The Impact of Beliefs on Business Practice in the Lao People’s Democratic Republic Mrs. Thongsavanh NAKHAVITH ABSTRACT The Lao PDR is multi-ethnic groups and cultural diversity country. The government of Lao PDR reserves this multi-ethnic and diversity as the core economic development. The beliefs of Lao vary from one group (geographic and demographic) to another throughout the country. The comparative analyses of factors: religions, beliefs, myths, culture, level of economic development, business development, natural resource use, and education, influencing the business managementhas never been carried out in Laos. Thus, this study aims at firstly examining to what extent and how background beliefs affect the business practices. Secondly, the research attempts to identify whether one groupbeliefs nurture the characteristics associated with entrepreneurship more than others. Finally, the paper analyzes the degree of respects to successful entrepreneurs in certain ethnic beliefs. Samplesare selected in different domain(District level, provincial level, and capital city level) and also classified in terms of demography. Source of belief, if it is human, are also interviewed. The results shows that astrological belief and religion is greatly influencing the livelihood of people in the society; including business practices, which have been mainly influenced by management science, human resource management, economics, psychology, and other. In business practices, the entrepreneurs who need to make decision consider the uncertainty and problems. They decide the solution option from many alternatives which have been analyzed and think that which alternative is the best one. Astrological, religious, and animism belief is one option that the entrepreneurs choose to support their confidence in the case of risky decision making in business practices, as has been seen from entrepreneurs checking appropriate timing with fortune tellers, monks, or clan leaders.From various phenomena that have been explained by the source of belief (astrological and/or religious) and entrepreneurs, the belief enhances confidence and sometimes resulted in miracle outcome. The results, nevertheless, show that different groups of people have different level of religious and astrological practices, both in geography and demography. Key words: entrepreneurs, belief, astrology, religious, business practice

243

1.

Introduction

Belief is a way of thinking culture which human created in order to secure their mental peacefulness since the happiness is born in the mind, which is the basic need of humankind. Happy mind is fundamental need for human. Brosnislar Malinowski (1997:31) classified human needs into three categories: basic physical and mental needs, the needs to be a member in the society, and a need for identity which needs to be catered for by the development of sciences, religion, magical arts, and performance in the society. One of the learning system have identified that there are many scientific story that cannot cater for the learning and explanation of a phenomenon. Human have created astrological and religious belief system to explain the phenomenon and to assist humankind to understand and to feel safe. Belief has influenced the Lao lifestyle since the ancient period; and currently, human are so advanced in science and technology by utilizing modern equipment in their living support. The advancement in science and technology have changed or eliminated many beliefs; nevertheless, some of the beliefs still have tremendously influence the mentality and lifestyle of human, such as astrological belief, magical power, and etc. (Pakaphone Vichivathakane, 1989:13). Astrological and religious belief has been one of the Lao local knowledge since ancient time. There are evidence in the Lao Bailane script and famous literature, namely Sangsinxay Story, Khouncheuang story, Nang Phomhom story, and others. Besides, tradition such as wedding, new house construction has shown that Lao people look for good dates in accordance with astrological belief for auspiciousness and success. Therefore, the astrological and religious belief is a practice to enhance the confidence, brave, and attacking societal program. Having a particular belief and practice, according to each individual horoscope, an entrepreneur gains more confidence and endurance. It can make the surrounding people also accept the belief since they think it will bring good things for them. Therefore, astrological belief has been a science relating to human psychology for a long time. As it is a science that cannot be proved by evidence, reason, or history, the science has not been accepted; as it may be relevant to the sayings of Monk Vichitvathanakane: “maybe we don’t know or not knowing enough as ancient people” (Lavan Soukri 1994: 7). Although nowadays scientific knowledge and technology has been so advanced, we still find that the astrological belief and religion is greatly influencing the livelihood of people in the society; including business practices, which have been influenced by management science, human resource management, economics, psychology, and others, so that the business management is governed by proper principles and rules with high effectiveness and efficiency. Nevertheless, the current business practices, the decision on business practices are facing problem of uncertainty due to the changing business environment or the result of decision is feasible in many ways. Business people have to understand the current situation, forthcoming situation, and future situation which is difficult to predict. Future is difficult to predict precisely. Sometimes an occurring situation might positively or negatively affect the business practices; it may be a bottle neck preventing the fulfillment of the target (Souyouthon Minaphan, 1997:9-20). In real situation of business practices, the entrepreneurs who need to make decision will consider the uncertainty and problems. They will decide the solution option from many alternatives which have been analyzed and think that which alternative is the best one. The selection of a solution strategy will consist of an uncertainty element in the decision making process because there may be some changes that they expect to occur. The option that has been selected might not be the best one due to the option has some feasibility of success or 244

