Use this URL to cite or link to this record in EThOS:
Title: The growth of Chinese software firms
Author: Su, Shiwan
ISNI:       0000 0004 2717 3665
Awarding Body: University of Reading
Current Institution: University of Reading
Date of Award: 2011
Availability of Full Text:
Access from EThOS:
The fast growth of the Chinese software industry since 2000 has resulted in an annual growth rate of approximately 40%. This growth has been measured in different ways. However, this thesis discusses the increase of sales revenue and employment only. The contributions to the growth of this industry comprise of the sales revenue of existing firms and the increasing number of new software firms. However, not all software firms have experienced the same growth rate, with some growing faster than the others, and some failing to grow at all. One of the objectives of this research will be to investigate the general factors which influence the growth of Chinese software firms. In the past years, different arguments have been raised in terms of which factors actually affect firm growth, but Storey's synthesis (1994) is the most appropriate model. His framework outlined only three determinants for firm growth, including the characteristics of the entrepreneur, the firm, and the strategic management. Whereas some other researchers believe that the Chinese institutional environment is also an important factor. Therefore, a general growth model has been used to retest Storey's synthesis, with the Chinese institutional environment as a potential factor. This general growth model analysis is quantitative, and is based on the survey data collected from 137 software firms. The result reveals that export and guanxi (a mutually beneficial relationship) with the government are the two most significant variables with a positive influence on the growth of Chinese software firms. Therefore, export will be further discussed in a separate chapter, where factors effecting export will be identified. Two software firms (from within the sample) will be used as case studies. The findings also indicate that the Chinese government plays an important role in the export of Chinese software firms; using incentive policies and undertaking other actions to stimulate the growth. In this context, the Chinese government plays multiple roles: as a policy maker, a service provider, and a large customer, as it can be involved in over 75% of the Chinese domestic software market. In theory, government policy is supposed to have the same impact on all software firms, but the results indicate a difference. Guanxi is the factor that creates this difference. The Chinese software industry was an emerging sector in 2000, and was identified as a pillar industry. Preceding this, the Chinese government allocated special resources to support the growth of its software industry. However, some resources such as finance and licensing are scarce, and not all firms are able to receive the same support from the government, furthermore every level of Chinese government has its own interpretation on the "rules of game" (Gold et aI., 2002; Hui, 2006). Therefore, a guanxi with the government is the key to accessing these resources. In addition, guanxi can aid a firm in overcoming the uncertainty and complexity of the institutional environment. The result indicates that the Chinese government plays a significant role and that guanxi has a positive effect on firm growth. Through quantitative analysis and qualitative study this thesis presents a clear view on the growth of Chinese software firms. This study does not just identify the factors which influence the growth, but also points toward how to use these factors to affect growth.
Supervisor: Not available Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available