Leadership & Organization Development JournalBenefits of Hong Kong Chinese CEOs' Confucian and Daoist leadership stylesChau#kiu Cheung Andrew Chi#fai Chan

Article information:To cite this document:Chau#kiu Cheung Andrew Chi#fai Chan, (2008),"Benefits of Hong Kong Chinese CEOs' Confucian andDaoist leadership styles", Leadership & Organization Development Journal, Vol. 29 Iss 6 pp. 474 - 503Permanent link to this document:http://dx.doi.org/10.1108/01437730810894159

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Benefits of Hong Kong ChineseCEOs’ Confucian and Daoist

leadership stylesChau-kiu Cheung

Department of Social Studies, City University of Hong Kong, Kowloon Tong,Hong Kong, and

Andrew Chi-fai ChanDepartment of Marketing, Chinese University of Hong Kong,

Sha Tin, Hong Kong

Abstract

Purpose – Because of the paucity of information about what and how Chinese leadership stylescontribute to organizational success, this study aims to elucidate Chinese leadership styles withreference to Confucian and Daoist schemata, relate them to organizational success, and explicate therelationships by exploring a grounded theory.

Design/methodology/approach – To obtain such knowledge, this study applies a grounded theoryapproach to analyzing interview data from 11 Hong Kong Chinese CEOs.

Findings – Results delineated the Chinese leadership styles based on relationship building, virtuouspractice, hierarchical and centralized organization, and humility and self-effacement. These practiceswere conducive to trust, cooperation, competence, and other achievements in the staff. Thecontributions of the Chinese leadership styles tend to reflect a security theory in that sustainingfollowers’ security appears to mediate leadership practices and their outcomes.

Originality/value – Because the tradition of Confucian and Daoist teachings can be a basis forsuccessful Chinese leadership styles, the teachings can still be valuable for leadership developmenttoday.

Keywords Chief executives, Confucianism, Management styles, Hong Kong

Paper type Research paper

In choosing a favorable leadership style among a plurality of styles, it is imperativeto explore the benefit of the particular style. For this purpose, the present studyfocuses on the delineation of Chinese leadership styles as contrasted with prevailingWestern leadership styles and the identification of the benefits based on interviewswith 11 Hong Kong Chinese chief executive officers (CEOs). It accordingly contraststhe Chinese leadership styles of Confucian and Daoist brands with the Westernleadership styles of transactional, transformational, Christian or servant, andconnective models. Whereas the contrast witnesses both differences and similaritiesin varying components of the styles, it illustrates that, as a whole, the Chinesestyles are distinguishable from the Western styles. Furthermore, the study aspiresto illustrate the usefulness of Chinese leadership styles for achieving their aim ofeffective leadership. This usefulness is a basis for the sharing of good leadershippractices internationally to facilitate cross-fertilization in international leadershipdevelopment.

The current issue and full text archive of this journal is available at

www.emeraldinsight.com/0143-7739.htm

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Received December 2007Revised March 2008Accepted March 2008

Leadership & OrganizationDevelopment JournalVol. 29 No. 6, 2008pp. 474-503q Emerald Group Publishing Limited0143-7739DOI 10.1108/01437730810894159

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The study of the Chinese leadership styles or perspectives is paramount for at leastfive related reasons. These reasons pertain to the:

(1) globalization of leadership practices in organizations and corporationsspreading across national and cultural borders (Marcoulides et al., 1998);

(2) significance of Chinese (Guan, 2001) and Hong Kong (Chiu and Lui, 2004;Forrest et al., 2004) organizations and corporations in the never endingglobalization endeavor;

(3) international division of labor and dependency (Ashley, 1997), involvingChinese and Hong Kong organizations and corporations (Chan, 2004);

(4) international employment and deployment of personnel relating Chinese tonon-Chinese working people (Borstorff et al., 1997; Sin and Chu, 2000); and

(5) international development of leadership through knowledge sharing andcross-fertilization involving Chinese as well as Western knowledge (Selmer,2001).

Notably, Hong Kong has been functioning as a financial center that attracts andfacilitates investment for international development for several decades (So, 1986). Itsknowledge on flexible development and economic structure, free capitalism, businessgrowth, and cross-cultural management is appreciable for international learning(Hofstede et al., 2002; Ng and Poon, 2004). Without doubt, the leadership style in HongKong has also been a prominent topic for research and learning across borders (Chu,2004; Redding, 1990; Wong, 1988). Such learning or exposure is promising for thedevelopment of leadership on an international scale (Cao, 1999). Eventually,international leadership development would fuel globalization (Ralston et al., 1996),which in turn reinforces the need for assembling knowledge about leadershipinternationally.

Of concern are Chinese leadership styles that demonstrate effective leadershipoutcomes. Leadership is clearly not a showoff but is instrumental to the aim of leading.Essentially, leadership refers to mobilizing collective action to achieve a goal. It isinevitably a manipulation that explicitly or subtly capitalizes on other people’s effort(Greenleaf, 1977). Because of people’s resistance to manipulation, leadership is notnecessarily successful. Effective leadership styles need to circumvent resistance inorder to achieve their goals. Besides, leading people to exert collective action typicallyyields favorable outcomes (Zaccaro, 2001). Such outcomes hinge on effectiveleadership, which necessarily includes that of Chinese leaders. Nevertheless, effectiveChinese leadership styles have received less attention than Western or mostly NorthAmerican ones (Ardichvili, 2001; Littrell, 2002). Such concentration attention toWestern leadership styles may not be adequate in the current world characterized byglobalization and cross-cultural management (Manning, 2003; Marcoulides et al., 1998).Working people in many places of the world inevitably need to fit themselves to theChinese style of leadership in order to work effectively (Ashby and Miles, 2002;Chemers, 1997; Mendonca and Kanungo, 1994).

In order to ascertain Chinese leadership styles, the study is obliged to illustrateways that the styles engender desirable outcomes expected of leadership. As such,generating effective managerial outcomes would be a demarcation criterion foridentifying leadership styles or perspectives (Zaccaro, 2001). The criterion is

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reasonable in view of evidence supporting the contribution of various forms ofleadership to acceptance of and satisfaction with leadership (Ardichvili, 2001; Felfe andSchyns, 2006), work and organizational commitment (Mathieu and Zajac, 1990;Walumbwa et al., 2005), work involvement (Howard, 1992), job or work satisfaction(Smith et al., 1994; Walumbwa et al., 2005), job performance or competence (Epstein,2001; Helgstrand and Stuhlmacher, 1999; Nikolaou, 2003; Jung and Avolio, 1999), andcreativity and innovation (Lee and Chang, 2006). Among these forms of leadership,transformational leadership appears to be a common cause of various favorableoutcomes (Pearce and Sims, 2002; Walumbwa et al., 2005). Another notable leadershipstyle is the transactional one, which can be conducive to effective outcomes accordingto some theory and research (Jung and Avolio, 1999; Podsacoff and MacKenzie, 1998).These leadership styles from the Western perspective are thereby important referencepoints for identifying effective Chinese leadership styles.

Leadership styles in Chinese and Western perspectivesSalient in the Chinese leadership styles are those of Confucian and Daoist origins,whereas Western styles consist of transactional, transformational, Christian orservant, and connective prototypes. Despite their disparity in origin, Chinese andWestern styles share some similar practices. Nevertheless, each style is distinctivefrom the others under close examination (see Table I).

