Closing the distance: a grounded theory of adaptation

Abstract

Purpose

This paper seeks to consider the impact of psychic, cultural and institutional distance, the adaptation of international joint ventures and the performance of international companies entering an emerging economy. It is also a critique of the dominant quantitative approach to analyzing distance in international business.

Design/methodology/approach

This study applies a comparative case study using a grounded theory approach of six companies who entered Vietnam from 1986 until the present. A total of 20 international executives were interviewed representing different phases from start-up, implementation to the current situation.

Findings

In comparison to other empirical studies on entry strategy and distance, this research finds that executives involved in entry do not consider established theories such as transaction costs. The resource-based approach is considered but from a practical view. Despite the considerable cultural and institutional distance between the European cultures and the Vietnamese values, these international ventures have managed to close the distance. This contradicts the findings of many quantitative studies on this issue.

Research limitations/implications

This study is qualitative. It depends on the perceptions of international executives over a 25 year period. Only a few of the Vietnamese counterparts are included in this study.

Practical implications

This study demonstrates the importance of adaptation overtime for the success of international ventures.

Originality/value

A long term qualitative study including executives from six major international companies and executives over such a longtime is rare. Using the grounded theory process in this research context is also unique.

Citation

Hans Wafler, B. and Swierczek, F. (2014), "Closing the distance: a grounded theory of adaptation", Journal of Asia Business Studies, Vol. 8 No. 1, pp. 65-80. https://doi.org/10.1108/JABS-11-2012-0050