An overview of the management consulting firms of the Spanish company in China: company profile and success and failure factors
This article explores the vision of Management Consulting Firms (MCF) specialized in internationalization processes of Spanish companies in China. The main objective is to shed light on a process full of uncertainty as is international expansion into emerging markets on the point of view of the advisors of that process.
First, it is analyzed whether there is a Spanish company profile that is internationalized toward China in terms of sector of activity, size and experience in international business. And second, with their client’s experiences, success and failure factors in the internationalization process are studied.
To achieve those objectives in depth interviews were held with partners and managers of six Management Consulting Firms with Spanish clients in their portfolio.
As a result it is concluded that the sectors where the Spanish company has invested are several, the size of the company is important to undertake an implementation process in China and its international experience as well.
Eight key factors were found relevant to invest in China successfully. Five factors are related with their resources (humans and financials) and the other three are related with their strategy. The main reasons of failure are also discussed.
The article provides an outside perspective on the reasons why an internationalization process is successful and other fails.
Boisot, M., and Meyer, M. W. (2008). Which Way through the Open Door? Reflections on the Internationalization of Chinese Firms. Management and Organization Review, 4(3), 349–365. http://doi.org/10.1111/j.1740-8784.2008.00116.x
Brenes, E. R., Mena, M., and Molina, G. E. (2008). Key success factors for strategy implementation in Latin America. Journal of Business Research, 61(6), 590–598. http://doi.org/10.1016/j.jbusres.2007.06.033
Buckley, P. J., and Casson, M. C. (1976). The Future of the Multinational Enterprise (p. 132). New York: Holmes & Meier. http://dx.doi.org/10.1007/978-1-349-02899-3
Caves, R. . (1996). Multinational Enterprise and Economic Analysis (2nd edition, p. 322). Cambridge Univertisty Press.
Chen, C.-H. (1996). Regional determinants of foreign direct investment in mainland China. Journal of Economic Studies, 23(2), 18–30. http://doi.org/10.1108/01443589610109649
Chen, C.-I., and Yeh, C.-H. (2012). Re-examining location antecedents and pace of foreign direct investment: Evidence from Taiwanese investments in China. Journal of Business Research, 65(8), 1171–1178. http://doi.org/10.1016/j.jbusres.2011.07.032
Chetty, S., and Blankenburg Holm, D. (2000). Internationalisation of small to medium-sized manufacturing firms: a network approach. International Business Review, 9(1), 77–93. http://doi.org/10.1016/S0969-5931(99)00030-X
Claver, E., Quer, D., and Molina, J. F. (2005). Inversión directa en el exterior : evidencia empírica de las empresas españolas en China. Revista Española de Dirección Y Economía de La Empresa, 14, 25–42.
Cremer, R. D., and Ramasamy, B. (2009). Engaging China: strategies for the small internationalizing firm. Journal of Business Strategy, 30(6), 15–26. http://doi.org/10.1108/02756660911003086
Cui, G., and Liu, Q. (2000). Regional market segments of China: opportunities and barriers in a big emerging market. Journal of Consumer Marketing, 17(1), 55–72. http://doi.org/10.1108/07363760010309546
Dean, D. L., Mengüç, B., and Myers, C. P. (2000). Revisiting Firm Characteristics, Strategy, and Export Performance Relationship: A survey of the Literature and an Investigation of New Zealand Small Manufacturing Firms. Industrial Marketing Management, 29, 461–477. http://doi.org/10.1016/S0019-8501(99)00085-1
Dunning, J.. (1988). The eclectic paradigm of international production: a restatement and some possible extensions. Journal of International Business Studies, (19), 1–31. http://dx.doi.org/10.1057/palgrave.jibs.8490372
Eisenhardt, K. M. (1989). Building Theories from Case Study Research. Academy of Management Review, 14(4), 532–550. http://doi.org/10.2307/258557
Enderwick, P. (2009). Large emerging markets (LEMs) and international strategy. International Marketing Review, 26(1), 7–16. http://doi.org/10.1108/02651330910933177
Figueira-de-Lemos, F., Johanson, J., and Vahlne, J. E. (2011). Risk management in the internationalization process of the firm: A note on the Uppsala model. Journal of World Business, 46(2), 143–153. http://doi.org/10.1016/j.jwb.2010.05.008
Forlani, D., Parthasarathy, M., and Keaveney, S. M. (2008). Managerial risk perceptions of international entry-mode strategies: The interaction effect of control and capability. International Marketing Review, 25(3), 292–311. http://doi.org/10.1108/ 02651330810877225
Freeman, S., and Sandwell, M. (2008). Professional service firms entering emerging markets: the role of network relationships. Journal of Services Marketing, 22(3), 198–212. http://doi.org/10.1108/08876040810871165
Galán, J. I., and González-Benito, J. (2001). Determinant factors of foreign direct investment : some empirical evidence. European Business Review, 13(5), 269–278. http://dx.doi.org/10.1108/EUM0000000005795
Gao, H., Knight, J. G., and Ballantyne, D. (2012). Guanxi as a gateway in Chinese-Western business relationships. Journal of Business & Industrial Marketing, 27(6), 456–467. http://doi.org/10.1108/08858621211251460
Glaister, K. W., and Wang, Y. (1993). UK joint ventures in China: motivation and partner selection. Marketing Intelligence & Planning, 11(2), 9–15. http://doi.org/ 10.1108/02634509310027855
Glückler, J. (2006). A relational assessment of international market entry in management consulting. Journal of Economic Geography, 6, 369–393. http://doi.org/10.1093/jeg/lbi016
Hosseini, M., and Dadfar, H. (2012). Network-based theories and internationalization of firms : applications to empirical studies. The Business & Management Review, 3(1), 182–191.
