By Lin Zeyan, Xiao Qingwen& Chen Bo

Research Report No 023, 2006

China’s sustained rapid economic growth has given rise to a large number of substantial enterprises. The development of enterprises is inseparable from entrepreneurs and managers. During the transitional period, Chinese enterprises are facing complicated internal and external environments. Successful entrepreneurs and managers usually possess some typical features, which involve strategic decision-making, catching business opportunities, development of concept, business management, handling of human relation, personal virtues and leadership arts. An analysis of such typical features is helpful for fostering the new enterprise leaders in the new era of China and upgrading the competitive advantages of enterprises.

This survey[1] lists 58 typical features[2]which are graded in view of their performance or expectation: 1 stands for minimum degree of recognition and 7 stands for maximum degree of recognition. The features of the surveyed involve different ages, posts (enterprise founders or managers), length of service, nature, industry and market situation (competitive or monopolized) of the enterprises. Many people surveyed are founders, and most of them have been engaged in enterprise management for a fairly long time. The proportion of different enterprises and their industries are basically the same. All these facts help us to have a complete and in-depth understanding of the new enterprise leaders in China’s transitional period. The average grade for the features that the surveyed believed they possess is higher than 4.99 points, indicating that they basically recognize these 58 items but the degrees are different. The average grade for the features needed for future success is higher than 5.41 points, showing that the surveyed share more recognition over the 58 features in their future management.

The 58 items of characteristics raised by the survey may fall into three types: first, those relating to the personalities of the enterprise leaders, such as "sense of responsibility", "confidence", "tolerance" and "passion", etc; second, those relating to the behaviors, such as "clean and law-abiding", "fair play", "practicing what one preaches", "keeping close ties with the staff", etc; third, those relating to the capabilities, such as "capable of solving problems", "having strong analytical ability", "good at planning" and "properly using human resources". These three types of characteristics reflect the features of Chinese enterprise leaders during the transitional period as well as the expectations for future enterprise leaders.

I. An Analysis of the Personalities of Domestic Enterprise Leaders during the Transitional Period

Credibility and responsibility are the most important characteristics of enterprise leaders (See Table 1 for the results). "Good sense of responsibility", "ready to take responsibility" and "good sense of mission" are the three items that receive the highest average scores for the characteristics that enterprises already have. The enterprise leaders’ sense of responsibility has been highlighted. The two items that followed are "trustworthy" and "extremely valuing credibility", which reflect enterprise leaders’ value of credibility. The items that receive the highest scores from the surveyed regarding the characteristics that future leaders should possess also include credibility and responsibility with the former being even more stressed. We can see that credibility and responsibility are the most fundamental guarantees for the success of domestic enterprise leaders, as well as the most important characteristics for future leaders. Credibility and responsibility or "credible and honest" and "diligent and dutiful" are also requiredby good corporate governance under the modern enterprise system for board members and high-level managerial personnel. This is not only the general practice of corporate governance in the developed market economy countries, but also part of the widely accepted code of conduct in China. These characteristics can be regarded as the basic personalities that enterprise leaders should have.

Creativity has not become a typical characteristic of domestic enterprise leaders. The surveyed gave a low average score to the items relating to creativity. "Creative", "daring to take risk", "extraordinarily courageous" and "innovative" are listed lower in the rank for both current and future entrepreneurs. Although foreign researchers believe that innovativeness is one of the most outstanding characteristics of entrepreneurs and at the core of the spirits of entrepreneurs, successful Chinese enterprise leaders have not appeared to be innovative due to their special background and the impact of the traditional culture. In institutional innovation, the reform in the traditional enterprises has been gradual in order to maintain stability through steady transition. In technological innovation, they have mainly introduced and digested imported technologies to realize partial innovation. They need major and substantial innovation. In management innovation, they have mainly learned from advanced foreign experience and used mature management methods to reform their enterprises. The pattern of "stressing learning but ignoring innovation" reflects the typical characteristics of late-developing countries like China. Domestic successful enterprises are usually those good at learning, although they are not innovative. They can adapt to the market demand and narrow the gap with and even surpass the advanced enterprises. In addition, traditional Chinese culture, different from the foreign commercial culture, makes enterprises hold fairly negative attitude toward risks. Therefore, there has not been an atmosphere that encourages innovation.

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[1]The enterprise leaders in this survey refer to the enterprise founders and the middle- and high-level managerial personnel. The terms "entrepreneurs", "enterprise leaders", "enterprise managers" and "new enterprise leaders" in the article refer to the same kind of people.

[2]Typical features mainly refer to the personalities, abilities, behaviors and knowledge that help enterprise managers, such as entrepreneurs and professional managers, achieve outstanding achievements. At present, many professional analysts tend to use such terms as "competency" and "qualities".