Strategic decision making in Chinese SMEs

Abstract

Purpose

This paper aims to examine the process and characteristics of strategic decision making (SDM), and their influencing factors in Chinese small‐ and medium‐sized enterprises (SMEs).

Design/methodology/approach

This study adopted a case‐study research design. It collected data from 20 Chinese SMEs with multiple approaches, including interviews with owners/managers, focus groups, gathering of internal documents and access to their web site.

Findings

Several important conclusions can be drawn. First, the steps involved in the SDM process in Chinese SMEs are less complex than the theoretical models; second, Chinese SME owners/managers rely heavily on their personal networks for identifying opportunities in the business environment, and for information search and advice; third, a firm's ownership significantly influences the degree of participation and the level of political activities in the SDM process; and fourth, decisions made in Chinese SMEs can be implemented quickly partly due to slack legal enforcement in China.

Practical implications

For SME owners/managers, a better understanding of the decision‐making routes provides a basis for enhancing the quality of the decision‐making process. They can expand and/or improve the steps in executing their decision‐making process. For Chinese government policy‐makers, they can better sponsor training programs in strategic management and develop mentoring programs among SME owners/managers for better connecting them with peers and external advisors. For SME researchers, this paper has pointed out several important areas for future research.

Originality/value

This research is one of the pioneering studies on SDM in Chinese SMEs. It provides a detailed description of the SDM process and several important characteristics associated with this process in Chinese SMEs, and thus contributed significantly to our understanding and potential improvement of SDM in Chinese SMEs.

Citation

Huang, X. (2009), "Strategic decision making in Chinese SMEs", Chinese Management Studies, Vol. 3 No. 2, pp. 87-101. https://doi.org/10.1108/17506140910963602