developmental project/forecast (final paper) microsoft cloud computing expansion to china

Final Exam, Microsoft Cloud Computing 1

Developmental Project/Forecast (Final Paper)

Microsoft Cloud Computing Expansion to China

Xxxx Xxxxxxx

University of Maryland University College (MGMT 615 or MGMT 630)

November 22, xxxx

Turnitin Score 3%


INTRODUCTION

The goal of this paper is to provide sufficient information to make

informed decisions based on the goal for Microsoft to expand its cloud

computing technology to China. In order to do this it is important to provide

as much pertinent information as possible to make educated decisions. First,

the paper will provide an overview of Microsoft followed with an overview of

China. Next the paper will identify Chinese economic, consumer, and cultural

trends to help identify strategic decisions that will assist accomplish the

objective. The paper will then address intercultural considerations by

comparing the United States culture with that of the Chinese culture. The

Hofstede cultural dimensions will be used to break down the characteristics of

each culture and then identify the differences between each. Finally, the

paper will then outline an approach needed to successful expand their cloud

computing into the Chinese markets. As part of the plan a few key components

of a leadership style will be detailed. The purpose of the paper is to

provide as much valued information that Microsoft’s senior management can have

a broad understanding what lies ahead during the process of achieving this

goal.

OVERVIEW OF MICROSOFT


With a market capitalization of over $250 billion, annual revenues of

around $60 billion, and a host of products that cover all aspects of the

software industry Microsoft is well positioned to maintain its leadership

position for many years to come. But this is not necessarily the case. With

the looming of Microsoft’s competitors such as Google and Apple among others

it is not safe for the company to be complacent. It is prudent for Microsoft

to consider its competitors and more importantly the trends in the software

industry. Currently Microsoft is made up of the following businesses

(Microsoft 2009):

o Client

o Server and Tools

o Online Services Business

o Microsoft Business Division

o Entertainment and Devices Division

The Client business includes the Windows family of products and the

personal computer industry. The Server and Tools business includes

Microsoft’s server business like Windows Server operating system, SQL Server,

BizTalk server, and Visual Studio products among some of the examples. The

Online Services Business includes online services such as e-mail, instant

messaging, live search, and portals and channels. The Microsoft Business

Division includes Microsoft Office products, Microsoft Dynamics, and a host of

other business solutions. Finally, the Entertainment and Devices Division


consists of Xbox systems and software, Zune products, Media products, Surface

computing, and Microsoft Automotive.

It is clear that Microsoft has a breadth of products that cover a range

of areas and technologies. It is also well known that all these products run

on a host of different environments and operating systems that can result in a

management nightmare for their customers. Microsoft has done what it can to

take as much of the headache out of managing all these information technology

requirements. But despite Microsoft’s efforts it is still difficult to keep

up with the continual changes in technologies. This is not only true for

small businesses but for large multinational corporations as well. Large

corporations are required to hire a very large IT staff just to manage the

data and networks as well as update custom applications and maintain existing

applications. To alleviate many of these issues Microsoft is marching forward

with its cloud computing initiative. Cloud computing is where applications

both existing and custom are hosted by a virtual environment external to the

business. In the case of Microsoft they will host a virtual farm of

environments specific to the customers needs. Instead of these businesses and

organizations managing their own IT infrastructure they will hire Microsoft,

or in some cases other companies like Amazon or Google, to host the

applications for a predetermined fee. The cost will be based on the needs of

the organization. For small companies the fees will be relatively small while

for larger corporations the fees will comparable to the needs of the large

organization. Since the corporations would no longer have to manage their own


environments the costs would be provided at a discount of their current IT

costs which should result in a value add to the customer.

The potential for this technology is significant. By 2019 Microsoft

plans on operating 16 datacenters around the world (Tran 2009). Each

datacenter will include 500,000 physical servers with 4 CPU cores each for a

total of 2,000,000 CPUs. Based on a 15% utilization rate Microsoft expects

revenues to exceed $400 million. Due to the scalability of this model the

utilization costs should drop as utilization increases resulting in higher

profit margins.

