Language Fluency, Socialization and Inter-Unit Relationships in Chinese and Finnish Subsidiaries

Abstract

High levels of trust and shared vision contribute to collaborative behaviour among units belonging to the same corporation. We examined the relationship of language fluency and socialization mechanisms to inter-unit shared vision and trustworthiness, using a sample of 310 inter-unit relationships involving subsidiaries of multinational corporations located in China and Finland. Results show that language fluency related significantly to shared vision and perceived trustworthiness in both the Chinese and Finnish subsidiaries. We also found socialization mechanisms to have a positive relationship to shared vision in the Chinese but not the Finnish sample, and no significant relationship to perceived trustworthiness in either sample. The interaction effects of language fluency and socialization mechanisms produced different results in the Chinese and Finnish samples. The study confirmed the importance of language fluency for inter-unit relationships and offered several suggestions for future research.