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Group Decision and Negotiation 12: 243–263, 2003 COLLECTIVISM AND INDIVIDUALISTIC VALUES 243 © 2003 Kluwer Academic Publishers. Printed in the Netherlands

Collectivistic and Individualistic Values: Their Effects on Group Dynamics and Productivity in China DEAN TJOSVOLD Department of Management, Lingnan University, Hong Kong (E-mail: [email protected])

KENNETH S. LAW Department of Management of Organizations, Hong Kong University of Science and Technology, Clear Water Bay, Kowloon, Hong Kong (E-mail: [email protected])

HAIFA F. SUN Management School, Sun Yat-Sen University, Guangzhou, China (E-mail: [email protected])

Abstract Collectivistic and individualistic values are theorized to have far reaching effects on teamwork and organizations. This study proposes that cooperative and competitive goal interdependence mediates the relationship between these values and group interaction and outcomes. Working in State Owned Enterprises in three regions of China, 689 employees in 194 teams indicated their group’s values, goal interdependence, constructive controversy, and productivity. Their managers also reported on the extent these teams were productive. Structural equation analysis suggested that collectivistic values may reinforce cooperative goals and an open-minded discussion of views which in turn results in strong relationships and team productivity, as experienced from both the team’s and manager’s perspectives. Individualistic values, especially the horizontal version, can have contrasting effects through fostering competitive goals and closed-minded discussion. These results, coupled with previous research, suggest that collectivist values, cooperative goals, and constructive controversy provide an important foundation for productive teamwork. Key words: collectivistic, individualistic, cooperation, competition

1. Introduction Collectivistic and individualistic values have a prominent role in such important areas as cross-cultural psychology, international management, politics, and religion (Adelman and Morris 1967; Bakan 1966; Hofstede 1993; Inkeles and Smith 1974; Kim et al. 1994; Miller, Bersoff, and Harwood 1990; Singelis et al. 1995; Taylor 1989; Triandis 1995). They have been fundamental in theorizing and research on differences between organizing in the West and the East and in recommendations for how managers should be flexible in the global marketplace. Theorists argue that these values affect leadership, conflict management, and relationship development. But more empirical evidence is needed to document the processes by which these values affect work relationships. This study empirically relates the literatures on cultural values and the theory of cooperation and competition. It uses the theory of cooperation and competition, developed largely by social psychological experiments,

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to explore and specify the role of these values on the interaction and effectiveness of teams in China. Collectivistic values are hypothesized to lead to cooperative goals which in turn promote constructive controversy and team productivity whereas individualistic values foster competitive goals, closed-mindedness, and team ineffectiveness. Research on values has traditionally been conducted at the individual and cultural levels. Studies have assessed how individual differences in values predict behavior and personality and the role of cultural differences on behavior and outcomes (Wheeler, Reis, and Bond 1989). Values, although not often collectivistic and individualistic ones, have been studied at the group and organizational level. Corporate culture is thought to have major effects on the dynamics and success of organizations (Deal and Kennedy 1982; Pfeffer 1994). This study uses collectivistic and individualistic values at the group level to develop a specific understanding of their effect on team dynamics and outcomes. Values measured at the group level may well have a stronger, more demonstrable relationship to group productivity than values measured at the individual or cultural level. We explore the role of collectivistic and individualistic values on the interaction among team members and their productivity in China. Although cultural values have been used to predict behavior, it is understood that cultural values are continually in flux and manifested in various ways (Morris et al. 1998; Yamagishi and Yamagishi 1994; Yamagishi, Kikuchi, and Kosugi 1999). Research is needed to understand how the situation and the expression of values alter their effects. Rather than the traditional cross cultural research of comparing individuals or samples from different cultures regarding the strength and effects of values (Leung 1997), we use a theory with universal aspirations to explore the role of collectivistic and individualistic values in groups in China. The present research attempts to develop both the theory of cooperation and competition and our understanding of the effects of collectivistic and individualistic values on group dynamics in China. The role of values on groups is also important to study because teams are increasingly becoming central to organizations. The majority of Fortune 500 firms report using project management, executive management and production work teams, compared to a minority of firms only a decade ago (Lawler, Mohrman, and Ledford 1995). Through teams, organizations can combine and channel their members’ tacit as well as explicit knowledge to promote innovation (Leonard and Sensiper 1998; Nonaka 1990; Simonin 1999). Teams are an alternative to hierarchy with its heavy investments in contracting and monitoring (Ouchi 1981). Many employees, especially professionals who traditionally distrust hierarchy, may welcome teams as a more acceptable means of social control. Effective teams are a complex, embedded competence that can be difficult to replicate (Barney 1991; Barney, Edwards, and Ringleb 1992; Wernerfelt 1994).

