earticle

영어

Although the geo-political circumstances between two nations are not always secured, Korea & China have been expanded their cooperative relations steadily for more than 20 years. They have been trading a huge quantity of material exchange, exceeding that quantity of exchange between America and Japan. And international trade between Korea and China are more likely to be promoted in the future. Korean companies have been investing in China. As the China's high economic growth continues, problems like excess investment, reverse discrimination, environmental pollution and RMB appreciation pressure were emerging recently. Especially since 2008, when the Korean companies' great withdrawal out of China have started, scholars have been interested in the difference between Korean-Chinese management style and the moderating role of Guanxi between localization strategy and business performance. This study tries to integrate the variables of Guanxi utilization and localization strategy variables that have attracted the strong attention in the academic community in a single model. In this study, the nexus between the localization strategy and corporate performance have been reviewed by the previous researches and practical experiences to create the research model and setting up the hypotheses. Based on previous researches, the sub-variables of localization strategy include: marketing localization, production and technology localization, human resources localization, financing localization. The localization strategy was set to represent the independent variables. Guanxi utilization variables were derived from social exchange theory, and three core elements of them are reciprocity, trust and long-term orientation. Guanxi utilization variables were to represent the control variable. Dependent variable was set to represent the measurement variable of corporate performance. The research results of this study showed that Guanxi plays the significant role between localization strategy and business performance for the Korean companies in China. In this case, for the Korean companies in China pursuing a localization strategy requires Guanxi utilization to be done correctly. The results derived from the analysis of the questionnaires are summarized as follows; First of all, Guanxi utilization has a material impact on corporate performance as a number of previous studies have concluded. In this study, however, it is confirmed that the moderating effect of Gunxi utilization could be achieved more strongly through trust and long-term orientation rather than reciprocity in the subsidiaries of the Korean firms in China. Secondly, the relationship between localization strategy and the corporate performance can be demonstrated by the Guanxi of mutual trust and long-term orientation. Therefore, it becomes clear that the South Korean companies operating in China should take advantage of Guanxi element of trust and long-term oriented relationship rather than sort-term profit oriented reciprocity.