Closing cultural distance: the cultural adaptability in Chinese-related firms in Thailand
| Pages | 229-250 |
| Published date | 02 May 2017 |
| Date | 02 May 2017 |
| DOI | https://doi.org/10.1108/JABS-07-2016-0097 |
| Author | Kitisak Sorndee,Sununta Siengthai,Fredric William Swierczek |
| Subject Matter | Strategy,International business |
Closing cultural distance: the cultural
adaptability in Chinese-related firms
in Thailand
Kitisak Sorndee, Sununta Siengthai and Fredric William Swierczek
Kitisak Sorndee and
Sununta Siengthai both
are based at the School
of Management, Asian
Institute of Technology,
Klong Luang, Thailand.
Fredric William Swierczek
is based at School of
Management, Asian
Institute of Technology,
Hanoi, Vietnam.
Abstract
Purpose –The aim of this paper is to investigate the effect of cultural values and cultural adaptability of
Chinese expatriates and Thais on organization performance.
Design/methodology/approach –The designed perceptual scale research instrument adapted from
Schwartz’s instrument is used to conduct a questionnaire survey in which 180 sample Chinese
expatriates and Thai coworkers participated. Descriptive statistics, factor analysis, and regression
analysis were used to analyze the data obtained.
Findings –The authors found that cultural value variables that are significantly related to productivity
are social order, openness, and tradition; while cultural adaptability variables found significantly related
to productivity are open-mindedness and judgment. When organization performance is focused on
innovation, cultural value variables that are found statistically significant are openness and tradition;
while cultural adaptability variables that are significant include open-mindedness and personal values.
Finally, when customer satisfaction is the organization performance focus, only one cultural value
variable is found to be statistically significant, that is, tradition; while cultural adaptability variables that
are significant are personal values and judgment.
Practical implications –The results of this study can be used to design new approaches and HRM
practices (i.e. recruitment and training) to enhance the corporate culture and cooperation among
Chinese expatriates and Thai coworkers to maximize organization performance in a new competitive
environment.
Originality/value –This study contributes to the literature on cultural management and cultural
adaptability. It empirically investigates the perception of both Chinese and Thais on cultural values
influencing the performance of multinational companies. Further, the modified Schwartz’s values survey
instrument used in a Thai business operating context makes it a very rare empirical study that provides
insight into these issues.
Keywords Cultural values, Chinese, Cross-cultural adaptability inventory (CCAI), Cultural adaptability,
Organization performance, Schwartz’s framework
Paper type Research paper
1. Introduction
Multinational organizations create international business projects to enhance collaborative
networks together with global competencies (Caligiuri et al., 1998). Many cross-cultural
studies suggest that international business expatriates who work with local employees
need to have cross-cultural adaptation skills to adjust to other cultures and to learn from
local partners to enhance organization performance. Understanding culture is thus
important for the assigned expatriates to effectively manage their subsidiary in a new
competitive environment (Dong and Lui, 2010). The most difficult challenges confronted by
multinational corporations (MNCs) such as cultural differences among organization’s
members have been emphasized in various case studies (Swierczek and Onishi, 2002).
Executives and specialists sent as expatriates have to be able to cope with the cultural
Received 8 July 2016
Revised 8 July 2016
Accepted 1 October 2016
The authors are grateful to
C. Charoenngam, T.K. Peng,
C. Rowley, H. Merchant, and
anonymous referees who have
reviewed and provided valued
comments and suggestions
which have significantly
improved this manuscript. The
authors’ thanks are extended
to the sample respondents
who participated in our survey
without which this study would
not have been possible. Any
remaining errors are solely the
authors’ responsibilities.
DOI 10.1108/JABS-07-2016-0097 VOL. 11 NO. 2 2017, pp. 229-250, © Emerald Publishing Limited, ISSN 1558-7894 JOURNAL OF ASIA BUSINESS STUDIES PAGE 229
distance and acquire cultural adaptability when operating within foreign countries. It was
estimated that about 20-40 per cent of all expatriates sent on foreign assignments returned
home prematurely (Kim and Slocum, 2008;Okpara and Kabongo, 2011). Cross-cultural
interactions essentially capture the multicultural adaptation regarding norms, behaviors,
and practices to boost a good understanding among staff in organization (Hall and Hall,
1987;Kale and Barners, 1992;Pornpitakpan, 2002).
Over recent years, MNCs are trying to understand and become successful in Chinese
cultural contexts (Quer et al., 2010). Similarly, this is very important for Chinese companies
going global. As Chinese companies go global and enter competitive markets, questions
have been raised about the adaptation of Chinese in non-Chinese cultural contexts.
In fact, many Chinese MNCs have invested in Thailand. The total value of bilateral trade of
China and Thailand has increased from US$8.5bn in 2002 to US$64.7bn in 2011 (Board of
Investment, 2012). Apparently, Thailand still remains a remarkable location, i.e. 17th in the
FDI confidence index 2013 (Kearney, 2013). Interestingly, it has been the second runner up
for ASEAN FDI (Kearney, 2013). Furthermore, in Thailand, Chinese expatriates are the
second largest in number next to Japanese expatriates (Ministry of Labor, 2014). Chinese
expatriates have been sent to Thailand for management control purpose and to develop
Thai coworkers. Thus, Chinese MNCs not only bring in capital and technologies to Thailand
but also their managerial cultures and practices (Banchapattanasakda and Wong, 2010).
The increased number of Chinese-related companies operating in Thailand and the
expected growing volume of trade and investment between the China and Thailand means
that it is important to understand the effect that cultural relationships between expatriates
Chinese and Thais may have on organization performance.
This research investigates the impact of cultural values and adaptability of expatriates on
organization performance. It focuses on the increasing phenomenon of Chinese
expatriates managing their firm operations in Thailand. To examine this further, we need to
understand the key cultural mindsets that Chinese and Thai organization members bring.
This current study provides further insight into how cultural factors impact on organization
performance in Thailand, a notional context that has been neglected in the research
literature to date.
In the following sections, we provide the relevant literature review on cultural distance and
cultural adaptability based on which our hypotheses are formulated. This is followed by the
elaboration on the research methodology. Then, the data analysis and findings are
described and discussed. Finally, conclusion and agenda for future research are provided.
2. Literature review and hypothesis development
In this section, we first discuss about organization performance. Then, the concept on
cross-cultural distance and its effect on organization performance are discussed. Following
this, we elaborate on the concept of cultural adaptability and discuss existing relevant
empirical studies. Finally, based on the relevant literature review, this research conceptual
framework and its formulated hypotheses are given.
2.1 Organization performance
Organization performance is an index success of an enterprise based on its goals and
targets (Venkatraman and Ramanujam, 1986;Lin and Kuo, 2007). The concept of
“organization performance” is complex and has competing definitions (Wong and Wong,
2007). Organization performance is an indicator which measures how well organizations
accomplish their objectives (Hamon, 2003;Al Saifi, 2016). The organization’s performance
evaluation is dependent on the working mental model of its managers (Day and Nedungadi,
1994;Neill and Rose, 2004). Many studies have used various methods to determine
organization performance (Wong and Wong, 2007;Prajogo et al., 2007;Moneva et al., 2007;
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