Why Not China? : a study of organizational features behind Swedish SMEs' internationalization towards China

• Main Authors: Bashir, Salman, Sarakinis, Mikael
• Format: Others
• Language: English
• Published: Högskolan Kristianstad, Sektionen för Hälsa och Samhälle 2011
• Subjects: Swedish SMEs; China; Move of production; Drivers; Core strategies; Organizational features; SOCIAL SCIENCES; SAMHÄLLSVETENSKAP; Business and economics; Ekonomi
• Online Access: http://urn.kb.se/resolve?urn=urn:nbn:se:hkr:diva-8193

In today’s global market, China attracts great attention due to its rapid growing economy. Organizations from different countries take advantage of this, and move production to China. The noteworthy aspect of this situation is that most of these companies are Multi National Enterprises. These MNEs are aggressive in their expansion due to possession of major capabilities and possibilities to confront barriers and take economic risks. However, there are smaller companies with fewer resources that are more limited and choose not to move production to China. What drives these companies to bypass the well documented advantages with a production process in there? This research aims to fill that gap. This deductive research is based on Swedish SMEs that have been inquired to rank the most influential drivers behind their decision to move or not to move production to China. The investigation is conducted quantitatively by a survey. Another aspect of the survey which strengthens the result is the core strategies of the SMEs, which are asked to be ranked in order to reveal the most dominant one. The results analysis signifies that the key-drivers and the core strategy together influence the decision, to either move or not to move. However, the generalizability is negatively affected by the low level of participants. Therefore, in-depth analysis has been conducted, which highlights that the results do reveal a connection between the drivers and the core strategy and how they influence the decision. This research reveals the most influential processes for Swedish SMEs, which can further be considered by other SMEs that are in the process of making a decision to move or not to move production to China.