BCN 3761 Global Learning Reading and Essay Instructions: Write a 750 to 1000 word multi-paragraph summary essay of the article which you will find on the a

BCN 3761 Global Learning Reading and Essay Instructions: Write a 750 to 1000 word multi-paragraph summary essay of the article which you will find on the attachment entitled, “Cross-Cultural Project Management for International Construction in China” by following the format below in the attachment. Please focus on addressing the topics and points below while writing the summary. International Journal of Project Management 18 (2000) 307±316
Cross-cultural project management for international construction
in China
Low Sui Pheng*, Christopher H. Y. Leong
School of Building and Real Estate, National University of Singapore, 10 Kent Ridge Crescent, 119260, Singapore
Received 21 January 1999; received in revised form 16 March 1999; accepted 25 March 1999
The need to recognise and manage other cultures is an important component in this era of globalisation. With China poised
to take on a more dominant role in the world economy, there is a pressing need to understand the Chinese style of management.
Likewise, foreign project managers who deal with construction projects in China should be ¯uent in cross-cultural management.
This paper examines key concepts in cross-cultural management as well as key functions in construction project management
with speci®c reference to China. A real life case study of the New Chinese Hotel project in China will be presented to show how
the interaction between cross-cultural management and construction project management can a€ect the outcome of a project.
Lessons on the Chinese style of management will be drawn from the case study for international construction ®rms. 7 2000
Elsevier Science Ltd and IPMA. All rights reserved.
Keywords: Culture; Project Management; International; Construction; China
1. Introduction
There is no one single de®nition which encapsulates
the term `culture’ wholly. It has been referred to as
shared values, expectations and norms found within
countries, regions, social groups, business ®rms and
even departments and work groups within a ®rm[1].
Culture is also that complex whole which includes
knowledge, beliefs, arts, morals, customs and any
other capabilities and habits acquired by man as a
member of society. It is a distinctive way of life of a
group of people which forms their complete design for
living[2]. It comprises “the behavioural norms that a
group of people, at a certain time and place, have
agreed upon to survive and co-exist”[3]. Cross-cultural
management then refers to the control and organisation of two or more cultures. The involvement of frequently large organisations in construction outside
* Corresponding author. Tel.: +65-874-3413; fax: +65-7755502.
E-mail address: (Low Sui Pheng).
their national boundaries, including the establishment
of subsidiaries in other countries, is classi®ed as `international construction'[4].
Each country in which such organisations operate in
can have a distinct economic, political, legal, cultural
and competitive context which businesses must
respond to positively. The problem of integration will
obviously occur for a construction ®rm which operates
in many di€erent countries. Integration can, however,
be a daunting task as it involves maintaining a balance
between global eciency and being responsive to local
cultural di€erence in the host countries. Consequently,
to succeed in the international marketplace, construction businesses must deal e€ectively and eciently
with the diverse cultures encountered. International
construction is not an entirely new concept. It has its
genesis in the numerous military installations and public works projects undertaken by colonial governments
even before the 20th century. This is particularly true
between the two world wars when infrastructural projects were undertaken either by an agency of expatriate
engineers who occupied the senior echelons in public
0263-7863/00/$20.00 7 2000 Elsevier Science Ltd and IPMA. All rights reserved.
PII: S 0 2 6 3 – 7 8 6 3 ( 9 9 ) 0 0 0 2 7 – 7
Low Sui Pheng, C.H.Y. Leong / International Journal of Project Management 18 (2000) 307±316
works departments, or by consulting engineers who
sent their representatives to direct and supervise the
works of local labour. The operations undertaken by
the British Colonial Oce in Africa, Asia and the Caribbean are good examples of overseas construction
works undertaken in the past. In the period following
the end of World War 2, international construction activities followed very much the same pattern witnessed
between the two world wars. As colonies gained independence in the 1950s and 1960s, new governments
were formed who realised the need for major infrastructural development. This fuelled the demand for
experienced builders and designers, the bulk of whom
came from developed countries[5]. The scope for international construction in developing countries was also
boosted considerably following the emergence of international funding institutions such as the World Bank
and the Asian Development Bank. Many contractors
from the developed world were involved with construction works funded by these agencies in developing
countries. The petrodollar boom in the Middle East
and elsewhere in the 1970’s also witnessed a marked
expansion in international construction activities[6]. International construction also gained prominence in the
newly industrialising economies of Asia, at least until
mid-1997 when the Asian currency crisis set in[7].
