chinese strategic alliances

228 Pages·2007·2.4 MB·English

FACTORS INFLUENCING THE SUCCESS OF
VIRTUAL COOPERATION WITHIN
DUTCH - CHINESE STRATEGIC ALLIANCES
DISSERTATION
to obtain
the doctor’s degree at the University of Twente,
on the authority of the Rector Magnificus,
prof. dr. W.H.M. Zijm,
on account of the decision of the graduation committee,
to be publicly defended
on November 14, 2007 at 16.45.
by
Yi Wei
born on 31 January 1970
in Hubei, China
I
This dissertation is approved by:
Promotors: Prof.Dr.Ir. E.J. de Bruijn
Prof.Dr. R.A. Stegwee
Assistant promotor: Dr.Ir. S.J. de Boer
II
Promotion Committee:
Chairman: Prof.Dr. P.J.J.M. van Loon University of Twente
Secretary: Prof.Dr. P.J.J.M. van Loon University of Twente
Promotor: Prof.Dr.Ir. E. J. de Bruijn University of Twente
Prof.Dr. R.A. Stegwee University of Twente
Members: Dr.Ir. S.J. de Boer University of Twente
Prof. Dr. J.C. van Dalen University of Wageningen
Prof.Dr.Ir. O.A.M. Fisscher University of Twente
Prof.Dr. A.J. Groen University of Twente
Prof.Ir. R. Pieper University of Twente
Prof.Dr. H.E. Roosendaal University of Twente
Dr. D.A. Wassenaar University of Twente
III
IV
“I dedicate this book to my family”
V
Yi Wei
FACTORS INFLUENCING THE SUCCESS OF VIRTUAL COOPERATION
WITHIN DUTCH - CHINESE STRATEGIC ALLIANCES
Ph.D. Thesis University of Twente, Enschede. – With ref.
ISBN 90-365-2162-9.

English correction: Giles Stacey, Englishworks, Hengelo, the Netherlands
Printed and bound: PrintPartners IPSKAMP, Enschede, the Netherlands
Cover design: Haibing Gao, Dalian, China
Cover modification: Shaoqiang Qin, Amsterdam, the Netherlands
Copyright © 2007 Yi Wei
All rights reserved. Subject to exceptions provided by law, no part of this publication
may be reproduced, stored in a retrieval system, or transmitted in any form by any
means, electronic, mechanical, photocopying, recording or otherwise, without the
written consent of the copyright holder. Request for permission should be direct to
the author at:
E-mail: [email protected]
VI
Acknowledgements
Studying and working in the Netherlands, after 27 years in China, was, for me, quite
an adventure: jumping into a totally new environment with different people, a
different culture, different nature and different views. This thesis would not have been
possible without the active assistance and support of many people over the past six
years. I would like to take this opportunity to thank individually all those who have
assisted and helped me in one way or another during this research project.
Foremost, I would like to express my gratitude to Prof. E. J. de Bruijn, as my
first promoter. Since being the chairman of my MBA graduation committee in 1998,
he has guided and supported me for more than seven years, and I must say that I have
learned a lot from him. Without his help, this dissertation would not have been written.
I would like to convey my special thanks to Prof. R. A. Stegwee for being my
second promoter. Once his job changed it must have been very difficult for him to
divide his time and attention among all his students, but he has proved his
commitment to this research. Without his contribution, this thesis could not been
concluded.
My greatest personal, as well as intellectual, debt is to Dr. S. J. de Boer, as my
daily supervisor. He has also guided and supported me for more than seven years
since my master study. Not only as my academic supervisor, but also as the advisor of
ACSS-Twente (association of Chinese students and scholars) which has given a lot of
Chinese students and scholars great help. He is the person who has taken care of many
details - not only the research, but also in my life and social activities. One area
deserves a special mention: my English writing skills. He had spent a lot of time
helping me to improve not only the structure, but also the sentences and the words.
From the beginning, when almost every sentence needed to be rewritten until ‘only
minor changes needed to be made’ at the end, he has invested great effort and time in
my study. When I lost confidence in my ability to finish this research, he was the one
who always gave me a hand to solve the problems and overcome the barriers, and ‘yes,
we can make it’ has always been the motivation in completing this research.
