On the Development Orientation of Chinese Corporate Culture

On the Development Orientation of Chinese Corporate Culture

－Comparison Between American and Chinese Corporate Culture Which May Affect Chinese Corporates

1. Introduction. 3
2. About corporate culture. 4

2.1 What is corporate culture?. 4

2.2 Functions of corporate culture. 5

3. Characteristics of American corporate culture and Chinese corporate culture. 6

3.1 Characteristics of American corporate culture. 6

3.1.1 Characteristics of American social culture. 6

3.1.1.1 Individualism and worship of money. 6

3.1.1.2 The spirit of venture and pioneer 7

3.1.1.3 Continuous innovation. 8

3.1.1.4 Freedom and equality. 8

3.1.2 Characteristics of American corporate culture. 8

3.1.2.1 Innovation. 8

3.1.2.2 Customer orientation. 9

3.1.2.3 Emphasize quality. 10

3.1.2.4 Encouraging risk taking and emphasize teamwork spirit 10

3.1.2.5 Employment, promotion and compensation. 11

3.2 Characteristics of Chinese corporate culture. 12

3.2.1 Chinese traditional social culture. 12

3.2.1.1 Collectivism.. 12

3.2.1.2 Lack of enterprising spirit 12

3.2.2 Characteristics of Chinese corporate culture. 13

3.2.2.1 Innovation. 13

3.2.2.2 Focus on group. 13

3.2.2.3 Neglect of customer and product quality. 14

3.2.2.4 Employment, promotion and compensation. 14

4. Comparison between American and Chinese corporate culture which Chinese. 15

corporates may use for reference. 15

4.1 American enterprises greatly emphasize on innovation, which comes from their traditional admiration of taking risks and pioneering spirit. This has great effect on their success. Chinese enterprises should encourage their employees to take risk, because innovation is the result of taking risk. It can help Chinese enterprises open a new market and maintain the market share. Haier group, one of Chinese successful enterprises, has known that innovation is one of the key factors for an enterprise’s long-term development and has its own understanding for innovation. 16

4.2 American enterprises are customer-oriented and highly focus on quality. They believe that only when a business wins customer’s satisfaction and only when it is able to provide superior quality good and service, can it win in market competition and has long-term development. On the contrary, there are still many of Chinese companies neglect their customers and product quality. However, Haier has realized this matter and began to focus on customers’ satisfaction. 17

4.3 American business emphasizes on individual. They pay great attention to the personal development. They bring the competition and chances to employees. Everyone is under huge pressure and face great opportunities with short employment, quick promotion and large compensation difference. Every one tries his best to have best performance. As a result, people’s potentials are brought into a full day. This kind of management is an effective way to use employees’ talent. On the base of this, Haier created a well-known management method, which is called “OEC” (Overall every control and clear). According to “OEC”, everything should be done and every object should be used well. Everyone’s responsibility is very clear. Each employee know clearly that what he should be done, how much he should do, which standard he should follow and what result he should reach everyday there is a kind of board hung on in the workshop, which used to descript employees’ responsibility and the scores they get by fulfilling these responsibility. Those score is connected with the employee’s salary. This management method not only cuts down waste and loss, but also makes responsibilities and performance clearly. 19

4.4 American companies pay more attention to attract talent people to work with them. They treat every employee equally and offer fair chances for their promotion. They connect employees’ performance with their compensation. Haier has a good performance in this field. For example, the employment and promotion method of Haier is “Do not judge the worth of a horse by merely looking at it. Let horses compete with each other.” Promotion depends on competition. Haier provides chances of promotion for every type of employee. If one is talent, he can be promoted from a technician to a senior engineer. If he thinks he is qualified to be a director, he could apply for the position. Also, if one is not fit to the position and fails to have good performance, he would also be replaced. 21

4.5 As for Compensation, it is mainly connected with employee’s capability and position. This is different from that of Chinese enterprises. In most Chinese enterprises, compensation is equal and seldom connects with personal ability and performance. This can not arouse the enthusiasm of employees. However, Haier is an exception. He connected compensation with job performance and market effects. For example, the compensation of staff in R&D department is connected with the market effect of their research and development results. In computer department, haier learned from foreign high tech companies and carried out stock-holding system among its technical staff. 22

4.6 The values like openness and teamwork are also worth to learn. American companies appreciate openness and teamwork spirits, but very few of Chinese companies pay attention to this aspect. Chinese need to be more open to communicate, to learn and foster teamwork spirit and teamwork awareness. 22

5. Conclusion. 23

References. 25

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