al., 1994) and complements the survey in the previous study. The participants were asked to roleplay as a managing engineer of a nuclear power facility in their home country (e.g. Chinese participants role-played managing engineers in a Chinese nuclear power facility). The scenario is described as follows:
You are the managing engineer of a nuclear power facility. Your operations engineer, Eric, comes to you disturbed about a problem. The backup generator, which would pump the water to cool the nuclear fuel if the main generator failed, broke down when tested. Eric fears a nuclear catastrophe if the main generator should fail, although he admits the odds of the main generators failure are very remote. The rules say that if either the main generator or the backup generator breaks down the whole nuclear generation operation must be closed. Eric says, Rules are rules! Society needs rules or else there would be chaos. He is a very religious person who believes that morality is to be strictly followed. He threatens to go to the Nuclear Regulatory Commission (NRC) if you dont shut the nuclear reactor down now. Last weeks high temperature was 12 degrees. This cold weather is expected to last five more days. All the other power plants in your power grid (the area from which you can borrow power) are operating at the maximum. There is no power to borrow. Your boss is out of reach on vacation. You are in charge of all decisions. Statistical projections show that five people will freeze to death if you close for the two days it would take to make repairs. The NRC will fine the firm which breaks its rules. It will also bring to trial those people responsible for breaking rules. Those convicted in court will be forbidden to work for any firm which holds an NRC license. Safety is important to the NRC. No extenuating circumstances have ever been accepted in the NRCs court cases to prevent conviction. If convicted, you will serve one year in jail and two years on probation. Your main generator is only one year old and running smoothly. You believe that if the facility shuts down, you will be made the firms scapegoat and fired. You will be fired because of the loss of life and property caused by the unusually cold weather. There are no other jobs you are qualified for. Your sick spouse and sick children depend on your income and company insurance. You have no savings, no friends to turn to, and no family members who can help. You have used up all your vacation time and sick leave. Your contract says that all resignations must be submitted two weeks in advance. Even if you walked off the job, you would be held responsible for all decisions made about the plants operations for the next two weeks.

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Forty business executives, 20 Chinese from the PRC and the rest Americans, took part in the study. All participants (20 women and 20 men), with their age ranging from 25 to 38, were attending an advanced business training program in an American university at the time of the study. Participants were asked to respond and negotiate using the information on hand. Every American was paired with a Chinese negotiator. The

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negotiations were taped. After the negotiation, participants completed a short questionnaire that contained the SINDICOL scale. As mentioned earlier, cross-cultural difference in conflict management style should not be reduced to a single value dimension running from individualism to collectivism. In this study, Schwartzs cultural taxonomy is used to classify values. Schwartz acknowledges anthropological constructs which suggest that human values are culture-based. His SVS scale yields the following three bipolar dimensions of culture: Embeddedness-Autonomy, Harmony-Mastery, and Hierarchy-Egalitarian (Sagiv and Schwartz, 1995; Schwartz and Ros, 1995). Embeddedness-Autonomy describes cultures in which one is (or is not) viewed as an autonomous entity who finds meaning in ones own uniqueness, who seeks to express ones own internal attributes. Harmony-Mastery describes the degree to which one emphasizes attributes such as ambition, success, daring, and competence. The Hierarchy-Egalitarian dimension describes power differences, and the degree to which a society relies on hierarchical systems of ascribed roles. It is this third dimension that carries strong ethical connotations. Specifically, the Egalitarian pole of the dimension can be defined as a voluntary commitment to social responsibility and the welfare of others. This pole is at the heart of the approaches to ethics taken by many in the West. Confucian ethics also includes this dimension, but narrows social responsibility to those with whom one comes in contact. In addition, Confucian ethics, in contrast to most Western ethical theories, also takes under its domain the other pole of the dimension, Hierarchy, by emphasizing the responsibility of living according to hierarchical roles. Triandis (1995, pp. 103-5) felt that these three cultural dimensions as identified by Schwartz fit well with his own partitioning of the individualism-collectivism dimension by the horizontal-vertical dimension. The statements uttered in each of our 20 paired negotiations were analyzed and coded by five independent researchers as to how those statements embodied Schwartzs value classifications. The analysis group consisted of one Chinese, two Americans, one German, and one Israeli who had worked under a member of Schwartzs values research team. During each analysis session, the researchers listened to the recorded negotiations. After each negotiation was completed, researchers talked about their coding and verbally exchanged their thoughts on the negotiation. Any differences were subsequently re-analyzed and resolved. Because we were only applying qualitative codes to the data (e.g. values identified from ethical reasoning) and not seeking to apply any quantitative assessment (such as effect size or statistical significance), and because of the relatively low number of interpretative coding categories, reliability problems were minimized. Results Study 2 uses content analysis, one of the dominant methodologies used in communication research (Frey et al., 1991; Krippendorf, 1980; Zhao, 2000) as the primary research method. Here, we do not aim to test statistical significance, with a relatively small sample. Instead, we focus on identifying the values reflected in respondents ethical reasoning. Table II shows the percentage scores for the four value dimensions (i.e. the score on one value dimension over the sum of scores on all four dimensions). As is shown in the table, the average group SINDICOL scores are fairly similar in both of our studies. This suggests in a way that sample selection bias is not of a major concern in this study. Averages, however, can hide individual preferences in decision processes, especially when decision processes are applied to difficult problems. On the other hand, an in-depth analysis of the ethical reasoning used to

