CDG: Managing in China's Economic Transformation

Posted: 18 Mar 2012

See all articles by Roy Y. J. Chua

Roy Y. J. Chua

Harvard Business School, Organizational Behavior Unit

Shaohui Chen

Harvard University - Business School (HBS)

Lisa Kwan

Harvard University - Business School (HBS)

Date Written: October 19, 2010

Abstract

China Data Group (CDG) is a leading business processes outsourcing company based in Beijing, China. Roc Yang, Chairman of CDG had to confront a dilemma when he discovered that one of his senior managers gave a gift to a potential client in an effort to win a large business deal. Although this practice was pervasive in the China business context characterized by heavy reliance on personal relationships or guanxi, it went against the founding principles of CDG - professionalism and service quality. Yang had to decide where to draw the line between adherence to principles of professionalism and local norms in a country caught in the midst of rapid economic transformation.

Learning Objective: This case illustrates a key challenge of globalization - how and where do companies draw the line between global business practices and deeply ingrained local cultural norms. As students debate and discuss what the protagonist should do, they should appreciate the various sources of the tension faced by companies operating in emerging markets. The case also allows for specific discussion on the dynamics of relationships and networks (guanxi) when doing business in China.

Suggested Citation

Chua, Roy Y. J. and Chen, Shaohui and Kwan, Lisa, CDG: Managing in China's Economic Transformation (October 19, 2010). Harvard Business School Organizational Behavior Unit case no. 411-067. Available at SSRN: https://ssrn.com/abstract=2025004

Roy Y. J. Chua (Contact Author)

Harvard Business School, Organizational Behavior Unit ( email )

Soldiers Field
Boston, MA 02163
United States

Shaohui Chen

Harvard University - Business School (HBS) ( email )

Soldiers Field Road
Morgan 270C
Boston, MA 02163
United States

Lisa Kwan

Harvard University - Business School (HBS) ( email )

Soldiers Field Road
Morgan 270C
Boston, MA 02163
United States

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