#2008-052 Internationalization and Technological

#2008-052
Internationalization and Technological Catching Up of Emerging
Multinationals: A Case Study of China’s Haier Group
Geert Duysters, Jojo Jacob, Charmianne Lemmens and Jintian Hu
01-09-08
Working Paper Series
United Nations University – Maastricht Economic and social Research and training centre on Innovation and Technology
Keizer Karelplein 19, 6211 TC Maastricht, The Netherlands
Tel: (31) (43) 388 4400, Fax: (31) (43) 388 4499, e-mail: info@merit.unu.edu, URL: http://www.merit.unu.edu
2
3
Internationalization and Technological Catching Up of Emerging
Multinationals: A Case Study of China’s Haier Group1
Geert Duysters2
Jojo Jacob3
Charmianne Lemmens4
Jintian Hu5
UNU-MERIT
Abstract:
In recent years, a number of firms from Asia and Latin America have been internationalizing their
businesses to access new markets and to acquire new technology. This follows similar attempts only a
few years earlier by leading firms from countries such as Korea and Taiwan. Much research has gone
during the last two decades into understanding the success of Korean and Taiwanese firms. In this
paper we carry out a case study of the Haier group— one of the most promising global enterprises
emerging out of mainland China. We explain the need for recognizing some important differences in
the early stages of growth between emerging MNCs today and MNCs from Korea and Taiwan. Unlike
firms from the latter countries, globalizing firms of recent times during their early years of existence
had little incentives to improve their technological competence. Furthermore, they generally had a
one-off relationship with international technology suppliers that further prevented the regular
upgrading of their technological base. Nevertheless these firms have shown themselves to be adept in
facing up to the challenges of globalization by adopting innovative technological and business
strategies. What are the distinctive features of these strategies? How useful are these strategies for
long-run growth? What lessons can other firms and governments learn from these experiences? We
hope to offer some preliminary answers to these important questions. Case studies like ours can also
contribute towards developing newer frameworks for a better understanding of the internationalization
of businesses in modern times.
JEL codes: L24, L25, O19, O32, M13
Key words: emerging MNCs, internationalization, technology strategies, alliances, technological
catching up, Haier group, China.
UNU-MERIT Working Papers
ISSN 1871-9872
Maastricht Economic and social Research and training centre on Innovation and Technology,
UNU-MERIT
UNU-MERIT Working Papers intend to disseminate preliminary results of research carried
out at the Centre to stimulate discussion on the issues raised.
1 We are grateful Ad Notten for providing us some valuable data and information.
2 UNU-MERIT, Keizer Karelplein 19, 6211 TC Maastricht, The Netherlands, Tel: (31) 43 3884413, e-mail:
duysters@merit.unu.edu and Eindhoven Centre for Innovation Studies (ECIS), P.O. Box 513, 5600 MB
Eindhoven, The Netherlands, g.m.duysters@tm.tue.nl
3 Jojo Jacob, UNU-MERIT, Keizer Karelplein 19, 6211 TC Maastricht, The Netherlands, Tel: (31) 43 3884454,
e-mail: jacob@merit.unu.edu
4 Charmianne Lemmens, UNU-MERIT, Keizer Karelplein 19, 6211 TC Maastricht, The Netherlands, Tel: (31)
43 3884400, e-mail: lemmens@merit.unu.edu
5 Wuhan University of Technology, China
4
5
1. Introduction
The last two decades have witnessed the emergence of a growing number of multinational
companies (MNCs) from many of today’s newly industrializing countries such as China,
India, Mexico, Malaysia and Russia. They operate in an increasingly integrated global
economy which is quite unlike the world economy during the ‘late’ industrialization episodes
in Taiwan and South Korea (Korea hereafter) during the 1960 and 1970s. The latter countries
followed a combination of the strategies of import substituting industrialization (ISI) and
export oriented industrialization (EOI). Such a policy framework established a ‘carrot and
stick’ incentive structure in which enterprises experienced both the luxury of domestic
protection and the pressure to succeed in competitive foreign markets. Domestic protection,
together with state support, also helped them access foreign technology on favorable terms
(Amsden, 1989).In contrast, emerging MNCs today experience intense competition in their
home markets, and this has driven many of them to compete in markets abroad. Furthermore,
globalization has reduced governments’ ability to control technology transfer through not only
trade policy but also ‘contract bargaining’ with foreign firms on behalf of domestic firms.
This means that emerging MNCs today need to devise novel strategies to learn ‘dynamically’
through continuous access of foreign technology (as opposed to a one-off import of
technology), as well as markets (Radosevic, 1999).
It is well known that late comer firms enjoy certain advantages for catching up because of
their technological ‘backwardness’ (e.g. Gerschenkron, 1962; Abramovitz, 1986). Over the
past two decades an increasing number of studies have examined the successful catching up
of latecomer firms in East Asia (e.g: Kim,1980; Amsden, 1989; Dahlman, 1994; Wu 1995;
Hobday, 1996; Felipe, 2000; Mathews, 2001). A common theme of these studies has been
their attempt to explain the so-called “East Asian Miracle” (World Bank 1993). A majority of
these studies has taken on a policy level perspective and has focused on the role of institutions
and governments in the catching-up processes. Others have examined the individual
technology sourcing strategies of latecomer firms that were able to catch up technologically
with their Western competitors.(Dahlman and Sananikone,1990; Bloom, 1992; Mckendrick,
1992; Dahlman, and Sananikone.1993; Hobday, 1995; Kim, 1995, 1997; Kim, 1998; Chen,
1999; Lim, 1999; Choung, et al.2000).
In the literature cited above, the conceptual and theoretical frameworks developed regarding
the internationalization of MNCs pertain largely to the period prior to the 1990s. These
studies, while providing useful benchmarks, cannot fully explain the distinctive approaches to
internationalization and building up of international R&D capabilities by MNCs that have
begun to emerge since then from countries such as China and India.
In this paper we examine the internationalization and technology strategies of the Haier Group
(Haier hereafter) of China. We will argue that Chinese, as well as Indian, firms grew
differently from Korean and Taiwanese firms in the early stages of their development. By
studying Haier we hope to draw some distinctive lessons about the internationalization
strategies of firms from emerging economies like China and India. In this process we will
examine how has Haier achieved its transition from being a small national entity producing
for local markets using borrowed technology, to being a large MNC that makes higher-end
products (developed through its own design, branding and marketing capabilities) and sells its
technology. We will bring out the important role played by the firm’s internal technological
efforts, alliances with foreign firms, creation of product niches, diversification strategies, and
acquisitions of foreign firms and brands. We will also explore the significance of the
6
institutional support the firm has been receiving to draw lessons for policy makers in other
less developed countries.
We start by noting in the following section the need for moving away from traditional
frameworks for understanding the process of internationalization in recent times. First we
look at the growing significance of diversification for successful internationalization
strategies. Second, we distinguish the initial growth circumstances of firms from Korea and
Taiwan on the one hand and China and India on the other. We conclude this section by
pointing out the major advantages offered by internationalization to late comer firms. In
section three, we carryout a detailed examination of the Haier Group and the group’s
internationalization strategies. The final section discusses the key features of Haier’s
internationalization strategies in the wider context of globalization, the changing role of the
state and the internationalization efforts of other firms from less developed countries.
