Comparing Chinese and the Indian Software MNCs: Domestic and Export Market Strategies and Their Interplay

China and India are emerging as major new entrants in the international software industry. Both are rapidly learning through outsourcing with multinational enterprises from advanced nations. Yet, their paths to this dynamic sector are very different. Chinese software firms have focused on their domestic market by working with foreign MNCs, while they move cautiously abroad. Indian firms, despite already being large, continue to expand overseas as well as to climb the value chain. We show that a macro perspective on the global movement of work can be gained by utilizing concepts from different approaches to the MNC. At the same time, the innovation systems perspective is necessary to explain the foundations of the industry. The paper provides hypotheses and performs an initial validation of them. It concludes that the internationalization and learning processes are somewhat different in the Chinese and Indian MNCs, and provides explanations for the different patterns.outsourcing, software industry, industrial development, MNCs, MNEs, multinational enterprise, China, India

Energy service companies in China: The role of social networks and trust

China's energy-service companies (ESCOs) have developed only modestly despite favorable political and market conditions. We argue that with sophisticated market institutions still evolving in China, trust-based relations between ESCOs and energy customers are essential for successful implementation of energy efficiency projects. Chinese ESCOs, who are predominantly small and private enterprises, perform poorly in terms of trust-building because they are disembedded from local business, social, and political networks. We conclude that in the current institutional setting, the ESCO model based on market relations has serious limitations and is unlikely to lead to large-scale implementation of energy efficiency projects in China. --energy policies,energy service companies (ESCO),social networks,trust,China

THE DEVELOPMENT OF TRANSFORMATION AMBIDEXTERITY: A COMPARATIVE STUDY OF FOUR LEADING IT ORGANIZATIONS

Successful IT organizations are ones that can constantly transform themselves to adapt to the changing environment. Unlike the punctuated change in traditional organizations’ transformation, IT organizations’ transformation is often a continuous change where the existing and the new business coexist. The ability to simultaneous exploit the existing business while exploring the new business during organizational transformation, which we term transformation ambidexterity, has proven to a key success factor. This study intends to explore how IT organizations develop transformation ambidexterity. We conduct a comparative case study of four leading IT organizations that have just gone through a successful transformation and unveil four development approaches, namely partition, hybridization, self-extension, and self-generation. These four approaches are based on two primary dimensions of ambidexterity development: 1) development mechanism and 2) development path. We conclude with theoretical contributions to IS, organizational transformation and ambidexterity literature and with guidelines for IT and general managers to redeploy appropriate mechanisms and follow appropriate path for ambidexterity

The work of financialisation: an ethnography of a global management consultancy in post-Mao China

This thesis examines and exposes the work of one of the most enigmatic of capitalist institutions – the management consultancy – as that of financialisation. In recent decades financial markets have played an increasingly important role in the operations of the global economy, which has led to fundamental changes to managerial practices of the modern corporation. In particular, many authors, from a variety of disciplines within social sciences, have discussed the ascendancy of shareholder value as the ideology of corporate governance. But what is rarely examined is how shareholder value has been disseminated and installed as a corporate good. At the same time, there continues to be widespread ignorance about one of the major proponents of shareholder value – management consultancies. In short, we still do not know what consultancies do. I attempt to address this lacuna by examining how management is practised within management consultancy. Through an ethnography based on 16 months of fieldwork inside one of the world’s largest management consultancies, I show that shareholder value is an ethic of production which has to be made through a set of sociotechnical practices which are deployed in the pursuit of an ontological transformation – the enactment of the corporation as a financial asset. I highlight the importance of information technology (IT) in this endeavour, specifically, how it is incorporated in managerial techniques of “corporate culture”, which attempt to not only orientate employees towards the “needs” of financial markets, but also constructs them as financial objects. The work of consultancies is to establish the practice of managing labour as financial capital. This thesis draws on analytical approaches from science and technology studies to examine complex managerial systems and how they operate to produce an ethics of capitalism; it contributes to existing anthropological scholarship on the “new economy”, financial markets, corporate subjectivities and theories of value, and provides a novel example of how “fast capitalism” can be captured, ethnographically, through a methodology of collaboration

Global and regional sourcing of ICT-enabled business services: upgrading of China, Hong Kong and Singapore along the global value chain