2. Collectivistic and individualistic values Collectivistic and individualistic values consist of a set of related dimensions. These values differ on their emphases on a collective or personal self, whether personal goals are considered more or less important than the goals of ingroups, and the extent that social norms

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or individual attitudes should determine behavior (Davidson et al. 1976; Kashima et al. 1992; Kim et al. 1994; Markus and Kitayama 1991; Mills and Clark 1982; Triandis 1995; Yamaguchi 1994). These values are in turn expected to induce behavior. For example, Chinese people are considered collectivists who see themselves as part of a larger whole and who place high priority on their ingroups (Chan 1963; Triandis 1990; Triandis et al. 1990; Trompenaars 1993; Tung 1991). These collectivistic values have been hypothesized to lead to valuing harmony and relationships (Morris et al. 1998). Chinese people are expected to avoid conflicts and aggressive ways of dealing with them for the collectivist reasons of protecting social face and maintaining relationships (Leung 1997; Ting-Toomey 1988). In comparison, individualistic values, common in the US and other Western countries, lead people to discuss conflicting ideas openly and directly. Evidence that Chinese compared to Western managers endorse and rely upon conflict avoidance supports the argument that collectivist values lead to harmony maintenance and avoiding open, aggressive conflict management (Jehn and Weldon 1992; Kirkbride, Tang, and Westwood 1991; Tse, Francis, and Walls 1994). Collectivistic and individualistic values have also been hypothesized to play a significant role in economic development (Adelman and Morris l967; Inkeles and Smith l974; Taylor 1989). Collectivistic values may be appropriate for agrarian and centrally controlled economies whereas individualist values reinforce open, growth-oriented economies with their demands for innovation. Consistent with this argument, studies have found that individualist values accompany economic development (Heuer, Cummings, and Hutabarat 1999; Ralston et al. 1999). Managers from the East have increasingly endorsed individualistic values as their economies develop. In arguing that there are many kinds of collectivism and individualism – Korean collectivism is not the same as the Indonesian one – Triandis (1995) proposed that the most significant distinction is between horizontal and vertical collectivism and individualism. Horizontal emphasizes equality and vertical emphasizes hierarchy. The underlying assumption of horizontal is of equality among individuals whereas in vertical, selves are distinct from each other. These different emphasizes result in four distinct patterns of Horizontal Individualism (HI), Vertical Individualism (VI), Horizontal Collectivism (HC), and Vertical Collectivism (VC). In Horizontal Individualism, the emphasis is that self-reliant people want to pursue personal agendas but with little interest in having higher status. Vertical Individualism emphasizes pursuing personal agendas to acquire superior status. Horizontal Collectivism emphasizes equality, sociability, and interdependence without strong deference to authority. Vertical Collectivism also emphasizes the ingroup but with a willingness to submit to authority. Evidence supports that these four patterns have discriminant and convergent validity (Singelis et al. 1995; Triandis and Gelfand 1998). For example, individualists of both versions are high on competition and emotional distance from ingroups whereas collectivists are low on competition and hedonism and high on family integrity. But vertical individualists are particularly competitive and self-reliant compared to horizontal ones.

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There is a need to develop a more specific understanding of the processes by which collectivistic and individualistic values in their vertical and horizontal versions affect interaction and productivity. Chen, Chen, and Meindl (1998) proposed that cooperation is an important mediator between values and social interaction and outcomes. This study contributes to this literature by examining how Deutsch’s (1949, 1973) theory of cooperation and competition might be useful to understand more specifically how values have their effects on team dynamics. Although previous research has suggested that collectivist values induce conflict avoidance and team effectiveness, few if any studies have used the theory of cooperation and competition to understand the possible dynamics by which values have their impact. This theory provides specific definitions of cooperation and competition and its considerable empirical support may identify the specific ways that values affect teams (Deutsch 1973; Johnson and Johnson 1989). This paper argues that shared team values have significant effects to the extent that they alter how team members consider their goal interdependence. This perspective allows the use of the largely experimentally developed social psychological theory of cooperation and competition to be brought to bear on understanding how shared collectivistic and individualistic values affect group interaction and productivity.

3. The theory of cooperation and competition Social interdependence exists when individuals have common goals and each individual’s outcomes are affected by the actions of the others (Deutsch 1949, 1962; Johnson and Johnson 1989; Tjosvold 1989). The basic premise of the theory of cooperation and competition is that the way goals are structured determines how individuals interact, and the interaction pattern determines outcomes. Goals may be structured so individuals promote the success of others or obstruct the success of others. When a situation is structured cooperatively, individuals’ goal achievements are positively correlated; individuals perceive that they can reach their goals if and only if the others also reach their goals. When a situation is structured competitively, individuals’ goal achievements are negatively correlated; each individual perceives that when one person achieves his or her goal, all others with whom he or she is competitively linked fail to achieve their goals. Whether team members understand the relationship among their individual goals are related cooperatively or competitively critically affects their expectations, interaction, and outcomes. In cooperation, people believe that as one person moves toward goal attainment, others move toward reaching their goals. They understand that others’ goal attainment helps them; they can be successful together. With cooperative goals, people want each other to perform effectively for such competence helps each person be successful. They interact in ways that promote mutual goals and resolve issues for mutual benefit. In competition, people, believing that one’s successful goal attainment makes others less likely to reach their goals, conclude that they are better off when others act ineffectively. When others are productive, they are less likely to succeed themselves. They pursue their interests at the expense of others. They want to “win” and have the other “lose”.


