Does Confucian Culture Promote Innovation? An Empirical Investigation of a Leading Organization in the Field

Abstract

Based on their growing innovation capabilities, Chinese companies have become important players in the global innovation arena. Among the factors influencing these firms’ innovation, cultural values have increasingly attracted scholars’ attention. However, research on the relationship between one of the key elements of traditional Chinese culture, Confucianism, and innovation remains scarce. By focusing on two core elements of Confucianism, we extend the innovation contingency literature in examining whether Confucianism is associated with management and product innovation at the firm level in China. Through an empirical examination of a highly innovative private company in China’s premium kitchen appliance market, we find that Confucianism, as reflected in innovative management practices, can foster product innovation. Specifically, benevolence as a Confucian virtue can trigger innovation by forcing a user-centred focus and widening managers’ perspectives of stakeholder interests. Another Confucian principle, the Doctrine of the Mean, can also boost innovation by yielding harmony with surrounding elements, such as users, space, and nature, and defining the employee-management relationship.