failure; therefore, in any option the entrepreneur adopts, they still face some risk on the decision making (Sourayout Minaphan, 1997:289). This characteristic causes the entrepreneur to search for mental soundness support by various ways. Astrological belief is one option that the entrepreneurs choose to support their confidence in the case of risky decision making in business practices, as has been seen from entrepreneurs checking appropriate timing with fortune tellers, monks, or clan leaders. From past to present, Lao economy has been changing continuously and has been growing rapidly recently. The evidence is seen from the increase of new business establishment, leading to industrial development. Such rapid growth cause intensive competition as well as entrepreneur’s confidence level is declining. Therefore, these entrepreneurs search for other means of confidence support, which is highly sensitive and never enough. For this reason the belief system has played important roles as the need to find mental support and ways to release tensions, creating confidence in business conducts (Nithi Iaosrivong, 1993:42-45). From various phenomena that have been explained above, belief (astrological and/or religious) is the fact in the society which many people know, yet lack of systematic research regarding the influences of beliefs and correlation between beliefs and the business practices of the entrepreneurs. Therefore, I am interested in conducting the research in this area in order to understand the insight of entrepreneurs’ beliefs and their business practices. I am confidence that the result of this research will be beneficial to the business development so that the entrepreneurial activity can support economic and social development in the future. 2.

Literature Review The study on religious influence business practiceby Anderson et al, (2000) on the Christianity influence business practice in Western country while Islam shape the business environments in many countries where Islam is the dominant religion (Ali and Al-Owaihan, 2008;Ali and Gibbs, 1998). Chinese and East Asian firms was influenced by Confucian philosophy (Yan and Sorenson, 2004), however, there were many philosophical orientations shaping Chinese management theory including Confucianists, the Legalists, and the orientations. Theravada Buddhism seemed to have influence on business environment and practice in mainland Southeast Asia. This region is, however, difficult to define as there are also distinct divisions within the region. The Philippines is influenced by Catholic while Indonesia, Malaysia and Brunei are Islamic countries. Singapore is somehow associated with Chinese and Confucian values; Vietnam is the mix of variety of religions including Mahayana Buddhism and Catholicism, Lao PDR, Cambodia, Myanmar and Thailand have traditionally been centers of Theravada Buddhism. Theravada Buddhism was more a philosophy than a religion and according to the Buddhist doctrine; the Buddha is not a god or a supernatural being. In theory, Theravada Buddhism “has no dogmas, superstitions, necessary rituals, mediating priests or blind faith in an unknown (and unknowable) God” (King, 2001). However, most daily practice the followers are mixed with animist beliefs including praying for intervention in daily life of the Buddha, saints or spirits and other practices and beliefs with similarities with the practice of other religion. Thus, there are significant changes or difference from its origin (Jackson, 2003;Schober, 1989) Belief and culture can be defined as an interpretive framework through which individuals make sense of their own behavior. It is a set of historically evolved learned values and meanings shared by the members of a given community that influence the material and non-material way of life(Hofstede, 1994). Members of the community learn these shared 245

characteristics through different stages of socialization processes of their lives in institutions such as family, religion, formal education, and the society as a whole. Kutcher et al, (2010) study found that there were strong religious beliefs correlated with improved ability to cope with stress in the workplace. Their study was supported by Vitell’s research that an individual religious value would affect ethical behavior. Religious beliefs in some context appear to influence consumer behavior (Doran, C.J., and Natale, S.M.,, 2011)whereas Cole’s (2009) study indicated that individual religious values can have an effect on that individual’s views about organizational justice. However, at macro level, the dominant religion of a region or country has often been found to have an impact on the overall business environment. There seems to be a correlation between the dominant religion in a country and the level of corruption, although other factors, specifically low gross domestic products per capita, also appear to play an even more important role in contributing to high levels of corruption (Samanta, Pleskov, Zadeh, 2010). Some studies also indicated that religious practices and values play a less important role in daily life than they once did due to the decline of its level and intensity or the role of religion in daily life specifically incomes rise and economies develop (Barro and McCleary, 2003;McClearly and Barro, 2006). 3.

