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WEEK 4: International Management: Focus on Asia, Regionally Unique…
WEEK 4: International Management: Focus on Asia
Reality of International Management
ongoing & increasing globalisation
increase competitiveness & survival
blurring of international borders
Diversify or Die
Not taking advantage can cause organisations to stagnate
Management in Asia
home to 4.4 billion people (approx. 60% world population)
accounts for 40% of the global economy
accounts for 1/3 of total Foreign Direct Investments (FDI)
rising middle class
size of middle class in Asian predicted to double by 2030: > 3 billion
Characteristics of WESTERN Management
Individualist
Focus on individual outcomes
Environment typically competitive
Early adopters & proponents of
capitalism
push towards right-winged agenda :
Short-termism
forgoes long-term goals
Limited hierarchy
Merit-based pay and promotions
Shareholders - primary stakeholders
Characteristics of EASTERN Management
Collectivist culture
Goals of group prioritised over and above that of any individual
Multiple equally important stakeholders
Interest of employees, competitors, suppliers and all the rest are managed equally
Seniority-based
Denoted by authority and status
Long-termism
Short-term goals being subjugated under the longer term objectives
Reluctant followers of capitalism
Economics are shifting to the right, but still stagnant
Steep hierarchy
Great power distant
Formal status positions
Rigid reporting structures
Characteristics of EAST-ASIAN Management
Support of
long-term planning
and risk minimisation
Through
diversification
Closely linked with ruling political elite
Social & business relationships
critical for success
Trust is key
Networking is important
Historically, East Asian management involves significant state intervention
Partially in terms of price controls
Growing focus on Intellectual Property (IP) protection
Underrepresentation of women
in labour force
Regionally Unique Managerial Implications
CULTURAL Factors
Confucianism
High morals, ethical conduct and loyalty to others are stressed
Three teachings -
loyalty, reciprocal obligations, and honesty
May lower cost of doing business
Emphasis on education
Particular focus on hard and technical skill development
Value hierarchy / seniority
Those in authoritarian positions must be treated with the utmost respect
Relationships important
Notions of value networks is increasingly important
ECONOMIC Factors
Rising powerhouse of global economy
Embracing
capitalistic pursuits
, despite limited political freedom
Privatisation
of previously state controlled entities
reflects more Western organisational structures
Growing
income gaps
within countries
Reflective of the rising middle class and the shift away from communist economic systems
POLITICAL Factors
Tension
within East-Asia due to shared complex history
Close relationship between political and business leaders (often consisting of men)
subjugates women and their potential in the workforce
Protection of IP - ownership & enforcement
Highlights the prerogative to protect ownership and enforce the same
Push towards
anti-corruption practices
as well as
protectionism