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Cooperative goals have been found to lead to constructive controversy, the open-minded discussion of diverse views. Recent studies have emphasized that conflict can very much affect the dynamics and outcomes of groups and in particular can be useful for solving problems and task accomplishment (De Dreu and van de Vliert 1997; Jehn 1997, 1995; Nemeth and Owens 1996). Experimental research has documented that people with cooperative goals engage in direct discussions and full exchange of views that lead to the understanding of each other’s perspectives and issues (Tjosvold 1982; Tjosvold and Deemer 1980; Tjosvold and Johnson 1977; Tjosvold and Sun 1998; Tjosvold, Johnson, and Fabrey 1980; Tjosvold, Johnson, and Lerner 1981). Confronted with an opposing view and doubting their own position is fully adequate, they have been found to be curious and seek to understand opposing views. They ask questions and demonstrate understanding of the other position. Through defending and understanding opposing views and rationales, protagonists begin to integrate ideas to create new, useful solutions. These dynamics lead to quality solutions protagonists accept and implement when they emphasize their cooperative goals. They also develop confidence in working together in the future. Field studies in the East and West also support that cooperative goals foster an open-minded, productive discussion of opposing views that result in quality decisions and implementation (Alper, Tjosvold, and Law 1998; Tjosvold and Wang 1998). Cooperation and competition research has concentrated on the effects of goal interdependence (Johnson and Johnson 1989; Stanne, Johnson, and Johnson 1999). However, theorizing suggests that values may be an important antecedent to goal interdependence. Deutsch (1973) argued that personal relationships and feeling of belonging develop cooperative goals whereas impersonality and interpersonal distance foster competition. People see that their destinies are positively linked with those they know and regard positively whereas they are apt to believe that their goals are incompatible with those whom they feel distant and removed (Gruenfeld, Mannix, Williams, and Neale 1996; Lau and Murnighan 1998). This argument suggests that collectivist values with their emphasis on ingroup relationships foster cooperative goals in a team. Although it may seem that individualistic values would lead simply to independent goals, this study proposes that these values promote competitive goals. Generally, teams that do not develop cooperative relationship have impersonal ones that emphasize competitive goals (Johnson and Johnson 1989). Individualistic values with their emphasis on differentiation from ingroups are expected to increase impersonality within the team and result in competitive goals. Deutsch (1973) also argued that equality was an important antecedent of goal interdependence. In particular, feelings that people are morally equal and that each person is considered valuable in his or her own right lead to commitment to cooperative goals. Inequality and valuing persons based on their status or performance foster competition (Lawler and Yoon 1996, 1993). Horizontal values with their emphases on equality then can be speculated to induce cooperative goals among team members. Vertical, hierarchical values can be expected to promote competitive beliefs. Research and theory in cooperation and competition suggests then that collectivist and individualistic values can have far-reaching effects on the dynamics and outcomes of in-

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teraction by influencing perceived goal interdependence. Cooperation and competition may be important mediators between values and group interaction and outcomes. However, the implications of cooperation and competition research suggest some modification in traditional theorizing on the role of values. Typically, collectivistic goals have been thought to lead to conflict avoidance (Leung 1997; Morris et al. 1998; Ting-Toomey 1988), but here it is hypothesized that collectivist values reinforce cooperative goals that in turn lead to constructive controversy. In addition, individualistic values are often thought to result in more openness and productivity and economic development more generally whereas collectivist values lead to conformity and ineffective performance development (Adelman and Morris l967; Inkeles and Smith l974; Taylor 1989). However, the research on cooperation and competition suggests that to the extent that collectivistic goals induce cooperative goals they result in more productive teamwork whereas individualist values, by leading group members to believe their goals are competitive, result in closedmindedness and low productivity.

Figure 1. Hypothesized Relationships among Values, Goals, Constructive Controversy, and Productivity.


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Hypotheses Based on the above reasoning, it is hypothesized that: H1a: To the extent that groups in organizations have collectivistic values, group members believe their goals are cooperative. H1b: To the extent that groups in organizations have individualistic values, group members believe their goals are competitive. H2a: To the extent that groups in organizations have horizontal values, group members believe their goals are cooperative. H2b: To the extent that groups in organizations have vertical values, group members believe their goals are competitive. H3a: To the extent that groups in organizations have cooperative goals, they engage in constructive controversy. H3b: To the extent that groups in organizations have competitive goals, they engage in low levels of constructive controversy. H4: To the extent that groups in organizations engage in constructive controversy, they are productive from the standpoint of the team and their managers.

