While China has long been considered the world’s leading manufacturing powerhouse, it has never enjoyed a reputation for making high-quality products. For years companies across the globe have outsourced production to China, taking advantage of low-cost labor despite poor quality control measures. In recent years, China’s economic growth has stalled, altering demands on the manufacturing sector. In particular, China’s machine tool components industry is struggling to adapt to changing market needs as pressure to manufacture high-end devices is mounting. Underlying this deficiency are distinct cultural values that negatively influence China’s ability to garner a stronger position in the high-quality components market; historical Chinese traditions seem to be at complete odds with implementation of effective total quality management (QM) practices.
China’s machine tool industry serves as an example of the influence of culture on economic performance. After years of progression, a downturn in China’s economic growth has shifted the demand for machine tools from the most inexpensive and readily available to instruments capable of producing high-quality products. The manufacturing industry is experiencing an upgrade process as a whole, and local companies are incapable of producing the high-end machines and components required for this evolution, leaving the country heavily reliant on expensive foreign imports. For decades the Chinese neglected investing in the machine tool components sector, and is now suffering the consequences, as Chinese companies possess inadequate fundamental and theoretical research and are incapable of supporting future R&D and innovation. In addition, the machine tools industry is completely subordinate to the technical knowledge and skills of its laborers, technicians and service engineers; without their professionalism, advancing to high-end production capabilities is impossible. Despite the best efforts to train these employees, attempts at expanding their qualifications have been fruitless.
Numerous sources within the industry cite employees’ attitudes toward their work as the principal difference between Chinese and western companies: Chinese technicians lack pride in the fruits of their labor. In terms of quality management (QM), the predilection of the workers and engineers is fundamental. Frequently, Chinese technicians lack the spirit of precision and creating a perfect product. Even with access to the best machinery and tools, Chinese factories struggle to produce products with comparable quality to their European counterparts because their engineers neglect to follow user guides to the letter. A manual may direct its operator to perform a task at 100%, but the Chinese laborer finds 99 or 101% acceptable, resulting in high default and turnover rates. Compounding this dilemma is poor process management. In addition to detailed instructions, there must also be good monitoring procedures to ensure quality, which is often not the case. Furthermore, employees have little desire to improve their expertise through educational opportunities and lack motivation to perfect their crafts. Absent good work values and attitudes toward their professions, all the government subsidies and investments will be unsuccessful at increasing quality in China. In order to effect a change in this arena, fundamental changes in cultural institutions are necessary.
An examination of Chinese culture provides a paradigm for explaining this phenomenon. Cultural values—what a society deems important and acceptable—influence mental outlooks as well as observable practices and activities. These values characterize organizational culture, and underlie quality management practices within that organization. Individual preferences influence whether QM principles are implemented or rejected; assuming that actions are aimed at obtaining desired outcomes, cultural proclivities determine whether employees deem QM to be within their best interest and whether they will be actuated. In a landmark study, Ralston et al. (1997) identified China as a collectivist country much like Japan (as opposed to individualism, collectivism emphasizes the interdependence of a society’s members), but highlighted a critical difference between Chinese values and other free-market cultures. According to Kull et al. (2010), the principles expected to correlate unfavorably with high-quality production are elevated in China compared to western countries and even other Asian nations (such as South Korea and Taiwan).
