Indigenous management research.
| Verfasser | Holtbrugge, Dirk |
| Posten | GUEST EDITOR'S INTRODUCTION |
Abstract
* While the last years have witnessed a tremendous economic boom in many emerging markets around the world, the knowledge of management practices in these countries lags behind their growing relevance in the world economy. One reason for this is that concepts, such as guanxi. jugaad, ubuntu, and blat, are not adequately reflected by traditional Western management theories.
* We call for more context-specific research and for drawing on indigenous thought in developing new theories that do not only help to better understand management practices in emerging markets, but contribute to global management knowledge as well.
* Examples of indigenous management concepts are illustrated and adequate context-sensitive research methods, such as locally-meaningful constructs and measures, participatory research, storytelling, and visual ethnography, are discussed. Moreover, we provide an overview of current research and conclude with major implications for indigenous management research.
Keywords: Indigenous management * Cross-cultural management * Emerging markets * Research methods
Introduction
The last years have witnessed a tremendous development in many emerging markets around the world. According to a study of Goldman Sachs, China will become the largest economy in the world by 2040 (Wilson and Purushothaman 2003). India, Russia, and Brazil are expected to grow at considerably higher rates than Western industrialized countries as well. As a result, the accumulated GNP of the four BRIC countries Brazil, Russia, India, and China is likely to exceed that of the G7 countries USA, Japan, Germany, France, UK, Italy, and Canada within the next 20 years.
The unprecedented economic growth of emerging markets is accompanied by a sharp increase of foreign direct investment (FDI). Not only have large multinational corporations (MNCs) established foreign subsidiaries in emerging markets, but also many small- and medium-sized companies have too. However, the BRIC countries have not only become very attractive locations for inward FDI, but are also successfully investing abroad. In 2011, they accounted for nearly 10% of global outward FDI (UNCTAD 2012). This often takes place in the form of mergers & acquisitions, such as the overtaking of Jaguar and Land Rover by Tata Motors, of IBM's personal computer division by Lenovo, or of the energy provider Envacom by Gazprom.
Similarly impressive is the growing number of managers from emerging markets who have been appointed as CEOs and board members of firms in industrialized countries. In particular, many Indian managers have made it to top positions in Fortune Global 500 firms. Prominent examples include Anshu Jain (Co-CEO of Deutsche Bank), Indra Nooyi (Chairman and CEO of PepsiCo), or Vikram Pandit (ex-CEO of Citigroup).
Despite the large success of many firms and managers from emerging markets, the knowledge about management practices in these economies is still limited and the academic literature is still dominated by Western concepts. However, as Marsden (1991, p. 32) argued already more than 20 years ago, "strategies based on European scientific techniques ignore the rich resources, both practical and intellectual, which exist in nonWestern societies (...). 'Local', 'traditional' or 'folk' knowledge is no longer the irrelevant vestige of 'backward' people who have not yet made the transition to modernity, but the vital well-spring and resource bank from which alternative futures might be built."
While scholars have called for the consideration of local concepts for many years (e.g., Gopinath 1998; Meyer 2006; Panda and Gupta 2007; Banerjee and Prasad 2008; Zheng and Lamond 2009), this aspect has only recently been recognized in international management research. For example, in a study of the indigenous conceptual dimensions of corporate social responsibility (CSR) in China, Xu and Yang (2009) reveal that several widely accepted CSR dimensions in the Western world have no embodiments in China. Das (2010) shows how the Indian view of good management practices is deeply rooted in ancient Indian epics such as the Mahabharata and the Ramayana. Additionally, Jackson et al. (2008) demonstrate how the success of firms in Africa is affected by the use of local management techniques that have evolved over several centuries. Thus, in order to understand the success of emerging market firms it becomes essential to analyze indigenous management concepts such as ubuntu (South Africa), jugaad (India), guanxi (China), or blat (Russia) and their impact on management behavior and outcome in these countries.
Moreover, studying indigenous management concepts can also be useful for understanding the implicit assumptions of Western theories of management and thus contribute to global management knowledge as well (Welge and Holtbrugge 1999; Tsui 2004). Consequently, the analysis of management concepts originating from non-Western countries may improve seemingly universal theories of corporate strategy, innovation management, or leadership (Cappelli et al. 2010; Leung 2012). "As countries such as India and China aspire to play an increasingly important role in the world economy and indigenous managers attempt to build and lead world-class companies, possibilities of the emergence of a richer model for managers need to be explored (...). The choice is clearly for not only the indigenous management to tap into its deep-routed ethos, but also to contribute the contemporary concepts and practices of governance in developing a true globally relevant cross-verging managerial frame to emerge" (Chatterjee 2009, p. 138).
Examples of Indigenous Management Concepts
One of the few indigenous management concepts that has been extensively discussed in the academic literature is the phenomenon of guanxi in China (e.g., Luo 1997; Lovett et al. 1999; Park and Luo 2001; Fan 2002). Guanxi refers to the concept of drawing on a web of personal relations to secure favors in personal and organizational relations. The network of connections with members of the extended family and individuals of the same birthplace, educational institution, or workplace contains implicit mutual obligations, assurances, and understanding, and governs attitudes toward long-term social and personal relationships. The practice of guanxi originates in Confucianism and has been pervasive for centuries in every aspect of Chinese society and economy.
Empirical studies reveal that guanxi affects several aspects of management, such as firm growth (Park and Luo 2001), competitive advantages (Tsang 1998), organizational trust (Chen et al. 2004), human resource management (Law et al. 2000), and the performance of local (Luo et al. 2012) and foreign-invested enterprises operating in China (Luo 1997). Thus, it is critical for all businesses in China and for those cooperating with Chinese firms from abroad to understand and properly utilize this indigenous management concept in order to be successful.
The recent success of many Indian firms has attracted a growing number of studies on how they develop innovative products and services. Central to this is the principle of jugaad, frugal innovations...
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