OVERVIEW OF CHINA

China is the largest country in

East Asia covering 3.7 million square

miles with a population of over 1.3

billion people. The capital of

Peoples Republic of China is Beijing

and its largest city is Shanghai.

Mandarin is the most common language

spoken with over 70% of Chinese who speak the language; it is of course the

official language. The Han is the largest ethnic group in China and has

significant influence throughout the country. The “Book of Changes” is

considered one of their greatest works of literature. Their arts include

pottery, calligraphy, painting and performance arts. Western culture has had

Figure 1 - Chinese Martial Arts


a large influence on Chinese culture even allowing Starbucks in the forbidden

city but recent trends have been to lean back to its historical cultural

roots.

The Peoples Republic of China is

considered a communist country and is run by

the Communist Party of China. China has

over 22 provinces, 5 autonomous regions, 4

municipalities, and 2 special administrative

regions which are Hong Kong and Macau. All these regions and provinces are

classified as mainland China.

China is the third largest economy in the world behind only the United

States and Japan. China has a nominal GDP of about $4.4 trillion as of 2008

when accounting for the exchange rate. China is the second largest economy in

the world behind only the United States with regard to purchasing power.

China has a purchasing power of $7.8 trillion (Wikipedia 2009). Over the past

30 years China has been growing at an average rate of 10% growth per year.

China’s major sectors of their economy can be broken down in the following

ways.

o Industry (48.6%)

o Services (40.1%)

o Agriculture (11.3%)

Figure 2 - Chinese Cuisine


As indicated Industry is the largest sector of the economy with over 48%

with Services close behind with over 40% of the economy. These primary

sectors should find value added implementing the Microsoft cloud computing

initiative.

TRENDS

In order to outline a successful plan to implement Microsoft’s cloud

computing in China over the next 15 years it is important to identify the

current trends and extrapolate educated predictions as to what the future

holds for China. Three trends are discussed; they are economic trends,

consumer trends, and cultural trends. It is the intention to use these trends

to identify key areas that will position Microsoft to succeed in its mission

to expand cloud computing to China.

ECONOMIC TRENDS

The Chinese have been attempting to grow the country economically for

several decades beginning back in 1953 to 1957 by the five year plan to

rebuild and industrialize the country. This was the initial planning period

followed by other stages. Most notably was stage one from 1978 to 1984, then

stage two from 1985 to 1991 and stage three from 1992 to present. In 1992 the

objective was for the country to open up its market initiated by Deng

Xiaoping’s speech (Ho, Li 2007).

One important statistic is that China invests nearly 20% of its GDP to

research and development (R&D). This is significant since the United States


and other leading countries invest only about 5% to 6% of their GDP to

research and development. The result of this should be a more advanced China

in the future compared to other developed countries such as the United States,

Japan and Germany. This trend of R&D investment should continue at the same

percentage rate which provides China with a 14% of GDP advantage of any other

country (Technology Trends 2009). It is my opinion that this will also result

in the attraction of great research to China as the world begins to realize

the success that China is having and the breakthroughs that China is

discovering. Similar to the what happened to the United States as this

country advanced great leaders, scientists, inventors, and researchers

throughout the world were attracted to this country and came to America to

advance their interests. This should happen to China as well.

One recent trend in

China is a dangerously fast

growth rate. In the near

future the results are likely

to be painful. As the

economy grows new skilled

positions are created without qualified workers to fill those positions. What

is of greatest concern is the increasing demand for management and leadership

positions and not having truly qualified leaders to fill these positions. It

is the leaders of the country that will guide decisions of the company and

Figure 3 - Real GDP Growth


provide strategic direction. After tapping into the external markets to fill

these positions China is forced to promote employees earlier than they would

like. China has tapped out trained leaders from neighboring markets of Hong

Kong, Taiwan, and Singapore. (Silk 2006) “Managers in China with just eight

to 10 years of experience can land HR director jobs at big companies. “The

same position in the U.S. would take 15 to 19 years.”” (Frauenheim 2007) Most

of these younger workers accept these positions because of the financial and

title benefits driven by the need to support their immediate and extended

families. This trend could very well be a benefit for Microsoft’s cloud

computing since it would reduce the need to hire a large IT team to manage the

IT functions of the company. Microsoft could provide these new and young

managers with one less issue to be concerned about.