Although many different models exist, QM research conventionally utilizes cultural dimensions proposed by Hofstede (1980) and expanded by the GLOBE project (House et al. 2004): power distance, uncertainty avoidance, humane orientation, institutional collectivism, in-group collectivism, assertiveness, future orientation, performance orientation, and gender egalitarianism. Of these, Kull et al. (2010) found two that demonstrated a statistically relevant link with the adoption of QM techniques: assertiveness (AS) and uncertainty avoidance (UA). Assertiveness is characterized by the tendency to be confrontational, defiant and aggressive in behavior towards others, and is traditionally believed to be at odds with core quality management values like cooperation and customer focus. Cultures with a high degree of assertiveness value rationality over emotion, believe that extrinsic events can be controlled by the individual, and forsake tradition in order to satisfy internal desires (Kull et al. 2010). Numerous studies have shown that Asian societies–especially China–have a high degree of AS (Gupta and Hanges, 2004), which subsequently negatively effects QM due to its underscoring of individual demands and gains (Kull et al. 2010). AS fosters competition and superiority, traits also antithetical to efficacious QM. Organizations plagued by a high degree of AS are likely to place blame for failure on individuals rather than interpret them as systematic, making the implementation of even the best QM difficult. Assertiveness is likely a recent cultural development in China stemming from the country’s transition from a command economy to a modernizing society, but it plays a critical barrier to the country’s ability to transition to manufacturing high-end products.
Uncertainty avoidance (UA) was identified as the second cultural dimension having a statistically relevant influence on quality (Kull et al. 2010 and Lagrosen 2003). UA is defined as “the reliance on norms and procedures to alleviate unpredictability” (Kull et al. 2010), translating into fear of risks and the unknown, little tolerance for disagreement, support for formal systems and processes. Cultures characterized by high UA are more amenable to following procedures, and should theoretically favor the implementation of QM practices in response to customer feedback concerning quality. Studies regularly find that China possesses higher than average UA tendencies. It is possible that if the right measures are undertaken, Chinese factories can begin to improve their capabilities, but these efforts will be strongly opposed by the assertive nature of Chinese culture and their desire to maintain the status quo in the workplace. In addition, high UA may adversely affect the conviction that continuous improvement is necessary to maintain status as a high-end producer, and could actually serve to stifle innovation. The lack of R&D and innovation in the machine tool components sector has been cited by many sources as being a critical problem. Additionally, UA influences the way businesses interact with their customers; cultures with high UA tend to favor important customers and those they already have established relationships with (Lagrosen 2001). One of the major problems identified in the machine tool industry is China’s inadequate customer service and failure to provide solutions to clients or services for the entire product life (Nanyao 2013), which could be partially attributed to their high uncertainty avoidance. Overall, especially when considering the machine tools industry, it seems that the assertive nature of Chinese society underlies its most pressing issues and outweighs any advantage conferred from their tendency to avoid uncertainty: lack of pride in work due to the view that their efforts are neither prestigious nor lucrative, lack of motivation to advance skills, and indifferent attitudes (Nanyao 2013).
While a population’s culture is multifaceted, two dimensions in particular can be used, in part, to explain China’s difficulty in producing high-end goods: a high degree of 1) assertiveness, and 2) uncertainty avoidance. These factors combine to create an atmosphere that undermines workers’ attitudes and motivations, inhibiting the fabrication of superior merchandise. A deep understanding of these cultural phenomena is necessary in order for organizations and their managers to devise approaches to mitigate the quality issues experienced in Chinese manufacturing industries. Altering these cultural institutions will require a tremendous effort, but it is likely the only solution to the ills experienced in many Chinese manufacturing sectors, in particular the machine tools industry.
Gupta, V., Hanges, P.J., 2004. Regional and climate clustering of societal cultures. In: House, R.J., Hanges, P.J., Javidan, M., Dorfman, P.W., Gupta, V. (Eds.), Culture, Leadership and Organizations. Sage, London.
Hofstede, G., 1980. Culture’s Consequences: International Difference in Work- related Values. Sage, Beverly Hills, CA.
House, R.J., Hanges, P.J., Javidan, M., Dorfman, P.W., Gupta, V., 2004. Culture, Leadership, and Organizations: The GLOBE Study of 62 Societies. Sage, London.
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Ralston, D.A., Holt, D.H., Terpstra, R.H., KaiCheng, Y., 1997. The impact of national culture and economic ideology on managerial work values: A study of the United States, Russia, Japan, and China. Journal of International Business Studies 28 (1), 177–207.