This study tests these hypotheses in State-Owned Enterprises (SOE) in China. Although research has focused on differences between the West and the East, it is useful to test theories developed in one culture to another (Morris et al. 1999). Indeed, the collectivism-individualism framework is thought to be useful to apply to diverse cultures. This study tests the universal aspirations of the theory of cooperation and competition. In addition, because data were collected from several SOE’s in different parts of the country with quite contrasting levels of development, teams were expected to have a range of collectivist and individualist values. However, no measures of economic development were collected.

4. Method 4.1. Participants Teams responsible for production tasks in machinery and power firms located in three cities central to the major industrial regions in China were recruited to participate in the study. In addition to the support of top and middle management for the study, confidentiality of responses was provided. Only group members who volunteered completed the survey, with 36 employees refusing. Participants were from 55 groups with 216 respondents from three factories in Jinhua (East China), 62 groups with 242 respondents from five factories in Guangzhou (South China) and 77 groups with 231 respondents from four factories in Shenyang (North China). The final sample was 194 teams with 689 employees. Teams averaged 11.9 members, with a range of 3 to 25. Fifty-three percent of the teams had between 7 and 13 members. Average age of the team members was 34 and 67% of the team members were males. Six hundred and forty-one (93%) respondents had been in their teams for over six months.

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4.2. Collectivism and individualism Scales for collectivistic and individualistic values with their horizontal and vertical versions were taken from Trandis and Gelfand (1998). The seven horizontal collectivism items measured the emphasis on ingroup solidarity and equality. A sample item for the horizontal collectivism scale is “the well-being of each team member is important to this team”. (Appendix A has the items for all scales.) Participants were asked to rate on a 7-point scale (1 = strongly agree, 7 = strongly disagree) their degree of agreement to the seven statements. The vertical collectivism (VC) with its emphasis on ingroup solidarity and hierarchy had seven items with similar anchors. A sample item is “team members respect the majority’s wishes”. The eight horizontal individualism items measured the emphasis on the self and equality. A sample item for this scale is “team members rather depend on themselves than on each other”. The vertical individualism with its emphasis on the self and hierarchy had four items with similar anchors. A sample item is “it is important for team members that they do their job better than other team members”. The scales all demonstrated acceptable reliability. The coefficient alpha for horizontal collectivism (HC) is .76, vertical collectivism (VC) .81, horizontal individualism (HI) .79, and vertical individualism (VI) 0.67.

4.3. Goal interdependence (COOP vs. COMP) Scales for cooperative and competitive goal interdependence were developed from a previous questionnaire study conducted in North America (Alper, Tjosvold, and Law 1998). The five cooperative goals (COOP) items measured the emphasis on mutual goals, shared rewards, and common tasks. A sample item is “the goals of team members go together”. Participants were asked to rate on a 7-point scale (1 = strongly agree, 7 = strongly disagree) their degree of agreement to the five statements. The competitive goal scale (COMP) had five items with similar anchors to measure the emphasis on incompatible goals and rewards. A sample item is “team members’ goals are incompatible with each other”. Coefficient alphas for the cooperative and competitive goals scales were each 0.79.

4.4. Constructive controversy Constructive controversy (CC) is the set of behaviors that have been found to develop from cooperative goal interdependence in problem solving situations. Cooperators have been found to seek a mutually beneficial solution, take each other’s perspective, directly discuss their opposing views openly, and try to integrate them for the best solution. The 6-item scale was developed from a set of experimental studies (Tjosvold 1998) and a questionnaire study in North America (Tjosvold, Wedley, and Field 1986) that measured the social interaction of team members when the team was engaged in decision making. Subjects were asked to answer on a 7-point scale (1 = strongly agree; 7 = strongly disagree) about their


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degree of agreement with the six statements. A sample item from the scale was “we express our ideas directly to each other”. Coefficient alpha of the scale was 0.79.

4.5. Productive team measures As with other work team research (Cohen and Ledford 1994; Goodman, Devadas, and Griffith-Hughson 1988), obtaining objective work outcome measures proved impossible. Companies did not collect team level productivity data. Therefore, we used managerial ratings of team performance as the effectiveness measure. Pritchard (1992) proposed that there is no strictly objective measure of performance in organizations; a specific criterion cannot be assumed because some groups are to be innovative, others to reduce costs, others to reduce waste, and so on. Pritchard (1992) argued that ratings of the extent users of the team outputs find them productive are often the most appropriate measure of team productivity. In addition, team managers should be informed about the group’s performance (Hackman 1987). Managers most knowledgeable about the outcomes of each team were asked to rate the effectiveness of the team using a 6-item scale developed for this study. A sample item was “Team members meet or exceed their productivity requirements.” Coefficient alpha for this 6-item team effectiveness scale (YPROD) was 0.80. In addition to managerial rating of team performance, team members also evaluated the extent that the team was committed and effective in doing its work. This 5-item measure (TPROD) was derived from previous studies (Alper et al. 1998; Barker et al. 1986). A sample item is “Team members feel highly committed to the goals of their work”. Coefficient alpha of this self-rating scale of team effectiveness was 0.83. The questionnaires originally written in English were translated into Chinese by two members of the research team who are native Chinese. To ensure conceptual consistency, the questionnaires were back translated into English to check for possible deviation (Brislin 1970). The questionnaires were pre-tested to make sure that respondents clearly understood every phrase, concept, and question. To prevent and eliminate potential concern for being involved in evaluating others, participants were assured that their responses would be held totally confidential.