2. Towards understanding the internationalization strategies of emerging MNCs
The conventional frameworks for analyzing the internationalization activities of MNCs are
not very useful in explaining the internationalization strategies of firms from emerging
economies. For example, the ownership-location-internalization (OLI) theory á la Dunning
(1981, 1988) is based on the successfully internationalized, predominantly Anglo-American
firms. A central characteristic of these firms was their repository of proprietary technologies
and brands.6
However, emerging MNCs have no or very little proprietary technologies or brands to start
with.7 Internationalization therefore has become a necessary means to capture ownership
advantages, through acquisition of foreign technological knowledge. We can thus characterize
the evolution of today’s late comer firms as one of evolving from locational advantage to
adopting internationalization to achieve, among others, ownership advantages (of brands and
technology).8
Internationalization today also has other important differences with internationalization in the
past. First the motives underlying internationalization have changed. And second, key
differences exist with regard to the initial phases of growth between internationalizing firms
today from China and India on the one hand and MNCs from Korea and Taiwan on the other.
2.1 Diversification and value creation: a shift from the past
There are important differences in both the moves for and the path to internationalization
between late comers today and their Western counter parts in the past. As Smyth (2000) notes,
“Chandlerian firms which emerged in Europe and the United States from the second industrial
revolution first specialized in producing a narrow product line based on core competences and
then diversified into related industries” (emphasize added). Part of the reason for
internationalization of these firms, in a narrow band of products, was to exploit economies of
6 The OLI framework views internationalization as a firm’s attempt to exploit its ownership advantages by
extending its proprietary assets abroad. This involves first, exploiting locational advantages of producing abroad,
and second, integrating the firm’s activities across borders to tap the advantages of economies of scale and
scope. The latter ensures that the firm has internalized its ownership advantages— rather than sell its products or
technologies to a foreign firm. For a critique of the application of this approach to emerging MNCs, see
Bonaglia, Goldstein, Mathews (2007).
7 By definition, “late industrialization is a process devoid of innovation” (Amsden, 1992).
8 India’s Tata group’s acquisition of Land Rover and Jaguar from Ford perhaps exemplifies this pattern.
7
scale and scope. Today’s emerging MNCs by contrast diversify to create value to compensate
for the absence of core competences.
In modern industries, economies of scale and scope are not any more important than creating
knowledge and enhancing learning (Chandler and Hikino, 1997). Emerging MNEs thus do not
wait to become large to diversify or to internationalize, rather they internationalize and
diversify. Rapid diversification and enterprise expansion (for example into multi-product
business groups, like Chaebols in Korea) offer these late comers certain advantages in their
internationalization process. One of the important advantages offered by diversification is that
it allows the enterprise group as a whole to leverage the reputations built up through honest
dealings in the past (Khanna and Palepu, 1997). They can also point to their track record and
returns to foreign investors. Diversified groups thus can far more easily secure external
financing, as well as foreign technology, for new ventures than enterprises with a more
narrow focus.
Diversification and internationalization appear to have gone hand in hand for MNCs that
emerged during the 1960s and 1970s in Korea and Taiwan, and for MNCs that have begun to
emerge in recent times from China and India. However, the two groups of enterprises do not
share a common history of early growth. Below we highlight some of these key differences,
which we believe need to be recognized from the perspective of our study.
2.2. Path to internationalization: the diversity of initial circumstances
In recent years, the shift-away from ISI strategies in most of world’s protected economies has
transformed the way enterprises from these countries do business. Under ISI, these enterprises
had experienced certain locational advantages on account of little or no competition from
foreign firms. However, falling tariff and foreign investment barriers has increased
competition and brought down profit margins in local markets. The result, from Asia to Latin
America, has been a shift in focus towards internationalization of business (see for example,
Cuervo-Cazurra, 2008; Chittoor, et al, 2008). The initial approach to internationalize was by
increasing the share of exports in total sales. However, with foreign MNCs starting to operate
in local markets, these enterprises have realized the need for moving away from cost-based
comparative advantage to technology-based competitive advantage. Like catching up firms
before them, in the West and in East Asia, they have focused on acquiring existing technology
from abroad, and combining that with the locational advantages of the home market. Thus a
growing number of enterprises are resorting to overseas acquisitions and strategic alliances to
acquire new brands, technological assets and other sources of competitive advantage that
expand and diversify their competence base (Bonaglia, Goldstein, Mathews, 2007).
However, while these firms can be expected to benefit from their well known late comer
advantages (which we discuss in the following section) the position of Chinese and Indian
firms is somewhat unique compared to the Korean and Taiwanese late comer firms. The
latter, from an early age, had a significant exposure to international markets. Many of them
started off as Original Equipment Manufacturers (OEMs) for established MNCs before
transitioning to Original Design Manufacturers (ODM) and finally to Original Brand
Manufacturers (OBM). They were thus able to leverage their access to knowledge and
markets from their initial positions to establish themselves on the world stage (Hobday, 1995).
However because of the extreme nature of ISI in their countries Chinese and Indian firms
often controlled the entire value chain of mainly low-end products. Internationalization
8
strategies of these firms therefore can be expected to take a different course compared to what
we know from the experience of Korean or Taiwanese firms.
2.3 Late-comer advantages
What are the potential advantages which late comers could exploit in their internationalization
efforts? This is especially an important question in the current international business
environment in which established MNCs too are carrying out extensive internationalization of
their businesses.
First, latecomer firms have the speed and flexibility to enter into new resource spaces fast.
They are not bothered by sunk costs and other inertial pressures as in the case of incumbent
firms. As noted by Mathews (1999) “the distinguished feature of the latecomer firm is its
preparedness, and its ability to learn; it is a learning organization ‘par excellence’”. Until
recently, late comer firms also had the advantages associated with the low cost of production
inputs (e.g. materials and labor) and the fact that they were shielded from foreign competition
by their governments. As earlier discussed, many of today’s emerging MNCs have enjoyed
such benefits.
Another advantage the emerging MNCs have is that instead of building their business model
from scratch, they can adapt the business models of their competitors. For example, emerging
MNCs can benchmark their business against established MNCs and then maneuver around
them by exploiting niches that the established companies have overlooked. Established MNCs
are often characterized by a strong inertia which prevents them from transforming their
current products and technologies. This so-called ‘success breeds failure syndrome’ (Starbuck,
Greve and Hedberg, 1978) is often observed by industry leaders. Newcomer firms, in contrast,
can change the rules of the game by introducing innovative and risky business models,
capitalizing on the inflexibilities in the business models of established MNCs (Bartlett and
Ghosal, 2000).
As part of their internationalization efforts, emerging MNCs are increasingly resorting to
strategic (technology) alliances, joint ventures, and mergers & acquisitions. These range of
cross-border alliances are aimed at both access to new markets and climbing the global
technology ladder. Thus technological and product diversification strategies have become
heavily intertwined under the internationalization strategies of firms (Cantwell and Piscitello,
1999). Emerging MNCs have shown to master this process quite well.
Emerging MNCs can also benefit from yet another well known advantage of new comer
firms: knowledge spillovers. Knowledge spillovers are non-pecuniary externalities that
depend on face-to-face interactions between active researchers, and are expected to be highly
localized and to decay rapidly with distance (Rosenthal and Strange, 2003). Theories of
industrial clustering and new economic geography stress the importance of local knowledge
spillovers “because technical knowledge has imperfect proprietary rights and because
geographic proximity provides an advantage for observation, interaction, collaboration, and
inquiry” (Aharonson, Baum, Feldman, 2007). Evidence points to emerging MNCs
strategically locating their research and design centres, in addition to production units, in
advanced economies.
9
In the following we conduct a case study of the Haier Group, one of the biggest emerging
MNCs from China. We hope this study will offer insights into aspects of internationalization
and technological catching up in the 21st century.
3. Technology strategies for successful internationalization: a case study of the Haier
Group
The Haier Group is the single largest maker of comprehensive household appliances in China.
