Original Research

Why do Chinese multinationals in South Africa get benefits from digital business strategy?

Kuizhen Rong, Ruhong Liu
South African Journal of Economic and Management Sciences | Vol 27, No 1 | a5473 | DOI: https://doi.org/10.4102/sajems.v27i1.5473 | © 2024 Kuizhen Rong, Ruhong Liu | This work is licensed under CC Attribution 4.0
Submitted: 20 December 2023 | Published: 15 May 2024

About the author(s)

Kuizhen Rong, Business School, Faculty of Business Administration, Henan University of Engineering, Zhengzhou, China
Ruhong Liu, School of Business, Faculty of Business Administration, Nanjing University, Nanjing, China

Abstract

Background: Chinese multinational enterprises (MNEs) are obsessed with implementing digital business strategy in global competition, but there is limited knowledge about how and when the MNEs can achieve performance.

Aim: This study aims to clarify the influence of digital business strategy on MNEs’ performance in South Africa, and whether this impact is mediated by exploratory and exploitative learning and moderated by organisational memory level and dispersion.

Setting: Senior executives from the MNEs participated in the year-long survey. Before the survey, the participants were communicated and agreed, and the survey was completed by email.

Method: Two-stage data from 314 MNEs in South Africa were obtained. Hierarchical regression analysis and Hayes Process Macros were used.

Results: The results show that digital business strategy positively influenced performance, and the relationship was mediated by exploratory and exploitative learning. Organisational memory level and dispersion had an inverted U-shaped moderating effect on the relationship between digital business strategy and exploratory and exploitative learning.

Conclusion: This study provides the first insight into the relationship between digital business strategy and MNEs’ performance in South Africa. It reveals the mediating mechanism and boundary conditions of this relationship, making an important contribution to the literature concerning digital business strategy.

Contribution: This study encourages MNEs in South Africa to implement digital business strategies according to local conditions. What’s more, exploratory and exploitative learning is a strategic process that cannot be ignored, and moderate organisational memory can help these MNEs benefit from digital business strategy better.


Keywords

digital business strategy; organisational learning; organisational memory; Chinese MNEs; performance; South Africa

JEL Codes

F23: Multinational Firms • International Business; M10: General; M20: General

Sustainable Development Goal

Goal 9: Industry, innovation and infrastructure

Metrics

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