Entry modes and barriers to internationalisation in China: An overview of management consulting firms

Niñerola, Angels; Sànchez-Rebull, Ma. Victòria; Hernández-Lara, Ana B.

Abstract:

Purpose The purpose of the paper is to analyse the entry mode choice of the Spanish companies in China, the factors that influence it and the barriers that they found. Design/methodology/approach A qualitative approach is used by interviewing the partners of management consulting firms (MCFs) specialised in internationalisation processes in China. Findings The decision on the entry mode choice depends on whether the firm has incentives for investment with a partner rather than the size or the international experience of the board and the top managers. The barriers faced by Spanish companies in China are related to legal issues, bureaucracy, culture, language, trust and human resources. Practical implications Companies must have a differential factor to succeed in China and use a legal form that lets them to protect this advantage regardless of the entry form chosen. MCFs pointed out the need to collaborate with local people and to rely on a management team capable of overcoming the barriers. Originality/value One of the major contributions of this study is the methodology, as the view of the consultants in the internationalisation process of companies had not been studied before.

Year:

2017

Type of Publication:

Article

Keywords:

Internationalization; Entry modes; Foreign direct investment; Entry barriers; Chinese market; Management consulting firms; F21; F23; M16

Journal:

Measuring Business Excellence

Volume:

21

Number:

1

Pages:

37-49

ISSN:

1368-3047

DOI:

https://doi.org/10.1108/MBE-04-2016-0022