Confucian leadership has been evolving from the Confucian perspective or norm forat least 3,000 years of preaching and practice. The Confucian perspective took shape,thank to Confucius’s (551-479BC) consolidation work. Nevertheless, the perspectiveemerged several hundred years before Confucius, most visibly by the beginning of theZhou Dynasty, together with the creation of Zhou propriety or ritual. In Chinese,Confucianism means the ideology of scholars, gentlemen, or ritual managers (Liu, 1997;Pan and Yu, 2001). As such, rituality and its conformity in the form of propriety orpoliteness are at the center of Confucianism. This conformity forms virtue or morality,which is the aim of education and cultivation, which differentiate gentlemen fromuncultivated people (Fernandez, 2004). Within the scope of virtue, benevolence orhumaneness is the core, which deals with kindness, love, forgiving, magnanimity, andsensitivity to other people, including subordinates (Fernandez, 2004; Pan and Yu, 2001;Schlevogt, 2002). Meanwhile, keeping promise, justice, righteousness, unselfishness,and loyalty together constitute virtue. In all, virtuous practice is the foremostcomponent in Confucian leadership. Such practice, according to Confucianism, hingeson the rule of man, put in a right position to exert authority hierarchically. TheConfucian ideal is to have a sage-like man as the leader to maintain social order byvirtuous practice. In this juncture, the Confucian tenets of definitionism, relationalism,and harmony are crucial. Definitionism maintains that every person must have aproper name, title, or role that prescribes behavior (Liu, 1997). As such, only the leadercan play the leader’s role and subordinates should follow. It implies that one cannotinterfere with another’s business and one’s business vanishes once one is not in theposition. This is the rule of man such that everyone has one’s unique rules andpractices. Importantly, the leader has a role to innovate and foster innovation amongfollowers, in order to differentiate one leader from another (Pan and Yu, 2001).Restriction on one’s role further extends to dyadic and social relationships involvingpairs of the ruler and ruled, parent and offspring, husband and wife, and so on, in the

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Table I.Chinese and Western

leadership perspectives

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tent of relationalism (Pan and Yu, 2001). The tenet aims at sustaining cohesion,consensus, and mobilizing support, which would eventually proliferate order andfunctioning. Underlying relationalism is the pursuit of harmony, which extends fromrelationships among people to those with nature (Fernandez, 2004; Pan and Yu, 2001).A means to maintain harmony is through learning and accommodation to people aswell as nature. In the realm of leadership, they importantly rest on observation offollowers’ performance (Pan and Yu, 2001). Meanwhile, the leader is responsible forfostering followers’ virtue to make the followers trustworthy. This effort is the basisfor the leader to trust followers. All the above leadership practices, in the Confucianideal, rely on the leader’s initiation, with authority centered on the leader and delegatedin a hierarchical way (Schlevogt, 2002).

Confucian leadership or Confucianism rests on the theoretical root of functionalism,manifested as the pursuit of harmony (Hwang, 2000; Weber, 1964). This root explainsthe emphasis on virtuous cultivation, learning, and accommodation. In the first place,Confucian theory views nature as an orderly system with components organizedhierarchically and functioning in a collective way (Zhou and Yan, 2002). Second,Confucian theory views virtue as a reflection of nature. Sometimes, the theory tried tomystify natural order by likening it to the sentiment of the heaven. The theory thuspersonalizes natural phenomena and in turn trusts people’s virtue in people’s nature.Performing virtuous practice and leadership then represents a way to be honest topeople’s nature and to keep human and physical natures functioning. Conversely, thetheory claims that vicious practice and rule would irritate the heaven, which wouldenforce sanctions on the ruler or leader.

Daoist leadership has been evolving from Daoist teaching at least 2,500 years as itscreator, Lao Zi, was a contemporary of Confucius. Since its inception, Daoism has beenevolving in a parallel way with Confucianism. Daoism puts emphasis on conformity todao or the way, which is different from the virtuous way of Confucianism. Thedifference happens when the Daoist way refers to the natural way that is universal tosocial as well as physical realities, whereas the Confucian way concentrates on humanrelationship. Such a Daoist way emphasizes change, flexibility, and taking opportunityrather than maintenance of stable order (Liu, 1997). The Daoist way furthermoreupholds the tenets of reversion, softness, and inaction (Durlabhji, 2004; Low, 2003; Panand Yu, 2001). Among these tenets, the tenet of reversion tends to be the most profoundas it recognizes the nature of dialectics or polarity, and proposes alternative and evendiametrically opposite ways to achieve a goal. Put into practice, the tenet of reversionadvises one to give in order to take, to forgo in order to capture, and to follow in orderto lead. Furthermore, the tenet suggests the leader to behave like a child and to take aretreating stance. In a similar way, the tenet of softness advocates the strength ofsoftness and regards it as more instrumental than hardness. The tenet likens thestrength of softness to that of water, in terms of its penetrative and corrosive power.Applied to leadership, the soft leader is desirably invisible, noncoercive, inactive,effortless, and noninterventive. As such, the Daoist leader would stay away fromcompetition, innovation, and being cunning. The ideal Daoist leader would be a ruler ofa small group, imposing no rules, and instigating no desire among group members.Ritual, cultivation, and social order are not of concern to the Daoist leader, who prefersinaction, with no pushing and even training (Liu, 1997).

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Daoist leadership has its grounds in the theory of naturalism (Pan and Yu, 2001).The prominent characteristic of naturalism is the equating of physical and socialrealities. As such, tenets about leadership and social behavior just follow the operationof the natural world. The tenet of softness is therefore justifiable with reference to thenature of water. Similarly, the tenet of reversion reflects the nature of gravitation, inthat the bottom is the most rich and powerful, as in trees, buildings, valleys, and oceans(Moeller, 2004). Daoist theory regards the natural and social worlds as a form of arotating wheel, which maintains a cycle with no beginning and ending. This analogyjustifies the dialectic view regarding the change between darkness and lightness, or yinand yang. More essential in Daoist theory is the specification of dao, the way, qi, orether as the universal constituent of human and natural lives (Ge, 1996). Because of thecommon root of humanity and nature, Daoism anticipates and advocates people’sreturn or conformity to nature. As such, Daoism regards nature as the best teacher forleadership and other activities.

Transactional leadership relies on the use of appropriate rewards to motivatefollowers (Pearce and Sims, 2002). It states that the provision of rewards needs to becontingent on the follower’s performance and preference. Accordingly, material andnonmaterial rewards can be motivating to different people at different times. Themotivating function of a reward specifically depends on valence, instrumentality, andexpectancy regarding the reward. As such, motivation occurs when the reward isvaluable, contingent on a performance (i.e. instrumentality), which in turn is contingenton an effort (i.e. expectancy). To maximize the relationship between performance andreward, managing by exception is a preferable mode. Transactional leadershiptherefore builds on the theory of behaviorism or cognitive-rationality, such thatcontingent reinforcement would produce success in leadership. Meanwhile,transactional leadership promotes and capitalizes on people’s calculation anddependency on the leader (Manz, 1998). It appears to be a straightforward means toachieve a goal by paving a straight and reasonable path, through contingentrewarding, to the goal (Klein and House, 1998).

Transformational leadership hinges on the long-term development of followers(Avolio, 2005; Bass, 2002; Pearce and Sims, 2002). The underlying theory therebyemphasizes a long-term perspective of rationalism, which goes beyond short-termbehaviorism or instrumental rationality. Instead of providing rewards contingently,transformational leadership provides vision, employs idealized influence, inspirationalmotivation, intellectual stimulation, and individualized consideration, such asmentoring (Zaccaro, 2001). These techniques specifically involve the building ofmoral reasoning, expectation for performance, challenging the status quo, and the useof charisma to transform followers (Ardichvili, 2001; Bass, 2002). Such transformationand thereby personal growth and long-term rewards in followers are rational bases forthe success of transformational leadership.

Christian or servant leadership puts the promotion of followers’ interest in the firstplace (Barbuto and Wheeler, 2006; Greenleaf, 1977; Manz, 1998). Such leadership is notto serve followers in a subservient way. Rather, the servant notion in Christianleadership means encouraging followers to grow, be creative and intelligent, andserving people, and thereby better the society. For this purpose, Christian or servantleadership advocates acceptance, tolerance, empathy, love, forgiveness, and adherenceto the Golden Rule of giving benefits to others just like to oneself. The benefits would

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include ownership and commitment rather than dependency. Such leadership alsorequires equality between the leader and followers and participatory decision makinginvolving followers. The leadership would survive in a decentralized organizationalstructure that accommodates to followers’ needs. In such a structure, the leader needsto behave in a humble and moral way to mitigate stress from administration,regulation, and manipulation. The mitigation is the primal reason for the call forservant leadership. Such leadership reflects the Christian concern withhumanitarianism, characterized by love, even for one’s enemies.

Connective leadership promotes the formation of various coalitions with followersand other people (Lipman-Blumen, 1996). Such leadership is principally a response tothe increasingly globalized world. It thereby champions the development ofcosmopolitan attitudes and practices that connect to people across statuses andcultures. Dispelling Machiavellianism, individualism, and even charisma is theworking goal of connective leadership. Conversely, connective leadership aspires tomaximize social networks and alliances in an egalitarian way. This aspiration rests onthe leader’s entrusting, empowering, and ennobling people. Meanwhile, the leaderneeds to be accountable, authentic, tolerant, altruistic, helpful, and responsive. Theleader’s help can transpire in the promotion of followers’ sense of security, coherence,interdependence, commonality, and sharing of visions.

