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Sunday, July 6, 2014

I was pressured over UM research centre’s work, says former VC

Former Universiti Malaya vice-chancellor Tan Sri Professor Dr Ghauth Jasmon says he was scolded because of the work done by UMcedel. – The Malaysian Insider pic by Nazir Sufari, July 7, 2014.Former Universiti Malaya vice-chancellor Tan Sri Professor Dr Ghauth Jasmon says he was scolded because of the work done by UMcedel. – The Malaysian Insider pic by Nazir Sufari, July 7, 2014.A former Universiti Malaya (UM) vice-chancellor has revealed that he was constantly harassed by Putrajaya over the unflattering findings by the university’s research centre, lending weight to claims that the ruling Barisan Nasional coalition was unhappy with its work.
Tan Sri Professor Dr Ghauth Jasmon‎, who served as vice-chancellor at the public university from 2008 to 2013, said a senior politician had scolded him for not controlling former Centre for Democracy and Elections (UMcedel) director Professor Datuk Dr Redzuan Othman.

"The political masters (from Putrajaya) were angry with me because of Prof Redzuan," Ghauth told The Malaysian Insider via the Whatsapp messaging service.
"I was scolded by a politician because of Redzuan and UMcedel and was warned about my job (as vice-chancellor),” he said.
He said a day after the 13th general election, he had received an earful from a senior member of Datuk Seri Najib Razak’s administration.
"I got a scolding and reminder the day after the general election, around 11am."
"The person told me that as VC, I should control Redzuan and not allow him to speak freely," said Ghauth.
Alhough he refused to reveal the person's identity, Ghauth confirmed it was a well-placed politician.‎
In the run-up to the election, the Barisan Nasional coalition had been rattled by UMcedel's findings which showed the prime minister trailing behind opposition leader Datuk Seri Anwar Ibrahim.
A UMcedel poll showed that more than 60% of voters surveyed favoured Pakatan Rakyat’s (PR) manifesto, compared with just 50% who preferred BN’s election pledges.
It also showed that 43% of respondents believed that Anwar was qualified to be prime minister, pipping Najib by four percentage points.
Najib had rubbished the findings and many BN supporters had questioned the methodology.
UMcedel, in its reply, had noted that Najib had been pleased with earlier surveys after he assumed office which had painted a positive picture of him and the BN.
However, despite the projections, BN won the 13th general election albeit with a reduced majority, capturing 133 parliamentary seats. Pakatan, meanwhile, clinched 89 out of the 222 parliamentary seats.
Ghauth said despite the pressure from Putrajaya, he had defended Redzuan.
"UM is an academic institution, not (a) political institution. My job as VC is to defend the sanctity of the academic institution,” he said.
"Regardless of whether people are happy or not, the academic freedom of the institution is above everything."
Ghauth was the 10th vice-chancellor of UM and served for five years before his contract ended in 2013.‎
Prior to that, he was the founder and chief executive officer of Universiti Multimedia for 11 years.‎
UMcedel was set up during Ghauth's tenure as vice-chancellor. First approved by the university's senate, UMcedel was later endorsed by the UM board of directors chaired by‎ Tan Sri Arshad Ayub.
The university terminated Redzuan's services as UMcedel director on March 31, although his contract only expired on December 31, 2014.‎
Redzuan's tenure as Dean of the Faculty of Arts and Social Sciences was also not renewed on July 1, even though he was said to have received the highest votes from the academic staff‎ to continue heading the faculty.

