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As the global presence of Chinese firms grows, increasing numbers of Chinese managers are working abroad as expatriates. However, little attention has been paid to such Chinese expatriate managers and their leadership challenges in an inter-cultural context, especially across a large cultural distance. To fill the gap in the literature concerning the leadership challenges for expatriate managers in an inter-cultural context, the purpose of this paper is to elucidate the leadership styles of Chinese expatriate managers from the perspectives of three traditional Chinese philosophies (i.e. Confucianism, Taoism, and Legalism) in the inter-cultural context of the Netherlands.

The data for this qualitative study were collected via semi-structured, open-ended, narrative interviews with 30 Chinese expatriate managers in the Netherlands.

The results clearly show that the leadership style of Chinese expatriate managers is deeply rooted in the three traditional Chinese philosophies of Confucianism, Taoism, and Legalism, even in an inter-cultural context. Specifically, the study reveals two salient aspects of how Chinese expatriate managers frame and interact with a foreign cultural context from the perspectives of traditional Chinese philosophies. First, the Chinese expatriate managers reported an initial cultural shock related to frictions between the foreign cultural context and Confucianism or Taoism, but less so in the case of Legalism. Second, the Chinese expatriate managers also reported that their interactions with the Dutch culture are best described as a balance between partial conflict and partial complementarity (thus, a duality). In this sense, the leadership style of Chinese expatriate managers is influenced jointly by the three traditional Chinese philosophies and certain elements of the foreign cultural context. This is consistent with the Chinese perspective of yin-yang balancing.

This study is among the first to offer a more nuanced and highly contextualized understanding of leadership in the unique case of expatriate managers from an emerging market (e.g. China) in an advanced economy (e.g. the Netherlands). The authors call for more research to apply the unique perspective of yin-yang balancing in an inter-cultural context. The authors posit that this approach represents the most salient implication of this study. For practical implications, the authors argue that expatriate leaders should carefully manage the interplay between their deep-rooted home-country philosophies and their salient host-country culture. Reflecting on traditional philosophies in another culture can facilitate inter-cultural leadership training for Chinese expatriates.

In this chapter, we analyzed the effects of internationalization on innovation, productivity, and firm performance among multinational pharmaceutical companies as representatives of a global knowledge-based industry. The empirical analysis used multiple stepwise regressions based on a sample of 149 firms headquartered in Europe and the US. The results indicate that innovation outcomes are positively correlated to the number of foreign subsidiaries (scope internationalization), whereas surprisingly, formal research and development (R&D) does not seem to directly influence innovation. This suggests that the firms benefit from local overseas subsidiaries to create and implement new innovative offerings. The number of foreign subsidiaries has a U-shaped relationship to patent productivity suggesting that firms can gain advantages by locating cost-intensive activities in low-cost countries and critical tasks in advanced market locations. Firm performance has a U-shaped relationship to sales abroad (scale internationalization) and the relationship is further enhanced by a high focus on R&D. This suggests that sales abroad enable scale economies, where R&D improves quality and relevance of products and thereby boosts performance. Finally, to validate the findings we conducted two semi-structured interviews with representative industry experts and gained further insights for an extended interpretation of results.