Confucian leadership, Daoist leadership, transactional leadership, transformationalleadership, Christian leadership, and connective leadership are mostly dissimilar fromeach other, despite some similarities (see Table I). In the dimension of virtue versusopportunism, Confucian leadership, Christian leadership and connective leadership arecommon in their emphases on virtue, morality, and the Golden Rule. They contrastwith Daoist leadership, which questions about the significance of universal andabsolute morality in the state of change. In the dimension of learning versusinfluencing, Confucian leadership, Christian leadership, and connective leadershipcommonly pay attention to learning about and trusting followers, whereastransformational leadership endeavors to employ various means to shape followers.In the dimension of harmonizing versus dividing, Confucian leadership, Christianleadership, and connective leadership again come together in upholding harmony andcommonality. In contrast, Daoist leadership, transactional leadership, andtransformational leadership prefer individualized and divisional treatment throughcontingent rewarding and other means. In the dimension of ruling versus equalizingConfucian leadership stands away from Daoist leadership, Christian leadership, andconnective leadership. Whereas Confucian leadership favors the hierarchy of authority,the other leadership styles either treasure equality or reverse the authority hierarchy.In the dimension of innovating versus inaction, Confucian leadership anticipates aninnovative leader, whereas Daoist leadership and Christian leadership do not agreewith the need for the leader’s great contribution. Besides, a unique principle inConfucian leadership is that of moderation or taking the middle way, which disfavorsradical action. As such, Confucian leadership is clearly disparate from Daoistleadership, even though they have been evolving in the same space and time.Confucian leadership and Daoist leadership, as a whole, also do not agree withtransactional and transformational leadership. The disparity lies in the emphasis onindividualism in the latter. Furthermore, Daoist leadership, which denies universalmorality, clearly contrasts with Christian and connective leadership. Confucian

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leadership, valorizing hierarchy, is also different from Christian and connectiveleadership. The prime source of differences among the leadership styles, at any rate,lies in the difference in premises. Notably, Confucian and Daoist leadership upholdfunctionalism and naturalism respectively, whereas Western leadership styles haveother principal concerns.

The Chinese leadership styles of Confucian and Daoist persuasions are thusdifferent from Western leadership styles based on the conceptual analysis. Thisdifference is the basis for studying Chinese leadership empirically. The empirical studyis necessary to ascertain the application of the Chinese leadership styles among HongKong Chinese CEOs and the contribution of the application to successful leadership.The CEOs are favorable informants because of their clear, outstanding, and exemplaryrole of leadership (Zaccaro, 2001; Wood and Vilkinas, 2005). Clearly, as the CEO’s workenvironment is more complicated than that of people at lower levels, the CEO is obligedto demonstrate more leadership practices. CEOs’ narratives about their leadership areessentially an important source of knowledge for developing leadership (Ashby andMiles, 2002).

The study relied on a qualitative approach to illustrate the details of Chineseleadership styles and their outcomes. Specifically, the approach is to clarify leadershippractices and outcomes based on CEOs’ narratives. Outcomes of leadership broadlyrefer to the performance in an organization. They would cover work commitment,satisfaction, performance, and acceptance of leadership as found in past research. Inparticular, the study eventually reveals such outcomes of effective leadership as trust,collaboration, innovation, efficiency, and cost reduction.

MethodInformants recruited for the study were 11 Hong Kong Chinese CEOs, comprising ninemen and two women aged over 40. They were all CEOs or large corporations, some ofwhich were the biggest in their industries in Hong Kong. Sampling and recruitment ofthe CEOs hinged on the CEOs’ connection to an executive MBA program in HongKong. Such connection consisted of the delivery of guest lectures, recruitment talks,advisory, consultative, and other activities between each of the CEOs and the programor its personnel. Nevertheless, these CEOs did not have a stake (i.e. financial andemotional interest) in the MBA program. The study mainly consisted of a two-hourinterview with each of the informants separately. Profiles of the informants, withrandomly assigned codes from CEO A to CEO K are as follows.

SampleCEO A headed a leading cable television company in Hong Kong. He graduated inearly 1970s from universities in the USA and Germany, with a major in mathematics.His achievement is in the development of telecommunications, media, andentertainment.

CEO B headed multinational direct marketing business in the region includingHong Kong, Taiwan, and Mainland China. She was a chairperson or deputychairperson of a number of regional business federations and women’s association, andwas a steward of an association funding children in youth in China. Getting herdegrees in a university of Hong Kong, she entered the direct marketing corporation in1977.

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CEO C headed an electricity corporation, which was among the few awarded thefranchise for operation in Hong Kong. She was a chartered accountant and had beenworking in energy-related business for more than 20 years. Her achievement won herawards for the outstanding entrepreneur and quality management. She was also activein community affairs, notably in the committee to combat crime. Graduating from auniversity in Canada, she initially started her career in Canada during 1979.

CEO D headed a statutory financial authority in Hong Kong. Graduating in auniversity in Hong Kong, he got the first class honors in mathematics and statistics.Moreover, he got honorary doctoral degrees awarded by universities in Australia andHong Kong. He also got awards in Hong Kong and Europe for his excellence as abanker. Most notably, he got an award from the Government of Hong Kong.

CEO E headed the Asian branch of an American bank. He majored in economics andgraduated from a university in the USA in 1977. In the same year, he began his careerin the bank.

CEO F started and headed a holding company with core business in constructionand properties. He was a civil engineering graduate from a university in the USA in1958. Between 1994 and 1996, he got some doctoral degrees from universities in theUSA, Hong Kong, and Britain. He started an architect company in 1962, a constructioncompany in 1963, and his current business in 1972. His architectural designs won him alot of awards. Besides, he earned the fame as the eminent entrepreneur and the bestcorporation leader in Hong Kong. His business also ranked as one of the five tigers inChinese property business in Hong Kong. He was one of the first investors in MainlandChina since its opening in 1979. Furthermore, he was the biggest investor inconstruction business in Mainland China. He definitely made outstandingcontributions to the development of Mainland China. Besides, he offered a lot ofpublic service to Hong Kong and Mainland China, and was accordingly a chairman andmembers of a number of political and policy-making organizations.

CEO G headed a local bank. He got his bachelor’s and master’s degrees in socialscience and economics in Hong Kong and New Zealand. He started his career in thecurrent banking group in 1978. Between 1989 and 1991, he was once an advisor to theGovernment of Hong Kong and the Governor personally. He was a councilor of apolicy-making council between 1995 and 1997 and was a legislator between 1991 and1995. Currently, he was a chairman and member of a number of political and publicservice committees in Hong Kong and Beijing.

CEO H headed telecommunications business in a local corporation. He gotcredentials in social science and management from a university in Hong Kong. Hisearly career, spanning 23 years, was in an airline company. Between 1989 and 1990, heserved as a consultant to the policy making in the Government of Hong Kong. He gotthe award as a justice of peace.

CEO I headed an indigenous corporation group with core business in retailing. Hewas a civil engineering graduate and a MBA graduate from universities in the USA,and got an honorary doctor degree awarded by a university in Hong Kong. Hiseminence was most notable in his expanding the local company into a multinationalcorporation. In providing public service, he was a chairman and member of a numberof policy-making and political associations and committees. He got the award for thebest executive in Hong Kong and the nomination as one of the best 25 managers in the

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world in 1995. In 2000, he was elected as the best executive in newly developed marketsand one of the 50 business stars in Asia.

CEO J headed insurance business in a local corporation group. He was an economicsgraduate in a university in the USA and later became the member of the managingboard of the university. He offered public service as a chairman and member of anumber of associations in Hong Kong and Shanghai.

CEO K headed the Asian insurance group of a large banking group. He graduated ineconomics and psychology from a university in Hong Kong. In 1972, he joined thecurrent bank. Currently, he was the chairman of the banking federation in Hong Kong.Besides, he was a member of a number of committees for public service.

