Frontiers in Management Research

Download PDF (187 KB) PP. 54 - 64 Pub. Date: April 25, 2017

DOI: 10.22606/fmr.2017.12003

• Wanxing Jiang^*
  Department of Management, Hong Kong Baptist University, Hong Kong
• Ji Li
  Department of Management, Hong Kong Baptist University, Hong Kong
• Tao Liu
  School of Business Administration and Tourism Management, Yunnan University, China
• Xiaolong Tao
  School of Business Administration and Tourism Management, Yunnan University, China

Research shows several effects of first-mover strategy on first movers’ performance. However, the effects of first-mover strategy on late movers’ performance have not been sufficiently studied. Integrating viewpoints from theories of organizational sociology as well as those of business strategy, we predict that the first-mover strategy should have both direct and indirect effects on the performances of later movers. Moreover, the effects are more likely to be significant in emerging markets with more environmental uncertainties. To test these predictions, we develop hypotheses and test them empirically among MNEs in China’s insurance industry. This test shows that, other things being equal, first-mover strategy does cause significantly more imitation among late movers. The imitation, in turn, has significant effects on other dimensions of firm performance, including less deviation from the industry norm and better financial performance. Finally, in the process of imitation, similarity in home-country culture also has a significant and positive effect.

First-mover strategy; late movers; MNEs; emerging market

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