4.6. Analysis 4.6.1. (a) Data aggregation We aggregated team members’ ratings of values, goal interdependence, open-minded interaction, and team effectiveness outcomes to the team level in the analyses. The fundamental reason was that the hypotheses identified the unit of analysis as the group. The measures were carefully constructed so that individual team members reported on the team’s values, interdependence, constructive controversy, and team performance. However, the aggregation required that the perceptions of team members within a team were reasonably homogeneous. We used James, Demaree, and Wolf’s (1984) procedure to

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estimate the inter-rater reliability of members within each team for each of the eight individual-level variables (HC, VC, HI, VI, COOP, COMP, CC, TPROD). James et al.’s rWG(J) index was used as an estimate of inter-rater reliability because each of the seven variables was measured by multiple items. Two indicators showed that the ratings among members in each group were quite homogeneous. First, the median rWG(J) for the eight variables across the 194 teams were 0.94, 0.95, 0.88, 0.90, 0.94, 0.93, 0.88, 0.95 respectively. Second, George and Bettenhausen’s (1990) argued that rWG(J) which was greater than or equal to 0.70 could be considered as indicators of good agreement within group. Out of the 194 teams, the percentages of teams with rWG(J) greater than or equal to 0.70 across the eight variables were 92, 95, 86, 93, 92, 93, 81, and 93% respectively. We therefore concluded that the withinteam ratings were homogeneous enough to be aggregated to the team level. Individual team members’ ratings were aggregated to the team level and the data merged with supervisory ratings of team outcomes (TPROD). The final sample size of the merged data file was 194 teams. Correlations among the four exogenous variables, the three mediating variables and the two outcome variables at the team level are shown in Table 1.

4.6.2. (b) Scale validation Although most of the items used in this study were validated previously, we were still cautious and tested the factorial structure of the measurement items. We conducted a series of confirmatory factor analyses to test whether the team members’ ratings would load on nine distinct factors, namely cooperative and competitive goals, vertical and horizontal individualism and collectivism, and members’ and managers’ ratings of team effectiveness (HC, VC, HI, VI, COOP, COMP, CC, TPROD, YPROD). These series of confirmatory factor analyses were conducted at the team level (N = 194 team members) as the team is the level of analysis. The confirmatory factor analyses were conducted using LISREL 8.12a (Jöreskog and Sörbom 1993). Because of computational limitations for LISREL models involving a number of indicators (Bentler and Chou 1987), we simplified the structural model in the

Table 1. Correlations among Variables at the Team Levela,b Mean S.D.

(1)

1. Horizontal Collectivism (HC)

5.17

0.60

(0.76)

2. Vertical Collectivism (VC)

5.13

0.62

0.74

3. Vertical Individualism (VI)

4.90

0.66

0.48

0.56

(0.67)

4. Horizontal Individualism (HI)

3.86

0.72

–0.27

–0.22

0.11

(0.79)

5. Cooperative goal (COOP)

5.36

0.66

0.71

0.77

0.51

–0.24

(0.79)

6. Competitive goal (COMP)

3.25

0.77

–0.51

–0.35

–0.05

0.66

–0.43

(0.79)

7. Constructive controversy (CC)

3.42

0.63

0.67

0.66

0.36

–0.33

0.68

–0.58

8. Member rating (TPROD)

5.06

0.67

0.60

0.65

0.43

–0.19

0.69

–0.38

0.62

9. Manager rating (YPROD)

5.38

0.82

0.27

0.30

0.22

–0.15

0.32

–0.16

0.28

a

(2)

(3)

(4)

(5)

(6)

(7)

(8)

(9)

(0.81)

(0.79) (0.83) 0.26 (0.80)

Numbers in the diagonal are coefficient alpha estimates. bN = 194; r > 0.15, p < 0.05; r > 0.22, p < 0.01.

