Cross-Cultural Cooperation and Innovation: An Exploration of Chinese Foreign Direct Investment in Europe

This study explores Chinese Foreign Direct Investment
(FDI) in Europe and the cross-cultural cooperation between Chinese
and European managers. The aim of this research is to shed light on
the phenomenon of investments in developed countries from an
emerging market and to gain insights into the cooperation process. A
grounded theory approach is adopted, and 46 semi-structured
interviews were conducted with 10 case companies in Germany and 13
case companies in the UK. Grounded theory models are developed
from primary data and interview quotes are used to support the themes.
The interviewees perceived differences between the two parties in
cultural traits, management concepts, knowledge structure and
resource endowment between the two parties. Chinese and European
partners can take advantage of different resources and cooperate in
innovative ways to improve corporate performance. Moreover, both
parties appreciate different ethical and cultural characteristics and
complement each other to develop a combined organizational culture.
This study proposes an ethical and cultural diversity theory in
international management arguing that a team with diversified values
and behaviours may be more excited and motivated. This study
suggests that “resource complement” and “cross-cultural cooperation”
might be an advantage for international investment. Firms are
encouraged to open their minds and cooperate with partners with
different resources and cultures. The authorities may review the FDI
policies to reduce social and political barriers.