It is clear from the above history of international
construction business that modern-day construction
®rms no longer operate solely in their domestic markets. Consequently, they have to increasingly deal with
individuals from other cultures. Project managers from
these ®rms must therefore develop skills to interact
with individuals whose behavioural attributes are in¯uenced by other cultural priorities. The following skills
are important for project managers in the international
e€ective communication skills;
e€ective leadership skills;
good interpersonal skills;
adaptability and ¯exibility;
functional/technical strengths
Without these skills, project managers on overseas
postings may be hindered by cultural problems which
can lead to unnecessary costs/losses to their companies. Nevertheless, while e€ective cross-cultural management can make or break a building project
overseas, it is not the only one signi®cant factor which
determines the success of the venture. Other factors
which are equally signi®cant may include the demand
level for construction services in the host country;
supply of capital, materials and labour; activities of
competitors; national and international economic
trends; laws and regulations as well as organisational
This paper focuses on two areas. It will examine key
concepts in cross-cultural management as well as key
functions in construction project management with
speci®c reference to China. With this background in
mind, a real life case study on the New Chinese Hotel
project in China will be presented to show how the interaction between cross-cultural management and construction project management can a€ect the outcome
of the project. Lessons on the Chinese style of management will be drawn from the case study for international construction ®rms. The main areas to be
covered in this paper are shown in Fig. 1.
2. Cross-cultural management
Personal relationships are very important in Asian
cultures. Asians have a tendency to ®rst develop personal relationships with their business partners before
getting down to the speci®cs of negotiation. Family
ties and kinship, in particular, feature prominently in
Asian business dealings. There is also a tendency to
keep relations harmonious by not talking directly
about problems. Confrontations are avoided and
human relationships are highly valued in Asian societies. In contrast, personal relationships to the Americans are less important when doing business.
Americans like to get to the point more quickly and
directly even though such an approach may embarrass
someone personally and publicly[8]. Cultures with a
high social conscience, as in China, prefer to work in
teams and to make decisions through group consensus.
Other cultures, as in North America, place a high premium on individualism and individualistic reactions.
People in these cultures are not inherently team
players[1]. Some cultures such as those in Asia, Northern Europe and South America also emphasize social
status which is re¯ected, among other things, in seating
arrangements and other protocols based on positions.
On the other hand, the North American culture tends
to place more emphasis on competence. In cultures
where status is important, as in Japan and China, talking about problems directly with a person in public is
avoided so as not to embarrass the person or downgrade his status[3]. The time element also holds di€erent connotations in di€erent cultures. A monochronic
time perspective refers to the treatment of events in an
orderly fashion where things are done separately and
time is compartmentalised, organised and controlled.
It also tends to focus on the present or immediate
future and believe that an individual can a€ect future
outcomes. Monochronic cultures are prevalent in
North European and North American countries. On
the other hand, a polychronic time perspective is endless and where there is plenty of time which has no
beginning or end. More importantly, many events can
all happen at the same time. This perspective is preva-
Low Sui Pheng, C.H.Y. Leong / International Journal of Project Management 18 (2000) 307±316
lent in countries in Asia, the Middle East and Latin
America. In this context, many topicsÐinvolving both
the family and businessÐare discussed concurrently in
meetings. Polychronic cultures tend to be more futuristic and fatalistic in outlook, believing that one cannot
control the future[1].
The key concepts which can be used to explain the
cross-cultural experiences described above are discussed in the following sections.