As such, the CEOs had at least 20 years of experience working in Hong Kong. Theyproved their career success through gradual escalation of rank or growth in business.Importantly, they learned and improved their leadership skills mostly in their careerpaths, as many of them did not learn the skills from the educational institution. Theywere thereby important informants about working knowledge of leadership in HongKong.

Data collectionThe interviews elicited responses to the following major questions: “What are the goodpractices for your success?” “How do you manage successes and failures?” “What arethe criteria of a good leader and a chief executive in Hong Kong?” Importantly, theinterviews employed probing questions to solicit concrete examples and incidents toillustrate and substantiate responses. Each of the interviews involved one of the CEOsas the interviewee and one of the authors as the interviewer. The CEOs consented tohave their interviews videotaped, transcribed, analyzed, and extracted in ananonymous way for the study.

The grounded theory approach provided the guide for the coding and analysis ofqualitative data transcribed from the interviews (Pandit, 1996; Strauss, 1987; Straussand Corbin, 1998). This approach began with open coding, which highlightednarratives and classified them into categories and concept codes representing twomajor contents, pertaining to leadership and its outcome or achievement. The opencoding was a repetitive procedure involving several cycles to finalize the categoriesand concepts. A rule for the finalization referred to the constant comparative method,which confirmed codes that could apply to similar contents and differentiate dissimilarcontents. In other words, the comparative method assigned the same code for similarcontents and different codes to different contents. The method mostly involved acondensation procedure to categorize important qualitative data with a set ofdistinctive codes to summarize similar contents The second step of the approachproceeded with axial coding, which primarily related codes of leadership andachievement in the present study. This step fulfilled the essential aim of the study toexplore outcomes of leadership, specifically for each of the components and practices.One obvious basis for the axial coding was the interviewee’s report about therelationship between the leadership practice and outcome. In addition, inferential andanalytic techniques were necessary to grasp the relationship between the leadershippractice and outcome. The techniques essentially rested on the empathicunderstanding of the qualitative data. Finally, the grounded theory approachconcluded with selective coding, which developed a theory to explain relationships

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between leadership practices and outcomes. The theory thereby was necessary to fillthe missing link between leadership practices and outcomes. Such theory developmentrelied on qualitative data and supportive arguments invoked for the data rather thanany a priori theory. All the procedures of coding benefited from corroborative effortbetween the two authors. Each author then served as an error detector to preventpersonal bias and misunderstanding and thereby to ensure the reliability and validityof coding and resultant findings.

The grounded theory approach was adequate for the study aim to identifyrelationships between leadership and its outcomes and develop theories for explainingthe relationships. In contrast, phenomenological, hermeneutic, postmodern, and otherapproaches that emphasize the holistic understanding of singular concepts and themeswithout undergoing a series of systematic coding procedures to explore relationshipsand build theories would not cater to the study aim (Cheek, 1999; Hekman, 1986;Moustakas, 1994). Essentially, the grounded theory approach was distinctive in itsidentification of structural components in terms of detailed codes to reproduce thewhole picture. This identification reflected the adherence of the approach to astructuralist, positivist, and realist view of social life. Therefore, the approach did notaspire to understand every informant’s innermost world in a thorough way. Leadershippractices and outcomes rather than each of the leaders as a whole person were thefocus of the study.

ResultsThe grounded theory analysis of CEOs’ narratives generated findings in three steps. Inthe first step of open coding, the analysis identified prominent leadership practices andorganizational achievements. Leadership practices comprised social harmony,benevolence, and other Confucian approaches; forbearance, self-effacement, andother Daoist approaches. Organizational achievements included trust, support, respect,collaboration, perseverance, exploration, innovation, intrepreneurship (i.e.entrepreneurship within an organization), efficiency, cost reduction, group wisdom,extrarole commitment, from followers for the benefit of organizations. The second stepof axial coding related leadership practices and organizational achievements byfocusing on linkages among ideas and passages of the same CEOs. This step locatedfive major linkages relating organizational achievements to five groups of leadershippractices. The third step of selective coding made sense of the findings with a holisticview, which summarized the linkages by the identification of a security theory ofleadership effectiveness. Detailed findings from the three steps are as follows.

Open and axial codingMaintaining social harmony appeared to be the commonest leadership practice amongthe CEOs. Such practice identified relationalism in Confucian leadership andtranspired in pursuing a mass line, composing an orchestra, perspective sharing,non-competition, and emphasis on collectivism. The next most salient leadershippractice was benevolence or the display of virtues including humaneness, politeness,understanding, empathy, and humility. This practice again embodied Confucianleadership. Besides, other Confucian leadership features, covering definitionism, therule of man, trust, learning, and moderation were also notable among the CEOs.Apparently, Confucian leadership played a prominent role in the CEOs. However,

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Daoist leadership was also a common and salient feature, in terms of reversion,forbearance, self-effacement, and the creation of opportunity among the CEOs. Theseleadership practices, as characteristics of the Chinese style, tended to result in trust,support, respect, collaboration, perseverance, exploration, innovation, intrepreneurship(i.e. entrepreneurship within an organization), efficiency, cost reduction, group wisdom,extrarole commitment, from followers for the benefit of organizations. These findingsare testimony for the effective leadership practices of Chinese style. Detailedmanifestations and ramifications of the leadership styles based on open and axialcoding are as follows (see Tables II and III).

Harmony and relationalism. The pursuit of harmony appears to be the basis for theformation of Confucianism and its leadership. It has given rise to the emphasis on the

CEO Major business Leadership Achievement

A Telecommunications Reversion Innovation

B Direct marketing Virtue, politeness, benevolence,trust, empathy

Collaboration

C Electricity HumilityCompany first, centralizationGiving space

Trust, efficiency, cost reduction

D Finance Moderation Trust

E Banking RelationalismBenevolence – forgiveness

Redundancy avoidance,commitmentrealization of talent

F Construction Rule of man, definitionism,socialization

Collaboration

G Banking Reversion – following, humility,non-competition

Extrarole performance,Innovation, collaboration

H Telecommunications Relationalism, harmonyForbearance, self-effacement

Collaboration, competence

I Retailing RelationalismLearning, humilityCentralization

Exploration, innovation,perseverance, intrepreneurship,coordination

J Insurance Benevolence Courage

K Banking Relationalism, benevolence,learning

Concentration, respect,commitment

Table II.CEOs’ leadership and

achievement

Leadership Achievement

Relationalism, harmony Coordination, collaboration, commitment, realization of talentVirtue, benevolence Respect, courage, coordination, collaboration, commitmentDefinitionalism, hierarchy Trust, efficiency, collaboration, realization of talentModeration TrustReversion, softness Commitment, innovation, extrarole performance, competence

Table III.Leadership and

achievement condensedand related

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maintenance of social relationship by focusing on common and collective goals andsocial concern. A prominent instance in leadership practice was to follow a collective,mass line, as in the following quote:

I respect personnel very much. I do not regard myself as the boss. I would not close my doorto act as an emperor. I would permeate the masses to chat with them, trying to attainunderstanding from both sides, in the hope of building a foundation. It is because thecompany belongs to all of the personnel, Hong Kong belongs to all the citizens, and it does notbelong to officials, businesspeople, and citizens. The organization does not only belong toshareholders, customers, and the market. It instead belongs to the personnel. They are veryimportant segments. This is the fundamental concept (CEO H).

This belief in collectivism and harmony translated into practice in regular andfrequent contact with the mass personnel. Importantly, the practice was not animprovisational response to a crisis, but was a habitual meeting, as shown in thefollowing quote:

Communication is long-time work. Therefore, I meet colleagues every four to six months.How to meet? The company has a basketball field of in (a place of Hong Kong), having seatsfor four hundred people every time. I spend 45 minutes to dialogue with four hundredcolleagues, seven to eight meetings a day. Spending a long time with the masses has thebenefit of avoiding marginalization by the labor union. I am often in the midst of the masses.As such, the labor union has greater ease to communicate with me to handle my relationshipwith colleagues (CEO H).

The collective and harmonious leadership practice was furthermore visible in theblanket salary reduction for the whole workforce of 16,000 people, during the crisis ofthe corporation, concomitant with the financial crisis in Hong Kong during 1998.Meanwhile, the CEO made every employee a shareholder of the corporation by offerthem shares. Such collective practices helped the corporation weather the crisis inavoiding labor protest and industrial action. The alternative and easier way to cut costwas to lay off employees selectively. However, CEO H did not choose this method, as hebelieved in the collective and harmonious leadership style. Importantly, the collective,blanket action avoided problems related to selective layoff, including creatinginequality, discrimination, conflict, and thus disharmony. The achievement of suchcollective leadership practice was to secure employees’ support, collaboration, andcohesion that helped the corporation revive from the crisis.