In 1984 Qingdao Refrigerator plant, which was renamed Haier group in 1992, was close to
bankruptcy. The company’s turn around began with the appointment in the same year of
Zhang Ruimin, who currently is the CEO of Haier, as the plant director (Liu and Li, 2002).9
At that time its sales were a mere RMB1 3.48 million and it faced a debt of RMB 1.47
million. By 2007, however, Haier’s global sales had reached RMB 118 billion and it
employed about 50,000 people worldwide. At first, Haier only produced one specific kind of
household refrigerator— the BCD-212. Today, it manufactures a very broad range of
household appliances: 15,100 product varieties in 96 product lines. In 2003, the Haier brand
topped all Chinese trademarks in a nationwide survey. The Chinese Fortune magazine (issue
8/2004) rated Haier the second in their list of most admired companies in China. In this rating
Haier was perceived as number one in the fields of management performance, innovation
capability and social responsibility. In 2004, Haier was recognized as one of the World’s 100
Most Recognizable Brands in a global name brand list edited by the World Brand
Laboratory10. According to 2006 Euromonitor statistics on company sales, Haier has the
largest world market brand share for refrigerators, and it is the fourth among the global white
goods manufacturers. Between 2003 and 2006, Haier ranked first in terms of overall
leadership among mainland Chinese companies in the Wall Street Journal Asia’s annual
survey of Asia’s 200 Most Admired Companies. In 2008, Haier ranked 13th on Forbes’
Reputation Institute Global 200 list. Also in the same year, Haier ranked first among Chinese
enterprises on the Financial Times list of the most respected global companies.
These figures and rankings indicate that over a period of two decades, Haier has grown from
being a small, almost bankrupt enterprise to being one of the leading household appliances
makers in the world. In this paper we will show that an ambitious strategy of technological
internationalization, involving a reorganization of in-house technological efforts, setting up of
global design houses, strategic alliances and technology co-operations with leading global
firms, and acquisition of foreign companies and plants— all in tandem with an intensive
diversification and foreign-market access strategy— played an instrumental role in Haier’s
progress to its leading position today.
9 The ownership structure of Haier is opaque, however. The company calls itself a “collective”, purportedly
owed by workers who, however, receive no dividends (Newsweek, May 19, 2005). While about 30% of Haier’s
assets are traded in Hong Kong and Shanghai stock exchanges, the company is believed to be de facto state
owned (WSJ, Mar 19, 2008). As we will discuss later, the central and local governments have a significant
influence on the operations of the company.
10 World Brand Laboratory is one of the five leading brand evaluation organizations in the world.
10
3.1 Early years
The first step in the development of Haier’s technological catching up process was taken in
1984 when Haier decided to acquire from abroad a new refrigerator technology. After a
careful evaluation of 32 potential cooperative partners, Haier decided to establish an alliance
with the Liebherr Company of Germany. This move enabled Haier to import Liebherr’s fourstar refrigerator production technology and equipment to China. Liebherr had 70 years of
experience in producing high quality refrigerators. Its refrigerators were generally regarded as
the leading ones in the world. Compared to Liebherr’s refrigerators with four-star technology,
Chinese products featured the very old-fashioned two-star technologies with a freezing
capability of -12 degrees Celsius. The freezing capability of a four-star refrigerator was -18
degrees Celsius. By acquiring four-star refrigerator technology, Haier became the only
Chinese company that was able to offer this modern refrigerator in China.
Haier followed up the licensing of Liebherr’ four-star technology with an active learning and
R&D strategy. It established a sophisticated R&D department, and sent more than 40 of its
top engineers and managers to Liebherr for training. Liebherr proved to be a very successful
training institute for Haier’s top R&D talents. They studied the development of four-star
refrigerators, and eventually mastered the key technological skills required for developing
advanced refrigerators. In 1985, a year after it licensed Liebherr’s technology, Haier was able
to introduce its first four-star refrigerator in the Chinese market. This product instantly
established Haier as the leading refrigerator producer in China.
3.2 Internationalization Strategies
Quest for global markets and a new focus on quality
Globalization and the increasing interconnectedness of the world economy since the late
1980s marked a watershed in the history of Haier. The company foresaw the looming
competitive threat from foreign firms in a hitherto (largely) insulated domestic market. The
top management of Haier quickly realized that under the new rules of the game, the company
could no longer remain competitive based solely on cost considerations and that it needed to
be competitive based on quality. Haier thus envisioned a strategic shift in the company’s
focus from Chinese market to foreign markets. Towards becoming a globally leading
enterprise the company set the goal of elevating its product quality to be amongst the best in
the world. It thus launched a drive to improving quality, service, design, and technological
capability. For some time, Japanese household appliances were considered to be amongst the
highest quality products in the world. Haier however decided to set even higher quality
standards than the stringent Japanese Industrial Standards (JIS)— the quality standards applied
in Japan. According to JIS, the return-repaired ratio of refrigerators should be less than 0.6%.
Haier’s international standard was set at below 0.4%. The average life of Haier refrigerator
was 15 years (the longest life of all refrigerators in the world). In 1988 Haier was awarded
China’s National Quality Gold Medal, the first such award in China’s refrigerator industry. In
1990, Haier’s refrigerators passed the American UL certification. Since then, Haier
successively passed, among others, ISO9001 certification, ISO14001 environment system
certification, the European CE certification, the Canadian CSA certification, the German VED
and GS certification, the Japanese S certification, and the Australian SAA certification.
Meeting international quality standards allowed Haier to introduce its products into developed
country markets.
11
Inspired by Japanese TQC management and Frederick W. Taylor’s scientific management,
Haier also started to use the OEC (Overall every control and clear) model. The OEC model
implies that everything should be controlled and cleared within the specific time frame that
was set. Today’s tasks must be finished today and the problems showing up during the work
process must be dealt with immediately and improved at once, after finding out the reasons
and responsibility.
Haier made extensive use of the technological and managerial learning from its technology
cooperation with Liebherr. It continuously extended its cooperative efforts even after gaining
its leadership status in the refrigerator market. This allowed the company to gradually enter
into others markets by means of technology alliances.
Diversification, alliances, joint ventures, and acquisitions
In the case of Haier, we notice an intertwining of the strategy of internationalization of
technology on the one hand and the strategy of product diversification on the other. Haier’s
product range expanded rapidly during the 1990s (see table 1, which also shows how foreign
partnerships contributed to Haier’s diversification), and its technology alliance partners grew
from a single partner (Liebherr) to a multitude of partners in a wide range of sectors (table 2
shows some of Haier’s major international technology cooperative partners).
Table 1. The process of Haier’s diversification

1 1984-Dec.
1991
Refrigerators Imported refrigerator technology from
Liebherr Company of Germany
2 Dec. 1991-
Jul. 1995
Freezers
Air-conditioners
Merged Qingdao Freezer General
Plant and Qingdao Air-conditioner
Plant
3 Jul. 1995-
Aug. 1995
Washing machines
Microwave ovens
Water-heaters
Merged Red Star Electric Appliance
Factory.
Established a joint venture with
Laiyang of Shandong Household
Appliance General Plant
4 Sept. 1997- Black household
appliances
Established a joint venture with West
Lake of Hangzhou Electric Group
5 1998- Knowledge sectors Formed technology cooperation with
many external organizations
Source: Sun, 2002; Yan and Hu, 2001; www.3rd56.com
Technology alliances proved to be instrumental in Haier’s diversification strategy. During
1984-1991, Haier was a single product company focused entirely on refrigerators. In 1991,
Haier’s sales were RMB 724 million, and profits were RMB 31.2 million. From then on,
Haier started to diversify into new product markets ranging from freezers to air-conditioners.
It took Haier about three years to successfully establish itself in these two industries. By 1994
Haier’s sales had grown to RMB 2.56 billion, and its profits to RMB 200 million.