Research Objectives The main objectives of the research are to firstly examine to what extent and how background beliefs affects the business practices. The research also identifiesthe differencesbetween the belief practices of the different region. Secondly, the research identifieswhether beliefs nurturethe characteristics associated with business operation more than others.Finally,the paper analyzesthe degree of respects to successful entrepreneurs incertain region’sbeliefs. 4.

Research scope The belief is studied in the following elements: belief on fates, belief on horoscope, Belief on timing, belief on prediction or fortune telling, Belief on geographic prediction (Huang Chui). The belief and the astrological practices in business activities analyzed covers formulation of policy, investment decision, business planning, and Personnel recruitment: personnel selection, and space arrangement, human resource management, and marketing management. The study site covers Vientiane Capital City, representing the central part of Laos, and Sayaboury Province, representing the north. 5.

Population and sampling

The population in this study is the successful business people, the number of which is not precisely reported. Therefore, in this study, due to the limitation of time and resources, the author used random sampling technique. With the assistance of the district officials, successful entrepreneurs are identified, approximately 30 samples in a district so that statistical analysis can be carried out. The sampling selection also attempted to involve women entrepreneur as much as possible. 6.

Data Collection Indepth interviews with business owners who were selected by a purposive sampling based on business experienceswere conducted. The in depth interview wereheld during the observation period. In participant observation, the researcher learned about theirexperiences of those involved by not merely observing what is happening butalso feel it. In addition, survey questionnaires were distributed to the business owners for detail belief and its usage status. 246

7.

Data Analysis and Reporting The data analysis in this paper is mostly descriptive data analysis and report, particularly on the survey questionnaires. The statistical analysis will be on means, sum, standard deviation, and correlation. As for case study and qualitative information, the author will synthesize the information so that pattern and classification can be sported and will be reported in story telling or in life story method. 8.

Findings 8.1. Overview of Sampling The overall samplings include 160 subjects. The ratio of surveyed subjects from the north covers 44.4% (71) and from central part is 55.6% (89). Among them, 48.8% are female and 51.3% are male. Female subjects totaled 48.8% and male consists of 51.3%. The majority of the respondents (83%) are married, 11.3% single, 4.4% divorced, and 1.3% are widowers. The highest age group ratio is between 31 and 40, covering 34%, followed by the age group between 41 and 50, between 51-60, between 21 and 30, and more than 60, with the ratios of 32.7%, 17%, 15.1% and 1.3% chronologically.Education background of the respondents isbachelor degree 30.8%, higher secondary education 28.9%, and diploma degree 23.9%. Early secondary education and primary education cover 5.7% each, while Master’s degree is 3.8% and Ph.D. degree of 1.3%. As many as 97.5% of the respondents are Buddhists. Regarding business experiences of the respondents, higher percentage is between 6 and 10 years (36%). The business experience of between 3 and 5 years covers 23.8%, between 11 and 15 and over 20 years are 13.8% each, and between 16 and 20 years covers 12.5%. The types of businesses shows 29% services, 20.6% commerce, 18.1% retail shops, 6.9% construction, 6.3% construction, 4.4% transportation. Tourism and cultural promotion, agricultural production and others are 3.8% each. Communication technology business covers only 3.1%. 8.2. Differences between the belief practices of the different region. The nature of belief of the respondents is that 51.6% have Buddha statue, 27.4% carry non-Buddhastatue, 48.4% have spiritual house in their business facility, and 76.4% have Buddha shelves in business compound. 7.6% uses sacred text. The entrepreneurs believe that Buddha image helps business success at a very much level by 28%, much 32% and medium 25.5%. Monks are also believed to influence business success in a very much level by 17.5%, much by 21.9%, and medium by 33.6%. Other types of beliefs are not very influential. An analysis of mean score shows that the entrepreneurs believe that Buddha image help them succeed at a relatively high mean score (3.65 out of a 5 point scale), followed by monk (3.15) and non-Buddha image by 2.3. The classification between the north and the central part shows that the central part is more reliance on spiritual or religious belief for their business conducts in most items. Northern region has higher mean score on Buddha image for business success than the central region by 3.71 and 3.60; and marginally varies in the belief that magical plants contribute to business success of 1.57 and 1.55, and monk’s contribution to business success of 3.16 and 3.15. In all other categories, the central part has higher mean score. 8.3.

