Power Distance In Chinese And American Enterprises

Power is one of the most important factors of human activities in the society even since the moment human came into being. In different historical stages, power was distributed among different ranks of people, however in the same way: unequally. It is almost as certain as any truth that power can never be balanced between people, for either the physiological differences of people (e.g. physical or mental distinctiveness), or the social reasons (e.g. convenience of management or struggling for authority). In each cell of the human society, inequality of power distribution can be found. However, people come from different cultural backgrounds tend to show different attitudes towards such unequal distribution of power. It is apparent that people from some countries or cultures (e.g. Malaysia, Slovakia, and Philippines) are more tolerant of this inequality than other people (e.g. The U.S., Canada, and Netherlands). This is the reason why the concept of"power distance"has been created. Power distance, on one hand refers to the degree of inequality of power between the less powerful and the more powerful, on the other hand also displays the extent to which the less powerful group expect and accept such inequality.Although differences of power distance in different countries or cultures can be found in every corner of the society, this thesis will only focus on the differences of power distance within Chinese and American enterprises, especially by the study and analysis of two typical enterprises of the two countries: Lenovo and IBM. Lenovo, as one of the most representative corporations in Chinese IT industry, displays characteristics of large-power-distance-index as being located in the cultural background of China, which is perceived as a large-power-distance country. On the contrary, IBM represents more traits of small-power-distance, which is obvious to be the national character of the United States.When examining the corporate cultures of the two corporations, differences of power distance can be easily identified through three aspects: organizational structures, communication approaches, and leadership. Lenovo has a more hierarchical organizational structure, in which contains a strict power ladder. Superiors tend to have more prestige and are more autocratic in decision making processes. In contrast, IBM displays a much flatter organizational structure, where people tend to seek equality for everyone, who has an access to talk with the highest management to raise either criticisms or suggestions in a democratic way. Concerning the communication approaches, significant differences manifest themselves in two ways: direction of information flow and patterns of communication. While in Lenovo information always flows from top to bottom, parallel communication paths are attached great importance to in IBM. Moreover, employees in Lenovo always communicate with others with an implicit style, whereas the staff of IBM always adopt a more explicit communication style. Regarding the leadership styles, superiors in Lenovo possess a combination of authoritarian and paternalistic style, while in IBM the leadership is more participative.The present thesis, based on the theoretical framework of Hofstede's cultural dimensions, aims to provide a theoretical study of the power distance differences in Chinese and American enterprises, which serves to offer some indications to practical business doings. On the basis of previous studies and researches, this thesis also intends to shed some light on the power distance study of China, which has been to some extent ignored by numerous scholars. The study falls into five chapters. Chapter 1 introduces the background and main contents of the study as well as the structure of the thesis. Chapter 2 serves as the literature review of previous works, with major contributions and critical evaluations of important works. Chapter 3 gives the definition of power distance and its classification. Chapter 4 dwells on a comparison of power distance in Chinese and American enterprises based on the study and analysis of Lenovo and IBM. Chapter 5 reaches a conclusion of the whole study and provides indications for international businesses.