One other concern with rapid growth is inflation. A looser monetary

policy could generate a lot of inflationary pressure driving up costs. The

government has influenced the banking sector to increase lending to more than

$8 million Yuan; this is more than twice the 2008 levels. (Lee 2009)

Similarly, the Yuan should appreciate against the dollar over the next decade

as the country’s economy grows. This is an advantage from Microsoft’s

perspective and more specifically for cloud computing since more value can be

purchased with a single dollar. Cloud computing should provide significant

value added cost advantage helping Chinese firms to keep IT costs low.

CONSUMER TRENDS


A result of a growing economy China’s consumer power should increase

dramatically. In turn, the consumer trends will continually change

unpredictably. Currently, the Chinese have a savings rate of nearly 40% but

with the increase of consumption power the trend should be for the Chinese to

consume more. Yet it is still likely that in the nearer term the Chinese will

continue to be savers but as their incomes rise they should have more

disposable income above and beyond what they need. The concern is as demand

for goods increases significantly inflationary pressures will be strong. Even

despite inflation the pressure to continually consume may drive the consumer

to purchase what they could not afford and lead to an increase in debt. This

demand for goods in conjunction with the increase in goods could result as it

did in the United States over the past 30 years where the consumer debt rose

unmanageably. Another possible disturbing trend is that the Chinese economy

becomes much like that of the US economy which is 70% driven by the consumer

and less and less by manufacturing. If the consumer controls more than half

the country’s economy it could be disastrous since the consumer is

unpredictable. Due to the business model for cloud computing Microsoft should

be, to some degree, insulated from many of these issues.

CULTURAL TRENDS

Over the past few decades the Chinese have trended toward things western

even including a Starbucks in the forbidden city. This included western food,

drink, music, movies, and style. In the recent past this is changing. The

Chinese are turning back to their cultures especially food and values. One of


the benefits of the issues that the United States have faced over the past few

decades is that the Chinese can see the negative outcome of some of the

decisions made in the United States and are likely to learn from them. Also,

I believe that the anti-american sentiment has driven the country to not want

to emulate the negative aspects of the western culture as much as they might

have and simply take the good out of the culture and customize it with their

own Chinese flavor. As the country becomes confident it is likely that the

country will evolve their culture in their own way. They will realize that

many of their cultural habits are beneficial and attempt to eradicate some of

the negatives. It would not be surprising to see the Chinese, among other

Asian cultures, to begin to influence western societies much like western

societies have influences the Asian cultures over the past 50 years.

INTERCULTURAL CONSIDERATIONS

In order to successfully expand into the Chinese market it is important

that Microsoft have a good understanding of the Chinese culture and their

characteristics and how it relates to the characteristics of the United States

and more specifically as it relates to Microsoft’s way of doing business.

HOFSTEDE CULTURAL DIMENSIONS

Hoftstede is the foremost expert in the area of cultural studies.

Hofstede’s research has provided us with insights into other cultures that

will help interactions with people in other countries. Hofstede has

formulated a list of cultural dimensions to help identify characterists of


different cultures. These cultural dimensions are the following (Hofstede

2009):

o Individualism

o Power Distance Index

o Masculinity

o Uncertainty Avoidance Index

o Long-term Orientation

INDIVIDUALISM

Individualism as it relates to collectivism is the degree of integration

in groups. An individualistic society is one that values the individual

skills and abilities; where uniqueness is valued and personal goals are

achieved. On the other hand a collectivistic society is one that values the

group. It is the group and team success that is valued and any individual

success is only valued as it relates to the group as a whole. A

collectivistic society puts more emphasis on relationships (Felfe, Yan 2009).

POWER DISTANCE INDEX

The Power Distance Index is the degree to which power is distributed

throughout society (Hofstede 2009) Having a high power distance values roles

and titles which represented in respect for the leaders. As an example

positions at meetings is quite important. The leaders will have the most

respected positions with appropriate titles associated with them.