Another CEO found relationship building as his distinctive leadership feature. Hisleadership practice of relationalism was the avoidance of factionalism and themaintenance of harmonious and affectionate relationships, as shown in the followingstatement:

We do not have politics, but we have team spirit. We support each other. Departmentscooperate with each other. The ultimate objective is to benefit the bank and customers.Therefore we are successful. I have no clique member. I have no enemy among colleagueswith the same tenure as mine. I even maintain good affection with ex-colleagues (CEO K).

The reported success, due to the leadership practice, was the minimizing of timewasted in office politics. Consequently, personnel had more time to concentrate theireffort for the benefit of the bank and customers. The concentrated effort was the key toorganizational success. Besides, the CEO spent much time and effort in relationship

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building, including attending parties, chatting with, and learning from colleagues. Hestrove to understand and communicate with colleagues, which he acknowledged was apath to success, through the creation of commitment, as in the following quote:

Therefore I deeply realize the importance of communication. Communication must need to besufficient and colleagues would naturally agree. Once they agree, they would have a sense ofcommitment. When they have the sense of commitment, the great ship would naturally sail(CEO K).

A third CEO also illustrated the contribution of maintaining harmony, consent, andcommunication to colleagues’ coordination and commitment to complete a task. Heacknowledged coordination as the strength of his corporation, which resulted fromrelationship building and resulted in the success of the corporation, as in the followingquote:

You can see the World Cup. Putting the best members in the world to a team need notoutperforms the best team of any one country. Although they are not the best, they haveadequate coordination. In other words, only when the masses make a decision, they wouldcomplete it wholeheartedly. This is very important. No matter what, the masses need tocommunicate well and then wholeheartedly follow the decision in doing (CEO I).

Still another CEO was fond of the practice to maintain harmony and buildrelationships. Such a practice would contribute to followers’ realization of talent, asshown as the following quote:

Maintaining good relationships among colleagues is very important. If you get along wellwith colleagues, it will be easier for you to communicate requests. Banking in the end relies oninterpersonal relationship. If colleagues felt unhappy and fearful at work, they would notrealize their talent (CEO E).

As such, the prominent outcomes of relation building were coordination, collaboration,commitment, and realizing talent in the workforce. These outcomes represented thestrengths of the corporation, which helped the corporation succeed. To achieve theseoutcomes, the CEOs needed to make much effort to communicate with their colleaguesin a collective way.

Virtue and benevolence. Virtue, in the Confucian doctrine, primarily consists ofbenevolence or taking care of other people. It upholds the Golden Rule that requires oneto share what one desires with others. A CEO highlighted the importance and functionof being benevolent for encouraging him to manage in a proactive way, as in thefollowing quote:

The most important is the maxim – the benevolent person has no worry. In business, thereare relatively few wrongs or rights. However, it dealing with people, moral rights and wrongsare very important (CEO J).

Proactive management was important for the CEO to earn great profit for theinsurance business during the financial crisis in Hong Kong. He reasoned that havingthe courage to lead his business to take risk and opportunity was the key to success.This courage in turn hinged on his benevolent orientation to take care of people. Hisbenevolent leadership practice, for instance, happened in his cultivation of followers, asin the following quote:

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I suggest her cultivating in areas in which she is interested, making her invincible. She buildsup confidence, having a will to compete with others. It is because reality is cruel, dealing withthe survival of the fittest. The more you protect her, the more difficult is for her to compete insociety (CEO J).

Cultivating a confident, courageous, competitive workforce thereby helped the CEOtake timely opportunity to earn great business success. Apart from the contribution tocourage, benevolent leadership practice, in terms of forgiving, enhanced followers’respect for the leader, according to another CEO as follows:

Colleagues bestow me a word – admiration. This word of course means that colleaguesadmire you. When I handle problems, I first see them from other people’s view. You can thenbuild up relationships easily. Colleagues very often make mistakes. Perhaps you would saythat I am magnanimous. I never find fault in the small mistakes (CEO K).

Benevolent leadership, by forgiving and empathy, therefore earned admiration fromfollowers. The admiration reflected the success of leadership, which would lead tofollowers’ commitment to work assigned by the leader, in the case of the CEO.Similarly, another CEO explained the importance of benevolence for her effectiveleadership in the following quote:

Chinese people have many virtues. If you can realize most of them – benevolence,righteousness, propriety, wisdom, promise – you can succeed. In the process of management,the benevolent person is invincible. Your kind heart is very important. Chinese people saythat they need brotherhood. If staff members feel that you have brotherhood, standing out forthem when they have problems, and saying sorry when making mistakes, this is already veryeffective (CEO B).

The CEO clearly learned a lot about leadership from Chinese or Confucian doctrines.She supplemented that the Chinese CEO gave 60 percent of the weight to empathicconcern and 40 percent to performance in the appraisal of staff, whereas the AmericanCEO gave 70 percent of the weight to performance and 30 percent to empathic concern.Empathy or benevolence was thus the clue to her effective leadership, in terms ofmobilizing staff’s coordination and commitment to the organizational mission, as in thefollowing quote:

When asked to lead manufacturing, I have a feeling of fear once seeing the machinery. Howcan I perform production? However, I can make the head of manufacturing enjoy coordinationwith me and enjoy being a part of the team for collaboration. I can make them have a sense ofcommitment to the corporation, creating the goal for the survival and growth of thecorporation (CEO B).

Another CEO also explained the need for benevolent leadership, in terms offorgiveness. Accordingly, it was instrumental to sustain the staff’s stability, asrevealed in the following quote:

If a colleague did not meet the target, I would help the colleague improve. The bankingindustry pays much attention to risk. Employees’ stability is an important risk factor. Firingthe colleague is the last step (CEO E).

The CEOs therefore indicated the contribution of using benevolent leadership togenerate respect, courage, coordination, collaboration, and commitment conducive toorganizational success. Importantly, the CEOs required support from colleagues to

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make the success because the CEOs admitted that they were not versatile enough toperform all the tasks individually.

Hierarchy and definitionalism. The doctrines of hierarchy and definitionalismspecify the leader’s role and differentiate it from that of followers. Authority needs toflow from the top, because the leader is more virtuous. Such leadership relies on therule of the sage-like man, who enacts his own rules. This was what CEO F affirmed asin the following saying:

Every new ruler has his own staff. I refuse to interfere with his rule in behind (CEO F).

As such, the CEO suggested that leaders of different levels and different times hadtheir own roles, according to some definition. To gather his staff, the CEO suggestedways to identify truthful and loyal followers, as in the following quote:

My way is to appear to be daydreaming, disclosing what I think in order to observe colleagues’responses. Some would oppose my idea desperately, and some would echo forcefully. The latterwould echo whatever you say. Very easily, you can detect those people (CEO F).

In this instance, CEO F already differentiated some good and bad ideas, but still askedfollowers to comment in order to test followers’ competence and sincerity. This practicereflects CEO F’s adherence to the leadership principle favoring the rule of man, as hebelieved in his superior competence and simply required his follower to have moderatelevels of talent. The practice would build up a loyal and cohesive group around theleader to assist in solving various problems. Specifically, the CEO assigned followers toperform different tasks that they were most capable of doing. Such a division of laborwould best maximize the output, as in the following quote:

You should not find a group entirely consisting of cleverest people. If everyone were thesuperhero, no one would watch the drama. This definitely does not work. For the moderatetalents, what you only need to do is to mobilize their motivation. It is not necessary to findthose with PhD or MBA. I have 50 years of experience. It must not be those people. Therefore,it is necessary to activate team spirit, having someone solving one problem and anothersolving another problem (CEO F).

The crux of the success was having the CEO as the problem detector, who then calledhis followers to solve the problem in a collective way, according to centralizedoperation. Such a collective approach to problem solving tended to earn CEO F akingdom in construction and land development in Hong Kong and Mainland China.Such a concern for the centralization of operation also appeared in another CEO’sexplanation, as quoted in the following:

Working is for the benefit of the corporation. My way of handling things is to put solving theproblem of the corporation in the first place. Colleagues would gradually trust you (CEO C).