Hu, M. Y., and Chen, H. (1996). An empirical analysis of factors explaining foreign joint venture performance in China. Journal of Business Research, 35(2), 165–173. http://doi.org/10.1016/0148-2963(95)00087-9
Hymer, S. H. (1976). The international operations of national firms: A study of direct foreign investment (pp. 139–155). MLT Press.
Johanson, J., and Vahlne, J.-E. (1977). The internationalization process of the firm - a model of knowledge development and increasing foreign market commitments. Journal of International Business Studies, 8(1), 23–32. http://dx.doi.org/10.1057/palgrave.jibs.8490676
Johanson, J., and Wiedersheim-Paul, F. (1975). The internationalization of the firm - four swedish cases. The Journal of Management Studies, 12(3), 305–323. http://dx.doi.org/10.1111/j.1467-6486.1975.tb00514.x
Kindleberger, C. P. (1969). American Business Abroad. The International Executive, 11(2), 11–12. http://dx.doi.org/10.1002/tie.5060110207
Kyläheiko, K., Jantunen, A., Puumalainen, K., Saarenketo, S., and Tuppura, A. (2011). Innovation and internationalization as growth strategies: The role of technological capabilities and appropriability. International Business Review, 20(5), 508–520. http://doi.org/10.1016/j.ibusrev.2010.09.004
Lin, F.-J. (2010). The determinants of foreign direct investment in China: The case of Taiwanese firms in the IT industry. Journal of Business Research, 63(5), 479–485. http://doi.org/10.1016/j.jbusres.2009.04.005
Liu, X., and Wu, X. (2011). Technology embeddedness, innovation differentiation strategies and firm performance: Evidence from Chinese firms. Innovation: Management, Policy & Practice, 13(1), 20–35. http://dx.doi.org/10.5172/impp.2011.13.1.20
Lu, J. W., and Beamish, P. W. (2001). The internationalization and performance of SMEs. Strategic Management Journal, 22(6-7), 565–586. http://doi.org/10.1002/smj.184
Luo, Y. (1997). Does guanxi influence firm performance. Asia Pacific Journal of Management, 14, 1–16. http://dx.doi.org/10.1023/A:1015401928005
Luo, Y. (1998). Joint Venture Success in China : How Should We Select a Good. Journal of World Business, 33(2), 145–166. http://dx.doi.org/10.1016/S1090-9516(99)80068-6
Moreira, M. R. ., Maia, M. A. ., Sousa, P. S. ., and Meneses, R. F. C. (2013). Factors influencing the internationalization of services firms: The case of design, engineering and architecture consulting firms. Lecture Notes in Business Information Processing, 143, 246–262. http://doi.org/10.1007/978-3-642-36356-6_18
Moyano Vázquez, G. (2009). Presencia empresarial española en china. Boletín Económico Del ICE, (2972), 119–129.
