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This study of multinational companies in China focuses on the role culture plays in relationship cultivation. The author interviewed 40 participants from 36 multinational companies in China. The findings revealed that characteristics of Chinese culture, such as family orientation, guanxi, relational orientation (role formalisation, relational interdependence, face, favour, relational harmony, relational fatalism and relational determination) had an influence on multinational companies’ relationship cultivation strategies. Multinationals from Western countries were found, however, to be more persistent in maintaining their own cultural values in relationship building than multinational companies from Asian countries.

Despite close to two decades of foreign direct investment in China, and the country's enormous market potential, most US and European multinational corporations have never made a profit in that country. The distribution of profits among multinationals also seems highly skewed. The latest survey on profitability showed that five US companies accounted for one‐third of equity profits among US‐based multinationals in China. This research proposes explanations for why multinationals fail in China and strategic solutions for profitable operations.

Through in‐depth interviews with 29 CEOs and directors of major, profitable US and European multinationals, overseas Chinese companies and People's Republic of China companies, this paper proposes a model of strategic convergence for successful operations in China. The first part discusses cultural and cognitive differences between Westerners and Chinese that affect the strategies they choose. The second part proposes a strategic model of convergence, fusing the best of both Western and Chinese business practices, for strategic success in China.

Profitable foreign multinationals in China appeared to modify their management practices on eight dimensions, often adopting traditional Chinese methods of strategic planning and evaluations of effectiveness, as well as relations with key stakeholders, especially the government. Yet, these multinationals continued to retain their Western norms and values in business dealings. Conversely, profitable Chinese companies that competed with these multinationals also modified their management practices in line with Western norms

The study has implications for the management of foreign subsidiaries in China as well as the successful management of Chinese foreign direct investment in the US and Europe.

Despite close to two decades of foreign direct investment (FDI) in China, and the country's enormous market potential, most US and European multinational corporations (multinationals) have never made a profit in that country. The distribution of profits among multinationals also seems highly skewed. The latest survey on profitability showed that five US companies accounted for one‐third of equity profits among US‐based multinationals in China. This research presented in two parts proposes explanations for why multinationals fail in China and strategic solutions for profitable operations.

Through in‐depth interviews with 29 CEOs and directors of major, profitable US and European multinationals, Overseas Chinese companies and PRC Chinese companies, this paper proposes a model of strategic convergence for successful operations in China. The first part discusses cultural and cognitive differences between Westerners and Chinese that affect the strategies they choose. The second part proposes a strategic model of convergence, fusing the best of both Western and Chinese business practices, for strategic success in China.

The research found that profitable foreign multinationals in China appeared to modify their management practices on eight dimensions, often adopting traditional Chinese methods of strategic planning and evaluations of effectiveness, as well as relations with key stakeholders, especially the government. Yet, these multinationals continued to retain their Western norms and values in business dealings. Conversely, profitable Chinese companies that competed with these multinationals also modified their management practices in line with Western norms

The study has implications for the management of foreign subsidiaries in China as well as the successful management of Chinese FDI in the USA and Europe.

Since the declaration of reform and market opening from China in 1990, China has drawn much attention from the world thanks to its rapid economic growth and its emergence as the world's major consumer market and the center of the global economy. Moreover, it established the new trade order, making East Asia the center of the new trade trend as it becomes a manufactural and sales stronghold of multinational companies. The Chinese distribution market is expected to show a high growth rate by 2010 and it draws attention as a new business sector which can bring huge profits. However, advancement of the Chinese distribution industry now faces systemic problems and research on such problems is insufficient. Therefore, in this study we will conduct SWOT analysis based on previous studies on the Chinese distribution industry and use it as a ground to propose strategic solutions for development.

This paper aims to explore international training and development policies and practices in Chinese multinational enterprises (MNEs). The issues examined in this study include pre‐departure and post‐arrival training for expatriates and their spouses and families, training for host‐country nationals (HCNs), reasons for Chinese MNEs not providing adequate training and the approaches of Chinese MNEs to international management development.

This paper used a semi‐structured, interview‐based survey for collecting data from ten Chinese MNEs. The case companies consist of a range of industries and economic ownership types. A total of 30 in‐depth interviews involving general managers, HR managers at headquarters and executive managers in subsidiaries were carried out.

The paper reveals that Chinese MNEs provide only limited training to expatriates and other nationals, and lack a systematic international management development system. They adopt usually an ethnocentric approach to international training and development, and provide different levels of international training and management development for HCNs and PCNs.

The paper has many issues, especially those relating to the organizational determinates of international training and management development, their impact on organizational performance, and the effect of different approaches to training and development on different nationals; these require further investigation.

The paper shows that HRM in Chinese MNEs has not been much considered. This study has examined a selection of international training and management development issues in Chinese MNEs that have not been reported in the literature to date.

More and more foreign companies, including multinational companies, open business in China. The staff management under the local culture of China is one of the critical points affecting the success of foreign invested companies in China. This paper aims to illustrate the effective methods of staff management for foreign invested companies in China.

For this purpose, a survey on concrete practices of staff management was conducted among three multinational company affiliates in China, whose parent companies are located in the USA, Japan, and Europe, respectively, by the in‐depth interviews with the high‐level executives of the affiliates.

