Dissecting a Philosophical Revolution: Yuan Li Explores the Intersection of China’s Rhetoric and Organizational Change

In an age of 24-hour media commentary and drastically evolving business practices, Professor Yuan Li believes there is value in examining the space between words and action in organizations. Li studies in great detail the linguistic turn in philosophy, social sciences, and humanities that sees social reality as a linguistic construction.

Professor Yuan Li

"The turn to language and rhetoric really is to refocus our attention to words, to the things that we say, and to meanings, to what all of that means together. This idea revolutionizes how we see the relationship between language and reality."

According to Li, the recent election exemplifies this relationship. “People talk and talk. You turn on the news. It's all about what happened, about who said what. Then all kinds of gurus and commentators interpret. Based on the constructivist philosophy, there's no reality outside of the linguistic representation of it; there is no objective thing that exists without a symbolic component. The whole idea that words mean nothing, or actions speak louder than words—downgrading rhetoric to some kind of a distortion or misrepresentation of reality—is a very old bias that continues on today,” said Li. 

In a nutshell, Li’s theory is that words are very important, if not more important than what you do and how you act.  “A very simple action can be interpreted in so many different ways.  You blink an eye. You could be flirting.  You could be afraid.  You could be doing a lot of things, depending on how it's named, defined, and interpreted.”

Using semiotics, Li studies China’s political rhetoric in market-oriented transition, institutional and organizational change, and entrepreneurship. Li spent ten years working on her labor of love research paper, “A semiotic theory of institutionalization" (Academy of Management Review, In-Press).   

“I have published two other papers with my co-authors in this stream of research. Like the semiotics paper, these two others papers also try to understand the process of institutionalization--how things become taken-for-granted,” said Li, who is introducing the idea there is no direct connection between the words that we say and the actions that we do based on philosophy of language.  

"Management theory recognizes that what actors do is often not what they say. But it tends to assume that what actors do is what they mean, or that what they mean is what they say. These assumptions are problematic when studying the institutionalization process in which what we do, say, and mean at the micro level move to the macro level and become taken-for-granted rules. I argue that the three are distinct correlates of social reality that correspond to the semiotic triangle comprised of referent, signifier, and signified, which is key to understanding institutionalization," said Li. 

"Institutionalization is the process by which our actions and ideas become taken for granted. “And I study how these things become like rules,” said Li. 

 “One of the interesting things about rules is that you don’t know they exist until you break them. Sociologists asked their first-year sociology students to do an experiment on social norms and rules.  They asked them when they talk to their friends or their family members to keep saying nonsense.  One person may say, 'I have a flat tire.'  The student would respond, 'What do you mean?' They found if you keep asking this, the other person would get really annoyed, even angry. These students did these experiments and found out that once you break a rule,  a very common sense rule—you don’t even realize it's a rule [before that time].  If you break it, then you realize that the rule is there."

"Different societies have different rules.  It's not like you can't understand another society.  Once you understand these unspoken rules, then it all becomes sensible to you.  These rules are not coded in a brochure but they are there," said Li. 

For Searle, an American philosopher and currently the Slusser Professor of Philosophy at the University of California, Berkeley, a phenomenon becomes an institutional fact when language “creates a reality by representing that reality as existing.” Using his research, Li explains that there are two types of facts: brute facts and institutional facts. Brute facts exist independently of any observers while institutional facts are symbolic facts that exist only relative to human attitudes, intentions, feelings, and experiences.  For example, a piece of paper is a brute fact, but a 20-dollar bill as money is an institutional fact. A wall made of stones is a brute fact, but it is symbolic when it is collectively recognized as a boundary. This symbolic existence as a boundary may continue even when the wall decays and nothing is left but a line, according to Searle. Similarly, two people uttering sounds toward each other constitute a brute fact, but this is an institutional fact when recognized as an employee performance appraisal, a negotiation with a supplier, or a task force that has just been established to tackle an organizational problem. The semiotic triangle is important for organization and management studies because most of the things we are concerned about are comprised of both brute facts and symbolic facts.

"I think the linguistic philosophy that I discuss, semiotics, really helps us to understand that process. Before reading my paper, people understand the rules as either manifesting in repetitive behaviors or in the widespread adoption of a practice.  For example, when corporate social responsibility became a mandate, a practice for every corporation, many companies then had to produce a corporate social responsibility report.  Management researchers measure that and they say that corporate responsibility has become institutionalized.  It has become a rule, part of our belief system.  That's one way that management studies understand how rules become rules, which is to measure how widespread they are in terms of being adopted as a formal practice or formal structure in an organization."