Nair, A. S., and Stafford, E. R. (1998). Strategic alliances in China: Negotiating the barriers. Long Range Planning, 31(1), 139–146. http://doi.org/10.1016/S0024-6301(97)00100-3
Nielsen, B. B., and Nielsen, S. (2011). The role of top management team international orientation in international strategic decision-making: The choice of foreign entry mode. Journal of World Business, 46(2), 185–193. http://doi.org/10.1016/j.jwb.2010.05.003
Pagnattaro, M. A. (2012). Preventing know-how from walking out the door in China: Protection of trade secrets. Business Horizons, 55(4), 329–337. http://doi.org/10.1016/ j.bushor.2012.02.003
Pedersen, T., and Pedersen, B. (2004). Learning about foreign markets: Are entrant firms exposed to a “‘shock effect’”? Journal of International Marketing, 12(1), 103–123. http://dx.doi.org/10.1509/jimk.188.8.131.52648
Poulfelt, F., Smith, I. S., and Christensen, K. G. (2014). When West Meets East – the Case of a Scandinavian Consulting Firm ’ s Entry in India. European J. International Management, 8(4), 373–391. http://doi.org/10.1504/EJIM.2014.062964
Reuber, A. R., and Fischer, E. (1997). The Influence of the Management Team’s International Experience on the Internationalization Behaviors of SMES. Journal of International Business Studies, 28(October 1996), 807–825. http://dx.doi.org/10.1057/palgrave.jibs.8490120
Reynolds, P. D. (1997). New and Small Firms in Expanding Markets. Small Business Economics, 9, 79–84. http://dx.doi.org/10.1023/A:1007916217140
Sakarya, S., Eckman, M., and Hyllegard, K. H. (2007). Market selection for international expansion: Assessing opportunities in emerging markets. International Marketing Review, 24(2), 208–238. http://doi.org/10.1108/02651330710741820
Sapienza, H., Autio, E., George, G., and Zahra, S. (2006). A capabilities perspective on the effects of early internationalization on firm survival and growth. Academy of Management Review, 31(4), 914–933. http://dx.doi.org/10.5465/AMR.2006.22527465
The WorldBank. (2013). Foreign Direct Invesment, net inflows. Retrieved January 28, 2015, from http://data.worldbank.org/indicator/BX.KLT.DINV.CD.WD?order=wbapi_data_ value_2013+wbapi_data_value+wbapi_data_value-last&sort=desc
Tihanyi, L., Ellstrand, A. E., Daily, C. M., and Dalton, D. R. (2000). Composition of the Top Management Team and Firm International Diversification. Journal of Management, 26(6), 1157–1177. http://doi.org/10.1177/014920630002600605
Todo, Y. (2011). Quantitative Evaluation of the Determinants of Export and FDI: Firm-level Evidence from Japan. World Economy, 34, 355–381. http://doi.org/10.1111/j.1467-9701.2011.01331.x
Tsang, E. W. . (1998). Can guanxi be a source of sustained competitive advantage for doing business in China? The Academy of Management Executive (1993-2005), 12(2), 64–73.
Tung, R. L., and Worm, V. (2001). Network capitalism: the role of human resources in penetrating the China market. The International Journal of Human Resource Management, 12(4), 517–534. http://doi.org/10.1080/713769653
Van Praag, C. M. (2003). Business Survival and Success of Young Small Business Owners. Small Business Economics, 21(1), 1–17. http://doi.org/10.1023/A:1024453200297
Wagner, J. (1995). Exports, firm size, and firm dynamics. Small Business Economics, 7(1), 29–39. http://dx.doi.org/10.1007/BF01074314
Wang, H., and Guo, K. (2011). An Empirical Study on Factors Influencing Foreign Direct Investment to China. In Service Systems and Service Management (ICSSSM). http://dx.doi.org/10.1109/icsssm.2011.5959451
Wigley, S. M., Moore, C. M., and Birtwistle, G. (2005). Product and brand: Critical success factors in the internationalisation of a fashion retailer. International Journal of Retail & Distribution Management, 33(7), 531–544. http://doi.org/10.1108/09590550510605596
Yang, J., and Lee, H. (2002). Identifying key factors for successful joint venture in China. Industrial Management & Data Systems, 102(2), 98–109. http://doi.org/10.1108/ 02635570210419645
Yin, R. K. (1981). The Case Study Crisis: Some Answers. Administrative Science Quarterly, 26(1), 58–65. http://dx.doi.org/10.2307/2392599
Yin, R. K. (1984). Case Study Research: Design And Methods (Applied Social Research Methods) (p. 171). Sage Publications.
Zeng, S., Xie, X. ., Tam, C. ., and Wan, T. . (2009). Relationships between business factors and performance in internationalization: An empirical study in China. Management Decision, 47(2), 308–329. http://doi.org/10.1108/00251740910938939
Zutshi, R. K., and Tan, W. L. (2009). Impact of culture on “ partner selection criteria ” in East Asian international joint ventures. International Entrepreneurship and Management Journal, 5, 369–393. http://doi.org/10.1007/s11365-008-0076-1
Metrics powered by PLOS ALM
This journal is distributed under a Creative Commons Attribution-NonCommercial-NonDerivs 4.0 Internacional License.
Universitat Politècnica de València