The West Underrates China's Managers at its Peril

Last Updated Jun 24, 2008 10:44 AM EDT

UK managers underestimate the skills of their Chinese counterparts, says Management Issues, reporting on the Institute of Leadership and Management's report, 'Global Management Challenge: China vs the World'.

The western perception of Chinese management is outdated, says the ILM -- we see China's as a place where long hours and low costs prevail and management is authoritarian. But Chinese managers are highly principled and consider themselves good motivators who are outcome-focused team players.

What's more, China is starting to develop a "distinctive and highly effective management culture" that could result in businesses that leave the west in their wake, doing for China what techniques such as 'kaizen' did for Japan.

"The similarities with post-war Japan are uncanny," says David Pardey, the ILM's senior manager, research and policy. If so, western businesses need to up their game or find themselves outstripped in the longer term.

Chinese managers are generally far more educated and ambitious than those in the west, and in-house training is taken seriously -- telecoms giant Huawei has its own university.

The 'Chinese way' of management draws on western management models but is binding them with its own culture to create a new practice.

The traits most valued by Chinese managers reflect this:

  • Knowledge, wisdom and the ability to learn.
  • Taking responsibility.
  • Teamworking skills.
"The emphasis is on 'communitarian' values, discussion and consensus," says Pardey. "Decisions emerge, rather than being made."

What appears to western eyes as a reluctance to make decisions is simply a result of this consensual approach. What's more, because everyone's been consulted on a decision, they are more likely to buy into it.

The management model also focuses on long-term results. "There's a strong emphasis on relationships and not allowing short-term setbacks to deter a business from its end goals, whereas the Anglo Saxon model is much more short-termist," says Pardey.

He cites China's barter-style investment in Nigerian oil as an example -- it's willing to shoulder an initial loss for a bigger gain in the long term.

This is where western complacency is dangerous. Chinese businesses may not be immediate threats to their western rivals, but in 10 years, they will have deep foundations that guarantee success.

The ILM research also claims western managers tend to be slower to identify areas for improvement than the Chinese, a trait that must change.

Says Pardey: "We have got to learn and we've got to innovate. The UK's strength is in risk-taking -- culturally, it is more prepared for innovation. But not enough UK organisations are at the leading edge."