2.1. Organisational and national culture
Every organisation has its own unique culture which
is not quite the same as others. Consequently, members of an organisation need to learn their own culture. These values can be changed when top
management introduces new beliefs and attitudes.
Although workplace experiences are passed from
senior to junior sta€, these may not necessarily be in
line with management beliefs. Organisational culture
can has a strong in¯uence on the national culture.
Where top management is able to build a strong and
positive culture which re¯ects the national culture, the
behaviour of employees can be rendered more predictable.
National culture is learnt very early in life when
the individual is still unaware of its in¯uence. Organisational culture, on the other hand, is acquired
much later in life at a conscious level. Hence, it
can be deduced that national culture is more deeply
entrenched in the individual than organisational culture. Consequently, it is more dicult to change
one’s national culture than organisational culture.
The concept of changing one’s organisational culture
can be fraught with risks but may be inevitable in
some cases, as for example, when the existing internal system has deteriorated or when environmental conditions have changed. Top management must
initiate this change. It should also be highlighted
that the development and survival of organisational
change is not entirely dependent on individuals who
make up the organisation. This as evident in cases
where people come and go within a company and
yet the organisational culture remains[9]. The design
of company’s goals is therefore a€ected by organisational culture. As goals change, organisational culture also changes in tandem.
The organisational culture of an existing company
re¯ects the national culture in strong forms. It is logical for members of an organisation to resist plans to
impose a culture that does not re¯ect their national
values. Hence, an understanding between top management and employees is critical to avoid unnecessary
con¯icts. Where organisational culture is weak and
appears to have little in¯uence, workplace values and
behaviour provide a clear re¯ection of national cultures and values. On the other hand, where an organisational culture is strong, the manager cannot take for
granted that what he observes in the workplace is typical of a wider context[1]. Cultural control can be
achieved by using implicit norms that induce employees of di€erent nationalities to commit to a project. To
ful®l the technical requirements, training can be provided to employees by explicitly writing all instructions
in manuals. For the non-technical requirements, an
emphasis should be placed on developing an awareness
Fig. 1. Theme of paper.
Low Sui Pheng, C.H.Y. Leong / International Journal of Project Management 18 (2000) 307±316
of organisational culture and by integrating any newcomer into the company.
2.2. Cross-cultural communications
While certain forms of communication are acceptable in one country, these may be considered taboo in
another. Hence, while direct physical contacts (for
example, a peck on the cheek) may be practised by
North Americans, these are not accepted in most
Asian countries. The Japanese, for example, will avoid
using language which may cause o€ence. However, the
Japanese indirectness as evident in their `evasive’ manner in saying `yes’ may actually rebound to their disadvantage and cause the foreign party to lose face.
Cultural values, task as well as situational variables
help to determine the norms for communication.
The dichotomy of one-way as opposed to two-way
communication can also be an issue in cross-cultural
management. One-way communication is characterised
by the use of authority by the superior with the subordinates providing little or no feedback which may be
perceived otherwise as a challenge. This is prevalent in
societies where there is a desire to preserve social harmony and to avoid situations where disagreement may
arise. In organisations where one-way communication
dominates, attempts by senior managers to involve
their subordinates in decision-making may threaten
social norms and be resisted. On the other hand, twoway communication is adopted when a company
enters a new market and jobs undertaken by employees are no longer routine. Complex and frequently
open-ended situations may render the need for managers to adopt a more participative style of management by involving their subordinates in decisionmaking.
In cross-cultural management, managers should also
be sensitive to the non-verbal signals used as these signals may have a signi®cance which is di€erent from
what they are accustomed to in their own culture.