Ghauth said he was saddened over what happened to Redzuan, but added that he was still hopeful and believed in UM.
He said that Arshad was also initially unhappy with Redzuan's work in UMcedel.
"Yes, at one time he became angry with me because of UMcedel... But after a presentation by Redzuan to the board, Arshad changed his mind and endorsed UMcedel and I could see him becoming friendly with Redzuan.
"The entire UM board was happy with Redzuan’s presentation and endorsed UMcedel at that meeting," said Ghauth, adding that the senate, which he chaired, had already approved its establishment.
Ghauth said he and his peers had planned to steer UM into the list of top 100 universities in the world by 2015.
"I set the target of taking UM into the top 100 by 2015. I personally believed this would bring up Malaysia's standing globally."
But he was doubtful that UM could reach the goal under the current circumstances.
"I  am not sure but I sense that it will be very tough," he said.
UM has announced its goal of entering the QS World University Ranking's top 100 by 2015.
Although it is the top varsity in the country, UM was ranked at 167 in 2013/2014 by QS, a huge drop from its 2012 ranking of 156. – July 7, 2014.

Saturday, July 5, 2014

BackPolitics  Blair makes money not peace

Blair makes money not peace

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Yvonne Ridley
How can a man bearing the title 'Middle East Peace Envoy' agree to advise the blood-drenched Egyptian president, Abdel Fatah Al-Sisi, who seized power in a military coup last year after presiding over the slaughter of 2,500 protesters and the incarceration of more than 20,000 others?
The shocking announcement comes only days after Tony Blair attempted in vain to promote the idea of yet another war in the chaos of Iraq, to an incredulous world.
Blair has been a flop in terms of promoting peace in the Middle East ... the region has never been as volatile as it is now - and to add insult to injury, it appears he is now cashing in on his position as the envoy of the Quartet – the UN, US, Russia and EU.
The former British Prime Minister might be a spectacular failure at making peace but when it comes to making the filthy lucre his success knows no limits as his private business interests in the ever-volatile region merge in to his role with the Quartet. No other senior executive would be allowed to operate like this; he would be sacked but Blair continues to make money amid the misery and chaos in the Middle East - some of it a legacy from his days as British PM.
This latest deal as an adviser to Al-Sisi has been packaged together in a project funded by the United Arab Emirates. The programme is being supervised by the management consultancy Strategy which is part of PricewaterhouseCoopers. Their aim is to attract investment into Egypt's failing economy and a donors' conference sponsored by oil-rich UAE, Kuwait and Saudi Arabia will follow in which Blair will be a keynote speaker.
Of course, we are told by Blair's people that his decision to embark on this latest scheme was not being done "for any personal gain whatsoever". During an interview with The Guardian newspaper his spokesperson insisted he would make no money out of Egypt and neither would any of his organisations. "He is giving advice, he will have meetings, that's all," she said adding that he "is not a formal adviser".
Perhaps the question to ask would be how much is he being paid by the Gulf States promoting this scheme to give Al-Sisi some credibility ... The former army chief single-handedly did more to damage Egypt's economy when he got rid of the democratically elected Muhamed Morsi; it was a decision which destroyed the country's tourism and economy; sparked mass demonstrations and riots; and caused the deaths of hundreds.
It is not inconceivable that Blair will profit from the so-called lucrative business opportunities which could arise from the donor conference in Cairo.
Without a thought for the thousands being held in prisons throughout Egypt, including journalists, academics and supporters of the Muslim Brotherhood, Blair is nothing more than Al-Sisi's executive pimp. It's a role in which he excels. Since being shoe-horned out of Downing Street in 2007, Blair and his companies have amassed a string of multimillion pound consultancy contracts with private corporations, dictatorships and repressive regimes around the world.
His business dealings and consultancies are buried in a labyrinth of companies and partnerships which enable him to avoid publishing the full accounts and details of his activities although his earnings are thought to exceed £20 million a year.
Anyone can see there is a conflict of interest and Blair should be removed as Middle East Peace Envoy immediately, not least of all because his performance has been appalling.
If he is removed, it might just spur Labour leader Ed Miliband to review Blair's party membership - his obscene wealth and ability to do business with some of the world's worst human rights abusers and continued war-mongering must make him a prime candidate for expulsion from a party founded on socialist principles and ethics.
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Friday, July 27, 2012

25.07.2012 - Oslo
Murray Hunter
People Tend to Start Businesses for the Wrong Reasons
People undertaking strategic analysis or some type of strategic planning to develop ideas and strategies for a new potential business could not be further from the truth. This is part of the textbook fantasy that business schools have taught us to believe.
People Tend to Start Businesses for the Wrong Reasons
/Workforce and Economic Development @ LATTC

