IS6600-7

1
IS6600-7

• Leadership, Guanxi and Knowledge
• Two Failed Cases
• One Almost Successful Case!
• And a little Chinese Social Psychology

2
Introduction

• To what extent do you suppose that
• Leadership
• and
• Guanxi
• Might have an impact on how knowledge is shared?
• Or on the consequences of knowledge sharing?

3
Leadership

• 21st century opinions about leadership are less
  bureaucratic and more interactive
• The use of non-coercive influence to direct
  coordinate activities of group members toward
  goal attainment
• Three styles of leadership are recognised
• Transactional
• Transformation
• Laissez-faire

4
Transactional Leadership

• The motivation to work can be influenced by
• Incentives and rewards,
• Punishments, monitoring and control
• This is a compliance based perspective
• Consistent with cost/benefit analysis in the
  context of knowledge sharing
• More of a top-down style

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Transformational Leadership

• The motivation to work can be influenced by
• Inspiration participative decision making
• Coaching, informing, leading by example
• Concern, emotional encouragement interaction
• Subordinates will develop feelings of trust,
  loyalty, respect and so seek to perform at a
  higher level than normal
• This is also known as empowering leadership

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Laissez-Faire Leadership

• This is a rather strange style
• Laissez-faire implies letting something manage
  itself
• In this case, employees are self-managing, and
  the leader hardly leads at all
• No directions, no incentives or encouragement
• Unsurprisingly, this style of leadership is
  seldom encountered
• But self-managed knowledge is worth considering

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Guanxi (Relationships)

• Guanxi describes the basic dynamic in the complex
  nature of personalized networks of influence and
  social relationships, and is a central concept in
  Chinese society.
• Guanxi describes the existence of direct
  particularistic ties between two or more
  individuals
• Guanxi is comparable to the western concepts of
  relationships and connections, reflecting the
  ties and interdependencies that comprise a social
  network

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Guanxi and Knowledge

• Guanxi is very much related to the practice of
  sharing knowledge, given that reliable knowledge
  is considered a scarce, valuable and intangible
  resource in China
• People who engage in knowledge sharing may also
  seek, in parallel, to develop guanxi with one
  another in a mutually collaborative support
  system.
• positive interpersonal relationships are
  conducive to knowledge sharing

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The Theory of Weak Ties

• People you know less well, and with whom you have
  weak ties, are more useful, because it is more
  likely that they know things that you dont know

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Tie Strength and Knowledge
Strong
Chinese Theory of Strong Ties!
Strong Ties and Useful Knowledge
Tie Strength
Weak Ties and Useful Knowledge
American Theory of Weak Ties
Weak
Low
High
Knowledge Usefulness
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In-Groups

• A psychologically and communicationally proximate
  group of people with whom one has mutual and
  reciprocal obligations
• Knowledge sharing often takes place within
  in-groups
• It is psychologically easier/more comfortable
• It enhances ones face and reputation
• It embodies a preference for informal and
  implicit communication

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In-Groups and Knowledge Sharing

• Knowledge is usually communicated through some
  kind of interpersonal contact, but not through
  formal or codified means
• Traditionally, IT applications have rarely been
  used for this purpose but IM tools do have a
  role to play
• In the digital era, there is still no perfect
  substitute for the motivational effects of human
  bonding and social connectedness

13
Consequences of Knowledge Sharing?

• There can be many, but I would like to look at
  two major categories
• The quality of work that is performed
• Primarily by teams, but also individuals
• Organisational agility
• ability to react to emerging circumstances
• Speed, responsiveness, reliability
• These two consequences are good overall measures
  of an organisations ability to deliver in times
  of turbulent competition.

