GBUS 8305: Strategic Thinking: Integrating East and West

Professor Ming-Jer Chen (924-7260; Room 291D)

Assistant: Betty Sprouse (924-7333; Room 291C)



Course Description


As economies and businesses become more global, companies worldwide will increasingly need to examine their economic practices and beliefs. The purpose of this seminar is to help participants 1) develop a deep understanding of the strategic concepts and business models underlying foreign (in this case, Chinese) business, based on a thorough knowledge of cultural and institutional differences, and comprehend the implications of these differences for enterprise management in general; 2) use this understanding to think broadly about global enterprise and future enterprise development; and 3) develop a globally integrative perspective that enables them to conduct business in any part of the world.


Through an analysis of Chinese (mainland and overseas) business practices, such as methods of competition and strategy, the course aims to move from a comparative to an integrative perspective that considers Chinese business as a basis for rethinking the established structures and possibilities of enterprise in the new global economy. More broadly, the course will introduce a way of thinking that goes far beyond simply enabling one to do business with the Chinese. The integration of Eastern and Western business concepts and practices can lead to expansive thinking about the structure and possibilities of enterprise in the new global economy. Building on in-depth understanding of Eastern and Western business practices, we will explore a new global enterprise system. It is hoped that fostering such a global perspective will benefit participants’ business careers and personal endeavors alike.


Drawing heavily from the instructor’s work on this topic and from participant-led discussion, the course intends to push on two fronts: bridging application and scholarship, and maximizing the student-centered learning experience. This format and orientation have proved to appeal to MBAs committed to both intellectual rigor and practical relevance.


Course Objectives

·        Challenge participants’ most basic assumptions or presuppositions about business by introducing them to business cultures and institutions that differ radically from those in the US.

·        Understand how cultural differences underlie importance differences in enterprise strategy and competitive style.

·        Examine the business implications of cultural differences around the world, including Latin American and southern European business cultures, as well as Chinese.

·        Stimulate global, “integrative” thinking to gain a new perspective in a rapidly changing and interconnected business world.

·        Develop a framework for a new global enterprise system.

·        Build a learning community through intense interactions among all members of the class.


Learning Points


Target Audience

This seminar will be especially useful to those pursuing managerial careers with responsibilities involving international operations or high-level strategic components, as well as to anyone interested in strategy consulting, international business, or business opportunities in Asia. The course will appeal also to those interested in Chinese business culture and practices, entrepreneurship in the global context, or cross-culture, cross-border business issues, as well as to those who come from different cultural and national backgrounds with an interest in global integration at both an organizational and a personal level. In addition, students taking the Global Business Experience and traveling to China and other countries may find the seminar valuable.


Class Time

In general, each week the class will explore a given topic through two different approaches: case teaching and participant-led discussion. The second half of each class will be led by a different group of participants, which will submit a report the following week based on the discussion. The writing assignments and the guidelines for the in-class discussions will be assigned separately.


Term Project

In many ways, the term project is the foundation of this course. Preferably, teams of three participants will carry out the research, writing, and presentation of this undertaking. The project will focus at the enterprise level (Chinese or non-Chinese) on managerial and strategic issues that have broad global implications and which target a managerial audience.


The quality of the final report of this project should aim for the level and follow the style of such leading business publications as Harvard Business Review, Academy of Management Executive, and McKinsey Quarterly. The class should expect to devote a considerable amount of time to the project, as it is an essential part of the course. The details of the project and possible topics will be discussed.


Course Materials

Inside Chinese Business: A Guide for Managers Worldwide (Harvard Business School Press, 2001), a book by the instructor, is central to the structure and the readings of this seminar. ICB provides a view into the cultural and philosophical underpinnings of Chinese business practices. In addition, cases and business articles will be assigned for each session.


Our selection of readings follows the belief that “research breeds research” and that systematic knowledge accumulation over time is the best way to advance applied scholarship. Through collective effort, class participants will have a hands-on opportunity to shape cutting-edge strategic ideas.


Main Readings:

Chen, Ming-Jer, Inside Chinese Business: A Guide for Managers Worldwide (Harvard Business School Press, 2001) - (ICB).

F           Preface                   - From the Great Wall to Wall Street

F           Chapter 1               - Introduction: Who ( and Where) Are the Chinese?

F           Chapter 2               - Family Businesses, Business Families

F           Chapter 3               - Networking and Guanxi

F           Chapter 4               - Roles and Rules of the Social Fabric

F           Chapter 5               - The Middle Way: A Holistic Perspective on Time and Performance

F           Chapter 6               - Putting Values into Practice: Competing Indirectly    

F           Chapter 7               - Never Say “No”: Communicating with the Chinese

F           Chapter 8               - Negotiating from Start to Finish…and Beyond

F           Chapter 9               - Tradition in Transition: Doing Business in the PRC

F           Epilogue                - Toward the Globe as a Whole



Individual class participation:                                                 25%

Participant-led classwide discussion and written report: 25%

Term project:                                                                                        50%


Design Philosophy/Caveats

The course is shaped by the belief that all class participants—including the instructor—are “learning partners” in the process of creating and accumulating knowledge, from philosophy to theory/concept to practice. The course is therefore a collaborative investigation of modern Chinese business, its cultural underpinnings, and implications for managing global enterprise in general.


Asking the right questions is the key to strategy, business management, research, and case teaching. The instructor will use the Socratic method to help class participants develop a strategic-question mindset that will ultimately benefit both their business and personal endeavors.