Special thanks also go to Dr. D. A. Wassenaar, who was also my supervisor
before his retirement. The idea of narrowing the research scope from a very broad
range at the beginning to the final one focusing on virtual alliances was mainly his
idea. His comments, while always critical, were very knowledgeable and useful.
Many thanks also go to my committee members, Prof. P.J.J.M van Loon, Prof.
J.C. van Dalen, Prof. O.A.M. Fisscher, Prof. H. E. Roosendaal, Prof. A.J. Groen and
Prof. R. Pieper, for providing many valuable comments and suggestions, and also
giving their time to read the final draft of the thesis and serve on the committee.
I would particularly like to thank students Claudia and Johan, and Dennis and
Allard: contributing to my research while completing their master studies, they all
have made great contributions to my thesis. These included selecting and contacting
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target companies for case studies and field study in the Netherlands and in China.
Thank you all, without your valuable input, this thesis would not have been finalized.
Having worked in the Technology and Development Group for six years,
many colleagues in this group have provided valuable inputs, feedback and support to
my research. Therefore, I would like to thank Stephan, Julia, Annemiek, Bas, Martin,
Rob, Dradjat, Alugoro, Reza, Rajesri, Merlyn, Thongchai, Shirish and many others
who though I do not mention all their names here this does not mean that they are any
less appreciated and valued.
Being away from my family in China has not been easy. Fortunately, I have
friends who have always made it easier. Two families He Yizhi and Zhao Xiaoquan,
and Zhu Jianjun and Feng Lei I need to mention first. They have taken care of my son
when I had to travel and work away from Enschede for several months. My friends
Song Chunlin and Zhang Yelei have done the same. I feel really in debt to them. I
also want to thank my friends Feng Chuanliang and Guhua, Ye Mao and Cheng
Jiahua, Wu Jian and Wang Yu, Ran Shen and Tan Yanshu, Chen Wei and Hu Wenbin,
Wang Xin, Yu Jing, and many others who have brought a lot of fun and happiness to
me and to my family here. My special thanks also go to Ms. Jia Tian, Ms. Haibing
Gao, and Mr. Shaoqiang Qin, who have spent much time helping me with editing this
thesis and designing (modifying) the cover using their intensive IT knowledge.
I dedicate this thesis to my family, firstly to my dear parents. They have put all
their time and energy into their beloved son. In order to make their son’s study and
life abroad easier, they took on their son’s responsibility and cared for their grandson
for nine years without complaint. Rather, they said “your son makes us feel that our
son is always with us”. In 2000, when my deeply loved grandfather was ill in hospital,
they even refused to inform me until my grandfather’s funeral because they were
afraid that I would go back immediately and my study would be affected. Now that I
have brought my son here to be with me, my parents still do whatever they can if I
have any difficulties at work and in life and are there if I need them. To such great
parents, I can say nothing but express my guilt. Becoming a scientist was the target
they set for me. While I have not followed the path they planned, I hope that gaining a
PhD degree will fulfill their dreams to some extent. Seeing their hair becoming white,
I just pray that God gives me the chance and the time to return to my parents.
Finally, I must express my deepest and special gratitude to my patient, highly
committed and tolerant wife Haiming who had really supported me in concluding this
dissertation. Haiming, you will always be my inspiration and source of energy to do
my work and to enjoy the beautiful life. In addition, the expectation of our baby also
brings me even more hope and happiness.

VIII
SUMMARY
With the globalization wave taking place, companies are increasingly seeking
partnerships to gain and sustain competitive advantages. The rapid development of the
Internet has speeded up such processes and Information and Communication
Technology (ICT) is enabling organizations to be flatter, networked, and more
flexible on a global level; and the distance and place are no longer the barriers to
expand business. Over the past few years, China has made great progress in Internet
development, which provides a new way and channel for organizations, especially
SMEs both in China and Europe, to gain advantages from cooperation and to create
added value. Therefore, the research of how traditional international cooperation
sustains and expands business relationships in the age of ‘going virtual’ has been
executed. In order to research this phenomenon, International Virtual Alliance is
defined as: An electronically-networked cooperation involving companies, from
different countries, that envisage mutual benefits by delivering products or services on
the basis of common business understandings and a set of agreed goals and standards.