justify a managerial decision may be more revealing. The ethical choice posed to both sets of subjects in Study 2 was framed as a difficult problem with negative personal consequences for either of the initial decisions. There was no easy answer, since the dilemma was created to encourage reflection upon and application of personal values. Table III reports the frequency counts of subjects value rationales using Schwartzs cultural taxonomy, based on the coding of the five judges. The American negotiators applied Egalitarianism (the dimensional pole with the strongest ethical connotations) more frequently during their negotiations than they did any other of Schwartzs cultural values, reflecting their horizontal perspective. This value shows up in 15 out of the 20 Americans. In the ethical dilemma that the case presents, the American negotiators seemed somewhat more likely to opt to keep the reactor running. They appeared to be motivated by the belief that the spirit behind the NRC rules is to save lives, and keeping the reactor running achieves this goal. For them, the immediate loss of five peoples lives after shutting down the reactor was a very perplexing thought. As one American negotiator puts it, the immediate damage of five peoples deaths outweighs breaking the rule. One focus of the American negotiators was the discussion of actions that save the lives of weaker people in their society. Most of the American negotiators showed a deep concern for the welfare of these people. They were willing to make decisions that involve personal sacrifice (e.g. losing their job, going to jail) for the good of these people. They seemed voluntarily committed to social responsibility and the welfare of others with whom they didnt necessarily have a direct relation. This might be a little surprising, considering the stereotypical image about Americans is that they are self-centered, largely interested in pursuit of personal goals. Though less frequently cited than Egalitarianism, Mastery (which reflects individualist perspective) and Embeddedness (which reflects collectivist perspective)
Study 1 SINDICOL Mean scores (%) 26 28 24 22 26 28 24 22 Study 2 SINDICOL Mean scores (%) 25 29 22 22 28 28 25 21

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Dimensions Horizontal Individualism Vertical Individualism Horizontal Collectivism Vertical Collectivism

Nation PRC USA PRC USA PRC USA PRC USA

Table II.
Mean percentage scores for the four partitioned dimensions

Mastery n (%) PRC USA 6a (30b) 8 (40)

Egalitarianism n (%) 7 (35) 15 (75)

Embeddedness n (%) 12 (60) 9 (45)

Harmony n (%) 1 (5) 2 (10)

Hierarchy n (%) 11 (55) 5 (25)

Autonomy n (%) 1 (5) 7 (35)

Notes: aThe number of negotiators who exhibited a certain value in their moral reasoning; bthe percentage of negotiators, within each culture, who exhibited a certain value in their moral reasoning

