The Configuration of Entrepreneurial Strategy in Chinese Small Textile Manufacturing Firms

Abstract

Purpose - This paper examines the interrelationships among functional area activities in their association with entrepreneurial strategy in a progressive textile manufacturing industry in China. Design/methodology/approach - The research is based on a sample of 248 small businesses in a textile manufacturing industry in Shaoxing, China. A questionnaire survey of owners/managers in the industry was carried out at a conference of the Shaoxing Textile Industry Association. Partial Least Square was used to analyze the data. Findings - The findings suggest that the pattern by which functional area activities that comprise entrepreneurial strategy are organized are similar in several respects to such strategies in Western economies. Networking features prominently alongside market-based activities of customer retention management and technology as determinants of entrepreneurial strategy in the Chinese textile manufacturing industry. The study also found that activities in these three functional areas mediate the association between other functional area activities such as HRM, operations, planning, and finance and entrepreneurial strategy. Research limitations/implications - Generalization of the findings is limited by the examination of small businesses in one industry sector. Future research is required to assess the application of the findings to other industry sectors. Practical implications - In a social-based system where relationships are important, the development and maintenance of network ties as well as attention to customers and innovation are critical to pursuit of entrepreneurial strategy. Originality/value - The study contributes to the limited existing knowledge on entrepreneurial strategy among small businesses operating in China.