Impact of corporate entrepreneurial strategy on firm performance in China

Abstract

Implementing corporate entrepreneurial (CE) strategies is a panacea for established firms achieving high performance and gaining sustained competitive advantage in a fast-changing business environment. This paper investigates the effects of CE strategy on firm performance at both overall and individual sub-category (investing in R&D, brand equity, organisational capital and human capital) levels with Chinese listed companies over the period 2010 to 2018. The empirical results indicate two points. (1) Adopting CE strategies has a positive effect on firm performance. When investigating the influence of the specific sub-category, only investing in R&D and human capital influences firm performance significantly, while the effects of investing in brand equity and organisational capital are insignificant. (2) The effects of CE strategy and its sub-categories on firm performance exist heterogeneity across firm ownership and industry context. Specifically, the effect of CE strategy in state-owned (manufacturing) firms is larger than that in privately-owned (service) firms; state-owned firms’ performance is driven by R&D investment, while privately-owned firms’ performance is driven by R&D and human capital investment; manufacturing firms’ performance is driven by R&D and brand equity investment, while service firms’ performance is driven by human capital investment.

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Acknowledgements

This work was supported by National Social Science Fund of China (Grant Number: 15BGL078) and the Research Center of Cooperation of Ningbo Government and Chinese Academy of Social Sciences in 2017 (Grant numbers: NZKT201712).

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Correspondence to Minglin Wang.

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He, Q., Wang, M. & Martínez-Fuentes, C. Impact of corporate entrepreneurial strategy on firm performance in China. Int Entrep Manag J (2020). https://doi.org/10.1007/s11365-020-00678-7

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Keywords

  • Corporate entrepreneurial strategy
  • Firm performance
  • Heterogeneity
  • China