ehavioral sciences has been to focus on values (Bond, 2004). According to Kluckhohn (1951), “A value is a conception, explicit or implicit, distinctive of an individual or a group, which influences the selection from available modes, means and ends of action”. Hofstede’s (1980) finding of the four dimensions has encouraged researchers to study the effect of different cultures on management. Verburg et al. (1999), for example, who published a comparative analysis of the practices in industrial enterprises in China and the Netherlands, concluded that in China, the style of management is mainly influenced by Confucian values, while the Netherlands is strongly influenced by Western values. Such differences were most evident in the use of rewards, performance appraisal and career development.
Bae, Chen and Lawler (2000) examined Multi National Corporations (MNCs) in Taiwan and South Korea. They found that American sectors generally have “make-organic” HRM strategies while Japanese sectors have more “buy-bureaucratic” HRM strategies. As used in their research, the “buy-bureaucratic” HRM system is equivalent to “cost reduction” or “control” HRM systems, while a “make-organic” type of HRM system is equivalent to “commitment maximizing” or “high performance work systems” (Arthur, 2002; Pfeffer, 2005; Walton, 1985).
With the increasing importance of China and the Chinese-dominated Asian countries in the business world, more researchers started to focus on the influence of Chinese culture and Confucian values on business management. Until the 1980s, Western researchers in journals such as The Economist and Asia Week often proposed that Confucian values were closely linked to feudalism and were an explanation for China’s backwardness in living standards, technology for example. A lack of individual initiative, a reluctance to embrace constant change and the reliance on communal authority were then thought to be obstacles to the dynamism necessary for development (Tu, 2004). From the findings shown above, Confucian values have had a positive role to play in the success of the countries influenced by the values.
However, there are still issues on the “complete” concept of Confucian values to be used for future studies and whether there is indeed, a relationship between economic development and Confucian values. This disagreement amongst researchers arguing for and against the right concept to be used and the existence of Confucian values’ influencing economic development, indicates that a study such as this may be helpful in seeking to clarify the issues.
Furthermore, whilst there has been much research on the impact of Confucian values on economic development since Tu (1991) such as Chan and Cal (2002), Yeung and Tung (2004) and Villegas (2000), there has been little research on the impact of Confucian values on HRM practices and corporate performance.
1.2 Research Problem
For the past two decades, up until the Asian turmoil of 1997, Asian economies experienced the fastest growth in the world (Tu, 1991). This led to considerable attention being focused on the Human Resource Management (HRM) practices and corporate performance of Asian businesses (Chong & Jain, 1987; Shaw, Tang, Fisher & Kirkbride, 1993). The phenomenal economic success of the “east dragon” has often been attributed to the influence of Confucian-cultural values, which emphasize the need for hierarchical relationships, the concern for harmony, the imp
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