It was found that although the staff management experiences of the surveyed affiliates show differences in operation, the affiliates have a common sense on how to balance culture difference, how to effectively communicate with staff, and how to appraise the performance. The active and passive factors of these experiences were further analysed from the needs level under current Chinese economic situation and from the invisible impacts on human behaviour of Chinese culture.

This study surveyed only three multinational company affiliates in China and therefore, the understanding obtained is limited in scope. The comprehensive knowledge of the subject depends on more case studies.

The analysis reveals that the active factors and localization, especially localization of the management team, are very important to the staff management of foreign invested companies in China.

The paper contributes to the research on effective methods for staff management in multinational companies.

With the increasing dependence on the Chinese market, Chinese subsidiary managers rather than Western managers in the headquarters take responsibility for the overall success of the multinational company (MNC). This paper aims to argue that Chinese managers need to actively interfere to guarantee the survival of the MNC. Transaction analysis is suggested as a tool to rebalance the relationship.

Based on illustrative material and experience cases, the authors highlight why and how Chinese subsidiary managers have to engage in interference management.

Introducing different strategies within transaction analysis shows how Western managers can deal with Chinese interference management to improve relationships.

With the use of transaction analysis, Western managers can verify their communication strategies and behavior to better relate to Chinese subsidiaries on an “adult” level.

Interference management is based on counterintuitive thought that Chinese subsidiary managers rather than headquarters become responsible for the overall success of the MNC. Transaction analysis is used to uncover hidden assumptions, communication strategies and behavior in headquarters–subsidiary relationships.

The diffusion of “best management practice” across national boundaries is becoming a significant strategy for multinational companies (MNCs) to achieve competitive advantage in global markets. Several studies have shown that national cultural and institutional differences may constrain or limit the transfer of such “best practice”. However, these conclusions are based on studies of MNCs from developed countries and we know little about MNCs from developing countries in relation to human resource management best practice. China is engaging in rapid economic development and internationalisation of its business system, and Chinese MNCs see the adoption of advanced management practices as central to the process. Drawing on a study of Chinese MNCs operating in the UK, the article shows how the subsidiaries of these MNCs used the advanced environment of a developed country to transfer best practice of HRM into their organisations.

The purpose of this paper is to investigate the impact of the nature of firm heterogeneity and factors of the host country on the choice of entry modes in greenfield investments and cross-border mergers and acquisitions.

An empirical analysis was conducted of 450 outward foreign direct investment (OFDI) cases of Chinese-listed companies from 2001 to 2015. A regression analysis was conducted to determine the influence of the heterogeneous nature of enterprises and host country factors on the choice of entry mode.

First, the nature of a firm’s heterogeneity differs in terms of their mobile or immobile capabilities, which may affect entry strategies. Second, although Chinese multinational companies do not have a strong ownership advantage when compared with multinational companies in developed countries, they have certain marketing capabilities, such as innovations, aimed at customer needs that make it possible to implement their internationalization strategy. Third, factors such as cultural distance and investment risk of the host country significantly influence the choice of OFDI entry modes.

The authors discuss the mobility of a firm’s resource heterogeneity in determining Chinese firms’ entry mode choices and emphasize that Chinese marketing-intensive firms seek complementary resources from the firms of the host countries to achieve competitive advantages. The authors further divide heterogeneous enterprise resources into research and development resources and marketing resources according to the degree of international mobility and examine what kind of firm heterogeneity could help in the selection of different entry modes.

With China's economic development over the last two decades, the spirit and practice of Chinese companies have been radically transformed from administrative functions in a centrally planned economy toward that of market‐oriented enterprises. As Chinese enterprises restructure, the communication function is also undergoing dramatic changes. Discussion of the CCI Corporate Communication Practices and Trends 2005 Study and the CCI Corporate Communication Practices and Trends: A China Benchmark 2006 allow some insight into the state of the art in China, and help us to infer how best to communicate with the Chinese for a successful business relationship.

The observations in this article are based on the CCI Corporate Communication Practices and Trends: A China Benchmark Study 2006, which was underwritten by Prudential Financial, Inc., and conducted in Beijing, China, in December 2005 and July 2006 through a partnership of the Corporate Communication Institute, Beijing Horizon Market Research Group, and Dr Jian “Jay” Wang of Purdue University.

Business communication and relationships are integral to success for Chinese companies and their executives. Five years into its membership of the World Trade Organization, China is the world's fastest growing economy. Its companies are developing global business cultures and corporate communication management functions as they make the transition from government control to market‐driven enterprises. This development is revealing when compared with the corporate communication best practices of multinational corporations in relationships with customers, the media, employees, the community and society, and the government, as well as communication in a crisis. Understanding these contemporary practices can lead to healthy business relationship in China. Like any new venture, communication for Chinese businesses is focused on branding, marketing, and identity building. Their executives are developing global practices for relations with employees, and they are developing media relations practices. Many companies are well on their way to creating socially responsible policies and practices for the environment, energy, and relationships with the community. They are rapidly taking on responsibility, once entirely that of the government, for communication in crises.

Based on the findings of the CCI Corporate Communication Practices and Trends: A China Benchmark Study 2006, the Corporate Communication Institute at Fairleigh Dickinson University will conduct a study of Chinese companies and foreign companies operating in China, using a much larger sample.

This discussion should provide some insight into the state of the art in China, and help us to infer how best to communicate with the Chinese for a successful business relationship.

This paper discusses the findings of a first‐of‐its‐kind study of corporate communication practices and trends among Chinese companies.