Empirical Study On Decision-making And Performance Of Sino-African Small And Medium Size Enterprises Strategic Alliance Cooperation

This study is a survey of 600 small and medium sized business enterprises (SMEs) in the Economic Community of West African States (ECOWAS) where, 200 were involved in international business cooperation with China and 400 not involved in this business cooperation. This study examined the assumption that the participation in this cooperation is influenced by the social, economic, political and legal, technological and business environment factors. The study also examined the assumption that the performance of Sino– ECOWAS'SMEs strategic alliance cooperation is influenced by the resources characteristics, alliance symmetry, and competition intensity, innovation capacity, learning capacity and market influence factors.Under the guidance of the above identified, selected factors and in accordance of the two assumptions, a questionnaire was developed and administrated to 600 (200 were deliver hand to hand and 400 were mailed) small and Medium size enterprises identified in ten (10) countries out of the fifteen (15) that compose ECOWAS organization. From the 600 sent questionnaires, 340 (180 were collected hand to hand) were responded, of which 320 were usable, a response rate of 56%. Among the 320 usable samples, 150 were involved in international business cooperation with China and 170 not involved in this business cooperation. The examined selected factors were identified from a review of international business strategic alliance cooperation literature. The most reported areas in the literature review as barriers or incentives were labeled as core factors.First, this study examined the assumption that the participation in this cooperation is influenced by the social, economic, political and legal, technological and business environment factors. The analysis of the collected data indicated that managers tend to decide to cooperate when market preparation is effective. They are more likely to hesitate and even do not participate in this cooperation when the level of trustworthy level of their products or services, understanding beliefs and cultural values involved is faint. SMEs'managers tend not to participate in this cooperation when the level of selected variables from the economic factors: competitors'promotional programs, pricing policy and after sales services is effective. The effectiveness of the above variables constitutes an obstacle for the new entry in this cooperation. SMEs'managers also tend to participate in this cooperation when the political stability and the assistance of the import and export center are effective and available. Noteworthy, is that they hesitate or even do not participate in the cooperation when the laws impeding export in the host country is weak. Selected predictors among the technological factors do not have significant influence on the cooperation decision, this suggest that the more advanced technology is developed and available, the easier new SMEs'managers can get useful information related to their participation in the cooperation. A strong bargaining power of consumers and the government intervention are significantly and positively associated to the cooperation decision. These imply that SMEs'managers, when deciding to cooperate, should consider the risk, return, control, and resource effects arising from the cooperation and the selected operation mode.The importance of these selected factors requires combined considerations of the effects related to the risks, return and resources for the cooperation decision. This also necessitates a theoretical integration of various perspectives such as transaction-value, organization, absolute advantage theory and bargaining power capability.Second, by using the structural equation modeling and regression method, in accordance with the requirements of empirical research and practices, we carried out the main task of the empirical research and the related tests. According to the requirements of empirical research, we searched and collected the relevant literature. On the basis of this literature, we carefully studied and analyzed the main research questions of the study, and then formulated the related hypotheses. After sorting the data, factor analysis, structural equation modeling, regression analysis and other methods were carried out to test the proposed hypotheses. Finally, the relationship between the cooperation performance and the impact of its influencing factors was analyzed and discussed. The analysis and tests results indicated that:First, the resources characteristics and the learning capability, the innovation capability and the market influences are positively and significantly correlated with the cooperation performance. Also, the alliance symmetry and the learning capability, the innovation capability and the market influence are positively and significantly correlated with the cooperation performance. Competition intensity and the learning capability are negatively and significantly correlated with the cooperation performance. The Competition intensity and market influence are negatively and not significantly correlated with the cooperation performance. Second, the competition intensity and market influence are negatively and not significantly correlated with the cooperation performance. The competition intensity increment between partners can create a competitive situation in place of cooperative situation. The study has implications for international business strategic alliance cooperation research and the importance attached to both internal and external factors as determinants of the participation and its performance. The topic of this dissertation is: Empirical Study on Decision-making and Performance of Sino-African Small and Medium Size Enterprises Strategic Alliance Cooperation: The Case of the Economic Community of West African counties (ECOWAS) cooperation framework, but for this time we focus the survey only on ECOWAS SMEs because this is the beginning of this empirical study on Sino - ECOWAS SMEs's strategic cooperation participation decision and performance. First, we start with ECOWAS SMEs to give the opportunity to Chinese investors and businessmen to understand the needs of African SMEs for the cooperation. After that to let open the door for a survey on Chinese SMEs and give to their African colleagues the opportunity to know the needs of Chinese SMEs for the cooperation.