When perceived wrongly, these signals may be interpreted di€erently in a di€erent cultural setting. For
example, Americans are not comfortable with silence
and reserve. Taking time for re¯ection is often seen as
evidence of ine€ective management. On the other
hand, in Japan, managers dismiss this propensity for
action and decision as impulsiveness. For the Japanese,
taking quick decisions may signal a poor grasp of the
importance of making the decision on hand and an
insucient reaction. Silence is an indication of deep
mutual respect. Hence, close friends in Japan drink
silently together. Where formalised exchanges are concerned, Americans tends to pay less attention to protocol. In Japan, however, failure to show respect by
carefully exchanging and inspecting business cards can
get business negotiations o€ to a bad start.
Likewise, the dress code considered appropriate in
the oce, at meetings as well as in formal and informal social functions should be understood in cross-cultural management. In this context, North European
managers tend to dress more informally than their
Latin American counterparts. While style is important
for the latter, Anglo and Asian managers do not want
to stand out or attract attention in their dressing[10].
2.3. Cross-cultural dispute resolution
The Japanese generally prefer to resolve disagreements through compromise both within their own organisation as well as between other organisations.
They also tend to avoid contractual arrangements
which emphasise rigid performance criteria. Flexibility
is instead focused upon when interpreting contractual
agreements. In other countries, cross-cultural dispute
resolution can depend on many factors, including:
. level of tolerance of disagreement;
. localised strategies for resolving con¯icts;
. perception of the extent of appropriate intervention
by a superior.
In this case, assertiveness is valued more highly in a
culture that is both individualistic and masculine in
outlook. Consequently, con¯icts are resolved by
thrashing them out in the open. Non-assertiveness is
associated with an admission of defeat by this group
of people[11].
2.4. Cross-cultural negotiation
Problems at the negotiation stage can be inevitable
when a company from a developed country is trying to
access the market in a developing country. These problems occur because managers from the developed
country tend to assume the responses and behaviour
of their clients in the developing country without really
understanding what they want and what they can
o€er. Unnecessary con¯icts consequently arise[5]. The
problems encountered in the negotiation stage may be
magni®ed further when the cultural climate in both
countries is diversely di€erent, consequently leading to
a breakdown in communications.
3. Project management in China
As with many other developing countries, China
is still dependent on the developed countries for
capital and technology in many sectors of its economy. Its human resource is underdeveloped as
insucient funds are set aside for establishing training and education centres. A signi®cant proportion
of the Chinese population, particularly those in the
Low Sui Pheng, C.H.Y. Leong / International Journal of Project Management 18 (2000) 307±316
rural areas, are largely unskilled. Because of its past
closed-door policy, growth areas in human resource
as well as technology were sti¯ed in China.
Like other sectors in the Chinese economy, the construction industry is also dependent on foreign capital,
technology and expertise. This is particularly true in
mega infrastructural and sophisticated industrial projects where the Chinese lack the track records. There
are, however, several characteristics which foreign project managers must be aware of when they function in
the Chinese construction industry. Some of these
characteristics are highlighted below.
. Trust and mutual respect are important values in
the Chinese community. Foreign project managers
should not therefore impose too much of their
power and authority over their Chinese counterparts
but should instead emphasise trust and mutual
. Family businesses are still very dominant in China
and there is a heavy reliance on family contacts
both locally and internationally. When negotiating a
deal with a Chinese construction company, the
foreign project manager should be prepared to face
a horde of subcontractors who are connected in one
way or another to the main Chinese contractor.
There must be tactfulness and diplomacy in dealing
with situations of this nature. It is important for the
foreign project manager not to complain or jeopardise anybody’s position within the company,
because the bond and mutual trust between the
main Chinese contractor and subcontractors is dicult to break.
. There are also constraints in the use of international
standard forms of contract in the Chinese construction industry. This is because little or no provision
at all is included in these forms to provide for
amendments in order to suit local conditions. The
contract documents used are frequently lengthy and
refer to standards, codes and speci®cations which
are not readily available and if available, are often
applied rigidly. The situation for the foreign project
manager is made worse by the language barrier. The
local Chinese advisors do little to help, and prefer to
rely on provisions in these documents either as a
means to …
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