Subsequently Haier successfully developed, among others, washers, microwave ovens and
12
water-heaters. In August 1997 Haier made its entry into the black household appliances
sector; until then Haier’s products were primarily white household appliances.
Figure 1 captures the diversification of Haier’s technological competence base, which
underlie its rapid product diversification, in terms of the number of patent applications in
China in different product fields.11 Refrigerator and washing machine account for bulk of
Haier’s patent applications in China, and the rest of the patent applications are shared across
the remaining categories.
Figure 1: Industry-wide distribution of Haier’s patent applications in China: 1992-2007
49%
34%
5%
4%
4%
3% 1%
Refrigerator
Washing Machine
Mobile phone
Microw ave Oven
Freezer
Television
Air conditioner
Source: http://ensearch.sipo.gov.cn
By 1996 Haier had become an exporter of not only its products but also its technologies.
Haier made use of its improved technological capability and product diversification to
extensively enter into overseas markets by means of strategic alliances. Since 1990, Haier’s
products successively entered into Europe, North America and a large number of other
developed countries. Parallelly, Haier established a global network of design, manufacture,
distribution and after-sales services.
Leveraging its technological base and product range, Haier has entered into cooperative
research programs with leading foreign companies. Haier’s international technology cooperations span Tokyo, Los Angeles, Montreal, Lyons, Seoul, Sydney and Amsterdam. Its
cooperative partners include Toshiba, Mitsubishi, ESS, Philips, Metz and Lucent. These
alliances provide Haier with information about global trends in technology development. In
addition, teaming up with these globally leading innovative companies serves Haier a radar
function that has allowed it to scan and evaluate new and emerging technologies around the
11 The graph is based on a sample of 897 patents of a total of 2,120 patents Haier has applied in China until
2007. We used a key word search of patent titles to find out the number of patents applied for under each product
category. This naturally does not fully reflect the complete number of patents under each category because a
patent that falls under a given product category may not have the name of the category on its title.
13
globe. Haier has also established several overseas design and R&D centres. These design
centres (totaling 15 to date) are in charge of developing a broad variety of household
appliances that satisfy consumer needs in a number of countries world wide.12
Table 2. Selection of Haier’s most important technology alliances

1993 Mitsubishi Heavy Industry, LTD
(Japan_
Produced air-conditioners
1994 GK Design Company (Japan) Engaged in the cooperative design of
new products
1997 Philips (NL) and Metz (Germany) Produced color TV-set
1998 Beihang University (China) and CMold (USA)
Software development
1999 Toshiba (Japan) Produced MRV inverter series of
commercial air-conditioners
2002 Sanyo (Japan) and SAMPO (Taiwan) R&D
Source: Ouyang, 2003; and Zeng and Zhong, 2003; www.haier.com
Haier has established three overseas industrial parks (in the United States, Pakistan and
Jordan) and 30 overseas factories. The company has 58,800 sales agents worldwide, and
exports its products to more than 160 countries in Europe, North America, Middle East and
Asia. Some of Haier’s overseas acquisitions are significant from the point of view of
generating knowledge spillovers. For example, in June 2002 Haier purchased a refrigerator
factory in Italy, making Haier the first Chinese enterprise to purchase a factory in the
European household appliance sector. The factory is located in a geographic area that has a
concentration of many top home-appliances makers, such as Whirlpool, Candy and Zanussi.
As we discussed in section 2.3, close geographic proximity with incumbent firms create
strong potentials for generating localized knowledge spillovers. This is in addition to the
traditional benefits associated with industrial clusters: labor market pooling and input sharing
(Beaudry, 2001).
Haier carries out its globalization strategy according to a three one-third principle. Under this,
one-third of its products are both produced and sold in its home country, one-third of the
products are produced in home country but sold overseas, and one-third of the products are
both produced and sold overseas.
With regard to its global expansion, Haier’s approach is from difficulty to ease, which refers
to its strategy of entering tough markets first before moving into easier markets. Entering
more advanced markets first, the company hopes, will help it gain greater brand recognition
(an essential prerequisite for making inroads in the market for higher-end products). For
example, Haier made its entry into the European market through the German market;
12 Haier has a reputation of targeting niche markets, both abroad and in China. In the US, for example, Haier
developed a refrigerator model with a fold-out table aimed at students; this was after product designers who
visited cramped dormitory rooms discovered that students put boards across two refrigerators to create a makeshift desk. Likewise, in China, Haier developed a washing machine model that serves the dual purpose of
washing clothes and washing vegetables. This model, targeting rural areas, was the result of Haier repairmen
reporting back to the company that people in rural China use their washing machines for cleaning vegetables as
well (FT, Sept, 24, 2004).
14
Germany is generally recognized as one of the most difficult markets to penetrate in the
European Union. It has entered markets in Asia, such as Indonesia, Philippine, Malaysia,
United Arab Emirates and Iran mainly through joint ventures. European and North American
markets account for about 60% of Haier’s export.
Haier’s internationalization efforts are now primarily focused on the United States. For the
US market, Haier first started to export compact refrigerators that could easily be shipped
from China to the US (WSJ, Mar 19, 2008). Haier initially sold its products through WalMart, but soon wanted to sell higher-end products through major retailers such as Sears and
Lowe’s. To do that Haier needed to produce them because these were typically larger size
appliances that could not be as easily brought in from China.13 Thus, in 1999, Haier built a
factory in Camden, South Carolina with a view to produce these products in the US itself. The
new plant has a production capacity of 500,000 refrigerators per year. The company also built
a design center in Los Angeles, and a trade center in New York. Currently, with the US
economy going through a recession, Haier has even started exporting its higher-end products
made in the US to China, targeting affluent consumers. Haier thus has demonstrated its
flexibility and adaptability when faced with newer challenges of globalization.
Haier has experienced rapid growth in the US market. Its freezer sales in the United States
amounted to just 10,000 in 1997, before climbing to 43,000 in 1999, and by 2006 the
company had become the third largest seller of freezer. It is estimated that in the United States
the market share of Haier’s small refrigerator (less than 180 liter) is currently about 30%.
Haier is ranked sixth among all refrigerator companies in the United States. According to the
United States APPLIANCE journal, Haier freezer and air-conditioner have moved up into the
top ten in the US in sales volume.
Side by side with its product diversification and technology internationalization strategies,
Haier implemented a major reorganization of its internal R&D structure.
Reorganization of the internal R&D structure
In the course of Haier’s diversification efforts, Haier repeatedly adjusted its R&D
organizational structure and increased its R&D spending so that its new products could be
brought to the market quicker (table 3). Before 1996, the proportion of Haier’s R&D
expenditures as a percentage of total sales was about 3%, it subsequently reached 4% in 1997,
and climbed to about 5% in the next three years before reaching 6.6% in 2000. Although
R&D spending dipped slightly as a percentage of sales (it continued to increase in absolute
terms) it bounced back to over 6% during 2005 and 2006 . Significantly, in 2006 70% of
Haier’s total R&D expenses was on investment in overseas R&D (SCCBD, 2007). Haier’s
R&D spending appears to match or even exceed industry standards. Table 3 indicates that
Haier’s spending on R&D as a proportion of sales revenue has been approaching that of Sony
and is already higher than GE’s.14
13 A major reason why Haier is paying great attention to selling ‘mainstream’, high-end products is that these
products enjoy high profit margins. This is particularly important for Haier because since the mid 1990s its profit
margin has been declining due to increasing competition in the Chinese market. Between 1994 and 2007, the
profit margin of Qingdao Hair Co., the Haier subsidiary which makes and sells home appliances, declined from
10.4% to 2.2%. Established MNCs, on the other hand, enjoy much higher profit margins. General Electric, for
example, had a profit margin of 10-13% over the last few years (own calculation using computstat data)
14 GE’s low percentage share of R&D in sales should be viewed in light of the enormous size of its business, as
well as its leadership status in terms of technology. For example, in 2005, Haier’s total sales were only 1.2% the
sale of GE (Muroi, 2005).