"Other researchers say when organizations adopt these rules, that doesn't mean that they really follow them.  Sometimes they say that they're socially responsible, but they still pollute the environment. They say one thing, and they do another.  Studies have shown that as long as you say something—even if you don’t do it—a society thinks of you as legitimate.  They don't go examine whether or not you do it, but once you say that you are conforming to some of the established expectations of how you should behave—what's appropriate, what's not appropriate—then you acquire this status of legitimacy. In the eyes of stakeholders, you are appropriate or acceptable.  Some say that when rules become widely adopted and ingrained in our system, then we don't care about behavior.  We observe a decoupling between what we say we're going to do and what we actually do. That decoupling is ignored by the public. People don't know that there is a decoupling."  

Using semiotics as a linguistic philosophy to help understand the process of making rules, Li argues that it is not sufficient to only look at wide adoption or the decoupling between our words and action to gauge institutionalization. Sometimes a widespread business practice is still illegitimate and controversial; sometimes people say one thing and do another because they don't have the resources to implement what they say, due to many different organizational and resource constraints.  “We can't claim that just because what you say and what you do has a discrepancy, you must be hypocrite, or that you have violated institutional expectations,” said Li. Instead, she searches for the concepts that define such processes. 

She identifies in her paper, for example, two kinds of institutionalization processes: denotational and connotational. Says Li, “Denotational institutionalization entails the coupling of the referent, signifier, and signified, in which case what you say, do, and mean become widely accepted as having one meaning and take on a rule-like quality; connotational institutionalization involves decoupling among the three, in which case what you say or do acquire new and connotative meanings as they spread.  Both kinds of institutionalization processes increase how much something is taken-for-granted, but what is taken for granted differs drastically, which creates heterogeneity (or diversity) in the institutionalization process." 

These different ways of institutionalization mean that nothing can be taken for granted. There's a relationship between what we do and what we mean, she said, and that relationship is very flexible and perhaps always changing. 

Li has no shortage of enthusiasm for her current research. She had set out to study literature originally, but found she was really attracted by the world of business and organizations.” She joined the Marshall School of Business and received her Ph.D. in business administration from the University of Southern California. Li joined SEBA’s Management Department from McGill University in Montreal, where she taught for six years as assistant professor of strategy and organization. 

Li uses an interdisciplinary inquiry (i.e., combining rhetoric and management theories) to provide a more indigenous account of China's institutional transformation in the past 30 years. This area of research looks at how actors in positions of authority attempt to justify their right to rule while introducing controversial practices that potentially delegitimize their authority. For example, China’s reform leaders found themselves in a legitimacy conundrum when they established and developed the stock market, yet have been able to assert a central role for the state in managing the stock market. Using a critical rhetorical perspective, Li analyzed in her paper, "Rhetoric and authority in a polarized transition: The case of China’s stock market (Journal of Management Inquiry, In-press)," exactly how actors use “rhetorical genres,” i.e., argumentation and narration with differing content and style, to construct relationships under an authoritative basis. 

Li has studied the Chinese transformation over the past thirty years.  “Symbols and language have played such a significant role in that transformation,” said Li.  “For example, the Chinese have changed from basically a socialist country to a capitalist society with a socialist rule.  A lot of the practices are capitalist.  What they do now is very different from what they did thirty years ago.  Thirty years ago was central planning.  Now there are different market practices—the stock market and all kinds of markets—free enterprise, private enterprises, private entrepreneurs.”  

The Chinese communist party has been skillful in expanding what they mean by the things they say.  They can introduce a word and stretch the meaning of it so that it can be compatible with introducing controversial practices.  If you are a communist, how can you rule over a capitalist country?  You should be overthrown, and we should have an elected democratic government.  But that is not what's happening in China, although it has happened in other previously communist countries.  “One way that they were able to do it is because they're able to stretch communist concepts to such an extent that they can include and comfortably introduce all kinds of controversial capitalist practices without losing their story, the coherence of their social order, or their rule.”

Many Chinese, said Li, already feel they have lost their story.  They can be very cynical about all the changes, and about the communist party still being the one-party power.  Because, “When you go to China, you can also sense how difficult the stretching of the boundaries of concepts is to holding the Chinese people together,” said Li.  

In the end, said Li, “My whole research is about refocusing the attention to words and meaning… We must be very careful about what we say.  That's the fundamental assumption of the constructivist linguistic philosophy.  Words do not have intrinsic value to themselves.  They only become significant and different, and acquire their meaning because they are different from other words.”

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