A person’s psychological state will directly influence perception of people, objects and events. This can potentially lead to perceptive distortion, especially if the person has any psychotic tendencies. Therefore any construed reality, decisions made, strategies crafted, resulting actions and consequential behavior would be based upon biased perceptions. Thus everything that develops within a firm including culture, management style, interpersonal relationships, rules and procedures, strategy, symbols and behavior will have some unconscious basis[1].Perception and thinking processes that identify opportunities and shape subsequent actions have their origins both in the psych and the external world. Identifying an opportunity and exploiting it may have as more to do with inner needs i.e., recognition, love and affection, power and control, self esteem, or grandeur, etc., as with any rational thought processes.

We have our biases

Most people enter into a new business for reasons that are not rational and thought out badly. Our cognitive decision making processes are guided by heuristics or ‘short cuts’, ‘rules of thumb’, decision rules that influence our judgments and decisions. Heuristics have the potential to assist in decision making by cutting down on the person’s information load[2], allowing a person to make quick decisions about opportunities without taking any formal analysis that would tend to highlight problems that prevents its exploitation[3].

Consequently, heuristics have some advantages in entrepreneurial decision making processes as deep contemplation of a start up may lead to numerous reasons why a potential venture should not start up. Heuristics are very important where opportunity windows are very short[4]. This helps in making quick strategy choices, saving time, and adding to flexibility. This can trigger the creativity process by imposing alternative scenarios to what is perceived through the senses. Heuristics are deep in our belief systems and maybe also influenced by our deep motivations and reflect our social conditioning. Heuristics and other biases become intertwined within our knowledge structures and become a factor of influence in the assessments, judgments, and decisions we make involving opportunity evaluation[5]. They are part of our decision making processes[6].

On the negative side, heuristics can become cognitive biases. Cognitive biases are errors of judgment based on misconceptions of the facts, memory errors, probability errors, motivational errors, and/or social influences. These are the basis of irrational reasoning which can lead to all sorts of mistakes in judgment[7]. The general conditions that people work under, particularly if it is an entrepreneurial environment will normally be characterized with information overload, uncertainty, strong emotions, time pressure, fatigue and the need to do unfamiliar things with little prior experience. This type of situation is a stressful one and a potential trigger for distortion in perception and reasoning. This usually occurs without a person’s conscious knowledge of the fact[8]. Human reliance on heuristics and biases tends to increase in busy environments described above[9], especially when immediate answers are required[10]. This is where lots of irrelevant information works its way into the reasoning process[11] and leads to cognitive biases that contribute to irrational and less than optimal decisions.

One of the most common cognitive biases is the overconfidence bias. People tend to be over optimistic about their chances of success which motivates them to start a business, even through real prospects may be poor[12]. People usually perceive their chances of success are higher than others doing the same thing around them[13]. Other common biases include the representativeness heuristic, a generalization about a person or event that leads to the consideration of only a few variables[14], the law of small numbers where a person uses limited number of population data and generalizes it over a much larger population[15], and the halo effect where there is a tendency for people to make attributions about something based on past events and/or performance[16]. Other biases include loss aversion where the disutility of giving something up is greater than the utility associated with acquiring it, optimism bias, the tendency to be over optimistic about the outcomes of planned actions, ostrich effect, ignoring something obvious in a negative situation, planning fallacy bias, a tendency to underestimate the time it will take to complete a project, professional bias, a tendency to look at things according to the ideas of one’s own profession without considering broader points of view, and an escalation of commitment as a tendency for people to keep on investing time, effort and money in losing courses of action because of the initial commitment.