MASCULINITY INDEX


Masculinity index is the distribution of roles and responsibilities

among genders and how society adopts to those different set of roles. A

highly masculine country will have a clear distinction between the role of

women and that of roles of men.

UNCERTAINTY AVOIDANCE INDEX

Uncertainty Avoidance Index is the amount of tolerance that a country

has to uncertainty. This will determine the amount of risk the country is

willing to accept and the amount of risk the country is willing to work to

avoid. A low uncertainty avoidance index will be open to new ideas and will

limit the amount of rules that restrict innovation and creativity. The desire

to be creative and to experiment will be high in countries with low

uncertainty avoidance.

LONG-TERM ORIENTATION

Long-term Orientation index as it relates to short-term orientation

determines whether decisions are made for the long-term or for the short-term.

A country that has a long-term orientation will make decisions for the longer

term even if the short term consequence is painful. On the other hand a

country that has a short-term orientation will be much less concerned with the

long term and can make bad decision for short-term benefits.

The following sections will outline the degree to which China and the

United States fits into these cultural dimensions and how it will affect the


decisions for Microsoft to expand their cloud computing initiative into the

Chinese markets.

UNITED STATES

As one might expect the United States has a very high Individualism

index of 91. This implies that the US values individual achievement even above

the achievement of the team and the greater good of the community. Its

masculinity index is also very high with a score of 92. This shows that the

roles and responsibilities between male and female are very high; women and

men have clearly defined roles. In the recent past this is probably changing

where the roles of the male and female are beginning to merge. The United

States has the lowest long-term orientation than any other country with a

score of 29. This score indicates that the United States almost completely

disregards the long-term affects of decisions and focuses primarily on the

short-term. The US power distance score is 40 which indicates that they are

more or less average. Roles are defined but can be changed and that

responsibilities can shift based on need. Finally the United States has a

reasonably low uncertainty avoidance index of 46. This implies that the US is

willing to take risks. The latest economic issues are probably to some

extend pushing up the uncertainty avoidance index score where the US is less

willing to take risks and gambles.

To summarize the cultural dimensional scores the United States is a

highly individualistic country with a very short-term orientation and a


moderate willingness to take risks. The next section will outline how China

fits into these cultural dimensions.

CHINA

China has the lowest individualism score of 20. As a result it is a

highly collective country. China puts more emphasis on relationships and the

success of the team. This collectivist nature can be traced back to the

significant influence of Confucian ideology (Ho, Nesbit 2008). According to

Confucianism good people are guided by the five fundamental relationships

which they call the “Wu Lun”. These relationships are the emperor-subject,

the husband-wife, the parent-child, the older brother-younger brother, and the

older friend-younger friend. These relationships guide the definition of an

individual as it relates to the larger social order. Included in Confucius

beliefs is the idea of “servicing” as the goal in life and that it requires

the individual to make positive contributions to society.

The distinction of roles and responsibilities are clear which is

indicated by a power distance score of 80. The idea of Laoban “old boss” is

still true which represents the respect that elderly bosses still command a

level of respect. What is important from this cultural dimension is showing

respect for their roles and achievements. It is a sign of respect to

reference individuals with their appropriate title such as “doctor” if they

are a doctor.


The masculinity score of 66 indicates that China leans toward a gender

bias.

China has an uncertainty avoidance index of 30. This is lower than what

I initially expected but it is actually quite positive since China is willing

to take risks and be open to new ideas and approaches to solve problems.

China is hungry to learn, create and discover.

Since cloud computing is still in its infancy it is considered a technological

risk despite strength of its concept.

Finally, China has the highest long term orientation than any Asian

country with a score of 118. As a result they make decisions that have

benefits in the long term such as saving money, getting a good education,

investing in research and development. This is evident in how the Chinese

view technology. See figure 5 below.

