Dismantling conventional Chinese societal culture can pay dividends at work
Longfor achieved economic success by flouting traditional societal rules
How can companies in emerging markets organise themselves to become more innovative?
A possible answer: by designing an organisational culture that is distinctly different from their societal culture.
One of the biggest concerns for companies in emerging economies is how to move from their current low-cost, low-innovation model, based solely on operational efficiency, to a more sustainable, value-chain model which can produce high-premium products without the backlash of illegal reproduction. The core organisational competency is continuous innovation, but how can managers build innovative organisations in emerging economies with social norms that favour top-down command, inequality, and working hard rather than working smart? One potential lesson can be learned by examining the management style of a real estate company in mainland China.
Devolved decision-making enabled employees to take action as soon as problems emerged
Longfor Properties is one of the business miracles of modern-day China. From its humble beginnings as a startup in the mid-1990s, it took less than 15 years to grow into a leading real estate developer across the mainland. Longfor’s success made its founder, Yajun Wu, the country’s richest woman for a brief time, according to Forbes. Wu’s early projects stood out for their aesthetic appeal, giving valuable space to green features when other Chinese developers were fixated on the functional, low-cost model. Longfor once sent a design team to Europe for a month to master fine points of construction and aesthetics, an unusual practice in a country known for mimicking European architecture. Unlike its competitors, Longfor gave customers a voice in the design of their future homes.
Even more remarkable than Longfor’s economic success, however, was how that success was achieved: by flouting the traditional societal rules, ironically with yet more organisational rules.
Longfor formalised a distinct organisational culture in a pamphlet called “Longfor: Personnel, Organisation and Culture”. It went far beyond general principles, specifying detailed rules on “employee behaviours that Longfor advocates, and those it opposes”, which included, among many other items:
●Employees do not need to call the boss “general manager”;