15
Table 3. R&D spending as a percentage of sales (1997-2006) : A comparison between
Haier, General Electric (GE) and Sony

Source: Liu and Li (2002); SCCBD, 2007; Computstat
After its first diversification efforts in 1991, its R&D lab, formerly known as the refrigerator
institute, was split up into three main R&D groups: the refrigerator group, the freezer group
and the air-conditioner group. Haier founded a new technology research center in 1995. The
center consisted of three main administrative levels. The first level was the corporate group
which was responsible for the development of core technologies and basic research. The
second level was created in every department (business unit). The third one was connected to
every plant (cost center).
In 1998, the technology center was split into the technology development institute and the
new product development institute. The technology development institute composed of 11
institutes and laboratories that aimed to develop leading technologies for international use in
5-10 years. In addition, Haier invested RMB 500 million to build up an academy that was
responsible for developing new products that had the capability to be internationally
competitive. In 2001 the State Economic & Trade commission of China and the Evaluation
Research Center of the Chinese Academy of Science co-evaluated Haier’s technology
development center and ranked it first among 284 state-judged enterprise technology
development centers. The new product development institute composed of 14 institutes that
developed new products in order to satisfy emerging market needs. It was placed under the
technology development institute’s guidance.
Haier’s organizational structure too has been undergoing changes, geared towards innovation.
According to its CEO Zhang Ruimin, Haier follows an increasingly flat organizational
structure, which is intended to make “everyone a source of innovation” (Ruimin, 2006). This
is exemplified by the introduction of niche products, be it the refrigerator with a fold-out table
developed for undergraduate students in the US or the washing machine capable of cleaning
vegetables developed for rural China (see footnote 7Error! Bookmark not defined.).
4. Discussion and Conclusion
Over the last two and a half decades Haier has transformed itself from being a single-product
company focused only on its home market into a diversified global enterprise manufacturing
and selling its products in a number of locations world wide. Haier’s transformation
coincided with the arrival of globalization in the late 1980s. Haier viewed globalization as an
opportunity to climb up the global technology ladder, develop core competence, diversify its
product range, and finally become a global leader in its business both in terms of market
presence and technology. It thus began an intensive learning campaign involving a new focus
on absorbing foreign technologies and developing core competences through technology
alliances with leading global firms, acquisition of foreign firms, joint ventures, and
establishing R&D and design houses world wide, especially in developed countries. As the
1990s unfolded, the company has diversified and grown rapidly. What are the distinctive
features of Haier’s strategy which helped it achieve rapid growth and diversification? The
16
discussion in the previous sections explored these strategies in detail. Below we list the
challenges that Haier is facing on its ambition to become a global brand. We conclude the
paper by discussing the prospects of other firms from less developed countries emulating
some of Haier’s strategies. This is attempted against the background of the role of the Chinese
state in Haier’s development and the changes in the international economic order being
brought in by globalization.
4.1 Facing up to future challenges
Haier, like most Chinese companies, started off as a technological novice. Currently,
however, Haier develops on average 1.2 new products and applies for 2.3 patents daily, and it
ranks number one of all Chinese enterprises. Amidst the substantial progress it has made, the
company faces major obstacles on its way to become a leading firm in global markets. For
one, Haier remains highly dependent on foreign firms for key components and technology
including high performance compressors and sensors. For another, it has a daunting task of
convincing Western consumers of the quality of its products. Building a strong brand image is
vital for selling higher-end products which Haier wants to sell in the US and European
markets. However, this is a particularly difficult challenge because it takes several years, if
not decades, to build up a respectable brand image. How has Haier been preparing itself to
meet these challenges? We will answer this question by first reviewing Haier’s strategy for
operating at and extending the technological frontier, and then exploring Haier’s attempts at
quickly building its brand image in Western markets.
Innovation Strategies
Haier adopts a multi-pronged approach to enhance its technological base and develop
innovative products. The key elements of this strategy are the following.
Internal strategies: Haier has been continually increasing its investment in R&D and
innovation. It operates an R&D and design centre and has successfully introduced substantial
process and product upgrading, as evidenced by a number of awards and registered patents.
Haier has also set up local product-development teams in Tokyo, Germany and the US to
differentiate its product line and move up-market. In terms of organizational capabilities,
Haier is engaged in global consolidation of its operations, employing a strong and unifying
perspective that has enabled it to capture advantages from its global reach and coordination,
such as in logistics.
Overseas R&D and design centers: In addition to its R&D centres in China, Haier has set up
several overseas R&D and design centres— six of them in industrialized countries: USA,
Canada, Japan, France, the Netherlands and Korea. The company also has 15 overseas
information centers throughout the world. The main responsibility of these foreign centers is
to assist the company develop products that meet the specific needs and wants of local
consumers.
International collaborations and acquisitions: These are central to Haier’s technology
acquisition efforts. Alliances and joint ventures with established global firms have taken place
in many sectors such as refrigerator, washing machine, digital color television,
telecommunication equipment and mobile phone. Such alliances, with leading companies like
Liebherr, Philips, Mitsubishi and Toshiba, have provided important knowledge and
experience to the company in its catching up process. In this context, Haier has been able to
17
leverage its leading position in China and its diverse product base to secure access to
technologies that would otherwise have been unavailable. Apart from enhancing its technical
know how in its existing product base, partnerships and acquisitions are enabling Haier to
enter into new product spaces as well. Additionally, Haier has used these partnerships to train
its staff.
In sum, Haier has been implementing a complex technology building strategy involving
external sourcing of technology in combination with building internal capability through
investment in R&D and design, repeated restructuring of the R&D organization, and
improving general management capability.
The rapid expansion of Haier’s technological base is reflected in the growth in the number of
its patent applications, both in China and abroad. In China, where it first applied for two
patents in 1992, its total patent applications at the end of 2007 stood at 2,120. After a slow
start, Haier began to apply for hundreds of patents from the late 1990s. In the US, where it set
up a production facility only in 1999, Haier’s patent applications have been expectedly lower.
It first made a patent application in 1999, and since then it has applied for a total of 37
patents. The product range of Haier’s patent has also grown over time. In the US for example,
aside from applying for patents in its traditional areas of strength, such as washing machines,
refrigerators and air conditioners, Haier has applied for patents in other areas including for a
“pen-type mobile telephone” in 2003.
Building up brand awareness
Building a strong brand image is also a top priority for Haier. This is because compared to
Western multinationals, Haier suffers from poor international brand awareness. While
Western consumers are familiar with brands like Whirlpool, Siemens and Philips, few of them
have heard of Haier. Like most Chinese companies, Haier has for long been exporting lowerend products taking advantage of its low-cost manufacturing bases in China. In recent years,
the company has begun to focus on selling higher-end products in Western markets. It is here
that brand awareness becomes important because quality is usually associated with
established brands. However, changing Western consumers’ perception requires years of
marketing efforts (Liu and Li, 2002). Haier has been taking a number of major steps to
improving its brand awareness quickly. For example, Haier has established long-term
relationships with OECD-based brand-building specialists. Another route to brand recognition
that Haier has been exploring is acquisition of established brands, as well as their distribution
networks. It made a bid for the US appliance maker Maytag. Although Haier later withdrew
its bid (Whirlpool bought Maytag in 2006 to create the world’s biggest appliance maker), it
currently is “assessing the possibility of acquiring” General Electric’s appliance arm. In 2006
Haier acquired 60% stake in the household-refrigerator business of Sanyo-Electric Company
to form a joint venture named Haier-Sanyo-Electric.
