Are marketing strategy and business performance swayed by corporate culture? To what extent does national culture shape the development of a company? Do successful firms in different countries share common cultural traits? HBS professor Rohit Deshpandé has long been in pursuit of answers to these and similar questions, and his most recent research has led him and Professor John U. Farley of Dartmouth's Amos Tuck School of Business Administration to examine the forces at work in six Asian nations. Their findings, to be published in a forthcoming paper, show the relationship between national and corporate cultures and the effect, in turn, on business performance

Prior work by Deshpandé, Farley, and Professor Frederick E. Webster, Jr., also of the Tuck School, focused on similar issues at companies in Great Britain, France, Germany, Japan, and the United States. The researchers found that despite substantial differences in national cultures, the most successful firms in these countries had remarkably similar corporate cultures. Innovation, they also learned, was the strongest driver of performance in each of these organizations, regardless of nationality.

Eager to determine whether this finding would also hold true among developing economies, Deshpandé and Farley expanded their study to include several emerging and developed Asian markets -- China, Hong Kong, India, Thailand, and Vietnam. The project involved interviews with some 500 senior executives of firms based in Bangkok, Bombay, Hanoi, Ho Chi Minh City, Hong Kong, and Shanghai. Information acquired earlier from Tokyo-based companies brought Japan into the mix, making possible a comparison between a diverse set of nations within Asia.

"We launched our original study," says Deshpandé, "by looking at four 'strategic levers' -- corporate culture, organizational climate, customer orientation, and innovation. Corporate culture was perceived as the prevailing set of shared values held by a firm's managers," he explains, "qualities such as loyalty and tradition. We defined climate as the nature of the workplace environment itself -- for instance, an open and trusting atmosphere with decentralized decision-making. Our goal was to learn how these various strategic levers influence business performance differently in different countries."

IWithin the corporate culture lever are four basic culture types. In their Asian study, the researchers describe these as Tigers, Rabbits, Monkeys, and Elephants. Each has dominant characteristics distinguishing it from the others. The Tiger culture, they found, tends to be achievement-oriented and competitive, while the Rabbits are more flexible, creative, and entrepreneurial. Monkey and Elephant cultures reveal a more inward focus, with Monkeys epitomizing teamwork and loyalty, while Elephants favor strong hierarchies, organization, and order.

According to Deshpandé, in undertaking their initial study of developed markets, he and his colleagues expected to find significant differences in the way companies operated from one nation to the other, anticipating a French operating model, a German operating model, and so forth. "That turned out to be true among the majority of operations," he says, "but a more important discovery was that the most successful companies all shared the competitive, achievement-oriented culture symbolized by the Tiger." But would this also hold true among Asian firms?

Outside Reading All selections by Deshpandé, Farley, and Webster. "Corporate Culture, Customer Orientation, and Innovativeness in Japanese Firms: A Quadrad Analysis." Journal of Marketing, vol. 57 (January 1993). Developing a Marketing Orientation. Thousand Oaks, Calif.: Sage Publications, 1999. "Market-Focused Organizational Transformation in China." Journal of Global Marketing (forthcoming). "Profiling High-Performance Firms in Business-to-Business Markets: A Five-Country Comparison." Marketing Science Institute Working Paper, 1997.

Once again the research showed that the prevalent organizational culture varies among countries. "While we had previously seen that Japanese firms, for instance, typified the clan-like culture symbolized in the Monkey," remarks Deshpandé, "we found that Chinese companies tended to be more formally organized (Elephants), yet also entrepreneurial (Rabbits). However, we also discovered that joint-venture firms in China were more competitive and less bureaucratic than state-owned enterprises." But despite these differences, the similarities of corporate culture among the most successful companies continued to prevail -- even when the companies were state-owned rather than privately held, as in China.

The role of innovation among high-performance companies in developed nations notwithstanding, Deshpandé points out that the most significant lever among emerging-market firms is customer orientation. At a conference of academics and executives held in conjunction with the official opening of the HBS Asia-Pacific Research Office in January, Deshpandé asked attendees to speculate on the reason for this difference. Stan Shih, chairman and CEO of Taiwan-based computer maker Acer Group, suggested one possibility. Since Western firms "have already reached a threshold in customer orientation," Shih claimed, "they have to try other approaches to succeed." "This is one of several exciting areas for further study," Deshpandé says.

It is also important to note, Deshpandé adds, that the consistently high emphasis on marketing found among the most successful firms in the nations he studied appears to hold true within different contexts. The research team's sampling method enabled them to compare consumer-goods organizations with industrial firms, product companies with service providers, and small operations with large ones. In each environment, the reigning corporate culture was market-driven and competitive.

Explaining the cultural consistency among high-performing companies throughout the world, Deshpandé observes that the rapid dissemination of learning in regard to corporate performance enables executives to effect organizational innovation very quickly. And despite differing political systems, there is a growing convergence toward free markets.

"Assigning top priority to innovation and customer orientation really does pay dividends," affirms Deshpandé. "It is also clear that building and sustaining a strongly entrepreneurial culture drives companies toward success and high performance." But he cautions that no organizational culture should be of just one type. Executives must create a blend to achieve optimal results. The ideal corporate culture, therefore, is neither Tiger, Rabbit, Monkey, nor Elephant. "The best representation of all," he posits, "may be the Dragon, a common icon in Asia that combines the disparate and frequently beneficent attributes of lesser beings into one of extraordinary capability and power. In the best companies, the whole is truly the sum of several parts."

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