The CEO explained her leadership by referring to the pursuit of benefit for thecorporation in order to mobilize colleagues’ motivation and trust. Colleagues’ trust inturn facilitated their increase in work efficiency, as disclosed in the following quote:

You are probably aware that for the past five or six years, the corporation has dramaticallystrengthened its communication to the external. It is because we realize that the society ischanging and citizens’ demand for information has greatly risen. Our colleagues need to replywithin 24 hours of receiving queries from reporters. When colleagues trust you, your canaccomplish a task with half of the effort (CEO C).

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Gathering a staff being loyal to and trusting the leadership thereby raised productivityin the corporation, and the visible productivity raise earned the CEO a number ofawards. Another CEO portrayed centralized leadership in a way to expand business invarious areas. Accordingly, such a practice indicated the leader’s trust and delegationof authority to followers, as in the following quote:

Our personnel are like explorers parachuted into uncivilized forests. Their right hands holdlong knives to cut trees in the forest, whereas their left hands held the newest communicationsystems. I am the link of their gaps (CEO I).

The CEO thereby exerted remote control over personnel whom he trusted to developnew businesses in developing countries. Meanwhile, the CEO facilitated thedevelopment of intrepreneurship within the holding corporation by providinginfrastructures and logistical support, as in the follow description:

I concentrate my effort on how to assist outstanding entrepreneurs, popularly known asintrepreneurs, who are managers realizing their talent within the big corporation. I providestrong backup, covering information technology, finance, administration, and various areas.Personnel never worry about problems related to the payroll. Therefore, what personnel needto do is to present their strengths, having no need to waste time on administrative work andmeaningless direct production (CEO I).

Overall, leadership that observed Confucian doctrines about hierarchy anddefinitionism resulted in trust, efficiency, collaboration, and realization of talent inthe staff, according to the CEOs’ view. Staff members, under such a leadership style,contributed to a part, but not to the whole spectrum of the business. They offer theirbest work under the leader’s guidance and logistical support.

Moderation. Moderation refers to the practice of the Confucian principle of themean, argues against being overly positive or negative. A CEO interpreted moderationin the following way:

As a CEO, one cannot demand too highly. One needs to stand higher and farther, have apeaceful mind. One needs to keep balance and avoid being radical. One needs to bemagnanimous, having a broad mind (CEO D).

The CEO associated the practice of moderation with the creation of colleagues’ trust tobenefit the whole organization, as in the following quote:

If one can take a middle ground, those working with you will understand you, knowing thatyou can make objective analysis and decisions, they will have confidence in you. Thispractice is commonly beneficial to colleagues, subordinates, and superiors (CEO D).

Reversion and softness. Reversion stems from the Daoist advocacy for gettingsomething by first foregoing something and thus leading by following. Accordingly,by occupying the lowest position, one can be the most powerful. Similarly, the Daoistprinciple of softness states that the soft and meek can defeat the hard and strong. Thisprinciple also reverses a strong and direct approach by a soft and inactive approach todoing things. The obvious practice of reverse leadership was to consult followersrather than to lead them, as in the following quote by a CEO:

Many colleagues are more capable than me. I believe that a CEO preferably has more capablefollowers. If your colleagues were less capable than you, it would be terrible. Even if you workoverly hard, you cannot succeed. You must have a broad mind to let colleagues realize their

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talent. I think that I have nothing better than others. In handling daily affairs, I often consultcolleagues (CEO G).

Furthermore, the reverse leadership practice was to place the leader below followers.The leader should not overshadow followers’ talent and credit, as in the followingquote:

It is not that you are the superior, your words must be correct. Even though you have edgesover others, you need to try hard to conceal them. At least, you should not let colleagues thinkthat you overshadow them. You cannot 100 percent win. If you 100 percent won, others wouldchoose to leave, no longer working for you (CEO G).

In this case, the CEO put followers ahead in work capability, offered them credit forgood performance, and took a soft, non-competitive way of leadership. He alsoacknowledged his weakness and incompetence and the role of a leader as supporterrather than a control freak, as in the following quote:

I hope to lead the bank forward, assist and support my colleagues. Assisting and supportingare really very important. I often say that I do not control subordinates. Rather, I assist andsupport them, enabling them to realize their strengths. This is the only way for the bank toprogress (CEO G).

By reversing the leadership role by showing weakness and incompetence on the onehand, and assistance and support on the other, the CEO succeeded in keepingcompetent followers. The CEO thereby regarded his reverse and soft leadership asconducive to followers’ commitment. Furthermore, such practices facilitate extraroleperformance in the bank, as in the following quote:

Our bank has a merit. Colleagues do their best desperately. We have a slogan, termed littleextra – only taking one more step. For example, a foreign tourist came to our branch toexchange money. She left the bank without taking her passport. A colleague brought thepassport to the counter at the airport after work. The tourist was not aware that she had leftthe passport in the bank. When she found her passport at the counter, she was very delighted(CEO G).

Besides, the reverse leadership appeared to encourage innovation by givingopportunity to colleagues for realizing their talent. Such innovation inaugurated newsuccess for the bank, as suggested in the following quote:

The recently popular structure products, which offer higher interest rates, are our colleagues’brainchild. As mentioned earlier, I try the best to delegate authority for colleagues (CEO G).

Similarly, another CEO mentioned the trick of reverse leadership in fueling innovationin telecommunications business:

When finding that there is no way forward, I would lead to another direction, just like playingthe marble chess. Sometimes, I try to go backward and sometimes horizontally, and then I goforward. It is quicker to achieve the goal. I do not stick to the old rule. I would try hard tochange. The most important thing is colleagues’ willing to accept our practice not as constantand to find new ways to solve problems (CEO A).

The greatest innovation that required colleagues’ collective effort was the multiplyingof the channels by digital technology. This innovation greatly expanded the business

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of the corporation. Another reverse leadership practice centered on forbearance andself-effacement, as stated in the following quote by another CEO:

Forbearance not only is patience, but also is invisibility. To be invisible is the gist. I amcritical of myself. I often see my weaknesses. I need not open a note book to say how well Iperform (CEO H).

Such a reverse leadership practice was responsible to fostering competence or aperformance culture, in the term of CEO H. Conversely, he reasoned that anauthoritarian leader would impede followers’ performance culture, as in the followingquote:

How to create a performance culture? If parents overly control their sons, many men would betimid and shy. How can they take up responsibility? (CEO H).

Similarly, another CEO indicated the strength of reserved comportment for makingsuccess, as in the following quote:

If you could see fish under the deep sea, you would not be fortunate. If you could surpass thesage’s wisdom, you would not live lone. You need to be low-key, not praising yourcompetence. Otherwise, your ending would be very miserable (CEO D).

Reversion and softness in leadership, including the practices of humility andforbearance, would thereby contribute to colleagues’ commitment, innovation,extrarole, performance, and competence, according to the CEOs. These leadershipoutcomes were likely to fuel business expansion and continuing growth of thecorporation.

Axial coding: overviewThe preceding findings identified five linkages relating leadership practices andorganizational achievements, based on axial coding (see Table III). The first linkagerelated the leadership practices for relationalism and harmony and organizationalachievement in terms of coordination, collaboration, commitment, and realization oftalent among organizational members. An impetus underlying the contribution of theleadership practices, as suggested by the CEOs appeared to be the building of trustwithin the organization. Accordingly, trust could lubricate relationships, facilitatecommunication and coordination, and reduce costs expended for exchange andtransaction within the organization. Such a contribution tended to prevail in bankingor other service organizations, which relied on coordinated human services. The secondlinkage related leadership emphasis on virtue and benevolence to promoting respect,courage, coordination, collaboration, and commitment within the organization.According to the CEOs, this second linkage lies in the strength and durability of caringand affective connection. Such connection tended to be more rewarding and valuablethan pecuniary rewards, thus instigating organizational members to take care of eachother and the organization. The third linkage relates leadership orientation towarddefinitionism and hierarchy to organizational trust, efficiency, collaboration, andrealization of talent. Such a relationship, according to the CEOs, stemmed from thestrength of centralization and clarity of the goal and order. The CEOs reasoned that itwas important for the organization to mobilize collective effort to resolve complicatedproblems by creating a common goal for organizational members. After setting thegoal, it was also important to facilitate members’ loyalty, and such facilitation would

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require the clarification of leader-follower relationship. The fourth linkage related theleadership of moderation with organizational trust. Concerning the linkage, the CEOssuggested that moderation represented respect for organizational members. Thisrespect would give room for organizational members to demonstrate their talents andcontributions, because they expected rewards to the demonstration. Conversely, if theleader pushed forward everything perfectly and to the extreme, organizationalmembers would find little room for them to demonstrate their talents. The fifth linkagerelated the leadership strategies of reversion and softness to organizationalcommitment, innovation, extrarole performance, and competence. These strategieswere effective, accordingly to the CEOs, because they induce organizational members’proactive effort to help the CEOs. Such help was likely because of members’ kindness,sympathy, and sense of responsibility for the CEOs who appeared to be tenuous,thankful, and even incapable.