Contribution of diversification to alliance formation
There is no doubt that entering into new product lines have contributed to Haier’s growth. An
important question remains, however. How important was the role of Haier’s diversification
strategy in helping it enter into technology alliances with leading global companies? Our
answer to this question is speculative. Companies from China are often plagued by
fundamental problems of poor transparency and disclosure standards. It is reasonable then to
assume that the reputation being built up by the group as a whole, and not necessarily the
18
performance of individual product lines like refrigerators or washing machines, has helped the
company forge alliances, on a partnership basis, with global players in a variety of
technological fields. An additional explanation, from the industrial organization literature,
rests on the fact that many of Haier’s technology alliance partners are diversified firms
themselves. The argument is that ‘multipoint competitors are more likely to recognize their
mutual dependence … to sustain tacit collusions in a range of markets in which they meet’
(Ghemawat and Khanna, 1998).15
4.2 Lessons and conclusions
In many ways Haier Group epitomizes the dynamism of the Chinese industry today. Just over
two decades ago, while China was looking for ways to vitalize its state-enterprises dominated
industrial sector, Haier was waging its own battle for survival. Today, as with the Chinese
industry, Haier has finally arrived on the world stage. The global success of Haier has an
important implication: there is an alternative to the much-acclaimed East-Asian route to
growth in which emerging multinationals begin as subcontractors or OMEs for established
multinationals in the developed world, before establishing themselves as leading global
firms16. While we do not intend to make generalizations based on a single case study, Haier’s
story is likely to hold true for many other emerging multinationals from China, and perhaps
also India, which followed an extreme form of ISI. Like Haier, most companies from these
countries initially used licensed technology from foreign firms and usually controlled the
entire value chain of low-end products; production relationships with foreign firms were thus
minimal or absent. However, with increasing competition in their domestic markets due to
reductions in trade and investment barriers, many firms from India and China have been
internationalizing their businesses. From being exporters of cheap products, these firms are
seeking a slice of the global market for high-end products in their industries.
Haier’s experience illustrates that it is possible for companies to adapt themselves through
innovative strategies to meet the challenges, and, importantly, to exploit the opportunities of
globalization. Haier has been able to leverage the industrial base it had established during a
relatively protected phase of early growth, to forge alliances with global firms. To what extent
can Haier’s success be emulated by firms with similar backgrounds?
In our view, Haier’s progress has not been just about innovative management of
internationalization strategies. It has also been about the way in which the Chinese state has
adapted its role. The prevailing view about technology transfer since the 1950s until at least
the early 1980s was that technology could be easily ‘bought’ and ‘unpackaged’. Thus
governments that followed ISI strategies often acted as a ‘hard bargainer’ with foreign
suppliers on behalf of domestic companies. The focus was inevitably on keeping the cost of
technology at its lowest. However, in the globalized environment, intra-firm learning is only
secondary to learning through external interactions. Established firms are taking a variety of
15 In 2002, the year when Haier entered into a technological alliance with Sanyo, the two companies reached an
agreement to use each other’s distribution networks. Under the agreement Haier would sell Sanyo products in
China, and a Haier-Sanyo joint venture would sell Haier-branded products in Japan— a step unusual in the
Japanese market (Wall Street Journal Europe, Jan 9, 2002). The diversified product lines of Haier and Sanyo
must have made the deal attractive to both parties.
16 That is not to ignore the significant role of licensing of technology in the technological catching up of
Taiwanese or Korean firms. But many of these firms also engaged in production relationships with foreign
partners. In addition, unlike in China and India during their ISI phase, the incentive structure in these countries
necessitated learning from licensed technologies and continual technological upgrading for improving
competitiveness.
19
measures to keep their technologies from leaking (see, for a discussion, Radosevic, 1997).
Thus, while production capabilities could be achieved in house, acquiring design capabilities
requires developed network of partners and sourcing capabilities. In other words, technology
is no longer traded at the boarder, but through MNC structures or through sourcing
arrangements (subcontracting, alliances) over which government has little control. In such a
context, the Chinese government appears to have performed the role of a ‘supporter and
organizer of technology networks’. In this respect, the Chinese state must have learnt its
lessons from its Korean and Taiwanese counterparts.
The Chinese government— both the central and local governments— has a major influence in
the strategic decisions of conglomerates like Haier. The company can therefore rely on
governmental guidance in matters such as choosing a foreign partner. Government can also
play a vital role in assisting large scale foreign acquisitions. For example, China Investment
Corp (CIC), a sovereign wealth fund that controls a substantial part of China’s foreign
exchange reserves, has a mandate to assist Chinese companies such as Haier in their overseas
acquisitions.17The government also provides direct financial contributions to firms for
enhancing their technological capabilities. For example, in 1998 Haier group was one of six
large Chinese conglomerates selected to receive RMB 20 million each for technological
innovation. Another aspect that is perhaps unique to China is the way in which the state
contributes to the creation of large enterprises. In 1997 as part of its strategy of ‘grasping the
large while letting go of the small’ government focused on establishing ‘enterprise groups’,
by combining large state owned enterprises (SOEs), to reap the benefits of economies of scale
and international competitiveness. Thus in electrical household appliances sector, Haier and
its Chinese rival Konka Group have merged with several smaller SOEs in Anhui, Guizhou,
Heilongjiang, Jiangsu, Shaanxi and Zhejiang provinces.18
Haier’s spectacular growth embodies the dynamism exhibited by emerging MNCs from
China. It demonstrates that success in the globalized age is about embracing globalization,
diversifying, and partnering with and acquiring global firms. The success of Haier, and other
globalizing firms from China and India, also underscores that firms that operated inefficiently
under ISI can turn around and become internationally competitive through developing
appropriate internationalization and domestic capability building strategies. Haier’s case
further illustrates that the state can play a very important role in this process— by not being an
arbitrator between domestic and foreign firms as it did under ISI but by being a supporter and
facilitator of firms’ technological sourcing strategies.
REFERENCES
Abramovitz, M. (1986). Catching-up. Forging Ahead and Falling Behind. Journal of Economic
History. 46(2): 385-406.
Aharonson, B.S., Baum, JA.C. and Feldman, M.P. (2007), ‘Desperately seeking spillovers?
Increasing returns, industrial organization and the location of new entrants n geographic and
technological space’, Industrial and Corporate Change, 16(1), pp. 89–130.
17 For example, consider Haier’s bid for General Electric’s appliance business. While the bid is expected to fetch
US$7 billion, Haier appears to have little difficulty in mobilizing that amount; it could potentially tap CIC or
China Development Bank to help finance the deal (FT, 2008). Other benefits the company receives from the
Chinese government include assistance for R&D, government introducing foreign customers to Haier, and
cheaper input costs due to supply from subsidized state-owned upstream industries. The latter is especially
important in the technologically matured white goods sector where cost competitiveness is paramount.
18 A downside of such mergers is that local governments in China bully firms like Haier to buy loss making
enterprises. The list of companies ‘offered’ to Haier ranges from a pharmaceutical company, which Haier bought
and the joint venture ended in a disaster, to a bicycle company which Haier refused to buy (Newsweek, 2005)
20
Amsden, A. (1989). Asia’s Next Giant: South Korea and Late Industrialization, Oxford
University Press, New York.
Bartlett, C.A. and S. Ghosal (2000), Going Global: Lessons from Late Movers, Harvard Business
Review, March-April: 132-142
Beaudry, C. (2001), ‘Entry, growth and patenting in industrial clusters: A study of the aerospace
industry in the UK’, International Journal of the Economics of Business, 8, 405-436.
