![Sample our Humanities journals, sign in here to start your FREE access for 14 days]({"type":"image" , "src" : "/sda/5939/TOC-Subject-Sample-2021-Humanities.jpg"})
Abstract
Internationalisation is an important part of the business history of both non-family and family firms. The discourse regarding both is based on the mainstream microeconomic theories of the firm. This article, through examining the case histories of two successful Chinese overseas family firms, shows that explanations of internationalisation need often to venture beyond the confines of existing theories, especially where contextual factors are influential in shaping decision-making. The experiences of these firms point to the role of the state as a major contextual factor. The case history approach is the most relevant in this and other instances where context matters.
Acknowledgements
The authors, all affiliates of the Malaysian Chinese Research Centre, acknowledge the support of University of Malaya Research grant (UM.C/625/1/HIR/MOHE/ASH/04) entitled ’The Chinese in Malaysia: Evolving Identity in a Globalizing Environment and Nation Building.
Notes
1. See, for instance, CitationDunning, International Production; CitationHymer, The International Operations; CitationVernon, Sovereignty at Bay.
2. CitationFuentes-Lombardo and Fernandez-Ortiz, “Why Internationalize”; CitationGallo and Sveen, “Internationalizing the Family Business.”
3. See, for instance, CitationBelussi and Sammarra, “The International Growth of Family Firms”; CitationDyer and Mortensen, “Entrepreneurship and Family Business”; CitationSundramoorthy and Dean, “Family Business Openness.”
4. Although this group has often been referred to as ‘overseas Chinese’, we follow CitationWang, “Greater China” in referring to this population as ‘Chinese overseas’. The former definition arose from the fact that before the Second World War, this group counted many who were transients, sojourners so to speak, who hoped eventually to return to China. This option was no longer possible after this War with the establishment of the People's Republic of China.
5. CitationFukuda, Japan and China.
6. In this paper we refer to Malaysians of Chinese ancestry as Malaysian Chinese or ethnic Chinese. This is to distinguish them from Chinese who are the nationals of China.
7. CitationVernon, Sovereignty at Bay.
8. CitationJohansson and Vahlne, “The Internationalization Process.”
9. CitationDunning, International Production.
10. CitationCantwell, “The Globalization of Technology.”
11. CitationLee, “Business Networks.”
12. See CitationZahra, “International Expansion”; CitationFuentes-Lombardo and Fernandez-Ortiz, “Why Internationalize”; CitationPrice Waterhouse Coopers (PWC) in its Family Firm, 5, associates this desire for longevity with family businesses taking a long-term view (‘patient capital’).
13. CitationGubitta, “Assettiorganizzativi”; CitationPeng, “The Resource-based View”; CitationFriedman and Friedman, How to Run; Johansson and Wahlne, “The Internationalization Process.”
14. See, for instance CitationBell, McNaughton, and Young, “Born-again Global Firms”; CitationGallo, Empresa familiar; CitationGraves and Thomas, “Venturing Beyond the Backyard”; CitationOkoraofo, “Internationalization of Family Businesses”; CitationOviatt and MCDougall, “Toward a Theory”; CitationPeng, “The Resource-based View.”
15. See CitationWong, Ethnicity and Entrepreneurship, for a discussion on ethnic resources, CitationZhou, “Revisiting Ethnic Entrepreneurship” on enclave economies, and CitationValdez, “Ethnicity and the Economy” on the role of the state.
16. See CitationIbrahim and Galt, “Explaining Ethnic Entrepreneurship”, on the application of institutional economics and CitationSalaff, Greve, Wong, and Ping, “Ethnic Entrepreneurship” on social networks.
17. CitationKotkin, “Tribes.”
18. CitationKao, “The World Wide Web.”
19. CitationWeidenbaum and Hughes, The Bamboo Network; and CitationChung, “Western Corporate Forms,” 287–288.
20. CitationGomez and Hsiao, “Chinese Business,” xi.
21. Although the NEP was to last for only 20 years until 1990, the substance of the policy has remained in place to this day. Officially, the NEP was replaced by the National Development Policy, 1990–2000, which was in turn replaced by the National Vision Policy, in existence to this day.
22. CitationGomez, Loh and Lee, “Malaysia,” 70.
23. CitationRedding, The Sprit, 3.
24. See CitationForbes, “The World's Billionaires.”
25. CitationHoselitz, “A Sociological Approach,” 157.
26. CitationGambe, Overseas Chinese Entrepreneurship, 159–160, argued that the Chinese overseas were not integral members of the society, and did not develop innovations in social behavior, remaining detached from and viewed with suspicion by the local population.
27. CitationCheong, Lee, and Lee “Global Economic Crises.”
28. The volume of these remittances was substantial, sufficient in some years around the time of the Great Depression, to substantially finance China's trade deficit (CitationCheong et al., “Global Economic Crisis”).