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present study by reducing the number of indicators for the constructs. Specifically, we combined the items with the highest and the lowest loading by averaging until we yielded three indicators for each construct. That is, the items with highest and the lowest loadings were averaged to form a first new indicator, and the items with the next highest and the next lowest loadings were averaged to form the second new indicator, etc. This is a common approach in the literature of structural equation analysis and was used in Mathieu and Farr (1991) and Mathieu, Hofmann and Farr (1993). For vertical individualism, only two new indicators were formed because there were only four indicators in the original scale. We compared the 9-factor model, labeled as M0, (HC, VC, HI, VI, COOP, COMP, CC, TPROD, YPROD) with four alternative 8-factor models in testing the factorial structure of the items. M1 combined the three indicators of vertical collectivism with the three indicators of horizontal collectivism to form a new latent variable. This alternative model tested if the respondents would be able to distinguish the two collectivism measures in their responses since the vertical and horizontal collectivism seemed to be highly correlated with each other. Similarly, M2 and M3 combined the indicators of vertical collectivism and horizontal collectivism and cooperative goals to form two new latent variables. They were used to test if cooperative goals were, in fact, a distinct measure against horizontal and vertical collectivism. Finally, M4 combined the indicators of cooperative goals with that of constructive controversy to form a new latent variable. That was used to test if the second mediating variable of cooperative goals was, in fact, a distinct measure against constructive controversy. Results of this series of confirmatory factor analyses are shown in Table 2. The changes in model chi-square for all the four alternative models were significant at the 0.01 level. We were, therefore, confident that the nine constructs used in this study were capturing unique variances and were distinctive psychological constructs. 4.6.3. (c) Hypotheses testing Correlational analyses were used as an initial test of the hypotheses. Structural equation analyses tested the model contrasting the role of values and goal interdependence. We used covariance structure analysis to examine the underlying relationship among collective values, goal interdependence, constructive controversy, and team performance in this study. The covariance structure analysis of the inter-relationship among these constructs was analyzed using LISREL 8.12a (Jöreskog and Sörbom 1993). Table 2. Confirmatory Factor Analysis of the Measurement Models1,2

Baseline 8-factor model (M0) Combined HC & VC (M1) Combined COOP & VC (M2) Combined COOP & HC (M3) Combined COOP & CC (M4) 1

d.f.

Model c2

D c2

263 271 271 271 271

445.31 488.44 479.21 472.33 478.30

43.13** 33.90** 27.02** 32.99**

**p < 0.01; 2c2 is the model chi-square, D c2 is the change in model chi-square; D d.f. = 8 for all three alternative models.

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Following the five hypotheses, the four values (HC, VC, HI, VI) were specified as exogenous variables in our structural model. These four team values would affect the two goal interdependence measures, which will, in turn, affect constructive controversy. Constructive controversy would have effects on both team members’ rating and manager’s rating of team performance.

5. Results Zero-order correlations provide an initial examination of the hypotheses linking collectivistic and individualistic values, goal interdependence, constructive controversy, and outcomes (Table 1). Results support the first hypothesis that groups with collectivistic values have cooperative goals and the second hypothesis that groups with individualistic values, at least the horizontal version, have competitive goals. The data do not though provide much support that horizontal compared to vertical values promote cooperative goals. In support of hypotheses 3a and 3b, groups with cooperative goals but not competitive goals engaged in constructive controversy. Finally, results support the fourth hypothesis that groups with constructive controversy are productive from both the perspective of team members and their managers. Structural equation analyses through LISREL were used to explore the relationship between values, goals, constructive controversy, and outcomes. Table 3 shows the path estimates for the model tested in this study. Results indicate that horizontal (β = 0.47, p < 0.01) and vertical (β = 0.41, p < 0.01) collectivism have significant effects on cooperative goals whereas vertical and horizontal individualism did not. Horizontal individualism did have a significant effect on competitive goals (β = 0.47, p < 0.01), although vertical individualism did not. Horizontal collectivism had a marginally significant negative effect on competitive goals (β = –1.08, p < 0.10). On the other hand, vertical collectivism had a marginally Table 3. Parameter Estimates for Structural Model Path From

Path To

Path coefficient

Horizontal collectivism Vertical collectivism Vertical individualism Horizontal individualism Horizontal collectivism Vertical collectivism Vertical individualism Horizontal individualism Cooperative goals Competitive goals Constructive controversy Constructive controversy Model c2 (d.f.) Standardized RMR CFI TLI

Cooperative goals Cooperative goals Cooperative goals Cooperative goals Competitive goals Competitive goals Competitive goals Competitive goals Constructive controversy Constructive controversy Team member’s rating of team performance Team manager’s rating of team performance

0.47 0.41 0.13 0.01 –1.08 0.70 –0.03 0.51 0.83 –0.24 0.81 0.45 470 .31(281) 0.06 0.94 0.93

** **

+ + ** * + * *


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significant positive effect on competitive goals (β = 0.70, p < 0.10). Overall, collectivism seems to lead to cooperative goals whereas horizontal individualism and perhaps vertical collectivism result in competitive goals. Cooperative goals had a significant effect on constructive controversy (β = 0.51, p < 0.01) whereas competitive goals had a marginally significant negative effect on constructive controversy (β = –0.24, p < 0.10). With respect to the outcome variables, constructive controversy had a significant effect on both team members’ rating of team performance (β = 0.81, p < 0.05) and managers’ ratings of team performance (β = 0.45, p < 0.05). In regards to model fit, the model had a model chi-square of 470.31 and 281 degrees of freedom. The CFI and TLI for the model were 0.94 and 0.93 respectively. Both fit indices were considered as indicating good model fit, given the usually accepted critical value of 0.90 (Bentler and Bonnett 1980).