Bloom, M. (1992). Technological Change in the Korean Electronics Industry. Paris:
Development Center Studies, OECD
Bonaglia, F, Goldstein , A., and J. Mathews (2007), Accelerated internationalization by
emerging markets’ multinationals: The case of the white goods sector, Journal of World
Business, 42(4): 369-383.
Cantwell, J., and L. Pisitello (1991), the Emergence of Corporate International Networks for the
Accumulation of Dispersed Technological Competences, Management International Review,
1:123-147
Chandler, A. and Hikino, T. (1997), ‘Historical and Comparative Contors of Big Business’, in A.
Chandler, F. Amatori and T. Hikino (ed) Big Business and the Wealth of Nations, (pp. 3-23).
New York: Cambridge University Press.
Chen, W.H. (1999). The Manufacturing Strategy and Competitive Priority of SMEs in Taiwan:
A Case Survey. Asia Pacific Journal of Management 16(3),331-349.
Chittoor, R., Ray, S., Aulakh, P.S., and Sarkar, M. B. (2008), ‘Strategic responses to institutional
changes: ‘Indigenous growth’ model of the Indian pharmaceutical industry, Journal of
International Management.
Choung, J-Y, Hwang, H-R., Choi, J-H and Rim, M-H. (2000). Transition of Latecomer Firms
from Technology Users to Technology Generators: Korean Semiconductors Firms. World
Development Vol. 28, No. 5. 969-982.
Cuervo-Cazurra, A (2008), ‘The multinationalization of developing country MNEs: The case of
multilatinas’, Journal of International Management, 14: 138–154
Dahlman, C, J. and O. Sananikone. (1990). Technology Strategy In the Economy of wan:
Exploiting Foreign Linkages and Investing in Local Capability. Washington, Dc: World
Bank.
Dahlman, C, J. and O. Sananikone. (1993). Economic Policies and Institutions in the rapid
Growth of Taiwan, China. Lessons of East Asia. World Bank Country Study.
Dahlman, C, J. (1994). Technology Strategy in East Asian Developing Economies. Journal of
Asian Economics, 5(winter): 541-572
Felipe, J. (2000). Convergence, Catching-up and Growth Sustainability in Asia: Some Pitfalls.
Oxford Development Studies. 28(1): 51-69.
Financial Times (2008), Is it time for Haier to move up a gear via deal in US?, Jun 11, p. 16
Financial Times (2004), The art of innovating on a shoestring, Sep 24, 2004. p. 3
Gerschenkron, A. (1962), Economic Backwardness in Historical Perspective: A Book of Essays,
Harvard University Press, Cambridge, Massachusetts.
Ghemawat, P., and Khanna, T. (1998), ‘The nature of diversified business groups: A research
design and two case studies’, Journal of Industrial Economics, 46(1), 35-61.
Hobday. (1995) East Asian Latecomer Firms: Learning the Technology of Electronics, World
Development vol. 23 No 7
Hobday, M. (1996). Innovation in South-east Asia: Lesson for Europe? Management Decision.
34(9), 71-81.
http://tech.sina.com.cn/it/2005-03-17/1510553880.shtml . Accessed on March 20, 2005
http://news.xinhuanet.com/it/2005-03/17/content_2710263.htm . Accessed on April 3, 2005.
21
Khanna, T. and Palepu, K. (1997), ‘Why Focused Strategies May Be Wrong for Emerging
Markets’, Harvard Business Review, July-August
Kim, L. (1980). Stages of development of industrial technology in a developing country: a
model. Research Policy. 9, 1980.
Kim, L. (1995). Absorptive Capacity and Industrial Growth: A Conceptual Framework and
Korea’s Experience. Social Capability and Economic Growth. London: Macmillan.
Kim, L. (1998). Technology Policies and Strategies for Developing Countries: Lessons from
Korean Experience. Technology Analysis and Strategic agement. 10(3), 331-323
Lim, Y. (1999). Technology and Productivity: the Korean Way of Learning and Catching-up,
Cambridge, MA: the MIT Press
Mathews, J.A. (1999). A Silicon Island of East: Creating a Semiconductor Industry in Singapore.
California management Review. 41(2), 55-78.
Mathews, J.A (2001), Catching-up Strategies in Technology Development with Particular
Reference to East Asia, World Industrial Development Report, Background Paper.
Mckendrick, D. (1992). Obstacles to “Catch-Up”: The Case of the Indonesian Aircraft Industry.
Bulletin of Indonesian Economic Studies. 28(1), 39-46.
Newsweek (2005), Business: a Jack Welch of communists, May 19.
Ouyang T. (2003). The High Operation Platform of China: The Case Study of Haier.
Management World (in Chinese). 2003.2
Radosevic, S. (1999), International Technology Transfer and Catch-up in Economic
Development, Edward Elgar, Cheltenham, UK.
Rosenthal, S, S. and W.C. Strange (2003), ‘Geography, industrial organization and
agglomeration’, Review of Economics and Statistics, 85, 377-393.
Ruimin, Z. (2006), ‘2016: What’s Next for Asia?’ Far Eastern Economic Review, Nov. 169 (9),
62.
SinoCast China Business Daily News (SCCBD) (2007), Haier to Launch Two Overseas R&D
Centers, Nov 15, pg. 1
Smyth, R. (2000), ‘Should China be Promoting Large-Scale Enterprises and Enterprise Groups?’
World Development, 28(4): 721-737.
Sun J. (2002), The Company Strategy of Haier. The Enterprise Management Press
in China, 2002.
World Bank (1993) The East Asian Miracle: Economic Growth and Public Policy. New York:
World Bank, Oxford University Press.
Wu Xiaobo. (1995). The Development Process of the Secondary innovation, Science Research
Management (in Chinese). 1995.3
www.haier.com.cn/chinese/about/index.html. Accessed on November February 10, 2005
www.haier.com/chinese/about/synopsis/milestone.html Accessed 2004 and February 20, 2005
ww.pladaily.com.cn Accessed on November 3, 2004.
ww.3rd56.com. Accessed on November 3, 2004
www.people.com.cn/GB/jinji/33/172/20011115/605832.html . Accessed on November 4, 2004
www.lgoods.com/jydq/manage-14.htm . Accessed on November 5, 2004
www.denglongmen.com/information/article_show.php?ArticleID=2174 . Accessed on
November
www.fsi.com.cn/case500/view504/504-0304/03041801.htm . Accessed on November 6, 2004
ww.51lw.com/article Accessed on November 15, 2004
www.paper.edu.cn/scholar/download.jsp?file=wuxiaobo-8 . Accessed on November 18, 2004
www.people.com.cn/GB/jinji/222/2177/2966/3051395.html . Accessed on December 20, 2004.
www.lgoods.com/jydq/manage-14.htm. on November 5, 2004
22
www.denglongmen.com/information/article_show.php?ArticleID=2174. Accessed on November
6, 2004
Wall Street Journal (WSJ), 2008 (March 19)
Yan J. and Hu B. (2001), China’s Haier. Hainan of China Press
Zeng X. and Zhong S. (2003). The technological Alliance and the Succession of Haier.
