Asian contexts and the search for general theory in management research: A rejoinder

“Asian Management Research Needs More Self-confidence” (Meyer, 2006) generated a surprisingly extended and diverse set of responses from Asia and beyond. In this rejoinder, I draw together a few lines of arguments that have emerged in that debate with the aim of moving the debate—and thus Asian management research agendas—forward. In particular, I argue that context is a crucial variable to explain management behavior, yet for practical reasons, it has been neglected in research published in top journals. Thus, I challenge management scholars in Asia and beyond to devise new research strategies to enhance our understanding of the contextual boundaries of our knowledge.

The regional character of Asian multinational enterprises

In recent issues of this Journal a debate has raged concerning the appropriate nature of academic research in the Asia Pacific region. While we support the desire for both rigor and regional relevance in this research, we wish to demonstrate a strong commonality between the performance of large Asian firms and others from Europe and North America. This prompts us to question the need for a new theory of the MNE based on the experience of Asian firms. Like their counterparts elsewhere, the large Asian firms mostly operate on an intra-regional basis. While in the literature it has been assumed that the path to success for Asian firms is globalization, we show that the data supporting this is confined to a handful of unrepresentative case studies. We also present a bibliometric analysis which shows an overwhelming case study sample selection bias in academic studies towards this small number of unrepresentative cases.

Business groups in East Asia: Post-crisis restructuring and new growth

Business groups played an important role in the economic development of East Asian countries. Yet business groups in East Asia face an uncertain future. Following the Asian Crisis, foreign creditors and investors have demanded that business groups have more transparent operations and stronger corporate governance. At the same time, as governments in East Asia have loosened trade barriers, business groups have become subject to intense competition in domestic markets. This paper argues that business groups can survive or even prosper by taking initiatives in corporate restructuring. This paper also highlights some areas for further research on business groups in this region.

Opportunities and challenges for academic returnees in China

A growing number of Western-educated management PhD graduates are starting their academic career in Chinese business schools. While opportunities are abundant for these returnees, they also face the choice between developing internationally transferable assets and building locally embedded competences. Some possible solutions are discussed, at both personal and institutional levels.

Research rankings of Asia Pacific business schools: Global versus local knowledge strategies

Despite the increasing recognition of the importance of the research mission of universities, no previous work has investigated the research productivity and research strategies of Asia Pacific business schools. This article fills this important gap by conducting the first study to rank the publication productivity of 130 Asia Pacific business schools. Drawing on data from the UTD Top 100 Business School Research Rankings™ and several additional sources, we rank Asia Pacific business schools’ research productivity in three areas: (1) twenty-four leading business journals, (2) seven top management journals, and (3) five Asia Pacific management journals. We also extend this analysis by documenting the distinct publishing strategies of various Asia Pacific business schools—global, local, or both.

Change and continuity in Japanese corporate governance

Previous studies on Japanese corporate governance were largely based on the agency theory framework, and can be seen as attempts to understand the unique monitoring mechanisms in the Japanese context. This paper briefly reviews prior research and then discusses the recent changes in the environment that have been affecting Japanese corporate governance. Our central argument is that there is both change and continuity in Japanese Corporate Governance. We also present emerging research from an institutional theory perspective. In this line of research, corporate governance is treated as part of a nation’s institutional framework and hence, researchers need to understand unique institutional arrangements that affect corporate governance practices and their change or continuity.

Unsustainable varieties of capitalism along the Thailand–Malaysia border? The role of institutional complementarities in regional development

This contribution aims to couple national institutional complementarities to issues of regional development and long-term sustainability in Southeast Asia’s non-core regions. A comparison is made of Satun in Southern Thailand and Perlis in Northern Malaysia. Based on fieldwork data, the findings reveal that Malaysian institutional complementarities result from a key role of the state, leading to potentially ineffective forms of economic activity. On the Thai side, institutional complementarities give free reign to entrepreneurs, but they are less conducive for inclusive regional development and addressing environmental concerns. Based on the case studies, findings of a more general applicability highlight two additional issues. First, balanced regional development requires a set of institutional complementarities that integrates economic growth with distributional strategies. Second, more attention should be paid to the adaptability of institutional arrangements as they may actually “lock in” regions in an unsustainable development trajectory in the long run, be it in economic, social or ecological terms.

