Understanding Entrepreneurship Process and Growth in Emerging Business Ventures under Market Socialism in China

This paper explores the formation and growth of entrepreneurship in three different types of business venture under market socialism in China. It reveals how key contingency factors interacting in different types of firm shape the 'Chinese Characteristics' of entrepreneurial processes in 'China' type of market economy and explains its impact on firm's growth or failure. It emphasizes the important ownership effect on entrepreneurial outcomes.-Abstract Objectives: This paper aims to provide an insightful view of the entrepreneurial process and growth in different types of Chinese entrepreneurial enterprises under market socialism in China. This issue is explored by examining the organisational characteristics of three emerging business ventures under market reforms and institutional changes. It addresses the interactive effect of key contingency factors in entrepreneurship process and explains its impact on growth or failure outcomes in a particular 'China type' of market economy. more empirical studies are required to provide a critical insight into the emerging business practices. This research adopts a contingency model of entrepreneurship 2 (Wickham, 2006) to examine entrepreneurship process and growth in different types of business venture. It reveals the interactive relationships among key variables such as strategy, ownership, culture and management process. Approaches: This research is undertaken through the empirical analysis of three case study companies in the textile industry. This fieldwork was conducted in 2006 and 2009 respectively. Multiple sources of data were collected including 21 open-ended interviews of owners and key managers in three case study companies. Results: The study offers an explanation on how entrepreneurship takes different forms and features in different organisational contexts. Empirical evidence supports four hypotheses: (1) The type of ownership is a key contingent factor that moderates particular entrepreneurial outcomes. (2) Leadership and knowledge accumulation capability are critical factors in learning process, significantly affecting the strategic choices in either high value or low value added products strategy. (3) The broadening of product portfolios and increased production capacity will improve survival chances and increase the likelihood of firm growth. (4) Management capability and consistency have greater impact on the outcome of entrepreneurship process than the resource and strategy factors. Implications: The findings have significant implications for a conceptual understanding of Chinese entrepreneurship dynamics. It addresses important considerations on government policy making and promotion strategies for entrepreneurship development in different forms of business venture. Value: The textile sector has pioneered the government reforms in restructuring and creating entrepreneurial enterprises. It offers a perfect …