Table III.
Cultural value reflected in the negotiations

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were two other commonly articulated cultural dimensions reflected in the comments of the American negotiators. Some Americans justified their decisions to break the rules by emphasizing individual freedom to make choices instead of just following laws. This is in line with Cavanaghs (1976) contention that autonomy is of prime importance to Americans. The emphasis on individual freedom was less evident in the statements of the Chinese negotiators. The most frequent cultural dimensions that emerge from Chinese negotiators statements were Embeddedness (which reflects collectivist perspective) and Hierarchy (which reflects verticality). The Chinese negotiators main concern was their families security and well-being, following the advice of Confucius in the Analects (1:2; Table IV), compared to the Americans main concern about the weak in the society. Although both American and Chinese negotiators showed some collectivistic nature, their focuses were fundamentally different. For Americans, concern for the welfare of other people, especially those who are unprivileged or disadvantaged, was not uncommon. Their sense of belonging was very often associated with a group larger than their immediate family (e.g. community). As one American stated, we have commitment to our community. Compared to Americans, the Chinese definition of in-group was much more restricted. The collectivistic nature of the Chinese is reflected in the Chinese family and kinship system (Hsu, 1981). The primary concern of most Chinese is to protect and enhance the interests of their private kinship (Hsu, 1981). Though to a lesser degree, individualist values (e.g. Mastery, Autonomy) also arose in the Chinese negotiators comments. In the negotiations, the Chinese were more likely to rely on their superiors when they felt uncertain about a decision, a phenomenon reflecting a vertical value system. They expected their superiors to teach them what to do, as well as guide them. This hierarchical perspective is best exemplified in one Chinese negotiators comments: Im your advisor. Ill take full responsibility for it [. . .] You can take a vacation for five days (She was supposedly talking to Eric, the engineer). This type of overriding attitude may be considered patronizing to many Americans. However, its quite common and acceptable in China, where authoritarian behavior by superiors and passive obedience by subordinates are expected. Prior research suggests that such paternalistic leadership has a positive impact on employee attitudes in vertical collectivistic cultures (Aycan, 2006; Farh and Cheng, 2000). Western managerial
Book and line number in the Analects of Confucius (1938) Benevolence Caution Consistency but not blind fidelity Cordial, Frank, Courteous, Temperate, Deferential Courtesy, Tolerance, Good Faith, Diligence, Kindness Dont govern by regulation and punishment Economical, Punctual Faithful to superiors Harmony modulated by Ritual Humaneness Kindness Loyalty, Integrity, Tradition Moderation Never do to others what you would not like them to do to you Trustworthy A6:28 A7:10 A15:36 A1:10 A17:5 A2:3 A1:5 A1:8 A1:12 A1:3 A1:6 A1:4 A6:27 A15:23 A1:6

Table IV. Confucian virtues

philosophy, however, emphasizes that individuals be responsible for all decisions by themselves. Turning to superiors for resolutions for ordinary conflicts, particularly task-related conflicts, may signal incompetence at ones level of responsibility (Tse et al., 1994). It was anticipated that American negotiators would justify decisions about an issue with ethical ramifications more by a reliance on rules than by evaluating contextual factors (Keegan, 1989; Kim et al., 1998; Onkvisit and Shaw, 1993). However, we did not find strong support for this assumption. Among the American sample members, as many opposed the NRC rule as supported it. To many Americans, the spirit of the rule was more important than the letter of the rule. They justified their decisions to break the rules by emphasizing individual freedom to make choices instead of just following laws. They seemed to be confident that they could strongly influence and manage the outcome of their actions. On the other hand, Chinese negotiators seemed to feel that the rules absolved them from responsibility in the likely deaths of five people, resulting from the elimination of nuclear power. A reliance on rules illustrated the Chinese negotiators strong respect for authority. Morality in East Asia is linked to adhering to a rule (Triandis, 1995) as long as that rule is accepted by those with whom the person is in frequent contact, e.g. family, friends and business associates. This is somewhat akin to Kohlbergs stage 3 of moral development (Kohlberg, 1980). This is also consistent with Mas (1988) conjecture that stage 3 (adopting the moral values of ones reference group) may well be the highest and most desirable stage of moral development in much of Asia. The American negotiators were more inclined toward a style of assertively competing with the other person to see who could convince the other of their preferred resolution of the conflict. They also tended to dominate the conversations offering many more comments than the Chinese. This finding could be well explained by the difference in English language ability between the two groups. However, as the initial position of the Chinese negotiators tended to prevail in the final resolutions to the posed ethical dilemma, we feel that the discrepancy in language fluency did not play a critical role in determining the negotiation outcome. The Chinese sample, for the most part, showed a much greater tendency to be open to compromise (the Confucian goal of harmony) than did their American counterparts. Interestingly, when resolutions were reached, as they were in 10 of the 20 negotiations, the resolution usually appeared to be closer to the original Chinese position than to the American position. General conclusions Our research findings question the adequacy of the individualism-collectivism dimension alone to account for managerial decision-making by the Chinese and US sample members. Our study is not the first to challenge this cultural dimension. Similarly, Holt (1997) did not find differences between the US and Chinese entrepreneurs on values associated with individualism. Schwartz and Ros (1995) argue that value differences (in terms of the individualism-collectivism dimension) within the West are as large as differences between Western nations and presumably collectivist East Asian nations. Our study detects similarity in the collectivistic orientation of both countries. This suggests that metropolitan Chinese executives are likely to hold values that are similar to US managers, yet are also likely to be culturally bound to value family security (Embeddedness) and deference to superiors (Hierarchy). In the negotiations, tradition did not appear to portray the reasoning used by the American and as much as it did the Chinese subjects (again, see 1:4 in the Analects). The individualistic aspect of American values was not prototypical individualism,