Offshoring, as part of globalisation, first started decades ago with manufacturing processes disintegrated along the global value chain and dramatically redistributed to low-cost regions. The next global shift of work involving ICT-enabled business services has arisen since the 1990s, especially featuring the success of India’s supplier role. The possibilities for the Global South to move up the value ladder are well demonstrated by the achievements of the newly industrialised economies in East Asia in the first shift and of India in the second. In the services sector, however, potential for upgrading is conditioned by quality-based elements, such as trust, culture and language, which vary both between producing and market areas. Flows are increasingly multi-directional, requiring attention to the neglected issue of demands from fast-growing Southern economies. So how do locations and firms in the Global South attempt to upgrade in the regime of rising services offshoring? The Indian experience especially in serving Anglophone markets in the Global North has been widely documented – but not that of East Asian economies, with their distinct characteristics and strong historic, ethnic and cultural ties with each other. This study examines the upgrading possibilities and constraints of China, Hong Kong and Singapore along the global services chain. For cross-case analysis, it focuses on three specific sets of services, including information technology, finance and accounting, and customer contact services. The concepts of global value chain, competitive advantage and capabilities are applied to reconstruct the phenomenon of services offshoring from both the demand and supply perspectives in the selected locations, and synthesise the dynamics between locational characteristics and firm strategies. A series of distinct upgrading strategies are identified, involving mixes of manufacturisation, knowledge-intensification and deepening relational capabilities to exploit both regional advantages of language/cultural proximity and established global links

The emergence of markets and capabilities, dynamic transaction costs and institutions: effects on organizational choices in offshored and outsourced business services in China

This paper has three aims: 1) to use Langlois’ framework of dynamic transaction costs to illustrate the coevolution of firm capabilities and the emergence of new markets for offshored and outsourced business services in China; 2) to use Coase’s institutional structure of production framework to analyse the influence of Chinese institutions on the organizational choices made in the offshoring and outsourcing of business services in China and 3) to link the two themes and understand the interaction between Chinese institutions and the emergence of markets and capabilities in business services in China. We use case studies and interview data to look at these issues.offshoring, China, business services, institutions, dynamic transactions costs

Contextual factors, knowledge processes and performance in global sourcing of IT services: An investigation in China

Copyright @ 2011, IGI Global. Copying or distributing in print or electronic forms without written permission of IGI Global is prohibited. Reuse of this article has been approved by the publisher.In this paper, the authors explore the influences of two major contextual factors—supplier team members’ cultural understanding and trust relationship—on knowledge processes and performance in global sourcing of IT services. The authors discuss a joint investigation conducted by a cross-cultural research team in China. Cultural understanding is measured by individualism with guanxi and mianzi, two Chinese cultural concepts, and trust relationship is measured by adjusting trust, a notion reflecting the uniqueness of the Chinese people. Knowledge processes are characterized by knowledge sharing. Performance is measured by the outcomes of global sourcing, which is represented by product success and personal satisfaction. Data are collected in 13 companies in Xi’an Software Park, with 200 structured questionnaires distributed to knowledge workers. The results of quantitative data analysis indicate that cultural understanding influences trust relationship greatly, as well as knowledge sharing and performance in global sourcing of IT services. Trust relationship significantly impacts knowledge sharing, whereas trust relationship and knowledge sharing have no impact on performance. This study suggests that special aspects of the Chinese context have significant direct impacts on knowledge processes while no direct and immediate impacts on performance in global sourcing of IT services.National Natural Science Foundation of China, Program for Humanity and Social Science Research, Program for New Century Excellent Talents in University in China and Brunel University's Research Development Fund

A macroeconomic perspective on the rise of second-tier cities in the national and globalizing context of China

Since China’s economic reforms in the late 1970s, foreign investments have initially flooded the so-called “first-tier cities” including Shanghai, Beijing, or even Shenzhen or Guangzhou. Due to rising labour costs, growing constraints over natural resources, long-term inflation and environmental issues among others (Zhuang et al. 2012; Zuojun, 2012), they have been undertaking structural economic adjustments in order to shift from a “late-developing advantage” to a “first-mover advantage” model. This requires concentrating resources on modern services industry, strategic emerging industries and entrepreneurship rather than relying on foreign investments for technology, management skills and know-how (Liu, 2015). This process of economic restructuring and upgrading has initiated industrial relocation into the hinterland. As a consequence, several cities have emerged as new engines of economic growth in the past decade: Many second-tier cities have several millions inhabitants, the most performing achieved above 15% economic growth over the past decade, and many of them have been benefiting from massive public investments and preferential policies in order to accelerate their development path (China Briefing, 2010). Yet, the definition of a second-tier city is highly contextual and rather depends on the geographical scale we look at it. Therefore, this innovative research paper proposes to study the rise of second-tier cites in the national and globalizing context of China. In the national context, we undertake a comparative macroeconomic analysis between first-tier and second-tier cities in order to understand if the general environment is conducive to business investments. In the globalizing context, we focus our attention on the rise of secondary cities in Yangtze River Delta, a large emerging global city-region. More precisely, we study how Shanghai has become an urban vector for FDI into secondary cities, and thus stimulating their economic development by promoting industrial restructuring, upgrading and relocation. Ultimately, we conclude that the socio-economic development of second-tier cities are led by the first-tier city, which together benefit the overall sustainable development of China. In such a fast-changing and highly competitive business environment, second-tier cities shall be fully integrated to the strategic expansion plan of companies operating in China. Whether to achieve competiveness and cost optimization to better serve international markets or to increase revenue by supplying goods or services to Chinese consumers, decision makers shall take active anticipation and think ahead, so that the company can stand out in the market very rapidly