How Variations in Business Systems Affect the Innovativeness of Chinese Firms: Historical Background, Framework, and Case Studies

Jiajia Liu, Andrew Tylecote

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract

We look at how three features of current business systems—governance and finance, work management practices and inter-firm relations—have evolved during the reform process since 1978 in China, and how over the last decade they have shaped the technology strategies of Chinese firms. We examine three cases of more-or-less successful innovators—Delixi, Midea, and CNEGC, in electrical distribution equipment, microwave cookers, and steel plant, respectively; the first two privately-owned, the third a central state-owned enterprise. We point to weaknesses—Delixi’s dependence on a foreign joint venture partner, Midea’s production engineering—and strengths: Delixi’s strong relationships with suppliers, Midea’s ability to fund R&D, CNEGC’s ‘engaged’ governance. We find that the strengths are less typical of Chinese business than the weaknesses, even in the medium-high technology sectors to which these firms belong. We argue that the situation is less favourable in high-tech sectors.
Original languageEnglish
Title of host publicationChanging Asian Business Systems
Subtitle of host publicationGlobalisation, Socio-Political Change, and Economic Organisation
EditorsRichard Whitley, Xiaoke Zhang
Place of PublicationLondon
PublisherOxford University Press
Chapter13
Pages333-358
Number of pages26
Volume1
Edition1st
ISBN (Print)9780198729167
DOIs
Publication statusPublished - 25 Feb 2016
Externally publishedYes

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    Liu, J., & Tylecote, A. (2016). How Variations in Business Systems Affect the Innovativeness of Chinese Firms: Historical Background, Framework, and Case Studies. In R. Whitley, & X. Zhang (Eds.), Changing Asian Business Systems: Globalisation, Socio-Political Change, and Economic Organisation (1st ed., Vol. 1, pp. 333-358). London: Oxford University Press. https://doi.org/10.1093/acprof:oso/9780198729167.003.0014