Heuristics and cognitive biases are believed to be caused by the process of attribute substitution. Attribute substitution occurs when a person has to make a judgment (of an attribute target) that is very complex. As a consequence of the complexity, the mind substitutes a more easily calculated heuristic attribute to simplify complexity[17]. This occurs when the target attribute is relatively unavailable through reasoning (answer cannot be easily retrieved through memory), so an associate attribute (heuristic) is substituted. This process occurs because the heuristic is easily available in memory (i.e., a neural perception or primed in memory[18]), and this process is not detectable through the person’s reflective system. The attribute substitution process combines available knowledge and experience into heuristics that drive a new idea forward. In pragmatic terms, heuristics and cognitive biases are built into a person’s belief system.

Mistaking your aspirations for opportunities

Many people mistake their aspirations for opportunity. For example people put their money and efforts into a boutique, restaurant or spa for the wrong reasons because they like fashion and shopping, food and cooking, or aromatherapy and massage. In SME’s the values of the founder and the firm are the same in many cases. Perception of business opportunity is influenced to various degrees by a hierarchy of personal aspirations and concerns that cannot be easily separated from business goals. This can be dangerous if one is unaware of their influence upon thinking.

Emotions are part of our fundamental irrationality and unpredictability and thus an important influence on thinking. Our basic emotions come from inner extra-rational dynamics deep within our psych that are expressed as feelings, dreams, fantasies, and other imagined aspects of our lives[19]. Our more complex emotions like loyalty, sympathy, pride, confidence, achievement, embarrassment, indignation, bewilderment, pity, elation, satisfaction, boredom, shame, disgust, frustration, and surprise, etc, tend to be socially related and constructed[20]. Everything we perceive evokes some form of feeling and the process of creativity, innovation and invention is always an emotional and even a sensual experience in people as concepts are translated into words, numbers, diagrams, or objects, leading to something inspirational[21]. Emotions decide what we like, dislike, what is agreeable, disagreeable, giving meaning to our world. Emotions can sometimes help us see similar patterns across fields without conscious deliberation and plays an important role in signaling preferences for opportunities by arousing positive emotions, kindling enthusiasm and determining our reactions to shocks and the behavioral trajectories we take.

We view the world is filtered through our emotions which guides our self awareness to a past or future orientation. Any past orientation will be full of stories which influence our sense of meaning about the present. Some of the stories we remember will be full of regret for past mistakes, disappointment for what was not done, or full of satisfaction and/or pride for what was achieved. The past influences our interpretation of the present. Positive and negative experiences influence what we perceive, contemplate and put our focus upon in the now. The positive and negative memories of the past also guide our direction in the future. Positive memories guide us towards action where we have a high sense of self efficacy and negative memories tend to make us averse to taking action where we have a low sense of self efficacy. The future represents our positive hopes and aspirations, or negative fears and anxieties where positive emotions may lead to a sense of high self efficacy and become powerful motivators for action, while negative emotions may lead to sense of low self efficacy feasibility and averse to action. Extreme feelings of low or high self efficacy can lead to either reckless overconfidence in a positive emotional state or an aversion from action out of fear and anxiety in a negative emotional state. The same feelings are not uniform across the all activities, where a person may feel a high sense of self efficacy in some areas and low sense of self efficacy in other areas.

Too much past or future orientation may lead to personal delusion such as unrealistic hopes that an entrepreneurial opportunity really exists[22], or massive overconfidence in one’s ability to successfully implement a complex strategy in the field. Alternatively too much future or past orientation may lead to undue pessimism where the feeling of self efficacy and motivation is low, leading to states of anxiety and inaction. Orientation in the past will anchor one into previous patterns of success, which promote rigidity, while too much orientation into the future may lead to fantasy, thus leading to unrealistic objectives and the ability to consider realistic scenarios[23].

It is usually very difficult to see abnormality as many psychotic traits are also important drivers of manager and entrepreneur behavior. Many well known business leaders could be considered narcissistic in nature[24]. Some forms of psychosis (attention-seeking, paranoia, obsessive-compulsiveness & narcissism) are actually qualities that help bring people to the top of their fields. However these same qualities in excess can lead to an arrogant and overconfident delusion, once at the top. Many managers have fallen from corporate grace for this reason[25].