14
Two Cases in China Ravine Eastwei

• Ravine (60 locations in China)
• Hotel Management Company
• Part of a Global Group
• Many brands from to
• Strong command control style culture
• Eastwei BJ, SH, GZ, CD
• PR business. One Chairman, 4 City Managers
• Mostly a transformational management style

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Ravine

• This is a global firm, operates in 100 countries
• High levels of standardisation globally
• Expectation of compliance
• Rule-based organisation
• Each hotel has a general manager (GM) who has
  some autonomy, but not a lot

16
Ravine

• In 2011-2012 I studied the use of technology for
  knowledge sharing in 16 hotel properties managed
  by Ravine
• BJ (3), SH (2), WH (1), CQ (1), CD (10, SZ1 (2),
  SZ2 (1), HK (3), MO (1), GZ (1)
• I interviewed about 150 people at all levels
• From SVP, GM, Functional Managers to Clerical

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Key Knowledge-Related Issues

• Guanxi is critical to problem solving
• To build and maintain guanxi, one needs access to
  technology
• Primarily Social Media like MSN, QQ, Weibo
• However, these applications are usually blocked
  by corporate policy
• Fear of misuse or accidental malware delivery

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Employee Voices

• I am not allowed to use MSN at work, and my
  guanxi network has suffered in consequence. It is
  harder to work effectively. (FOM, BJ)
• Without QQ I cannot work (PRM, Wuhan)
• I have experts within my in-groups for gifts,
  media, printing (DoR, BJ)

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Workarounds

• If the corporate networks block access what can
  you do?
• Use a different network? Where?
• it is easy to tap into the guest network with a
  mobile device. However, it is impossible to log
  into corporate systems from the guest network.
  This means that one must use different networks
  for different purposes (Revenue/Marketing
  Manager, Macau)
• Mobile devices cannot be used when on duty, so be
  careful!

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Marketing, Communication PR Activities

• MC Job to promote the hotel as a place for
  meetings and events
• PR Job liaise with local government, companies,
  travel agents
• This is knowledge and information intensive work
• high volume, multi-megabyte graphics

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Problems

• Most hotels have very limited bandwidth
• 2mbps!
• Even though the Guest Network may be 50mbps-1gbps
• Email attachments are limited to 2-4MB
• Which is very small compared to the size of files
  that need to be sent

22
Employee Voices

• A one minute task, like sending an email with
  attachments to corporate clients, can take two to
  four hours (MCM, GZ)
• emailing a 5-6 MB attachment to 5,000 people is
  an impossible task (MCM, BJ)
• it is not just inconvenient it is a total
  waste of time time to use on other added-value
  activities (MCM, BJ)

23
More Voices

• prefer to use MSN or QQ to contact corporate
  clients and frequent guests, but this is
  impossible (GM-Sec, Macau)
• several hundred contacts... Some of these people
  never use email they prefer QQ for all
  communications (PRM, Wuhan)

24
Managements View

• There is no value in chatting. Web 2.0
  applications have no role to play in Ravines
  corporate culture (GM, GZ)
• Functional managers should be trusted, since
  they are working professionals who need these
  tools to get their work done (GM, SZ1)

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Workarounds

• MCM Set up an offshore microsite for marketing
  purposes
• Tacit support from boss and GM
• Use the GN with GMs approval
• So, the GM is complicit in fighting the system!
• GM as a manager is as much a victim as the other
  employees
• GN is high bandwidth and no IP blocking

26
Eastwei (2006-2008)

• Engaged in the PR business in China
• Small, agile, dynamic firm with young staff and
  culture
• Progressively implementing a KS culture and
  associated technologies since 2006
• Primarily a transformational leadership style
  empowerment and support
• Some transactional reward structures

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Longitudinal Investigations

• 1 Interview all employees on KS behaviour
• 2 KM and BPM workshops with selected employees
• 3 Survey all employees on antecedents of KS and
  its consequences
• 4 Observe employees at work
• 5 Plan a new KS initiative based on
  wiki-technology, measured with the BSC