6. Discussion The results extend our understanding of the role of collectivistic and individualistic values on group dynamics and suggest the processes by which they have their effects. The more the teams had collectivist values, both in the vertical and horizontal versions, the more team members believed that they were cooperatively interdependent. As previous field and experimental research has demonstrated, cooperative goals were found to be important aids so that team members discuss their views openly and constructively. This constructive controversy in turn predicted to team productivity from the perspective of both the team members and their managers. But individualistic values, especially the horizontal version, can have quite contrasting effects by developing competitive goals. To the extent team members believe their goals are competitive, they are more likely to discuss their issues closed-mindedly which contributes to ineffective team performance. In addition to understanding the mediating role of cooperation and competition, this study also challenges common theorizing about collectivistic and individualistic values. Collectivistic compared to individualistic values are thought to lead to avoiding conflict to protect face and maintain relationships avoidance (Leung 1997; Morris et al. 1998; TingToomey 1988). This study found that collectivistic values result in strong relationships, not because of conflict avoidance but because of an open-minded, respectful discussion of diverse views. Collectivistic values promote relationships, it appears, not through avoidance but through the direct, constructive discussions of different viewpoints. In support of this reasoning, previous research indicates that strong interpersonal relationships contribute to constructive conflict management (Kramer and Messick 1995). Managing conflict is increasingly recognized as central to the development and maintenance of effective work relationships (De Dreu and Van de Vliert 1997; Tjosvold 1991). Individualistic values, though perhaps harmful for relationships, have been thought to promote productivity and economic development (Adelman and Morris l967; Inkeles and Smith l974; Taylor 1989). In this study, the more the group embraced individualistic values, the more they were closed-minded to various perspectives and the less productive. As teams are increasingly considered the engines of product and quality improvement innovation, these

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results, as have other recent research, seriously challenge the assumed value of individualistic values on productivity and innovation (Lovett, Simmons, and Kali 1999; Peng and Nisbett, 1999). Although individualistic values may correlate with economic development, evidence is needed to show how these values contribute to group and organizational effectiveness. In addition to questioning the processes by which collectivistic and individualistic values have their effects, results also challenge their generalized theorized meaning. Individualistic values, especially the horizontal version, are thought to relate to individuals pursuing their independent agendas with little regard to the interests of others. But horizontal individualistic values were found to result in highly competitive goals and related effects on constructive controversy and team productivity. Especially within a group setting, pursuing independent goals seems to result in perceived competition. Individualistic values appear to be experienced as promoting competition where individuals are working against each other’s interests, not just for their own (Johnson and Johnson 1989). Consistent with previous research, the confirmatory factor analysis and reliability analyses indicated that horizontal and vertical values could be distinguished (Singelis et al. 1995; Triandis 1995). However, results were less successful in explicating their potential effects. It was hypothesized that the horizontal dimension of collectivistic and individualistic values would promote cooperative goals because of its emphasis on equality and that the vertical would promote competition because of its emphasis on hierarchy and inequality. Vertical collectivism had a marginally significant relationship to competitive goals in the structural equation analysis but not in the correlational analysis. Results overall though do not support this study’s proposal. Unexpected findings suggest possible ways to understand the apparently complex effects of vertical and horizontal values. Indeed, horizontal, not vertical, individualism was strongly related to competitive goals and negatively to cooperative ones. It may be that Chinese participants concluded they had competitive goals because horizontal individualism’s strong independent mode meant team members had little relationship of any kind. Vertical individualist values may imply that team members still had a relationship and enjoyed interpersonal give-and-take leaving them to believe that they had some degree of cooperative goals. This reasoning may also help to understand the unexpected finding that vertical collectivism had effects on competitive as well as cooperative goals in the causal structure analysis. Teams with strong vertical collectivistic values may have believed that they had intense relationships that could be both cooperative and competitive. However, much more research is needed to develop these speculations and more generally to clarify the horizontal and vertical dimensions in collectivistic and individualistic values and how the collectivist-individualist and horizontal-vertical dimensions interact. The theory of cooperation and competition, although developed in the West, proved useful for understanding values and group dynamics in East Asia (Deutsch 1973). The research approach of identifying conditions that affect organizational dynamics and outcomes in China with a theory with universal aspirations may be a viable addition to the traditional alternatives of comparing samples from different cultures and exploring a cultural variable with an indigenous theory (Leung 1997). The research approach used in this study can both probe general theories and improve understanding of organizational dynamics in non-Western cultures.


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6.1. Limitations The results of this study are, of course, limited by the sample and operations. The data are self-reported and subject to biases, and may not accurately describe the relationships, although recent research suggests that self-reported data are not as limited as commonly expected (Spector 1992). These data are also correlational and do not provide direct evidence of causal links between values, goal interdependence, constructive controversy, and outcomes However, team members completed measures of values, goals, and constructive controversy and their managers completed measures of team productivity. Developing different sources for the independent and dependent measures should reduce the possibilities of same source method as an alternative explanation of the results. Spector and Brannick (1995) have argued that the most effective way to overcome recall and other methodological weaknesses is to test ideas with different methods. It would be desirable to provide direct experimental verification of the role of collectivistic and individualistic values on team effectiveness in East Asian organizational settings.

