Research On International Performance Of Chinese Manufacturing Enterprises And Institutional Environment Difference

Manufacturing industry is the main body of the national economy and the foundation of the country. Since the founding of new China, especially the reform and opening up policy, China’s manufacturing improved a lot, and became the cornerstone of the dominant sector in China’s economic growth and economic transformation. With the deepening of economic integration, China’s manufacturing enterprises have begun the pace of internationalization, started to exploit global market, to participate in global competition. More than 40 years of research showed that enterprises "going out" strategy can enhance enterprise competence, obtain profits, and enhance the comprehensive competitiveness. With the development of research, point of view of scholars also changed from resource into the system level, and begun studying the influence of institutional factors on the performance of the international business. This study is based on the influence of institutional environment difference on the manufacturing enterprise internationalization performance, so as to provide reference for our country manufacturing industry enterprise’s internationalization.This paper first discusses the influence of internationalization factors in enterprise internationalization theory, the relationship between institutional environment difference and the manufacturing enterprise internationalization performance. Secondly, analyses the current situation and characteristics of Chinese manufacturing enterprises and its internationalization action, and the reason, and the risks and challenges in international management. Base on the analysis of theories and the present situation, this paper builds a theoretical model of institutional environment difference, and enterprise international performance, and put forward relevant assumptions. Finally, 197 listed manufacturing companies with overseas branches are selected as samples to analyze the relationship between institutional environment difference, enterprise strategy, R&D, human resource and enterprise internationalization performance.The results of the empirical analysis show that: the overall level of the internationalization of Chinese manufacturing enterprises is still at a low level, and the distance from the world’s advanced manufacturing enterprises still exists. The relationship between international performance of manufacturing enterprises and institutional environment difference is like a inverted U curve, which means the enterprises performance first increase and then decrease as the increase of institutional environment diversity. The inverted U curve shows that the marginal revenue in China’s manufacturing enterprises will be greater than the marginal cost in the initial stage of internationalization, with the expansion of business to the host country, the institutional environment faced by enterprises began to be more complex, marginal revenue brought about by the internationalization will be less than the marginal cost, so revenue decline. The study on regulatory and normative institution distance shows the similar conclusions of the total system distance; individually, the affect of a single variable on performance of enterprise internationalization is more obvious. Considering normative system is rooted in a nation and social culture, not easy to change, so the conclusions indicates that, the impact of normative institution is much deeper than the regulatory institution. R&D has a positive effect on international performance of manufacturing enterprises, while strategy and HR don’t have. In addition, the enterprise scale, the age of enterprise internationalization, the balance of assets and liabilities structure all have significant impact on the performance of the enterprise internationalization.The suggestions which are based on the conclusion of analysis are, in order to improve the performance of enterprise internationalization, our government should adhere to the 2025 Chinese manufacturing planning, construction a big and strong China manufacturing industry, so as to provide strong support for the industry upgrading and transformation, then to improve the government service functions, actively guide the enterprises in "going out" process. As a manufacturing enterprise itself, first of all, they have to enhance the comprehensive competitiveness, scientifically plan in the process of internationalization strategy, not blindly and rapidly, and give full consideration to the differences of host countries in the process of internationalization, abide by the laws and regulations of the host country, respect the local culture and society, deal with the relationships in all parties, attaches great importance to environmental protection, to be a responsible Chinese enterprise.