Science and TechnologyResearch (in Chinese), 2003.1
23
The UNU-MERIT WORKING Paper Series
2008-01 Science, Technology and Development: Emerging concepts and visions by Luc Soete
2008-02 Reframing technical change: Livestock Fodder Scarcity Revisited as Innovation Capacity
Scarcity. Part 1. A Review of Historical and Recent Experiences by Andy Hall, Rasheed
Sulaiman V., Mona Dhamankar, Peter Bezkorowajnyj & Leela Prasad
2008-03 Reframing technical change: Livestock Fodder Scarcity Revisited as Innovation Capacity
Scarcity. Part 2. A Framework for Analysis by Andy Hall, Rasheed Sulaiman, V. and Peter
Bezkorowajnyj
2008-04 Reframing technical change: Livestock Fodder Scarcity Revisited as Innovation Capacity
Scarcity.Part 3. Tools for Diagnosis and Institutional Change in Innovation Systems by
Andy Hall, Rasheed Sulaiman and Peter Bezkorowajnyj
2008-05 Is Inter-Firm Labor Mobility a Channel of Knowledge Spillovers? Evidence from a Linked
Employer-Employee Panel by Mika Maliranta, Pierre Mohnen & Petri Rouvinen
2008-06 Financial Constraints and Other Obstacles:Are they a Threat to Innovation Activity? By P.
Mohnen, F.C. Palm, S. Schim van der Loeff and A. Tiwari
2008-07 Knowledge-based productivity in ‘low-tech’ industries: evidence from firms in developing
countries by Micheline Goedhuys, Norbert Janz and Pierre Mohnen
2008-08 The Voyage of the Beagle in Innovation Systems Land.Explorations on Sectors, Innovation,
Heterogeneity and Selection by Martin Srholec & Bart Verspagen
2008-09 Crafting Firm Competencies to Improve Innovative Performance by Boris Lokshin, Anita
van Gils & Eva Bauer
2008-10 The Economics and Psychology of Personality Traits by Lex Borghans, Angela Lee
Duckworth, James J. Heckman & Bas ter Weel
2008-11 Embedding Research in Society: Development Assistance Options for Supporting
Agricultural Innovation in a Global Knowledge Economy by Andy Hall
2008-12 Playing in Invisible Markets: Innovations in the Market for Toilets to Harness the Economic
Power of the Poor by Shyama V. Ramani
2008-13 Explaining Success and Failure in Development by Adam Szirmai
2008-14 Running The Marathon by William Cowan, Robin Cowan and Patrick Llerena
2008-15 Productivity effects of innovation, stress and social relations by Rifka Weehuizen, Bulat
Sanditov and Robin Cowan
2008-16 Entrepreneurship and Innovation Strategies in ICT SMEs in Enlarged Europe (EU25) by
Kaushalesh Lal and Theo Dunnewijk
2008-17 Knowledge Transfers between Canadian Business Enterprises and Universities: Does
Distance Matter? By Julio M. Rosa & Pierre Mohnen
2008-18 Multinationals are Multicultural Units: Some Indications from a Cross-Cultural Study by
Nantawan Noi Kwanjai & J. Friso den Hertog
24
2008-19 The Innovativeness of Foreign Firms in China by Branka Urem, Ludovico Alcorta and
Tongliang An
2008-20 Beyond the emission market: Kyoto and the international expansion of waste management
firms by Ionara Costa, Asel Doranova and Geert-Jan Eenhoorn
2008-21 The ‘making of’ national giants: technology and governments shaping the international
expansion of oil companies from Brazil and China by Flavia Carvalho and Andrea Goldstein
2008-22 If the Alliance Fits . . . : Innovation and Network Dynamics by Robin Cowan & Nicolas
Jonard
2008-23 Facing the Trial of Internationalizing Clinical Trials to Developing Countries: With Some
Evidence from Mexico by Fernando Santiago-Rodriguez
2008-24 Serving low-income markets: Rethinking Multinational Corporations’ Strategies by Shuan
SadreGhazi and Geert Duysters
2008-25 A percolation model of eco-innovation diffusion: the relationship between diffusion, learning
economies and subsidies by Simona Cantono and Gerald Silverberg
2008-26 New Europe’s Promise for Life Sciences by Sergey Filippov and Kálmán Kalotay
2008-27 A closer look at the relationship between life expectancy and economic growth by Théophile
T. Azomahou, Raouf Boucekkine, Bity Diene
2008-28 Regional Capital Inputs in Chinese Industry and Manufacturing, 1978-2003 by Lili Wang &
Adam Szirmai
2008-29 Worker remittances and government behaviour in the receiving countries by Thomas
Ziesemer
2008-30 Strategic motivations for Sino-Western alliances: a comparative analysis of Chinese and
Western alliance formation drivers by Tina Saebi & Qinqin Dong
2008-31 Changing Configuration of Alternative Energy Systems by Radhika Bhuyan and Lynn
Mytelka
2008-32 Promoting clean technologies: The energy market structure crucially matters by Théophile
T. Azomahou, Raouf Boucekkine, Phu Nguyen-Van
2008-33 Local Knowledge Spillovers, Innovation and Economic Performance in Developing
Countries: A discussion of alternative specifications by Effie Kesidou and Adam Szirmai
2008-34 Wage effects of R&D tax incentives: Evidence from the Netherlands by Boris Lokshin and
Pierre Mohnen
2008-35 Cross-border Investment and Economic Integration: The Case of Guangdong Province and
Hong Kong SAR by Naubahar Shari and Can Huang
2008-36 Radical versus non-radical inventions by Wilfred Schoenmakers, Geert Duysters & Wim
Vanhaverbeke
25
2008-37 Localized Innovation, Localized Diffusion and the Environment: An Analysis of CO2
Emission Reductions by Passenger Cars, 2000-2007 by Bart Los and Bart Verspagen
2008-38 The economic impact of AIDS in sub-Saharan Africa by Théophile T. Azomahou, Raouf
Boucekkine, Bity Diene
2008-39 Further results on bias in dynamic unbalanced panel data models with an application to firm
R&D investment by Boris Lokshin
2008-40 A multilevel analysis of innovation in developing countries by Martin Srholec
2008-41 Experimentation with strategy and the evolution of dynamic capability in the Indian
Pharmaceutical Sector by Suma Athreye, Dinar Kale & Shyama V. Ramani
2008-42 The Impact of Social Capital on Crime: Evidence from the Netherlands by I.Semih Akcomak
and Bas ter Weel
2008-43 Portrait of an Odd-Eyed Cat: Cultural Crossing as a Trademark for a Dutch-Thai Strategic
Alliance by Nantawan Noi Kwanjai & J Friso den Hertog
2008-44 The challenge of measuring innovation in emerging economies’ firms: a proposal of a new
set of indicators on innovation by Luciana Manhães Marins
2008-45 Intra-firm Technology Transfer and R&D in Foreign Affiliates: Substitutes or
Complements? Evidence from Japanese Multinational Firms by Rene Belderbos, Banri
Ito, Ryuhei Wakasugi
2008-46 To Be or Not to Be at the BOP: A One-North-Many-Souths Model with Subsistence
and Luxury Goods by Adriaan van Zon and Tobias Schmidt
2008-47 Habit Formation, Information Exchange and the Social Geography of Demand by
Zakaria Babutsidze and Robin Cowan
2008-48 Agenda Disputes and Strategic Venue Preferences: The Doha Crisis and Europe’s
Flight to Regionalism by Francisco P. Toro
2008-49 The determinants of the outward foreign direct investment of China and India:
Whither the home country? by Paz Estrella Tolentino
2008-50 Comparing Chinese and the Indian Software MNCs: Domestic and Export Market Strategies
and their Interplay by Jorge Niosi and F. Ted Tschang
2008-51 Internationalising to create Firm Specific Advantages: Leapfrogging strategies of U.S.
Pharmaceutical firms in the 1930s and 1940s & Indian Pharmaceutical firms in the 1990s
and 2000s by Suma Athreye and Andrew Godley
2008-52 Internationalization and Technological Catching Up of Emerging Multinationals: A Case
Study of China’s Haier Group by Geert Duysters, Jojo Jacob and Charmianne Lemmens

The post #2008-052 Internationalization and Technological appeared first on My Assignment Online.

Expert Help With This Assignment — On Your Terms