Both global and local: ICTs and joint ventures in China

Abstract

Abstract. The expansion of global firms, supported by extensive information and communication technology (ICT) systems, is frequently seen as leading to the spread of best practices to different regions of the world. Some argue that these practices are bound up with the national origins of these firms, while others propose that local circumstances in specific economies are of prime importance. According to the first perspective, global firms will use ICTs in China that reflect their national origins, but the second approach emphasizes the importance of the Chinese local context in how and what ICTs are used. Based on evidence from two case studies of global UK multinationals with Chinese joint ventures, this paper argues that the ICTs used by these companies do relate to their national roots and that China is seen by them as a very unusual setting that is treated as a special case. For example, one company was prepared to roll out a global enterprise planning system elsewhere but refused to implement it in China, while the second company cordoned off their ICT systems in China from their other, more global systems. Cultural frames of reference are advanced as an important explanation of differences in the usage of ICTs in China. Building on these ideas, this paper argues that how difference is recognized, accommodated and (re)affirmed is significant for the performance of formal business processes. Formal and ICT‐enabled systems ‘work’ by being embedded in changing Chinese cultural practices such as guanxi, though this is frequently not recognized by Western managers. While the global nature of global firms may be overplayed, the local arrangements of joint ventures are very important in how ICT systems are implemented in which the embedding and disembedding require an understanding of sited cultural practices that underpin the performance of formal systems. What is at stake is how global firms and their ICT systems are able to adapt to Chinese circumstances, and, in the longer term, how Chinese joint venture partners, often previously state‐owned enterprises, adapt to different forms of control mediated by ICTs.