The cooperating units provide their respective complementary assets and core
competencies.
The key concept of this definition is the construction and operation of
electronic communication systems.
Regarding the new concept, most of the literature focuses on the technical
issues, different forms, and trust building. The main objective of this research has
been to investigate the success of international virtual alliances. However, as purely
virtual alliances are rare, in practice it was only possible to study virtual cooperation
within international strategic alliances rather than international virtual alliances. When
discussing virtual cooperation within international strategic alliances it is necessary to
study relevant aspects such as the degree of virtuality and the general ICT
applications. The higher the degree of virtuality, the more virtual becomes an alliance.
The highest level of virtual cooperation is regarded as a virtual alliance. Virtual
cooperation within an international strategic alliance is defined as:
Cooperating companies or business units from different countries in an
alliance that are linked by an ICT system in order to achieve mutual benefits by
delivering products or services on the basis of common business understandings and a
set of agreed goals and standards. The ICT applications may vary from basic
supporting communication to fully integrated collaborative systems.
By extending Arnold’s (1995) and Skyrme’s (1998) findings, in this research
we have summarized the degree of virtuality using five levels and also discussed
example applications based on this. Alliances between Dutch and Chinese businesses
that have implemented ICT applications beyond level one will be considered as
virtual cooperation to some extent.
The framework for characterizing the state of the Internet in a country is used
to compare Internet development in China and Netherlands. From the comparison, it
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is clear that the Netherlands is ahead of China in almost every dimension except in
terms of organizational infrastructure. However, as rapid improvement in China is
expected to be made in the near future, the gap between China and the Netherlands in
macro-ICT infrastructure is expected to narrow. Also, there is one thing that needs to
be kept in mind: the imbalance of ICT diffusion in different regions in China. In some
well-developed regions, the ICT infrastructure could well support virtual cooperation,
while in other parts, the weak ICT infrastructure could have negative impacts on
virtual cooperation within international strategic alliances.
In order to identify the influential factors to the virtual cooperation within
Dutch-Chinese strategic alliances, relevant literature such as international strategic
alliances, virtual organization, and success of information system have been studied.
From the literature study, several factors, namely strategic, operational (resource,
cultural, organizational, and technological), and related ICT (ICT system importance
to the alliance, degree of virtuality, ICT system quality, and information quality)
factors that influence the success of virtual cooperation within international strategic
alliances have been selected. As this research aims to investigate virtual cooperation
within international strategic alliances, strategic and operational factors together with
macro-ICT infrastructure act as independent variables, and ICT factors act as
intermediate variables that influence the virtual cooperation.
From the literature on success in strategic alliances and the success of
information systems, four measurements emerge: satisfaction with the alliance,
satisfaction with the partner, usefulness, and user satisfaction. As this research aims to
investigate virtual cooperation within international strategic alliances, the four
measurements are elaborated to: satisfaction with the alliance, usefulness of the ICT
system in the virtual cooperation, satisfaction with the ICT system in the virtual
cooperation, and satisfaction with the partner’s conduct with the ICT system in the
virtual cooperation.
After the conceptual research model had been developed, the relationships of
the relevant factors defined have been identified and tested in ten case studies. The
findings of the case studies provided the factors that influence the success of virtual
cooperation within Dutch-Chinese strategic alliances in actual practice. Four main
propositions formed in the case study protocol of this research have all been examined,
and supporting evidence has been found for all.
Literature suggests that the strategic fit is the starting point, and that the
operational factors are ‘equally’ important in influencing the success of international
alliances. Regarding virtual cooperation forms, some researchers argue that cultural
factors might not be as important as before once a high degree of standardized
electronic information exchange takes place. Moreover, the macro-ICT infrastructure
also plays a key role in forming and operating virtual cooperation successfully. For
the intermediate variables, previous research mostly focused on ICT use in a single
organization, with ICT system importance, ICT system quality, and information
quality being centrally important for the success of ICT system use. From the case
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