Understanding Asia: the limitations of using a home country lens in resolving perceptual differences & tensions


By Meena Thuraisingham 


There are many obvious and not so obvious differences between the nature of Asian markets and Western markets that pose challenges at multiple levels for companies and leaders deciding how they will approach their growth ambitions into Asia.  Framing the economic as well as cultural challenges we face using a home country lens is an ever present danger for cross border investment and can frustrate and even derail growth plans in host countries. Some of these distinctions are structural and lie in the respective economic histories, while other distinctions are more cultural in nature and lie in the respective social histories.

Leaving the informal unregulated economies of Asia aside, in the formal economies of Asia there are 3 key characteristics that shape the nature and feel of these markets and the business models used to thrive and prosper there. Keeping in mind that Asia is an extremely diverse region where generalised rules are dangerous, these characteristics are in effect strategic distinctions shaped by the historical and cultural realities of the Asian region:

  • The distinction between focus and opportunity – the developed economy mantra of focus as a strategy, stands in sharp contrast with opportunity as a strategy, evidenced by the number of large Chinese and Korean (chaebols) conglomerates that are a collection of often completely unrelated businesses that have no apparent synergy but driven by the commercial opportunity that presented itself.  GE, Siemens and LMVH are some of the exceptions to this in the west. Most western companies are driven by the reductionist principle – ‘this is what we do well, we will stick with that and deepen our capability, build scale and dominance’. Of course there are dangers in generalising about this given there is evidence that the emergence of the Asian conglomerate in some cases was a consequence of the lack of reliability of essential links in the supply chain rather than opportunistic reasons.
  • The distinction between business and family – in Asia many businesses are owned by family members primarily because of the absence of enforceable regulatory frameworks and somewhat opaque rules that govern the relationship between state and business. When you can’t rely on your business associates, you turn to family members whom you know you can trust. Historically many family companies thrived for generations in Europe but with the fragmentation of family structures in many western countries (in sharp contrast with the continued primacy of the family in Asia), this has dwindled in scale and size. In Asia these family owned enterprises are held together by family traditions operating on rules of trust and intimacy rather than being transactional or contractual in nature as they are in the west. Even in the regulated economies of Asia the impact of relationship trust (as opposed to contractual trust) in commercial undertakings remains strong.


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About the Author

flag-australiaPressroom_BannerMeena Thuraisingham

Meena Thuraisingham is the author of The Secret Life of Decisions, How unconscious bias subverts our judgments, Gower Publishing, 2013.  Meena is also currently undertaking a PhD program on the impact of cultural factors in investing behavior of listed companies. Based in Australia, she is the founder and director of TalentInvest. For more on these or related ideas contact [email protected]