National culture and business resilience: an exploratory study of Chinese construction firms in Singapore

Abstract

National culture is a field of cultural studies that focuses on the differences in values and beliefs between people of different nationalities. With the increasingly globalized economies around the world, it inherently set the construction industry at an unprecedented risk exposure level. This is particularly true for Chinese construction firms which are observed to be aggressively setting up their subidiaries and branches all around the world as they partake in large-scale complex projects overseas. With the liberal foreign trade policies adopted by China after their reforms, domestic construction firms within China also face immense pressure from the international players that are able to enter China’s construction market due to the lowered barriers of entry. This exploratory study seeks to learn about business resilience of Chinese construction firms from a national cultural perspective. Business resilience is the ability or capacity of an organization to adapt and handle the crises and major disruptions that may arise during business operations. This might explain why certain organizations can emerge relatively unscathed or even stronger out of a crisis. With collected empirical data along with data from the IMD World Competitiveness Yearbook and Hofstede’s cultural dimensions, national culture appears to be able to impact business resilience on a significant level. In particular, the multiple regression models reveal that the uncertainty avoidance and power distance of a culture seem to be the main predictors of business resilience, with limited effects from masculinity affecting adaptability of government policy. In addition, GDP (PPP) per capita, which is often represented by many researchers as a socio-economic factor, appears to have no moderating effect on our models. This academic study attempts to put business resilience of Chinese construction firms within a national cultural framework, and explores how business resilience may be split into two types: Manageable Resilience (MR) and Ambient Resilience (AR). MR is what organizations should be focusing on to improve as an organization, while AR is what organizations need to be aware of, especially when entering a foreign market.