Selective coding: security theory for explaining contributions of Chinese leadershipThe grounded theory approach discovered a security theory for explainingcontributions of Chinese leadership styles epitomized in Confucian and Daoistpractices, including relation building, benevolence, centralization, moderation andreversion. This security theory identifies the provision of security to followers as thecrucial way in which leadership engenders desirable outcomes. The theory was purelyan emergent finding useful for summarizing relationships between the various Chineseleadership practices and organizational achievement. The theory had grounds in theCEOs’ own images and broader theoretical support from attachment theory or thepaternalistic approach, as well as Confucian functionalism and Daoist naturalism.Importantly, the security theory is a parsimonious means to represent all therelationships between leadership practices and outcomes in a succinct way.

Support for the security theory from the CEOs’ narratives consisted in some of thequotes given above. These narratives indicated that personnel as well as theorganization prefer security (CEO E and CEO H), leadership strove to provide supportor security for personnel (CEO I), leadership played an important role in minimizingpersonnel’s worry (CEO J), which included that about being overshadowed by theleader (CEO G). The narratives also indicated the increase in employees’ security by theleader’s promoting harmony, cohesion, relationship building, ownership, andlong-term tenure (CEO H and CEO K), benevolence and forgiving (CEO E), andmoderate leadership practice (CEO D). Furthermore, CEO G intimated that sustainingpersonnel’s morale was an important concern, especially during the turbulent financialtime, with the following supplement:

For employees’ occupational security, lower fixed costs are more preferable. I believe thateveryone would rather receive low pay to keep one’s bowl (i.e. job) (CEO G).

Similarly, another CEO expressed his view about the importance of keeping employees,as in the following statements:

I am very concerned about the relationship between the corporation and employees. I have abelief in long-term relationship. If the company is good, the employee will work in thecompany until retirement. Some people are very short sighted. They would rather lay offemployees today and would reemploy and retrain them tomorrow. It is really very harmful tothe cost of the company (CEO I).

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The CEOs thereby recognized sustaining security in employees as a crucial need forboth employees and the organization. Such a need appeared to be far more prominentthan those needs for pay, praise, personal growth, and other rewards andtransformations. Hence, the CEOs regarded their leadership practices and styles asconducive to sustaining employee security and thereby favorable performance.

Attachment theory, apart from the CEOs’ narratives, provides generic support forthe security theory in explaining contributions of leadership. Accordingly, provision ofsecurity by leadership is reminiscent of the child’s attachment to parents or otheradults. Attachment involves care and responsiveness in the part of parents or adults,who offer secure bases and working models for children (Birch and Ladd, 1996;Lapsley and Edgerton, 2002; Wyman, 2003). Secure attachment importantlysafeguards the child’s desirable development and achievement, by reducing thechild’s worry and allow the child to explore outside the home environment. Thistheoretical pathway resembles that of the CEOs’ leadership practices to promoteexploration, innovation, and extrarole performance.

The Confucian logic of functionalism also supports the security theory by referenceto the contribution of harmony with the total organizational system. It involves amechanism that security contributes to harmony and the maintenance of thefunctioning of the total system, which in turn exert powerful force to generatefavorable outcomes. In the first place, employment security underpins the maintenanceof harmonious relationship among the organization by facilitating organizationalmembers’ adaptation to each other (Wethington, 2002) and enduring cooperation (Chiu,2005; Greenglass and Burke, 2002). Employment security also bolsters the fullfunctioning of the organization by avoiding downsizing and restructuring in theorganization (Cunningham et al., 2002). Moreover, the sense of security wouldconsolidate the relationship between employees and the organization, similar to thecase of marriage (Donovan and Jackson, 1990). Harmonious and enduring relationshipsamong the organization in turn are clear a determinant of organizational functioning(Hurlbert, 1991; Rosner and Tannenbaum, 1987). When an organization functions in itsfull swing, it can produce the best outcomes, more than are those resulting from thesum of organizational parts (Netting and O’Connor, 2003). This is the credit ofspecialization, collaboration, and the division of labor. Besides, there is evidenceshowing the direct impact of employment security to work and organizationalcommitment (Lundgren and Barnett, 2000; Parker et al., 2001) and competence (Gallieet al., 1998). The merit of the functionalist explanation for leadership success alsodovetails with the Confucian theory of harmony (Tian, 1998). Accordingly, the key tosuccess lies in the consolidation of the functioning of the total organization through themaintenance of harmonious relationship. This logic practically forms the core ofChinese medicine, which endeavors to strengthen the patient’s total functioning ratherthan quench particular germs, as in Western medicine (Maciocia, 1989). Thefunctionalist logic also received some CEOs’ explicit acknowledgments, as in theexplanation for the superiority of a cooperative soccer team over individual soccerplayers.

Daoist naturalism provided further support for the security theory by reference tothe principle of reversion. Accordingly, reversion draws its strength from a secure baselikened to the valley, ocean, the root of a tree, and other foundational structures in thebottom (Feng, 1992; Moeller, 2004). The secure base is powerful because it gathers

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resources from various channels, just like an ocean collecting water flowing fromrivers. The importance of security stems from the Daoist emphasis on preserving ahealthy body. In the Daoist image, the strength of the secure base would be in the formof softness, as an ocean. Such softness would involve flexibility and adaptability in thestaff, just like water. Flexibility and adaptability in the staff have proven theircontribution to organizational success in various contexts (Gundlach et al., 1995;Soidre, 2004; Zeffane, 1994).

DiscussionFindings for the analysis of the Hong Kong Chinese CEOs’ narratives are threefold.First, leadership practices consistent with Confucian and Daoist persuasions anddistinct from Western styles are common among the CEOs. Second, the practicescontribute to favorable leadership and organizational outcomes including trust,coordination, commitment, competence, and innovation among followers. Third, suchcontributions tend to endorse a security theory of leadership.

In the first place, Confucian and Daoist leadership styles are different from andinconsistent with Western styles. Although the Chinese and Western styles such asChristian and connective modes, have some similarities in relationship building andbenevolence, the Chinese emphases on hierarchy, moderation, and reversion in theChinese styles are distinctive. Essentially, the difference lies in the theoreticalassumptions of Chinese and Western styles. The Chinese theories of functionalism andnaturalism are different from those behaviorist and rationalist theories of the West.Whereas the Western styles focus on contingent reward and transformationconcerning followers, the CEOs did not mention such a focus. The CEOs’perspective is largely on collective interest rather than on the interest of anindividualized follower. Such a perspective deviates from the individualist flavor of theWest (Ardichvili, 2001; Avolio, 2005; Bass, 2002; Littrell, 2002).

The finding about sharing of Chinese leadership styles that are different fromWestern styles among Hong Kong Chinese CEOs refutes the assumption that theconvergence of managerial practices of managers of different cultures throughwesternization and globalization. The convergence thesis holds that Confucian andother Chinese orientations would erode due to exposure to Western culture (Ma andSmith, 1992; Walder, 1995). As an alternative, an eclectic view typically posits thatChinese managers combine both Chinese and Western styles (Ralston et al., 1996). Thisview, nevertheless, suggests the dilution of the Chinese styles. Instead, the presentfinding would suggest that the Chinese styles are still dominant at the high level ofmanagement, probably unlike the case at lower levels of management. The findingmay be attributable to the high level of need for matching the leadership style tosocietal culture at the high level of management (Zaccaro, 2001). This need arisesbecause the high level of management, especially that of large corporations, has a largestake in the society. Notably, the CEOs were all greatly involved in public service forHong Kong and other Chinese societies. They were obliged to adapt leadership stylesthat are compatible with societal culture in dealing with various people in the society.The finding substantiates the view about the need of leadership for fitting with culture(Ashby and Miles, 2002; Chemers, 1997; Mendonca and Kanungo, 1994). Accordingly,the need for fitting to societal culture is great when the CEO has a large number offollowers subscribing to the societal culture.