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Interview Data

• Employees exhibited a strong preference for
  one-to-one or within-team knowledge seeking
  sharing, but not relying on the corporate
  intranet
• Knowledge sharing means ensuring that the
  resources are available for the whole team
• My method of KS is to tell people my personal
  lessons and experiences when I know others meet
  similar situations. My aim is to prevent people
  from repeating my mistakes.
• If I need to get some media contacts which I do
  not have, I ask the other teams one by one. The
  corporate intranet system is there, but nobody
  maintains or updates it

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Research Model
Transformational Leadership
Sig at plt0.05 Sig at plt0.01

Teamwork Quality (R20.54)

Transactional Leadership

Speed

Organisational Agility R20.19

In-group Knowledge Sharing
Responsiveness

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Discussion Interpretation 1

• Transformational leadership is significantly
  predictive of teamwork quality and also has a
  strong link with organisational agility
• Transactional leadership is also strongly
  predictive of teamwork quality, but not
  organisational agility
• Guanxi-lubricated in-group knowledge sharing has
  a strong link with organisational agility but not
  teamwork quality.

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Discussion Interpretation 2

• Transformational Leadership at Eastwei
• Transparent organisational culture
• Open communications Monday seminars
• Clear strategic direction
• Positive attitude towards individual, team, and
  organisational learning
• Eastweis office layout is also transformational
• Open plan design, no allocated seats or offices
• Chairman engages with employees regularly

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Discussion Interpretation 3

• No rules about communication tools
• Most employees use IM (QQ or MSN/WLM)
• A few oldies use email or telephone
• Employees need to function independently, as well
  as members of work teams
• Work teams are often split across locations
• So, this is actually more laissez-faire
• But within a transformational structure

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Discussion Interpretation 4

• Transactional leadership
• Punishments are rare
• Rewards are clear and frequent
• Bonuses, paid-holidays, dinners (for family)
• Individual and team level rewards
• Focus on cooperation, not competition
• Salary is 100 basic
• Employees who dont fit the Eastwei style
  quickly find out and tend to move on

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Discussion Interpretation 5

• Guanxi-lubricated in-group knowledge sharing
• Why wouldnt sharing knowledge with in-group
  members also help improve teamwork quality?
• It seems a paradoxical finding

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Discussion Interpretation 6

• Well, who are the in-group members?
• Many employees have up to 500 names in their
  contact lists they cant all be Eastwei
  employees
• Also, knowledge sharing is primarily a 1-1
  activity at Eastwei, whereas teams typically have
  5-6 members
• Could this explain why sharing knowledge with
  in-group members may not be related to teamwork
  quality?
• We should have asked about sharing knowledge with
  Eastwei-based in-group members.

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Discussion Interpretation 7

• Teamwork quality is strongly predicted by
  leadership
• This is interesting and actionable
• Team leaders clearly have an important role to
  play

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Discussion Interpretation 8

• Organisational agility comprises speed and
  responsiveness
• Speed cycle time measures
• Responsiveness ability to deliver a quality
  service

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Eastwei - Conclusions

• A blend of transformational and transactional
  leadership seems to work well
• Guanxi-lubricated in-group knowledge sharing is
  important too.
• But it may not function quite as expected
• Indeed, there may be implications for knowledge
  asset management, as many in-group members are
  outside the organisations formal boundary

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Conclusions

• Informal KM tools seem to be more effective than
  formal KMS
• Many smaller companies would be wary of the high
  price tags traditionally associated with KMS
• So, is a formal KMS really a good idea, a
  necessity?
• Or can more simple, informal, interpersonal tools
  like IMs, Blogs or Wikis add value?
• One problem with IMs is the lack of reuse the
  knowledge is created, shared and then abandoned

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To Discuss

• Which is more important knowledge or guanxi?
  Why?
• Can we blend the informality of Web 2.0 and the
  formality of a KMS so as to leverage guanxi and
  knowledge now and in the future?
• Apart from leadership and guanxi, which other
  factors may influence the success of a knowledge
  initiative? And Why?

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