Internationalization and organizational resources of Chinese firms

• Main Authors: LAU, Chung-Ming, NGO, Hang-Yue, YIU, Daphne W.
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2010
• Subjects: China; International investments; International business; Competences; Management technique; International Business
• Online Access: https://ink.library.smu.edu.sg/lkcsb_research/7327; https://ink.library.smu.edu.sg/context/lkcsb_research/article/8326/viewcontent/Internationalization.pdf
• Institution: Singapore Management University

Purpose - The internationalization of Chinese firms has been gaining importance in recent years Informed by Dunning s eclectic paradigm this paper examines the factors leading to the going international decisions of Chinese firms in the very early days of the go global call before the central government offered substantial supportDesign/methodology/approach - It is suggested that two types of organizational factors are relevant to these decisions the firm s management capability and core competencies A survey of data of chief executives from over 3 000 firms in the year 2000 was analyzedFindings - Empirical results indicate that different resources endowments have different relationships with internationalization decisions The intention of going international is affected by organizational competencies of R&D and manufacturing Two capabilities (production and sales and operation and finance) have significant impacts on outward direct investment, while manufacturing and marketing competencies have positive effects on exports together with production capability In addition manufacturing competencies also have a negative effect on the acquisition and use of international capitalOriginality/value - By using firm level data collected in China a better understanding of the nature of internationalization and the foreign direct investment characteristics of firms has been obtained The empirical results show that the impacts of the organizational resources are different for different internationalization decisions, and the effects of core competencies of a firm vary across different paths of internationalization