Influence of beliefs on the characteristics associated with business operation The result of the analysis shows that the entrepreneurs believe in astrology relatively high. They believe that timing prediction leads to success is the highest with mean score of 3.78 out of a five point scale; followed by the belief of human elements consists of various components: earth, water, wind, fire (3.54), selection of location according to astrology or 247

Feng Shui leads to happiness and prosperity(3.44), auspicious naming brings prosperity to the owner (3.38), auspicious number e.g. 9 signifies prosperity (3.37), and conducts according to fate or timing support expectations, ease and self-confident (3.07). A lower level of believes are on the beliefs that fate or timing helps supporting decision making in travelling or action e.g. business launching (2.99), human characteristics and morals is from the main components or zodiac (2.98), auspicious ornamentation to birth zodiac help bringing auspiciousness (2.91), business establishment or job relavant to zodiac bring success (2.85), facial characteristic: forehead, eyebow, eye, nose, mouth indicates the person's habit (2.7), auspicious letter signifies power, color, and prosperity (2.67), using the belief on fate or zodiac as one component in setting policy or business goal (2.67), position of beauty spots or birth mark exhibits the merit and the bad (2.62), zodiac signifying fate (2.6), knowing person's elements or zodiac helps understanding the person's characteristics (2.56), zodiac owner can utilize power freely to perform well and make benefit (2.51), checking zodiac or palm reading help forcasting a person's potential (2.5), zodiac indicates characteristics and behavior (2.47), and knowing element's comflicts helps avoiding conflicts (2.26). The analysis between north and central part shows that most of the item in this section, the central part has a higher mean score, except auspicious letter signifies power, color, and prosperity with 2.71 and 2.64. 8.4. Utilization of Magical Arts, Astrology, and Religion in Business Practice In policy formulation, the results shows that entrepreneurs use at an average level with means score between 2 and 3. Praying for sacred things to help in policy setting has the highest score in policy formulation category (2.8), followed by using the belief on fate or zodiac as one component in setting policy or business goal (2.67),considering stars or zodiac in selecting business location (2.62), selecting business partners with similar fate or zodiac that support each other (2.48), and considering stars or zodiac as part of activity or business type selection (2.32). The north and central part analysis shows that all except praying for sacred thing to help in policy setting, the central part has higher mean score. In investment decision, a similar trend and level with policy formation is found. Praying for sacred things to help in investment decision has a mean score of 2.56, using fate and zodiac as part of creating alternative in business execution is 2.55, using personal belief on fate and zodiac as part of business performance evaluation is 2.5, using fate and zodiac as part of alternative evaluation for decision making is 2.44, and using fate or suggestion from astrologer as part of decision making for business operation is 2.4. There are differences between north and central part. Northern part has a higher mean score in terms of using fate and zodiac as part of creating alternative in business execution, using fate and zodiac as part of alternative evaluation for decision making, and praying for sacred things to help in investment decision. As for business operation planning, a higher variation is found in the result. Selecting timing for operation, considering auspicious time period has a higher mean score (3.06), followed by praying for sacred things to direct business planning (2.54), using personal belief on fate and zodiac as part of operation strategy formulation (2.37), using personal belief in fate and zodiac as part of business planning (2.36), and using fate or suggestion from fortune teller as part of problem solution planning (2.26). The analysis between north and central shows that the higher mean score of the north are in using personal belief in fate and zodiac as part of business planning, and praying for sacred things to direct business planning. In resource procurement, the mean score are relatively lower than the above categories. Location selection is based on geographical auspiciousness or geographical forecasting has a mean of 2.8, praying for sacred things in business resources procurement (location, staffing, financing) with 2.48, using belief in fate and zodiac as part of operation 248