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The Chinese leadership styles based on Confucianism and Daoism are importantbecause they are conducive to favorable leadership and organizational outcomes, suchas trust, cooperation, competence, and innovation. As such, the styles are not mereshowoffs but are instrumental to organizational success. Such a contribution ofleadership was salient in the CEOs’ mind. For instance, CEO A, CEO B, CEO H, andCEO J commonly purported that their talent to recognize talents among their followersgenerated great success for their organizations. The CEOs associated the leadershiptalent to the talent of recognizing good horses, by a historical figure named Bai Le.Besides, CEO D, CEO F, CEO I, and CEO K were explicitly proud of their effectiveleadership for the phenomenal growth of their businesses. As such, the Chineseleadership styles contribute to staff performance as their Western counterparts do(Ayman et al., 1998; Schriesheim et al., 1998; Silverthorne, 2000). The contributionfurthermore involves the building of trust, respect, coordination, collaboration, andcommitment among the staff in favor of the CEOs. Notably, these outcomes embodythe essential merits for collectivism and functionalism treasured in Chinese culture.The contribution of the Chinese leadership styles thereby is particularly pertinent toorganizational success in a Chinese context.

Narratives about the contribution of the Chinese leadership styles provided theground for the identification of the security theory for accounting the effectiveness ofthe leadership styles. As such, promoting security in the staff represents a link betweenleadership practices and their outcomes. The security theory in turn has grounds inConfucian functionalism and Daoist naturalism. Accordingly, harmony among thestaff and with nature would contribute to full functioning, which maximizesorganizational success. These grounds for leadership effectiveness are different fromthose of contingency theory, path-goal theory, and others that rest on behaviorism andrationalism (Ayman et al., 1998; Chemers, 1997; Furnham, 1997). Essentially,functionalist and naturalist accounts do not address direct paths to success and theyrather refer to the background factors conducive to success. Such referral tobackground factors reflects a reversed way to tackle problems (Davis, 1997), which fitsthe Daoist image about the wheel and yin-yang (i.e. interplay between opposing forces)(Ge, 1996; Moeller, 2004). Furthermore, the centrality of security in leadership isconsistent with the emphasis on conservation, tradition, and uncertainty avoidance inChinese culture (Hofstede et al., 2002; Wang and Zhu, 1996).

Further researchThe qualitative approach of the study aims at describing Chinese leadership styles anddiscovering a theory to explain the contribution of the styles. Such an approach offersno rigorous test of the description and theoretical explanation, which necessarily relyon pertinent quantitative and qualitative data. Hence, the qualitative approach servesto discover a theory rather than verify it. The logic of verification definitely requires arigorous research design, incorporating adequate sampling, measurement, andanalysis. Such research effort preferably verifies the current findingsprogrammatically involving three steps. First, research will tap the structure andprevalence of Confucian and Daoist leadership styles among Hong Kong ChineseCEOs. Essentially, research is necessary to validate measures of the styles, byillustrating the coherence of the various components of the styles, includingrelationalism, definitionalism, and benevolence. Research is further preferable to show

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the relative salience of the Chinese leadership styles as compared with Western styles.Second, research will examine the contribution of the Chinese leadership styles toachievement in leadership and the organization. Of crucial concern is for the researchto demonstrate the precedence of leadership practices to trust, collaboration,competence, and other performances in the staff. This demonstration preferablycapitalizes on a longitudinal, panel design. The research furthermore needs to showthat the contribution of the leadership styles is not attributable to other factors. Third,research will investigate the mediating role of security for the contribution ofleadership styles to their outcomes. The investigation can go further to tap therelevance of functionalism and softness logic to the mediating role of security. Forinstance, the investigation would assess functionalism by collective or holisticfunctioning on the one hand and softness logic by flexibility and adaptability in thestaff on the other hand.

Further research is necessary to combine the strengths of quantitative andqualitative approaches. In addition to launching the quantitative approach to enhancethe justification logic, the qualitative approach needs to strengthen its discovery logic.Such strengthening is necessary in view of the possible limitations of the presentqualitative study in sampling and data collection. Regarding sampling, furtherqualitative work needs to apply theoretical sampling to exhaust theoretical ideas. Inthe present case, theoretical sampling can target prototypical CEOs who practiceConfucian leadership or Daoist leadership. Regarding data collection, more intensiveand prolonged methods than interviewing would be valuable. As such, observation,documentary study, and repeated conversation can supplement interviewing andtriangulate qualitative data collected.

Apart from the verification of the present findings, further research can examine thegeneralizability of the findings to different levels of managers in different contexts.Such research needs to involve a sample of managers of various levels and contexts.The generalization research can have four goals. First, it has a goal of testing if theChinese leadership styles are more salient and instrumental among Chinese managersof higher ranks. Essentially, it can test the cultural fit explanation for leadershipsuccess by examining the contribution of followers’ cultural characteristics toleadership practice and the contribution of cultural fit to leadership success. Second,research can examine the specificity of the contribution of the Chinese leadership stylesby Chinese leaders of Chinese followers. It can further relate the contribution to Chineseculture involving Confucian functionalism and Daoist naturalism. Examining thisrelationship would require research to demonstrate the impact of exposure to Chineseculture on Chinese leadership practice. Conversely, research may examine if Chineseleadership styles are less effective for Western leaders and followers. The research cango on to illustrate that the Western emphasis on individualism weakens theeffectiveness of the Chinese leadership styles. Third, research can examine if theChinese leadership styles are more salient and effective in Mainland China in HongKong. This research goal concerns the possibility that Westernization makes thedifference, because Hong Kong is more Westernized than is Mainland China (Haila,2000). Fourth, the research can evaluate if the Chinese leadership styles are less salientand effective when leaders and followers subscribe to different cultures and whenfollowers are more culturally heterogeneous. The evaluation would show that the meritof cultural fit does not hold in these cases.

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ImplicationsThe study would open up research and discussion in three frontiers for researchers andpractitioners. First, the Chinese leadership styles of Confucian and Daoist orientationsare worth development because of their distinctiveness from Western styles and theireffectiveness with reference to cultural fit. This implication is consistent with thecontention that Western leadership is not necessarily the best (Blunt and Jones, 1997;von Bergen et al., 2002). Second, the Chinese leadership styles are useful for buildingfollowers’ trust, collaboration, competence, intrepreneurship, and extraroleperformance. This implication echoes the worry about the individualistic limitationof Western leadership (Ardichvili, 2001; Littrell, 2002). Third, sustaining security in thestaff is instrumental to the success of the corporation. The implication is consonantwith the concern for sustaining job security as a basis for organizational change(Ashby and Miles, 2002). In all, the Chinese leadership styles are substantially differentfrom Western ones when the former combines centralization with trust and do notendeavor to reward and transform followers contingently and individually.Importantly, Daoist leadership can induce effective leadership outcomes through areversed way rather than a direct practice based on path-goal rationality. The humbleand self-effacing leader would therefore gain followers’ support. A key to effectiveleadership is to implant a secure base in followers to facilitate their collectivefunctioning, flexibility, and adaptability. These leadership practices are especiallyrelevant to leading Chinese people.

The Chinese leadership styles are identifiable in terms of Confucian and Daoistways and are therefore not whimsical romance according to some alternative views(Meindl, 1998). The identification is important because the Chinese styles depart fromWestern styles. For instance, hierarchy and centralization in Chinese leadership maybe effective in the Chinese context but may be counterproductive in the West (Pearceand Sims, 2002). Moreover, reversed leadership practices such as following, consulting,and giving credit to the staff are neither inept nor ineffective leadership. Performingwell under the Chinese leadership styles, followers need to treasure social harmony andrelationship building, offered in place of contingent reward and individualizedtransformation.

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Further reading

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Corresponding authorChau-kiu Cheung can be contacted at: ssjacky@city.edu.hk

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