Philosophical Roots


The Philosophical Teachings of Confucius have had a major effect on Chinese Culture and Mindset. His writings served as the foundation for Chinese education for 2000 years. For example, Confucius taught that “Society organized under a benevolent moral code would be prosperous and politically stable and therefore safe from attack.

He also promoted reverence to scholarship and kinship, and he defined the Five Cardinal Relationships:

  • Ruler and Ruled
  • Husband to Wife
  • Parents and Children
  • Older and Younger Siblings
  • Friend and Friend

With the exception of the last, all are strictly hierarchal.

Confucius firmly believed that the strict adherence to all of these hierarchal relationships result in the ideal harmony of a society.

He also believed that harmony can make a fortune, and it is the goal of good guanxi, which lies at the heart of all human relationships. In China, Confucianism governs all relationships, including business ones. Both Confucianism and Buddhism influence the Chinese, and because of this, they are a calm, united, quiet, and obedient people.

Confucius has also influenced the cultures of collectivism and high power status, which are prevalent in China. Because of the high power status, new products tend to do well, because of their perceived scarcity. For the same reason, big brands are popular, because people care so much about their status.

Lao Tzu

  • Lao Tzu was the inspiration for the religious teachings and philosophies surrounding Taoism. Very little is known about his life, and legend has it that he emerged from the womb as a white-haired, wise old man.
  • He believed in the relationship between Yin and Yang – two separate elements that complement each other and are considered as a whole.
  • His beliefs and philosophies are pervasive, therefore affecting many aspects of life, ranging from traditional medicine and even to the economic cycles.
  • Lao Tzu believes that the key to success in life was to find the “Tao” or “The Way” between two opposite forces – the middle ground and/or the compromise.

Taoists are completely different from the image of the multitasking Western manager: they do one thing at a time, and will not fret about future strategies whilst trying to deal with today’s problems. Unlike Confucianism, which emphasises saving face, Taoists are honest in their relationships, treating their superiors in the same manner as their colleagues or subordinates.

Confucius and Lao Tzu were similar in the sense that they did not concern themselves with finding the truth, but only in finding “The Way”. The moral values stemming from the philosophical teachings of Lao Tzu continue to affect the Chinese, as clearly seen in their various management styles, and have a huge impact in terms of market research. The best research results are derived only through a long process, since Chinese managers seem to be more concerned with the process than the goal.

The basic teachings of Taoism – freedom and non-interference – are evident in China’s current market, with its opening of borders to foreign competition and allowing the Chinese people to choose for themselves and favor private over state ownership.

Next: The Confucian Principle “Li”