Do you believe the cell phone incident is a big deal? Why or why not?
I do believe that the cell phone incident is a big deal, going by the stakes involved. The business deal that Chen clinched ran into millions; such an engagement normally attracts a lot of attention from many quarters and cannot be viewed in passing. On the other hand, The China Data Group was to go global; this would put their business practice into scrutiny hence in other quarters, the cell phone issue would be a make or break affair. In addition, competitive bids often attract scrutiny from competitors. A competitor can use such an incident as an opportunity to damage the competitor’s image hence the need to assess and address this matter with the attention that it deserves.
Why is Roc Yang experiencing such a dilemma regarding the cell phone incident? What are the root causes for his dilemma?
The dilemma that Roc Young is experiencing is a result of there being no clear cut classification on whether Chen did the right thing or not. To begin with, Chen’s team had handled their role as the company’s relationship manager, very well. This instance is one of such where Chen’s team had gotten the company a lucrative deal. His competence therefore, is not in question. On the other hand, Chen and the CDG had exercised the guanxi philosophy in managing customer relations, therefore this was not totally foreign that it could be said to be a breach of company policy. However, the CDG was going global and they needed to adapt to universally acceptable ways of negotiating and acquiring clients. On the other hand, the company’s founders had a vision of growing and basing their business operations mainly on the quality of their products and services to their clients. This act by Chen came at such a time when its sustainability was being reexamined. These are what led to Yang’s dilemma.
How would you handle the cell phone incident and the upcoming meeting with Chen if you were Roc Yang? Where should he draw the line between upholding CDG's company culture based on professionalism and quality, and adhering to the local business culture that relies on guanxi? Discuss the risks and consequences of your decision.
In the meeting with Chen, I would explain my understanding and appreciation of what he had done in order to gain the business for the company. I would then explain to him the shift in policy to focus on quality and professionalism. I would then make him understand the need for a shift so that the client relationship management could be in line with the company’s goal. It would therefore be necessary for him and his team to reinvent themselves so that their sales tactics would reflect this.
While the company needs to foster its culture based on professionalism and provision of quality, it does not exist in a vacuum and is established in a local business culture that borrows from guanxi. To propose a total exit from the local culture and adopt the new culture may end up hurting the local business to some extent. It would therefore, be appropriate to find a middle ground to marry the two cultures. The guanxi culture could be applied to a certain extent that does not compromise the image and integrity of the company, while maintaining professionalism and quality as the bedrock of the company’s culture.
The risk is being unable to find a balance between the two without breaching the company’s main principle of doing business. It would also be a risk since the company may appear not to have a clearly understandable culture.
