The contrasting strategies of owner-managed and foreign-engaged joint ventures under market socialism in China

Abstract

Drawing upon a contingency approach, this research based on case studies offers an understanding of the conditions for contrasting growth strategies in emerging business ventures in China. It offers an insight into the interactive effect of organisational processes that are likely to shape their strategic outcomes. Ownership as a key contingency factor influences the objectives of organisations and the formation of their growth models. The empirical evidence collected from key stakeholders in a selected number of company case studies suggests that organisations with “open” structures and processes that encourage the adoption of ideas, policies and methods from both internal and external forces are more likely to adopt more high value-added strategies than “closed” entrepreneurial firms typical of organisations in the conditions of market socialism in China. It demonstrates the critical role of foreign investment in shaping local management practices in the transitional economy. It also implies that irrespective of political ideology, the creation of a market economy imposes ‘standardizing’ global similarities in business structures and processes that cut across national cultures. This is discussed on the basis of empirical data collected from interviews with key stakeholders in a number of company case studies.