Strategic intent, FDI entry strategies, and emerging market MNEs' subsidiary performance : the strategic fit approach : a thesis presented in partial fulfilment of the requirements for the degree of Doctor of Philosophy in Management at Massey University, Albany, New Zealand

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Massey University
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Employing the strategic intent perspective as the theoretical lens, this study examines how an investing firm’s foreign direct investment (FDI) entry strategies fit with its strategic intent, and how such a strategic fit influences multinational enterprises’ (MNEs) subsidiary performance in the context of emerging economies. Prior studies have emphasised the importance of strategic intent as the key determinant to sustain a firm’s competitive advantage and have investigated the drivers of strategic intent. However, little is known about whether or not, and if so, how emerging market multinationals (EMNEs) have achieved their strategic intent in the subsidiary. To address this research gap, this study sets out to investigate the linkage between strategic intent, FDI strategy, and subsidiary performance of EMNEs from the strategic intent perspective. The strategic management literature suggests that optimal performance is achieved through the strategic fit between strategies and strategic objectives. This study, therefore, adopts the strategic fit approach to investigate the fit between EMNEs’ strategic intent and FDI entry strategies (i.e. location strategy, entry mode strategy, entry timing strategy, and FDI intensity strategy). In order to reveal the fit conditions, this study proposes the theoretical framework by using two strategic fit approaches: the strategic fit as matching and the strategic fit as gestalts. The framework and the derived hypotheses are then empirically tested using survey data from 392 FDI projects made by 280 Chinese MNEs. To achieve conformity between theory testing techniques and theoretical perspectives, this study performs tests by using multiple statistical techniques including structural equation modelling, discriminant analysis, cluster analysis, and analysis of variance. The results derived from the fit as matching approach suggest that EMNEs’ strategic intent do influence their FDI entry strategies, but the intent-strategy linkage is not universally valid for all the intent-strategy combinations. Similarly, a match between the entry strategies and strategic intent does not always generate superior subsidiary performance. The results derived from the fit as gestalts approach reveal the combination profiles of FDI entry strategies and their strategic intent. Based on the patterns of the profiles, investing EMNEs can be labelled as strategic prospector, strategic analyser, strategic defender, and natural resource seeker. The results also suggest that strategic analysers tend to perform better than strategic defenders and natural resource seekers, while the differences of the performance between other groups are not significant. This study contributes to the strategic intent literature by investigating the fit between FDI entry strategies and strategic intent, and examining the subsidiary performance of EMNEs regarding the attainment of their strategic goals at the subsidiary level. Using the fit as matching and fit as gestalts approaches, this study provides a more comprehensive picture in how FDI entry strategies fit firms’ strategic intent and how such a fit generates superior subsidiary performance.
International business enterprises, China, Management, Investments, Foreign, Subsidiary corporations, Strategic planning, Organizational effectiveness