material procurement with 2.26, using personal belief in fate and zodiac as part of operation budget planning with 2.19, and using belief in zodiac as part of employee selection with 2.06. The differences between the north and the south are that all except praying for sacred things in business resources procurement (location, staffing, financing), the central part has higher mean score. Human resource management shows little usage of the beliefs. Praying for sacred things to help solving staff problems has a mean score of 2.05, using belief or ceremony as part of altering staff behavior 2.03, using belief in astrology as part of task assignment to staff1.91, using belief in zodiac for understanding staff behavior 1.9, and using belief in astrology as part of selecting staff for managerial position has the lowest mean score (1.87). The distinction between north and south in human resource management is that the north has higher means score in most of the categories, except using belief or ceremony as part of altering staff behavior. The entrepreneurs use astrology and religious belief to influence marketing management at a relatively high level. Using personal belief in selecting color, logo, business sign for auspiciousness and sale promotion has a mean score of 3.03, followed by decorating shops or business location (inside-out) according to geographical forecasting for sales promotion2.95, praying for sacred things to support sales or obtaining customer 2.86, selecting sales agents with the characteristics according to the entrepreneur’s belief 2.47, and using personal belief in auspicious timing as part of product pricing 2.39. In marketing, the northern entrepreneurs result shows higher mean score in all items mention above. 8.5.

Degree of respects to astrological and religious belief of successful entrepreneurs The analysis of religious belief shows that the entrepreneurs are very religious with the mean score of 4.2 out of a five point scale. Astrological belief, however, has a lower score, 2.55. The entrepreneurs believe that the contribution of these practices to the business success is relatively high, with a mean of 3.18. Magical art belief level has the lowest mean score of all, 2.48. Among these believe, the central part has higher mean scores, except contribution of belief on business success. 9.

Conclusion This empirical research looked intothe extent and how background beliefs affect the business practices. It identifies the differences between the belief practices of the different region, exploring whether beliefs nurture the characteristics associated with business operation and identifying the degree of respects to successful entrepreneurs between North and Central part of Laos. The results indicated that the belief in astrology and religion, in this case, Buddhism, as a reasonably strong role to play. Many of the entrepreneurs have Buddha image or non-Buddha image, Buddha shelf or house in their business compound for spiritual support. The use of zodiac, astrology, and religious principle into business activity is also evidenced. Central part uses belief on astrology and religious principle to support their business activity and success more than the northern part entrepreneurs. Strong evidence that the northern entrepreneurs does more than the central enprepreneurs is praying for sacred things to support their business fate, decision, and operation, and other activities. The result, nevertheless, need further exploration and confirmation by larger samplings and in-dept analysis.

249

References Ali and Al-Owaihan. (2008). Islamic work ethic: A critical review.Cross Cultural Management, 5-19. Ali and Gibbs. (1998). Foundations of business ethics in contemporary religious thought: The ten Commandments perspective.international Journal of Social Economics, 1552-15562. Anderson, drakopoulou-Dodd and Scott. (2000). Religion as an environment influence on enterprise culture: The case of Britain in the 1980s.International Journal of Entrepreneurial Behaviour and Research, 5-20. Barro and McCleary. (2003). Emerging Asia regionalism: A partnership for shared prosperity.Mandaluyong City, Philippines: Asian Development Bank. Cole. (2009). Cross-cultural conceptions of organisational justice: The impact of Eastern religion / philosophies.The Business Review, Cambridge, 18-25. Doran, C.J., and Natale, S.M.,. (2011). Empatheia and Caritas: The role of religion in fair trade consumption.Journal of Business Ethnics, 1-15. Gibb A.A. (1987). Education for entreprise: Training for small business initation - Some contrasts.Journal of Small Business and Entrepreneurship, 42-47. Hofstede. (1994). Defining culture and its four dimension.European Forum for Management Development, 1-4. Jackson. (2003). Buddhadasa: Thervada Buddhism and the modernist reform in Thailand.Chieng Mai: Silkworm. King. (2001). In the hope of Nibbana: An easay on Theravada Buddhist ethics.Chicago: IL: Open Court Publishing. Kutcher, Bragger, Rodriguez-Scrednicki and Masco. (2010). The role of religiosity in stress, job attitudes, and organisational citizenship behaviour.Journal of Business Ethics, 319-337. McClearly and Barro. (2006). Religion and political economy in an international panel.Journal of the Scientific Study of Religion, 149-175. Samanta, Pleskov, Zadeh. (2010). Religion as a determiant of corruption: Comparative evidence from OPEC and OECD countries.international Journal of Management, 728-744. Schober. (1989). Paths to enlightenment: Theravada Buddhism in Upper Burma .University of Illinois. Yan and Sorenson. (2004). The influence of Confucian ideology on conflict in Chinese family business.international Journal of Cross Cultural Management, 5-17.

250