The Chinese effect: Towards the disruptivenessof Chinese companies for the global marketplace

Maximilian Patrick Hinz

Student thesis: Master thesis

Abstract

This paper explores and argues for the increasingly complex drivers and capabilities of Chi-nese multinational enterprises (CMNEs) to innovate and achieve sustainable growth. More specifically this paper analyzes the disruptiveness potential of CMNEs and argues for disrup-tive innovation (DI) as a tool for late-coming CMNEs to catch up with and potentially leap-frog incumbents. By doing so, this paper responds to the demand for a better understanding of emerging market multinational enterprises (EMNEs) and the adaption of approaches and frameworks from developed countries to developing countries (Gugler / Boil, 2008; Hobday, 2005; Li, 2003; Li, 2007). In general, this paper follows an exploitation of extant theories from the West towards a local CMNE context with global implications, and therefore aims to integrate and transform prevailing theories to be more context-specific and –sensitive. First, the transformation of CMNEs towards being a pivotal actor in the global marketplace with increasing technological ambition is analyzed based on socio-economic and firm-level trajec-tories. After developing consistent working definitions of DI and related terms, DI is estab-lished as a strategic tool for CMNEs to improve on competitiveness. A critical review chal-lenges the prevailing academic and practical perception about the composition and potential of CMNE competitiveness with innovation as a core capability, and complements the groundwork for establishing a framework to analyze the disruptiveness potential. The frame-work itself is developed from a strategic intent perspective (SIP) and connects dynamic capa-bilities (DCs) with DI as the vehicle to achieve market disruption, to dynamically capture the parallel improvement in competitiveness of CMNEs. Last, the framework is validated and put into practice with a case study on a CMNE in the wind energy industry. In bridging innova-tion, technology and strategy research, this paper enhances the discussed around CMNE competitiveness beyond the established cost- and institutional-based advantages. The paper illustrates how CMNEs strategically utilize DI to sense and seize opportunities and develop and upgrade capabilities, which together elucidates into the potential for disruptiveness. By that, the paper not only advances disruptive theory towards competitive advantage. The ap-plied dynamic and holistic approach also aims to establish itself as a paradigm for CMNE research beyond the obvious, as well as for a more forward-looking than static view on global competitiveness by practitioners.

EducationsMSc in International Business, (Graduate Programme) Final Thesis
LanguageEnglish
Publication date2011
Number of pages99