The Influence Of Business Model On Firm Rowth In Emerging Economy:Evidence From Chinese Manufacturing Firms

Firm growth and evolution in the context of emerging economy has been a key theme. In the growth process of western firms, they invest intensively on R&D to promote technological innovation to bring in high quality products. This way is obviously not appropriate for firms in emerging economy for two reasons. The first is related with technology itself. Over several decades, firms in emerging economy have been isolated from their counterpart in western developed economy. As a result, they fall behind in terms of product and process technology, and lack of complementary assets. The second reason is regarding domestic situation in emerging economy, such as huge growth potential of domestic market, rapid growth firms backed by governments. Taken together, this phenomenon provides a new opportunity to build China specific theory. In fact, recent research propose various new growth approaches which focus on market rather than technology aspects, and this is the essentials of business model innovation. Therefore, with this starting point, the dissertation focus on how business model influence firm growth in the context of emerging economy.The dissertation incorporates three studies. First, the construct and nature of business model is examined, also its implications for strategic management research are identified. Furthermore, through a literature analysis using social network approach, it’s found that, while research on business model is still in infancy stage, three streams can be identified:research on concepts and elements of business model, research in innovation and entrepreneurship area, and research in strategic management area. Second, the elements of business model is examined and modified in the context of manufacturing industry in emerging economy. Building on this, a comparative case study of two firms in cellphone industry is conducted to investigate how their business models impact their growth. Third, using Chint group, which succeed in transformation and upgrading, as a case, the study reveals distinct development stages from copy to imitating and eventually to innovation and the evolution of business model. Furthermore, a dynamic match pattern between business model and firm growth is developed.The conclusions are as follows. First, business model as a construct, meets three criteria:falsification, utility and universality. Furthermore, it’s an umbrella construct, has a periodic development nature, and always receives validity critics due to its inclusive contents. To address this problem, the configuration approach with a holistic view is introduced to focus on overall order and reveal its punctuated equilibrium nature. Specifically, it’s suggested that,1) research on business model construct should focus on nonlinear and mutual reinforced relationship between business model elements, so as to develop the ideal type;2) researchers should pay attention to more specific firm populations, and to achieve generality through applying the results to different populations;3) research on business model should emphasize contingency study, trying to understand contingency relationship between business model configuration and its context. Furthermore, the citation of literature on business model, indexed by SSCI, is explored to systematically sort out the extant research streams. It’s found that, research on business model is still in infancy stage, with no clear schools identified or widely accepted theoretic framework developed. However, three broad inter-related streams are identified:research on concepts and elements of business model, research in innovation and entrepreneurship area, and research in strategic management area. Taken together, they form the theory foundation of business model research.Second, the elements of business model in the context of manufacturing industry in emerging economy is examined and modified. These elements are value proposition, capabilities, value chain and channels and all play a significant role. Building on this, a comparative case study of two cellphone firms is conducted. The case study shows that, in the context of emerging economy, both innovation oriented business model and Shanzhai oriented business model promote firm growth in the case of deregulation. However, the effect of the latter is more significant. In the case of technology change, Shanzhai oriented business model cannot keep up with external technology development. As a result, it shifts toward a disruptive innovation business model. To some extent it will remain technology advantage, and leverage emerging economy’s huge market, thus eventually leading to firm growth.Third, through a case study of Chint group, the evolution of business model corresponding to three development stages is investigated. Specifically, it reveals the development path from copy to imitation and eventually to innovation on the one hand, and the co-evolution of business model and firm growth. This dynamic match pattern explores the internal driver of Chinese manufacturing industry from the perspective of business model. This dissertation also discuss the theoretical implications of these studies for a business model view in strategic management fields, firm growth in emerging economy, and Chinese contextualized management research, as well as managerial implications for firm growth in the context of emerging economy.