Figure 5 - Countries Investment in New Technologies

Figure 4 - China Cultural Dimensions


As the table indicates they have the highest scores of any

industrialized country willing to invest in new technologies (Technology

Trends 2009). Much of this is representative of a long-term orientation since

the benefits of new technologies results in the future. This is very

beneficial for Microsoft’s initiative since the long-term benefit of cloud

computing is very high for companies willing to invest in the technology both

internally or externally due to scalability of cloud computing.

CULTURAL DIMENSION COMPARISONS

Now how do these cultural dimensions compare between the United States

and China? In fact they are quite different in many ways. The table below

shows the differences between the countries.

Cultural

Dimension

China (Score) United States

(Score)

Individualism 20 91

Masculinity 66 92

Long-term

Orientation

118 29

Power Distance 80 40

Uncertainty

Avoidance

30 46

Figure 6 - Cultural Dimensions Comparison between China & United States

The greatest disparity is between individualism and long-term

orientation. The United States is highly individualistic whereas China is


very collective. This is critical to understand when Microsoft attempts to

expand into the Chinese market. Microsoft will need to provide solutions to

Chinese business which will show that cloud computing will add value to the

organization as a whole and possibly to the business community as a whole.

Microsoft will have to provide proof that this can improve the firms

integration with all its divisions and provide significant value. Microsoft

may also need to show how this technology can help integrate with the Chinese’

buyers and suppliers efficiently.

The benefit of a long-term orientation is if Microsoft can show the

benefits of this technology then Chinese firms are more willing to wait for

the technology to mature. One of the downsides is that the Chinese would be

willing to entertain other competitors to Microsoft since they will not commit

prematurely. In fact, the Chinese will probably do their due diligence to

prove out the technology for themselves as well as assess the value of

Microsoft’s competitors technology.

One important consideration is that Microsoft must be sure to attend to

these dimensions affectively and not allow their own biases and approach to

come into play. In fact, Microsoft should focus on the following:

o Collective benefits

o Its long-term benefits

o Focus on the appropriate leaders


One other key point is that Microsoft should focus their attention to

the appropriate leaders in the country. There exists the risk that if

Microsoft pays attention to the wrong individuals at the exclusion of more

important leaders this could result in high profile disrespect. If Microsoft

does not pay close attention to respecting the correct leaders this could

result in irreparable damage and seriously hurt their chances of being

successful.

PROPOSED APPROACH

After carefully considering the Chinese culture and their markets and

identifying the similarities between the United States and China Microsoft can

formulate a high level approach to entering the Chinese market. This section

will first briefly outline a plan and then follow with critical leadership

styles that are needed to be successful in China.

THE PLAN

The plan is key to be successful in China and must include some of the

following ingredients.

Identify a respected Chinese leader to run the division.

Build up relationships between Microsoft and Chinese firms.

Involve the right leaders at each step of the development process.

Since the Chinese respect certain leaders in their country it is

critical for Microsoft to identify the correct leader to head up the division


that will be in charge of expanding the cloud computing initiative into China.

There should be extensive effort and analysis that goes into this decision

since it is one that could make or break the effort. A leader that is not

respected would not have the clout to influence the business and political

leaders in China. On the other hand if Microsoft discovers a well respected

leader the Chinese business leaders would be open to listening to the ideas

that Microsoft has to offer. The leader should have at minimum the following

characteristics.

Be Chinese

Have lived in China for a significant period of time

Has the appropriate credentials

Is successful

It goes without saying that this leader should be Chinese. Beyond

simply being Chinese the leader should have sympathies to China and its

culture and should respect the Chinese way of life. It probably wouldn’t be

good enough to have part Chinese and part other cultures but if conditions are

right it should not be ruled out.

The leader should not only have sympathies to Chinese culture but should

also be sensitive to the American way of life as well. Without truly

understanding the american way of life it would not be possible for the leader

to truly bridge the cultural dimensional gap between America and China; since

the goal is to provide success to Microsoft, an american company, in China.


Another issue is if too much of the loyalties are to China and very

little loyalties to america the leader may attempt to sabotage the effort;

making it succeed in such a way as to advantage China to the point of harm to

the United States. Another concern is the leader may be tempted to leave

prematurely taking the domain knowledge acquired through the expansion

experience and put it to use in China for their own benefit; of course this

could be a concern whether their loyalties are for China or for any other

countries.

