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Management innovation made in China: Haier’s Rendanheyi

Frynas, Jędrzej George; Mol, Michael J. and Mellahi, Kamel (2018). Management innovation made in China: Haier’s Rendanheyi. California Management Review, 61(1) pp. 71–93.

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This article shows how emerging market companies like China’s Haier Group create management innovations that are appropriate for an environment characterized by increased volatility, uncertainty, complexity, and ambiguity (VUCA). Dealing with VUCA effectively requires practices favoring nimble and decentralized responses; the Haier Group developed a platform of management practices under the label Rendanheyi (in Chinese: 人单合一) to transform itself from a conventional hierarchical manufacturing firm into a highly responsive online-based entrepreneurial company with “zero distance to the customer”. We demonstrate how the organizational, competitive, institutional, and technological contexts mattered for the development of Rendanheyi. Our study contributes several insights for practitioners and academics. First, we showcase how context dependent management innovations are created to allow emerging market firms like Haier to deal with a high VUCA world. Second, we draw lessons from Haier’s experimentation process for other firms. Finally, we create an extended process model of management innovation that managers, in both emerging and developed countries, can readily apply.

Item Type: Journal Item
Copyright Holders: 2018 The Regents of the University of California
ISSN: 2162-8564
Keywords: business history; case study; China; corporate strategy; emerging markets; innovation; innovation management; manufacturing; organizational structure
Academic Unit/School: Faculty of Business and Law (FBL) > Business > Department for Strategy and Marketing
Faculty of Business and Law (FBL) > Business
Faculty of Business and Law (FBL)
Item ID: 56044
Depositing User: George Frynas
Date Deposited: 07 Aug 2018 10:24
Last Modified: 02 May 2019 01:53
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