Multi-agent System Applied in the Analysis of Servitization Difficulty in Chinese MNE Greenfield Subsidiaries
An Exploratory Case Study
S. Yang (TU Delft - Technology, Policy and Management)
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Abstract
Over the last 20 years, the Chinese corporations have accumulated essential technological competencies such as those in the consumer goods manufacturing and information technologies. Therefore, Chinese multinational enterprises (MNEs) have high global ambitions to expand their reach into the foreign markets as an important role in contributing to the rising economic power of China. They are establishing greenfield subsidiaries from the ground up to penetrate into foreign markets. On the other hand, service offerings and service solutions are becoming the popular options for the consumption of our daily life. It has a huge potential for company to increase the customer engagement and “lock in” the customers. The term “servitization” is going viral nowadays which refers to an organizational transformation of companies from being a product-centered organization to being a service provider for customers. However, given the more and more integrated world economy, the servitization difficulties that are faced by companies, especially Chinese MNEs, are even more complex due to the changing environment and the involvement of different stakeholders in a global environment. This problem of servitization, especially for the greenfield subsidiaries of the Chinese MNEs, gets even difficult to be handled.
This research explains the reasons of why the Chinese MNE greenfield subsidiaries are facing many obstacles. By looking into the characteristics of the organization, this research suggested that the performance of the servitization is correlated to the organizational features. Using agent-based model OperA to study the servitization in the organization is served as an exploration of a new approach to study the servitization. The insights that are explored from this approach is able to assist the future studies of other research problems regarding the servitization. On the other hand, people in the industries of different countries could be aware of the challenges of the globalization of Chinese MNEs, as well as the issues that they are facing. Understanding their problems will be helpful to establish better business cooperation and networking connections with the Chinese MNEs.