Once the correct leader has been appointed it is important to begin

building relationships with Chinese business and government leaders. It is

critical to wait until the leader is in position to be able to do this since

it is the leader of the expansion division that should drive much of these

relationships. If for some reason Microsoft decides to begin building

relationships prior to appointing the head of the division it could counteract

what the new leader wishes to accomplish. It is important that once the title

is bestowed on the leader that the leader is respected by Microsoft

corporation. Showing respect to the leader is to allow him to run the company

the way he determines is the best; this includes building these relationships

the best way he determines is the most affective approach.

Since the Chinese value the collective they put more emphasis on

relationships. Relationships take time and effort so building this

relationship with the right leaders of the country is very important. This

means that anything that is done should cognizant of how the Chinese will


react to it. The question should always be asked how this decision affect the

Chinese; would this action build up the relationship or hurt it? Patterns of

building up the relationship is the goal of the new expansion. Anything that

would hurt the relationship should be avoided at all costs; in instances like

these it would be better to do nothing than do the wrong thing.

Another consideration is that it is important not to encourage

commitments prematurely. It is common for business leaders in the United

States to push for commitments as quickly as we can. We like the decisions to

be made so we can move on to the next opportunity. This will be

counterproductive in the Chinese culture. Relationships are not built on

pressure. Instead they are built on trust and belief in each other and that

each are looking out for the better good. It is important to realize that the

Chinese collective belief extends between Microsoft and the affected Chinese

companies. If a commitment is requested too early it might be interpreted as

Microsoft not truly valuing the relationship. It would be my guess that it is

almost better to wait for the Chinese businesses to extend the desire to

commit than it would be for Microsoft; at which point the relationship has

matured to a level where they are willing to make a commitment.

As an extension to building good relationships it is even more important

to build the right relationships with the right leaders. This too will be

determined by the appointed leader of the new expansion division. This is due

primarily because of the high power distance for China. Paying attention to

the appropriate business and political leaders in China is a sign of respect.


This respect will encourage the relationship and result in quicker commitment

and more potential deals in the future.

LEADERSHIP STYLE

Based on all considerations previously discussed, based on the

collective nature of the Chinese people, and based on the higher power

distance it is determined that the team leadership model is the best approach to

managing businesses in China. The team leadership model places leadership in

the hands of team effectiveness (Northouse 2007). The effectiveness of team

performance begins with the leader’s mental model of the situation. The

leader will identify all the components involved and will develop a model to

handle situations based on the environment and organizational constraints and

resources available. An effective team leader will be able to model based on

observing the team functioning.

The team leadership model can best be illustrated in the following

figure of Hill’s model for team leadership. Hill’s model for team leadership

discusses important decisions placed on the team leader such as whether to

monitor or take action, whether the situation is task or relational, and

whether to intervene internally within the team or external to the teams

environment.


Figure 7 - Hill's Leadership Model

Should I simply monitor the team or should action be taken can best be

illustrated using McGrath’s critical leadership functions discussed by

Northouse. These functions analyze whether internal or external and whether

to simply monitor a situation or

take executive action.

The two dimensions result

in four types of leadership

functions. The monitoring actions include diagnosing group deficiencies and

Figure 8 - McGraths Critical Leadership

Functions


forecasting environmental changes. The two executive actions include taking

remedial action and preventing deleterious changes.

The next important question is whether intervention should be for task

related actions or relational needs. Tasks functions include areas specific

to a problem or a process in the team. It focuses on the tasks that need to

get done and whether the team leader can help facilitate the completion of

these tasks. Relational needs focuses on the team cohesion or the environment

the team is working in. It might include how each team member is getting

along. This is important for Chinese companies since they pay more attention

to the relationships. It is recommended that team leaders engage in actions

that improve the team climate such as mutual understanding, good

communications between team members, and providing support contacts. (Felfe,

Yan 2009) Asian leaders are very concerned about relationships within the

workplace (Ho, Nesbit 2008). Effective leadership in China directly

correlates to how the leader builds up these relationships within the team.