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however, because of their observed emphasis on Embeddedness values, the value types central to collectivism. While more Chinese than Americans expressed values under the Embeddedness dimension, a minority did appear to express opinions based on Autonomy and Mastery, value types central to individualism. We suggest that the vertical-horizontal dimension might be more appropriate than individualism-collectivism to differentiate the work value profiles we observed in young executives in these two countries. Our Chinese participants are arguably among the most Westernized members of their society, and yet they still differ markedly in this value from the US participants. Although recent research (Woodbine, 2004) questions younger managers reliance on Confucian values, we found that the Confucian impact on the importance of hierarchy and status differential still persists. This conclusion coincides with that of Bond (1991), based on a value survey which he created specifically for citizens of the PRC. Although our participants are more individualized than their older generation, they still exhibit aspects of the Confucian tradition, which is biased towards obedience and against upward feedback. In China, hierarchical allegiance to authority is more likely to prevail, and a sense of compliance still endures. When confronted with a lose-lose ethical dilemma, young Chinese managers seemed to conform to a vertical collectivist mode of reasoning, a behavior in accordance with the research of Trompenaars and Hampden-Turner (1997). They were also likely to reverse the importance of the three decision criteria mentioned earlier and rank rules ahead of reasoning and relationships. As China moves toward a market economy at least towards a form of capitalism constrained by political ideology convergence of values associated with business practices may occur. For instance, in our study, we found that our younger sample of Chinese was more aggressive and competitive in their negotiations than the timehonored cultural stereotype had led us to believe. It would be a mistake, however, to conclude that these findings indicate the traditional Chinese value orientations have been completely eradicated in the transition to modernization. Our findings suggest that even the most cosmopolitan sectors of Chinese society have not completely converged in their values and managerial behaviors. This coincides with Matthews research results in which it was concluded that Basic Confucian ideals and values have not changed, only altered or adapted to fit the newer model of the political state (2000, p. 121). Implications Shen and Jiang (1985-86) give an interesting perspective to ethics in China when they quote Engles as saying that there is no lasting morality. As international business cooperation intensifies, core values in China may change in an unforeseeable way. For instance, Chinese managers are more likely to become Western-oriented (e.g. individualistic) since they are exposed to much more foreign influence than their less cosmopolitan fellow countrymen. However, as our study shows, Chinese executives do not necessarily follow a Western model of individualism. They still maintain a portion of their Confucian culture (e.g. deference to authority). Tradition and Western thought seem to be two cultural influences that operate within contemporary Chinese culture, a phenomenon dubbed crossvergence by Ralston et al. (1993). Crossvergence does not mean that the Chinese adopt Western values, but that they internalize some aspects of Western individualism into their Confucian-based value system (Ralston et al., 1993). They develop a unique perspective that possesses facets of both cultures. The Chinese government has sanctioned the establishment of over 100 Confucian primary schools, in part to reemphasize communal values in the face of a growing

sense of materialism. While there may be a new emphasis on moral education in the PRC (Li et al., 2004), it will take a long time before it is reflected in managerial behavior. Due to their increasing role in a globalized economy, the ethical orientation of Chinese businesspeople is changing, but changing slowly (Islam and Gowing, 2003). Currently the economic stratification in the PRC is such that for 80 percent of the population, economic survival strongly influences business decisions. This fact may account for the reliance on official rules that our Chinese sample expressed in our lose-lose ethical dilemma. Even if the managers with whom a Westerner deals are in the top (20 percent) economic stratum, those managers are responsible for employees who may well be in the lower 80 percent. That responsibility may confine practicing the Confucian core value of jen (humaneness or benevolence) to those in the firm, to the detriment of outside (foreign) business partners. Jen stresses on the maintenance of interpersonal harmony by following the principle of respecting superiors (those above one in the hierarchy) and the principle of favoring the intimate (those with whom one has a blood relationship) (Hwang, 2001). In our study, we observed an emphasis on these principles in the Chinese negotiators. Habermas (1979) claims that a successful resolution to ethical arguments is built on a mutual comprehension of values. Probing for and listening to the rationale behind their Chinese counterparts decisions can provide Western businesspeople with potential grounding for alternative courses of action, based on secondary as well as primary values. Interpretation of the results of that listening may not always uncover shared values, but it should, through the tradeoff process, reveal which values are not in direct conflict (see Schwartz (1996) for a listing of potential value tradeoffs upon which a successful negotiation can be built). In phase 2 of our study, an undeniable majority of the resolutions to the posed ethical dilemma were closer to the position originally chosen by the Chinese managers, not that of the American managers, due in part by exhibiting the Confucian traits of listening, discipline, flexibility and self-control. Those are Confucian traits that could prove beneficial to Western businesspeople to emulate in negotiations with their Chinese counterparts.
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