Trompenaars Case Study

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The analysis of the case based on two cultural frameworks by Hofstede and Trompenaars & Hampden-Turner leads us to believe that there are several reasons at play behind JPMorgan’s (JPM) hiring practices in China. In China, identity among collectivists is defined by relationships and group membership where social behavior is governed by norms and obligations. There is an emphasis on relationships even if they may be disadvantageous and in-group goals have the utmost priority. According to Hofstede’s cultural framework, the key drivers of Chinese culture, and in the context of this case, in organizations such as JPM are as discussed below: Power Distance This aspect deals with the fact that all individuals in societies are not equal – it expresses…show more content…
One of the main reasons could be the difficulty JPM has penetrating into the Chinese market and state owned enterprises in particular. Specific VS Diffuse The dimension of specific vs. diffuse refers to the degree of intimacy people feel comfortable with when dealing with others. The Chinese are generally a more diffused society. They remain detached except when outsiders, in this case JPMorgan, enter their private lives, that is, by the hiring of their children, and only then do they open up. Achievement VS Ascription An achievement culture is based on how well someone performs whereas ascription is based more on the person’s background, connections or what they ‘do’. In China, guanxi plays a very important role in Chinese culture – it’s not what you know but who you know and this could have resulted in JPM’s princeling hiring practices. It was crucial that their organization knew and had connections with the ‘right’ people so that they could progress in the business developments in China. (Luthans & Doh,…show more content…
State-owned enterprises are difficult to penetrate for a foreign company like JPM. Employees with guanxi can minimize JPM’s costs, especially for government procedures, requirements and taxes. Connections add a significant measure of flexibility and freedom inside an authoritarian political system and is critical to JPM’s market access. Hiring the sons and daughter of these ruling elite give JPM immediate access to not just their connections but the connections of their parents as well. This is reflected in the hiring practices and the resultant connections with China Everbright and China Railway Group. (Feldman,

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