It is sound advice to always ask one’s self before embarking upon any new venture; ‘what are your real reasons and motivations for doing so?”


[1]Kets de Vries, F. R. and Miller, D. (1984). The Neurotic Organisation, Diagnosing and Changing Counterproductive Styles of Management, San Francisco, Jossey-Bass, Inc.

[2] Gowda, M. V. R., (1999). Heuristics, biases and the regulation of risk, Policy Science, Vol. 32, pp. 59-78.

[3] This is one area where entrepreneurial thinking may be very different from management thinking. An entrepreneur without perfect information will act on intuition and hunch. Any analysis will be mental rather than through formal processes which managers in a company situation will tend to follow. Management analysis of new ideas will tend to frame the questions: What is wrong with the idea? Why should it not be exploited? What will be the potential problems?, etc. Thus analysis can become a very negative paradigm in management preventing new ideas emerging into new strategies.

[4] Tversky, A. and Kahneman, D. (1974). Judgment under Uncertainty: Heuristics and Biases, Science, Vol. 185, pp. 251-284.

[5] Mitchell, R. K, Busenitz, L, Lant, J, McDougall, P. P, Morse, E. A, and Smith, B. (2004). The distinctive and inclusive domain of entrepreneurial cognition research, Entrepreneurship, Theory and Practice, Vol. 28, No. 6, pp. 505-518.

[6] Wright, M., Hoskisson, R. E., Busenitiz, L. W. and Dial, J. (2000). Entrepreneurial Growth through Privatization: The Upside of Management Buyouts, Academy of Management Review, Vol. 25, No. 3, pp. 591-601.

[7] Baron, R. A. (1998). Cognitive mechanisms in entrepreneurship: why and when entrepreneurs think differently than other people, Journal of Business Venturing, Vol. 13, No. 3, pp. 275-294.

[8] Wilson, T. D., Houston, C., Etling, K. M. and Brekke, N., (1996). A new look at anchoring effects: Basic anchoring and its antecedents, Journal of Experimental Psychology: General, Vol. 4, pp. 387-402.

[9] Gilbert, D. T., Pelham, B. W., and Krull, D. S., (1988), On cognitive busyness: When person perceivers meet persons perceived, Journal of Personality and Social Psychology, Vol. 54, pp. 733-740.

[10]Gilbert, D. T. and Osborne, R. E. (1989). Thinking Backward: Some curable and incurable consequences of cognitive busyness, Journal of Personality and Social Psychology, Vol. 57, pp. 940-949.

[11]Chapman, G. B, and Johnson, E. J, (2003). Incorporating the Irrelevant: Anchors in Judgments of Belief and Value, In: Gilovich, T, Griffin, D, and Kahneman, D, (Eds.), Heuristics and Biases: The Psychology of Intuitive Judgment, Cambridge, UK, Cambridge University Press.

[12]Arabsheibani, D., De Meza, J., Maloney, J., & Pearson, B., (2000), And a vision appeared unto them of great profit: Evidence of self-deception among the self-employed, Economic Letters, Vol. 67, pp. 35-41.

[13]Cooper, A., Woo, C., & Dunkelberg, W., (1988), Entrepreneurs’ perceived chances for success, Journal of Business Venturing, Vol. 3, pp. 97-108.

[14]Tversky, A. and Kahneman, D. (1982). Judgment under Uncertainty: Heuristics and Biases, In: Kahneman, D., Slovic, P., and Tversky, A., (Eds.), Judgment under uncertainty: Heuristics and Biases, Cambridge, Cambridge University Press, pp. 3-20.

[15]Clement, J. (1987). The use of analogies and anchoring intuitions to remediate misconceptions in mechanics, Paper presented to the Annual Meeting of AERA, Washington, DC.

[16]Rosenzweig, P. (2007), The Halo Effect, London, Pocket Books.

[17]Kahneman, D. and Frederick, S. (2002). Represetativeness Revisited: Attribute Substitution in Intuitive Judgment, In: Gilovich, T, Griffin, D., Kahneman, D., Heuristics and Biases: The Psychology of Intuitive Judgment, Cambridge, UK, Cambridge University press, pp. 49-81.