The expansion division as a whole should engage in team moral in order be

successful as a company.

Note that this responsibility is squarely on the leaders of the division

since it is not likely that individual members of the company will speak up

and complain and risking the disharmony that complaining might result. It is

important in Chinese culture to create an environment that will enhance the

harmony and productivity of the team. As a result the leader needs to be


sensitive to the team’s morale and seek out information that might risk

conflict in the team.

The next section of the team leadership model are leadership actions.

These actions are either internal or external. The internal leadership

actions are divided into Task and Relational.

Internal Task Leadership Actions

o Goal focusing

o Structuring for results

o Facilitating decision making

o Training

o Maintaining standards

The internal task leadership actions are self describing and is

necessary to some extent for the success of all the teams but is second only

to the internal relational leadership actions which are described next.

Internal Relational Leadership Actions

o Coaching

o Collaborating

o Managing conflict

o Building commitment

o Satisfying needs

o Modeling principles


Internal relationship leadership actions are the most important focus of

the team leadership model for a Chinese firm. It may be necessary to coach

team members in interpersonal skills. Collaborating means to include and

involve all members of the team. Managing conflict and power issues must be

done without creating disharmony. Avoiding conflict is key but it is

necessary to question ideas in an appropriate way that will not lead to

disrespect. To prevent any type of conflict it is important to build

commitment to the team as well as commitment to the business. Commitment can

be encouraged by being optimistic, innovating, envisioning, socializing,

rewarding and recognizing. Satisfying the needs of team members can be done

by building trust and understand each team member’s needs and addressing those

needs. Finally, it is important to model ethical and principled practices by

being fair and consistent.

External Leadership Actions

o Networking

o Advocating

o Negotiating support

o Buffering

o Assessing

o Sharing information

External leadership actions are important as the team relates to the

business as a whole. Networking to form external alliances in the

environment. This can be done by gathering information and increasing the


team’s influence. Advocating the team to the environment is important to

build up the influence. Negotiating upward in order to secure the necessary

support and resources that would help the team be recognized. Buffering is

done by keeping unnecessary distractions out of the team and instead buffer

environmental issues. In some cases sharing valuable supportive information

with the team to help boost their morale. The more support the team can

acquire from the external environment the more the team believes they are part

of system much greater than themselves which helps

Finally the team leadership model deals with team effectiveness which is

the desired outcome of the team. The two functions of team effectiveness are

performance and development. Performance is concerned primarily with how

efficiently the team accomplishes tasks. Development is concerned with

cohesiveness of the team and how well the team can satisfy their needs as well

as the needs of other team members. Performance function should not be

neglected but the primary focus of the Chinese firm should be development and

building up the firm.

In 1989 Larson and LaFasto studied successful teams and came up with

these lists of characteristics of team excellence.

Clear, elevating goal

Results-driven structure

Competent team members

Unified commitment

Collaborative climate


Standards of excellence

External support

Principled leadership

These characteristics should be considered when establishing a team but

it is important that creating a Chinese team the focus should be on the team

relations and cohesion and less on the tasks. Overall these functions should

be considered only as it applies to the Chinese culture and people and how

they best function.

CONCLUSION

The purpose of this paper was to provide a comprehensive briefing on

different aspects of expanding the Microsoft’s cloud computing technology to

China. There are key areas to keep in mind. The first and foremost task

before actually integrating into the Chinese market is to establish the leader

that will head up the division and to be absolutely certain that this leader

is well respected by the Chinese people and has the capability and experience

to go along with effort. Choosing the wrong leader could literally derail the

effort. Once the right leader is selected all other expansion functions

should fall into place. Building up good Chinese relations with the

appropriate business and political leaders, requires establishing the

organization and infrastructure by an effective team model for leading and

managing.


Management of the project requires that Microsoft workforce pay

particular attention to cultural factors and differences between the Chinese

expectations and our US culture. These cultural factors include attention to

collectivism, power distance or status expectations and orientation towards

time. Once integrated into the Chinese culture Microsoft should be well

positioned to do profitable business with the fastest growing country in the

world.


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