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

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