[18] Priming occurs when an earlier stimulus influences a response to a later stimulus. For example, a person watches a television program the night before on conservation of forests. The next day someone asks the person for their views on conservation. It is likely the person will give views and ideas that originated from the program on conservation the night before. This is assuming the person does not already have any strong views on the subject.

[19] Chodorow, N. (1999). The Power of Feeling: Personal Meaning in Psychoanalysis, Gender, and Culture, New Haven, Yale University Press.

[20] Hunter, M. (2011), Opportunity, Strategy, & Entrepreneurship: A Meta-Theory, Vol. 1, New York, Nova Scientific Publishers., P. 250.

[21] Root-Bernstein, R. S., & Root-Bernstein, M., M., (2001). Sparks of Genius: The thirteen thinking tools of the world’s most creative people, Boston, Houghton Mifflin Company.

[22] Many people mistake their aspirations for opportunity. For example people put their money and effort into a boutique, restaurant, or spa for the wrong reasons because they like fashion, shopping, food and cooking, or aromatherapy and massage, only to close down a few months later because there was no real opportunity.

[23]However a future orientation in imagination may be the actual position that a science fiction writer may cherish.

[24]Maccoby, M. (2000). Narcissistic Leaders: The Incredible Pros, The Inevitable Cons, Harvard Business Review, Vol. 78, pp. 68-78.

[25]Kramer, R. M. (2003). The Harder They Fall, Harvard Business Review, Vol. 81, No. 10, pp. 58-66, 136.

Murray Hunteris associate professor at the University Malaysia Perlis, and consultant to Asian governments on community development and village biotechnology. Murray is the inventor/author of a number of chemistry patents in Australia and as a researcher was the first to report many new natural compounds in international journals like the prestigious Journal of Essential Oil Research.

TAGS: Business

Do Confucian Principled Businesses Exist in Asia?

By
University Malaysia Perlis

Confucius was born with the name K’ung Ch’iu in the Lũ Kingdom of China in 551 BC, and was in later life called K’ung Fu-Tzu (Master Kung) by his followers. He is probably the most famous Chinese moralist, intellectual, philosopher and educationalist known outside China and his teachings have had great influence on China’s social and political thought over the last 2500 years, as well as spreading to East and South-East Asia. Confucius developed a system that saw man as a social being, interconnected to society through a system of moral and social ethics, concerned with perfecting human character to create a virtuous social order.

While the traditions of Confucianism have historical and regional variations, there are certain central ideas and values which are common. These values have constituted the key elements of the traditions of societies which have endured history and political upheavals. The basic Confucian concepts embrace a dynamic cosmological worldview for promoting harmony amidst change, where individuals exist in concentric circles of relationships with ethical responsibilities that place importance on the family, within a hierarchical social system, where loyalty to elders is paramount and a generational concept of gratitude and respect for earlier ancestors exists. Education is the mechanism where individuals are cultured and developed as a means to enrich society and create a social and political order. History is valued as continuality and a basis for moral reflection and learning.

The worldview purported by Confucius is characterized by four key elements;

  1. An anthrop cosmic perspective of the great triad of heaven (a guiding force), earth and humans,
  2. An organic holism where the universe is seen as unified, interconnected and interpenetrating, where everything interacts and affects everything else,
  3. A dynamic vitalism of underlying units of reality which is constituted of the material energy force of the universe (chi), the natural force of the universe, which creates reciprocity between man and nature and is the substance of life responsible for continuing process of change in the universe, and
  4. Ethics embracing man and nature.

Within this context, Confucian thought sees the person in relation to others and not as an isolated individual. Thus, in Confucian society, the common good is more important than individual good. In this view, self interest and altruism for a common cause is not always mutually exclusive.