The adolescence of Asia management research: <Emphasis Type="Italic">APJM</Emphasis>, 1997–2006

In this article we reflect on the adolescent years of Asia management research published in the Asia Pacific Journal of Management (APJM) by reviewing work published in the past 10 years (1997–2006). We report that during the last decade, APJM has published 223 research articles, written by 373 different authors, who are affiliated with 203 different institutions. Our discussion of the future of Asia management research is guided by Kuhn’s (Kuhn, T. S. The structure of scientific revolutions. Chicago: University of Chicago Press, 1962) perspective on the nonlinear progression of science. We argue that as a growing community, Asia management research is finding its “identity” and establishing its presence in the larger worldwide management research community. Following our analysis, we conclude that the growth of Asia management research—as captured by APJM publications—throughout its “adolescent” years has set forth a challenging and exciting path for the future. All authors contributed equally. We thank Mike Peng (Editor-in-Chief) for his encouragement and advice. This work was completed when Yu-Shan Su was a Fulbright visiting scholar at the University of Texas at Dallas (UTD). She thanks the Fulbright Association and the Taiwanese Ministry of Education for partially funding this work.

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Real options and MNE strategies in Asia Pacific

Asia Pacific offers a lot of promising growth opportunities, but it also presents high levels of uncertainty for multinational enterprises (MNEs). In this paper, we introduce real options theory as a theory of investment under uncertainty, and we discuss its implications for MNEs and their strategies with a focus on the emerging economies in Asia Pacific. We suggest that MNEs must recognize the various sources of uncertainty, as well as the various options embedded in their investments, and real options theory can help them structure and design their investments to benefit from uncertainty. In particular, MNEs need to develop the dynamic capabilities of managing real options in their investments to respond to the evolving economic and institutional environment in the region. This paper also provides several implications for policy makers in Asia Pacific to stimulate investment activities in the region and to help their firms venture successfully in the international market place.

Regional multinationals and the Korean cosmetics industry

This paper analyzes the market penetration and expansion strategy of cosmetics and toiletries multinational enterprises (MNEs) in South Korea from the perspective of regional strategy as developed recently by Rugman. We find that MNEs have different market entry and expansion strategies in the home region and in the foreign region. Home region MNEs (Japanese MNEs in this case), in general, utilize their firm-specific advantages (FSAs) better than foreign region MNEs (European and MNEs from the Americas in this case). Due to differences in transaction costs, home region MNEs exploit downstream FSAs while foreign region MNEs develop upstream FSAs. Market similarity also leads to a greater incentive to operate in the home region rather than in foreign regions. The home region effect significantly increases the likelihood of entry into foreign markets as the host country's “diamond” significantly affects the market entry strategies of MNEs.

Indian business groups: Evolution and transformation

Business groups are an important constituent of many emerging economies. In this paper, we focus on the evolution and transformation of Indian business groups (IBGs) over two economic eras — pre-reform era (pre 1991) and reform era (post 1991). To this end, we analyze IBG behavior during these periods, and explain the implications of such behavior on IBG value creation. Our conceptualization of IBG dynamics utilizes the perspectives of product relatedness and institutional relatedness, and undertakes a broad review of the extant literature.

Japanese horizontal keiretsu and the performance implications of membership

Our study investigates the effect of Japanese horizontal keiretsu group membership on firm risk and return. Like prior studies, our results show that horizontal keiretsu membership has a negative effect on firm profitability. However, we find that horizontal keiretsu networks are likely to increase the gap between targeted and realized returns, which we call the outcome–aspiration gap. Moreover, in contrast to prior studies, our results indicate that keiretsu membership does not enable member firms to reduce risks by smoothing profitability. Instead, our findings provide evidence that is counter to the conventional notion that Japanese horizontal keiretsu allows their member firms to trade off profits for reduced risk.

Social capital and cross-selling within financial holding companies in an emerging economy

Social capital is the goodwill available to individuals or groups from their network of relationships. It is widely believed that social capital is useful in facilitating and governing hazardous transactions. But how social capital, in the context of a financial holding company (FHC), actually facilitates cross-selling is unknown, especially in an emerging economy. This article maintains that effective cross-selling requires an FHC to first access and accumulate comprehensive and tacit customer-specific knowledge (the “where from” condition) and then share and leverage this knowledge to other applicable business opportunities (the “where to” condition). The role of social capital and embedded ties is found to be critical to this process. Finally, we argue that the major route for the effective cross-selling within an FHC is from the commercial banking division to the underwriting division. Hypotheses are tested on the transactional data collected from Taiwan, and empirical results provide broad support for our arguments.

