The Raise of the Asian Business System

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The raise of the Asian Business System

Diverse business systems in Asia have proved their effectiveness by successfully boosting the economic prosperity in many Asian countries, such as Japan, South Korea, the raising India and China. These business systems reflect historical patterns in term of trust, loyalty and authority; they also vary in their specialization, strategic chooses, and inter corporate coordination because of the significantly different institutional environments. The raise of the Asian Business System with distinctive features compared with the most popular Anglo-Saxon business model that has been widely accepted and promoted in a world wide scale has been caused by a lot of factors. In term of corporate leadership, take the Chinese Family Business (CFB) as an example which is one of the most popular Asian business system, to maintain power, the boss of the CFBs control the information by transmitting just part of the information to its subordinates who can not have the big picture of the company and thus reliance to the top management has been created among the employees. And because of the scarce of information, the employees need to ask for instructions over many issues. So the most leadership style that the CFBs adopt is authoritarian. Under the authoritarian leadership framework, the power distance is kept large enough to avoid unnecessary contact and thus remain the image of power of the top management. And in term of decision making, the core family member will decide the major decisions for the company and other participation of the lower level employees is not preferred. They are expected to carry out the order and targets rather than suspecting the company’s decisions and making judgments.

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