Confucius was more concerned about the process of human development, rather than theological concepts and ends. He believed the principles of relationships could be extended from that of running a family to the governing of a kingdom or nation; “Those who want to be a leader or ruler have to have their own house in order”. Through education and rituals which signified respect, man would develop five inner virtues; integrity, righteousness, loyalty, reciprocity and human-heartedness, which once developed would radiate externally from the individual, so that society could be governed by man, rather than rules of law. To this end, Confucius defines five primary relationships that will achieve this; ruler and subject, parent and child, elder and younger brother, husband and wife, and friend and friend. As a child develops and learns, he or she will first learn to love and respect the parents, then brothers and sisters, then relatives, and later all of humanity. This piety is called Hsiao, which is considered the root of all humanity.

This philosophy was able to change the family in agrarian China from a unit of production to a collective moral dimension, with a social code for each rank of the family hierarchy, very different from the Western concept of individualism. This led to the concept of guanxi, much written about in Western literature, “a focus on relationships with a shared history, respect for the past, a value that many – not all – Chinese cherish”.

Two other concepts in Confucianism are Tao, the way of life and Te, potency and self-sacrificial generosity with humility, with the moral power of attraction and transformation, associated with these qualities. The humanistic attribute required to achieve the above is through Ren, which means love, kindness and goodness, qualities of the perfect individual. This is the essence of what makes humans different from other members of the animal kingdom. Failure to develop Ren would lead an individual to quickly develop foregone conclusions, dogmatism, obstinacy and egotism, which would block wisdomand prevent people from making new insights and discoveries, as one’s mind must remain open to become wiser. Li is the expression of Ren in a social context through norms, rites and rituals governing ceremonies according to one’s social position. Through Li, the individual expresses his respect and reverence for others.

Another important aspect of Confucian thought mentioned above is Yi or righteousness. This is where self interest is subservient to organizational interest. Yi is practiced through cultivating ritual and etiquette and eventually becomes second nature. Zhi or wisdom is the ability to apply the above virtues into life situations which implies an understanding of the Confucian worldview above. Zhi is therefore much more than knowledge. Finally one must possess Xin or trustworthiness to safeguard the mission of the organization. Romar suggested that Confucian ethics are very similar to the ideas developed by Peter Drucker.

Confucius was not influential in government during his time, serving only in minor positions, and wondering around China giving advice to those few that listened. However, he attracted a number of followers, who later held office in government, advised by Confucius on matters of ethics and piety. However he became quickly disillusioned as they didn’t take his counsel. Confucius spent most of his last years working on his classics.

After his death, Confucianism had to contend with other philosophies of Taoism and Buddhism during the 3rd to 7th Centuries, creating a blend of philosophies creating Neo-Confucianism, dominating philosophical thought in China during the Tsang Dynasty (618-906 AD), the Sung Dynasty (960-1279 AD) and later during the Ming Dynasty (1472-1529 AD). Confucian institutions in China slowly disintegrated after the overthrow of the Last Emperor in 1911, although it survived in practice in Taiwan, Hong Kong, Macao and parts of South-East Asia after that time.

Confucianism has been examined and debated about its significance to Asian Economic development by Western scholars, over the last few decades. Confucianism is often misunderstood, as to its real interpretations. Most have believed that Confucianism is completely worldly and humanistic, lacking any divinity. However Confucius last book The Annals of Spring and Autumn (chũnqĭu) is full of references to the divinity of heaven and its influence upon man and reason for existence. Some scholars have criticized Confucian works as being nothing more than a reaffirmation of earlier thoughts, with no originality, although Confucius himself stated the need to look back to learn history as examples of models and acts of piety. Many misunderstand the concept of holism, not necessarily meaning holism of society, but holism of the worldview from a family perspective.

