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Abstract:

Purpose – The purpose of this paper is to elaborate the reason behind a sustainable guanxi network through the introduction of the collaborative strategy in the Taiwanese shoe industry.

Design/methodology/approach – Literature review in the area of Chinese business culture, and guanxi network is used to elaborate the information obtained from the company.

Findings – This paper highlights that the belief of sincerity and trustworthiness has refined to the organization culture that supports the sustainability of Taiwanese guanxi network. Besides, the transaction cost theory, resource-based view, and specific relationship investment has become a hinder strategy for Taiwanese organization to maintain the business relationship. This paper introduces an interesting collaborative strategy between three parties, the original equipment manufacturer (OEM) supplier, the machinery manufacturer, and the end-user (the branding). Although there is no direct business flows between the end-user and the machinery manufacturer, the specific relationship investment between these two parties are tight and cannot be separated. This has ensured the proper business flows between the OEM supplier and the end-user as well as the OEM supplier and the machinery manufacturer.

Originality/value – This paper illustrates that a guanxi network is not sufficient to ensure a long-term business relationship to be established. Indeed, the organization culture as well as the consideration on the transaction cost and resources from each party does have a great impact on the collaboration relationship to be successful.

Keywords:

Business enterprise, Competitive strategy, Networking, Shoes, Taiwan

Article Type:

Viewpoint

Article URL:

http://www.emeraldinsight.com/10.1108/09555340910998841

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