National and corporate culture differences in international strategic alliances: Perceptions of Chinese partners

We consider the effect of national culture and corporate culture differences on the management of international strategic alliances (ISAs). Findings are based on the perceptions of a relatively large sample of Chinese partner firms in ISAs with foreign partners. We find that differences in national culture and corporate culture have contributed to a similar extent to differing views on ISA management. However, findings indicate that differences in national culture and corporate culture have a differential impact on aspects of ISA management. Perception of national culture and corporate culture differences and the contribution of those differences to differing views on the management of ISAs are greater in relatively younger ISAs compared with older ISAs. Managers in equity-based ISAs report fewer problems with culture related impediments to managing ISAs than managers in non-equity-based ISAs.

The development of entrepreneurship in China

In this paper, we provide an overview of the extant research on the development of entrepreneurship in China. This research focus is a relatively recent phenomenon since China’s market transition started from late 1978. We review the literature over the 26 years from 1980 through 2005, as published in 11 leading English-language academic journals. We identify 68 articles from this review and analyze them based on the research subjects, methods, and firm types. From this review, and integrating with research on market transitions, we propose a three-stage model of market transitions that has important implications for entrepreneurship research in transition economies.

Asia’s national innovation systems: Institutional adaptability and rigidity in the face of global innovation challenges

This paper explores several features of, and changes in, innovation capacity in Asia. The growth of technology-based industries has been a critically important element of Asian industrial development and has required extensive institutional support for the diffusion of innovation and technological learning. As a number of Asian countries reach the global technological frontier they need to develop new capabilities for creating “radical” innovations in order to sustain their international competitiveness. Using the analytical frameworks of national innovation systems and varieties of capitalism, the paper reviews some systemic and environmental factors encouraging and constraining these developments. By referring to illustrative case studies of institutional evolution within Taiwan’s national innovation system and technological entrepreneurship in Korea, the paper argues that whilst there are major developments in models of innovation support, emulating those found in liberal market economies, enduring cultural legacies can remain influential. It highlights the central importance of social as well as economic institutional adaptation. Some management and policy implications of this attribute are considered, and a future research agenda is proposed.

Does Asian management research need more self-confidence? Reflections from Russia

This commentary on Klaus Meyer’s article, “Asian Management Research Needs More Self-confidence,” in the Asia Pacific Journal of Management (2006), discusses the need for Asian management research to look beyond the pressures for publication in top-tier, Western scholarly academic journals. We reflect on our nearly two decades of research on Russian management to illustrate many of Meyer’s ideas and insights in a different transition economy. We support his call for more context-specific research that can also offer contributions to global management knowledge as well as indigenous management practice.

Economic and strategic considerations surrounding Chinese FDI in the United States

The growth of outward investment from China has generated expressions of concern from policymakers in the United States regarding the economic and national security impacts of such investments. While inward foreign direct investment (FDI) has come to be viewed by most observers as generally imparting net economic benefits to the host economy, acquisitions of US companies by Chinese multinational companies (MNCs) have been criticized on several grounds. One is based on the mode of entry itself: some critics believe that entry by acquisition brings lower benefits than greenfield entry. A second and more prominent concern is that acquisitions of US companies by Chinese state-owned enterprises (SOEs) may be motivated by non-commercial objectives which, in turn, make those acquisitions of questionable value to the host economy. In this paper, we argue that Chinese FDI in the United States is more likely to take the form of acquisitions than greenfield investments for the foreseeable future. However, there is no strong case to be made that the host country economic benefits from Chinese FDI would be larger if entry took place primarily through greenfield investments. Furthermore, most of the alleged costs to the US economy from inward FDI from China are either unlikely to occur or are already anticipated by existing US laws and regulations, thus necessitating no additional, specific legislation.

Adoption of professional management in Chinese family business: A multilevel analysis of impetuses and impediments

Building upon the market, institutional, and cultural perspectives, this paper identifies the major impetuses and impediments that affect the professionalization of Chinese family business at the environment, firm, and owner levels. Our integrative framework projects that whether a family business owner will adopt professional managers is largely determined by the relative strength of impetus factors and impediment factors. We then discuss the possible governance choices under different configuration of impetuses and impediments. This theoretical framework is expected to help set the momentum for further conceptual exploration and empirical study in this area.