Diminishing differences between East and West businesses

Lynda Gratton is Professor of Management Practice at London Business School, and writes regularly on the future world of work at her blogsite. She does a lot of work internationally, and is currently completing a global research project on key issues related to the future of work.

Her latest blog deals with perceived differences between how “west” and “east” businesses are run and managed. She makes some excellent points, indicating that on one hand multinational companies are becoming more and more alike, but that there are still such distinctive local business practices that it is almost impossible to generalise in any meaningful ways about global business practices. Read her blog entry at her site, or an extract below.

Asia and the West Differences?

The four reasons why it’s a tough question

As I move back and forth from Europe and the USA, to Singapore and India – one of the questions I encounter is ‘what are the differences between Asia and the West?’ The subset of this broad question is– are employees different (more cooperative, more skillful, more educated, more determined?) – are leaders different (more authoritarian, more inward looking, more specialized?) – are companies different (more hierarchical, more global, more innovative?) This question becomes ever more crucial as we look forward to the next couple of decades.

This question of Asia and the West arose again as we launched the Pan-Asian Hub of the Future of Work Consortium in Singapore this week. With over 50 people at the launch and another 60 expected at the London launch in November, this is a great crowd to play this question through.


But the more I get to think about the future of work – the less I can really answer this question of Asia and the West without falling into old stereotypical responses. It’s becoming increasingly clear to me that one of the profound impacts of the Five Forces we are exploring in our research, is that trends such as ever increasing technology and globalization are making it almost impossible to make any broad statements about the difference. Here are four reasons why:

Multinational Champions. Across Asia we are seeing the emergence onto the world stage of the multinational champion able to fend for itself in this world stage. Whether it’s Wipro, TCS or Infosys in India; Singapore Airways and Olam in Singapore; or Lee & Fung and Nanjing Automobile Group Corporation in China, these companies have world-class leaders, world-class systems and world-class processes. They are barely indistinguishable from their Western competitors and each have their own unique ‘signature’ that goes way beyond any Asian stereotype.

Global Talent Pools. It’s clear to me that the most talented Gen Ys in India, China or Malaysia are nearer in ideals, values and mindset to their peers in California, Moscow or Munich … than to their own parents. This is the world’s first truly ‘joined up’ global generation with skills and values that span the world. So you thought that ‘work-life balance’ was a western phenomenon of Gen Y? Then talk with the youngsters in Mumbai and you will hear many of the same issues. Technology and globalization has connected this generation to such an extent that to talk of differences is to miss the enormous similarities.

Regional Differences. Demography plays a key role in our research on the Future of Work – both in terms of the creation of talent pools and consumers, and indeed with regard to aging and pensions. With regard to demography, one of the Asian stereotypes I hear is that ‘ Asian families are bigger’. Well yes, they are in rural India (though rapidly declining) – but they are not in Japan, and certainly not in China. Or a western stereotype such, as ‘western managers are less hierarchical than their Asian peers’. Well perhaps in Finland and some UK companies, but not in many German or French companies that stick resolutely to their hierarchies. Broad sweeps – such as ‘Asia’ or ‘The West’ are just too general to pick up the huge variation between countries, and even within regions.

Families, Governments and Local Companies. Finally, it’s really hard, even within a single region, to make any broad sweeping generalization about ‘ leadership capabilities’ or ‘management practices’. The reason is simply that companies in the same location come in so many different types and varieties. Take family firms for example. Japan and Europe have some of the oldest family firms in the world, where resources have been carefully handed down for centuries. These family firms, which are prevalent across Asia – just as they are in the USA (Mars or Cargill for example), and Europe (Fiat or Banco de Santander) have typically their unique governance structures, managerial practices and resource allocation measures. They are different from the ways that state owned companies are lead and governed. The implication is that even for firms within a single location, the history of the firm is likely to play an even greater part than where it is located.

It is of course attractive to fall back on broad generalizations, particularly those associated with ‘Asia’ and ‘The West’. But as we learn more about the variety within regions and countries, these broad generalizations really have very little foundation. So much so, that when people ask me ‘what are the differences between Asia and the West’ I end up looking rather blank and saying ‘well it depends’

Am I being particularly blind about this? Are there differences between these parts of the world that you think hold up to scrutiny – I’d love to hear your views.

Source: Future of Work blog

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