This course has the following distinct features. First, it will require participants’ intense involvement throughout the course. Class participants are encouraged to “get their hands dirty” in order to engage in the intellectual inquiry and business application. Second, the instructor considers his role as that of a coach in helping the class complete its research. He will interact closely and informally with all participants throughout the term.


The success of the class depends on each participant pulling his or her own weight, in both the term project and the group-led classwide discussions. Knowledge building is a group effort, and information derived from projects may be used for future research activities. Contributions from the class in this regard will be fully acknowledged.


Along the same lines, the whole class is built on mutual trust and help among the class participants. Peer review and support are important contributors to intellectual progress and are highly encouraged—and required—in this class.


Session Outline


Session 1

January 13

Chinese Business and Social Practices



Richina Capital Partners Ltd. (HBS 9-396-059)



ICB Preface & Epilog, Chapters 1, 3 and 4



1. What factors contributed to Richina’s early success?

2. What values does Richina create, and how sustainable are they?

3. What lessons can we learn from the example of this global business “network”, or “web”?







Session 2

January 14

Communicating and Negotiating with the Chinese



Pacific Dunlop China (A): Beijing (HBS 9-695-029)



ICB Chapter 7 and 8



1. Why is Steve Littley finding his job so difficult? What would you do if you were in his situation?

2. How would you advise Pacific Dunlop to proceed with its China strategy? What should David Lau be doing about the challenges of managing the Chinese plants in his network?







Session 3

January 15




Kentucky Fried Chicken in China (C) (IVEY 9A90G003)



ICB Chapters 5 and 9



1. What were the main challenges facing KFC in China?

2. What have they done to meet these challenges, and could they have acted differently?

3. Is the KFC strategy an approach that you would recommend for other MNCs looking to succeed in China?







Session 4

January 21

Family Business vs. Business Family



Tai Po Fruit Traders Ltd. – Sell the Family Business? (A) (Ivey 9A98F002)



ICB Chapter 2



1. What are the key business challenges to the Chan family? How have these challenges changed over time?

2. How should David Chan resolve the family dispute that has been on going for several years after his uncle passed away? Should he sell TPF? Why should or shouldn’t he? How should he sell his business family?

3. Is TPF a typical Chinese business family or is it an exception? Why is it so? What are common attributes that the Chen family shares with other Chinese business families?

4. What historical factors have contributed to the development and success of the Chinese business family? How might the Chinese business family adapt to the new global economy? What advantages or incentives might there be for a Western company to become more “family like”?







Session 5

January 22

Indirect Competition



Hainan Airlines: En Route to Direct Competition? (UVA-ENT-0035)



ICB Chapter 6



1.   Why has HNA been successful in the Chinese domestic airline market? What are HNA’s key competitive strengths? What was HNA’s historical competitive strategy?

2.   What are the dynamics and the basis of competition in the Chinese airline industry? What are the key profit drivers?

3.   Analyze the main players in the Chinese airline industry. What are their relative positions and potential competitive moves?  Who is HNA’s key competitor? 

4. What should HNA do? Should the company continue to compete indirectly, change its strategy to compete head on, or seek an alliance with another airline?







Session 6

January 27

Emergence of China-based MNCs



*One-page project outline is due



The Haier Group (A) (HBS 9-398-101)



1. Why has Haier been successful?

2. Which of Haier’s practices might Western and Chinese companies find useful as they expand their global activities?







Session 7

January 28

Managing in PRC


Guest Lecture:

Kris Day (Calico Group)







Session 8

February 3

East-West Integration: Business Practice



Li & Fung: Beyond “Filling in the Mosaic,” 1995-1998 (HBS 9-398-092)



1. How did the Fung brothers transform a traditional Chinese business into a globally viable enterprise? 

2. Which practices of Li & Fung might Western and Chinese business find useful as they expand their global operations?







Session 9

February 4

East-West Integration: Strategy



Chen, Ming-Jer. 2002. “Transcending Paradox: The Chinese "Middle Way" Perspective,” Asia Pacific Journal of Management, 19:179-199.







Session 10

February 10

East-West Integration: Competition



Dell: Selling Directly, Globally (Center for Asian Business Cases, University of Hong Kong, HKU069)



1.Who are Dell’s competitors globally, and in mainland China?      How must Dell change its strategy if it wishes to compete successfully in Mainland China?

2. What are the unique features of the Chinese approach to strategy? How can these approaches enrich current strategic and competitive practices? What are some of the obstacles to applying such strategies to Western corporations? Could such obstacles be overcome? If so, how?

3. Knowing Chinese strategy, how could Western companies out-compete Chinese enterprises? Knowing Chinese strategy, how might Western companies collaborate more effectively with their Chinese counterparts?







Session 11

February 11

East-West Integration: Enterprise Model



The World Class Enterprise where East Meets West (Ming-Jer Chen, China Business Summit 2000)

C.K. Prahalad and Kenneth Lieberthal, “The End of Coporate Imperialism,” Harvard Business Review, July-August 1998, pp. 69-79.







Session 12

February 17

New-world Enterprise



William H. Newman and Ming-Jer Chen, “New-world Enterprise” (to be distributed in class)







Session 13

February 18

Term Project Presentations (I)







Session 14

February 24

Term Project Presentations (II)







Session 15

February 25

Course Wrap-up








March 4

*Final report is due