During the 1980’s and 1990’s many academics became interested in the connections between Confucianism and the spectacular rise of the Asian Tigers. Some argued that Confucius was opposed to modernization as it didn’t advocate individualism, common to the Western characteristics of entrepreneurship, was too dependent on guidance, emphasized an all round development of personality to harmonise with the environment, which discouraged aggressiveness and encouraged traditionalism, rather than modernisation. However Tu suggested that individualism is a Western mode of capitalism and East Asian had developed another model based on relationships to develop change through consensus and networks, with a sense of personal discipline. Confucianism was criticized for lack of profit motive, as his philosophies discouraged self-motivation and that merchants were not included in Confucius set of key relationships. However, through responsibility and obligation to family, other motives exist, such as their well-being, and treatment of those inside and outside an individual’s universe of relationships will be different, i.e., outsiders treated with respect but caution, more adversarial, rather than brotherly relationship. Confucianism is also criticized for its lack of innovation, whereas the reality of Chinese business has been to seek ways to control an existing market, rather than create new value through innovation.

The tremendous economic growth in Asia after the Second World War was labelled as ‘Confucian capitalism”. Hofstede postulated that culture is a prime determinant of performance and Confucianism dictates hierarchical organizational structure, preserving values, and thrift, which were all seen as organizational drivers of economic growth. One of the side effects of Confucianism is nepotism and thus the creation of lack of transparency, corruption, and inefficiency. Some scholars labelled this as one of the prime reasons of the 1997 Asian financial crisis.

Perhaps one area where Confucian concepts can be superficially seen is in the Chinese family business around Southeast Asia. Chinese family businesses are usually run by a patriarchal leader who installs direction and morals through the exercise of Confucian virtues. However this often degenerates into crude authoritarianism. The hierarchy usually follows a kinship structure where one’s position depends upon relationship with the leader, rather than on any professional merit. Subordinates know their roles and operate within a certain degree of autonomy, although most organizational knowledge is monopolized by the leader and shared at his discretion. Personal relationships are thus very much part of the decision making process and organizational performance is very subjective. Performance of these enterprises is often sub-optimal because of the nepotistic nature of organizations. In addition, one of the major objectives is to maintain harmony and avoid conflict within the organization as a means to maintain stability.

Human relationships are built upon trust based on the principles of personalization and quanxi. This was necessary in developing Southeast Asia when legal codes and contractual enforcement were still in their infancy. The effect of these arrangements was to slow down the state of progress and limit the incorporation of newcomers to an industry. This also restricted the input of new ideas and technology into firms within the region. The overview of a traditional Chinese family enterprise is depicted in figure 1.

Figure 1. The Traditional Chinese family Business

In theory the centralization of decision making increases the ability to make quick decisions and adapt to a changing environment. However leadership in these organizations seem to take on a conservative disposition and be averse to change. Firm flexibility and technology sophistication almost wholly depends upon the competencies of the patriarchal leader.

To the contrary, it can also be argued that Confucianism actually has little influence on the way Chinese business is operated, at least in South-East Asian countries like Malaysia. Although Chinese business sustains and nurtures family members and maintains a paternalistic and hierarchical nature of authority within the enterprise, there is little evidence that Malaysian Chinese businesses rely on guanxi networks for growth and development, have little interest in long term sustainability and little adherence to the Chinese philosophies associated with Confucianism. It is also unlikely that many contemporary Chinese have a thorough understanding of the Confucius philosophy or the will or want to fulfil the piety and wisdom defined by Confucius in everyday life. One of Confucius followers Mèngzî warned, Ren is a concept not easily achieved by man. However modern life and business may tend to be judged by old values, creating a complexity of behaviour that is often hard to understand, especially by the older generation that is Chinese educated. With the new generation returning to their family businesses after overseas study there is great pressure for patriarchal leaders to step aside and/or allow the introduction of ‘more professional’ management. Perhaps the greatest influence of Confucianism is in the governance of the State of Singapore, rather than in business.

Finally, John Naisbitt in his prophecy book Megatrends Asia predicted that the unique strengths of Chinese business networks, able to make speedy decisions and able to obtain resources through connecting people would make the Chinese business model the ideal flexible form of social organization for the globally connected world of the future. However this would assume that harmony doesn’t exhibit restriction on individuals from criticism of strategy, even though it may be constructive, as the practice of authority in Chinese companies means obedience rather than careful questioning of the status quo.