29. CitationWong, “Globalization and Localization,” 292.
30. CitationYeung, “Ethnic Entrepreneurship,” 576.
31. CitationKoning and Verver, “Historicizing the ‘Ethnic’,”; CitationParé, Menzies, Brenner, and Filion “The Internationalization.”
32. A detailed account of the Group's growth is contained in CitationLee, Cheong, and Lee, “Robert Kuok.”
33. Since Malaysia only came into being in 1963, it is not strictly correct to refer to the population of British Malaya (before 1957) and the Federation of Malaya (from 1957 to 1963) as Malaysians. They were Malayans. We have used the term “Malaysian” to avoid having to navigate between these terms.
34. CitationChua, “Kuok Brothers”. The literature on the Chinese overseas contains considerable references to their business networks. See, for instance, CitationDFAT, Overseas Chinese. Much of it deals with structures and relationships rather than their role in the process of internationalization.
35. When he started his own company, Kuok Brothers Limited, two of his workers were non-ethnic Chinese.
36. As late as 1947, when the first census of Malaya was taken after the Second World War, half the population was Malay unlike other major towns which were predominantly Chinese. See Citationdel Tufo, Malaya.
37. CitationCho, The Malaysian Economy, 44.
38. Ibid., 44.
39. CitationWhite, “The Beginnings.”
40. CitationSoh, “Perlis Plantation”; CitationLim, “Sugar King.”
41. The term ‘Bumiputera’ refers to the local Malays and other races indigenous to Malaysia. Although extensively referred to in official statements and documents, there is no uniform definition and the term does not appear in the country's Constitution.
42. See the website of Kuok (Singapore) Limited: http://www.pclsg.com/kuokgroup.com.sg/about-background.html
43. CitationLee et al., “Robert Kuok.”
44. Ibid.
45. This was revealed in the Kerry Holdings website under “History”.
46. CitationChan, “The English Language Media.”
47. Witchter and Ubels, “Malaysia's Kuok.”
48. Kuok in a rare interview in CCTV (in Chinese) related how in 1973, two Chinese officials met with him in secret in Hong Kong and told him about the dire shortage of sugar in China. See CitationKuok, CCTV Interviw.
49. CitationFong and Barrock, “Cover Story.”
50. See, for instance, “CitationWilmar Aims to Grow.”
51. As of June 18, 2014, Wilmar is the second largest palm oil company with a market capitalization of S$20.5 billion, behind Sime Darby with a market capitalization of MYR57.9 billion (S$22.5 billion) (Bloomberg).
52. CitationChen, Born and Bred.
53. Tin was discovered in other parts of Peninsular Malaysia, most importantly in Perak, but also in Negeri Sembilan and Melaka. Malaya was to become the largest producer of tin in the world even before the end of the nineteenth century (CitationChen, Born and Bred, 20).
54. Among others, Yong Koon's great grandchildren Christopher Yong is corporate graphics manager, Andrew Yong is a retail manager in Singapore, and Sun May Foon is a merchandiser and designer for Selberan (CitationChen, Born and Bred, 112–113). See also CitationKoay, “All in the Family”. Many details of the family business' development in this paper are from CitationChen, Born and Bred. Chen is a fourth-generation member of the Yong family.
55. CitationChen, Born and Bred, 106. This account was also given by Chen Mun Kuen, sister of Yong Poh Kon and a director of RS, in an interview with the authors on September 11, 2013.
56. Interview with authors on September 11, 2013. See also CitationLee, “Royal Selangor.”
57. CitationLee, “Comyns.”
58. CitationLee, “Royal Selangor.”
59. CitationWang, “Pewter Maker.”
60. In 1975, RS hired Anders Quistgaard, a Danish designer to redesign its packaging for the Australian market, and in 1978, he joined SP full-time. In 1986, designer Erik Magnussen was commissioned to design a product line for Western markets in preparation for RS' outreach to global markets. Of course RS' factory in Singapore had Singapore workers.
61. Interview with Yong Poh Kon by authors on September 11, 2013.
62. See for instance CitationGomez, “Targeting Horizontal Inequalities.”
63. Population data are from censuses.
64. See CitationChirot and Reid, Essential Outsiders.
Additional information
Notes on contributors
Kee-Cheok Cheong
Kee-Cheok Cheong is senior research fellow at the Faculty of Economics, University of Malaya, Kuala Lumpur, Malaysia.
Poh-Ping Lee
Poh-Ping Lee is senior research fellow, Institute for China Studies, University of Malaya, Kuala Lumpur, Malaysia.
Kam-Hing Lee
Kam-Hing Lee is senior research fellow at the Social and Behaviorial Sciences Research Cluster, University of Malaya, Kuala Lumpur, Malaysia.