A Research On The Behaviors Of Integrating Market And Nonmarket Environment For Chinese Firms

Nonmarket is as important as market which has the significant effect on the success of firms in the business environment. Thus, it is urgent that firms should integrate market and nonmarket and adopt the integrated strategy so as to improve their strategic management level. The field of nonmarket and integrated strategy will enrich the classical strategic management theory which is based on market and it is the new trend of the field of strategic management. Based on empirical researches including questionnaire and case study, we explore the behavior mode of integrating market and nonmarket environment and its influence on corporate performance in China.Firstly, the results indicate that market and nonmarket environment which Chinese firms are facing have high uncertainty during the stage of transition. Furthermore, the uncertainty of nonmarket increases the uncertainty of market significantly. The uncertainty of nonmarket in China manifests the following aspects, including vague items of policies and laws and rules, difficult operation of policies and laws and rules, various government departments having different explainations of the same central policy, and the game between central government and local government.Secondly, we test the internal behavior mode of integrating market and nonmarket environment. It is the behavior mode of three levels including the integrated strategy, negotiating mechanism and formal integrated management system. In detail, the integrated strategy is the direct behavior of integrating market and nonmarket environment.Negotiating mechanism and formal integrated management system are the internal institutional environment of supporting integrated strategy. Besides internal behavior mode, the information sharing mechanism among firms is the external mode of integrating market and nonmarket environment. During the process of establishing the information sharing mechanism, trade associations play the important role of"bridge"between firms and government. The internal and external behavior modes are both effective approaches of dealing with uncertain environment. Furthermore, the behavior modes will benefit for improving corporate economic performance through improving corporate social performance and adaptive capability significantly.Lastly, top managers play the much more important role of shaping the behavior modes no matter how the external environment is uncertain in the transitional period of China. On the one hand, the social capital of top managers will help shape the behavior modes directly. On the other hand, the social capital of top managers will benefit for improving their capabilities of perceiving and explaining the uncertain environment so as to adopt integrated strategy. With the increase of uncertainty of environment, organizational learning will play the much more important role which will help create a good internal integrated environment in order to adopt integrated strategy.