Self-Limiting Dominant Logic: An Exploratory Study of Chinese Entrepreneurial Firms

Abstract

Previous research has found that cognitive frame, mental models, and schema embody a dominant logic of firms that structure the behavioral routines of managers and can become a central force shaping a firm's decisions and actions. This exploratory study seeks to provide insight into an emerging dominant logic among recently established private-sector Chinese enterprises. Using multiple case studies of Chinese entrepreneurial firms, we identify convergence on a surprisingly similar dominant logic based on closely aligned concepts and accompanying behaviors: a defensive perspective of business environment; a conservative strategic decision-making process; and full involvement of owners and top managers in daily operations that substitute for development of elaborate routines and systems. Although a dominant logic may facilitate decision making and growth, it may also act as a perceptual blinder limiting opportunity search as firms seek to minimize risk in an uncertain environment.

KEYWORDS:

• China
• dominant logic
• emerging economies
• entrepreneurship

Notes

*The firm was established in 1994 but, for the first 5 years, remained a very small operation that started to develop around 1999/2000.