6.2. Practical implications In addition to developing theoretical understanding, the hypotheses, if they can continue to be supported, have important practical implications for structuring teams, especially in China and perhaps other collectivist cultures. Results further document that collectivistic values can be very useful for developing work relationships but they also indicate that they can promote team productivity. However, these collectivist values have their influence through developing cooperative goals and through open-minded controversy. To the extent that teams are committed to cooperative goals, they should be more prepared to discuss their opposing views directly and constructively. Previous research provides guidance for fostering cooperative goals and constructive controversy (Tjosvold and Tjosvold 1995, 1991). Managers can help their teams create a team vision and mission that incorporate collectivistic values (Tjosvold 1989). To support these values, team members together develop shared goals, integrated roles, common tasks, and shared reward distributions that build cooperative goals (Hanlon et al. 1994). In addition, employees can be trained in the skills of constructive controversy. They are willing to express their ideas and positions, ask each other for more information and arguments, and try to put the best ideas together to create the most effective solution. The theory of cooperation and competition proved useful to identify mediators of collectivistic and individualistic values on interaction and its outcomes in teams in China. Collectivistic values can reinforce cooperative goals but these do not result in conflict avoidance just to maintain relationships but to constructive controversy that develops team productivity. Individualistic values, especially the horizontal version, can have contrasting effects through fostering competitive goals and closed-minded discussion. This study’s results coupled with previous cooperation and competition research suggest that collectivist values, cooperative goals, and constructive controversy may provide a basis for productive teamwork in China and perhaps other countries as well.

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Acknowledgement This work has been supported by the Research Grants Council of the Hong Kong Special Administrative Region, China, (Project No: LC3004/98H) to the first author.

Appendix A Measures Horizontal Collectivism My happiness depends very much on the happiness of my team members. Team members like sharing little things with each other. The well-being of each team member is important to this team. If a team member were in financial difficulty, team members would help each other within their means. If one team member gets a prize, other team members would feel proud. To team members, pleasure is spending time with this team. Team members feel good when they cooperate with each other. Vertical Collectivism Team members usually sacrifice their self-interest for the benefit of the group. It is important to team members that they respect decisions made by the group. Team members feel they should stick together, no matter what sacrifices are required. Team members feel they must stay together, as much as possible. Team members take care of each other, even when they may have to sacrifice what they want. Team members respect the majority’s wishes. Team members consult each other to get their ideas before making a decision. Vertical Individualism Team members believe that winning is everything. It annoys team members when other members perform better than they do. It is important for team members that they do their job better than other team members. Team members enjoy working in situations involving competition. Competition is the rule in our team. When another person does better than them, team members get tense and aroused. Team members believe that without competition it is not possible to have a good society. Horizontal Individualism Teams members in this group like to do their own thing. Being unique individuals is important to team members. Team members rather depend on themselves than on each other. Team members rely on themselves most of the time, rarely on each other. Team members personal identity independent from others is very important to them. Team members own personal identity is very important to them. Team members feel they are unique persons, separate from others. Team members enjoy being unique and different from each other.


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Goal Interdependence Cooperation Our team members ‘swim or sink’ together. Our team members want each other to succeed. Our team members seek compatible goals. The goals of team members go together. When our team members work together, we usually have common goals. Competition Team members structure things in ways that favor their own goals rather than the goals of other team members. Team members have a ‘win-lose’ relationship. Team members like to show that they are superior to each other. Team members’ goals are incompatible with each other. Team members give high priority to the things they want to accomplish and low priority to the things other team members want to accomplish. Independence Each team member “does his own thing.” Team members like to be successful through their own individual work. Team members work for our own independent goals. One team member’s success is unrelated to others success. Team members like to get their rewards through their own individual work. Team members are most concerned about what they accomplish when working by themselves. Constructive Controversy Team members express their own views directly to each other. We listen carefully to each other’s opinions. Team members try to understand each other’s concerns. We try to use each other’s ideas. Even when we disagree, we communicate respect for each other. We work for decisions we both accept. All views are listened to, even if they are in the minority. We use our opposing views to understand the problem. Members Rating of Team Effectiveness Generally speaking, team members are very satisfied with their work. Team members feel a strong commitment to their work. Team members feel highly committed to the goals of their work. The way the team manages its work inspires the team to better job performance. All things considered, the team is highly pleased with the way it manages its work. Managers Rating of Team Effectiveness Team members work effectively. Team members put considerable effort into their jobs. Team members are concerned about the quality of their work. Team members meet or exceed their productivity requirements. Team members are committed to producing quality work. Team members do their part to ensure that their products will be delivered on time.

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