Modeling team efficiency for international production assignments in Chinese manufacturing multinationals

ABSTRACT

In 2019 China accounted for 14 percent of world total outward foreign direct investment, with 188 countries recipients of this investment. However research suggests that 67 percent of this investment is considered unsuccessful. Furthermore, the current Covid-19 outbreak has severely hindered global economic and trade activities. This is partly due to an under-efficiency of Chinese expatriate executives resulting from the lack of cultural intelligence of these executives to maximize team efficiency in production. From a data set of 358 expatriate Chinese executives, this research utilizes structural equation modeling to examine the role of expatriate executives' cultural intelligence on team efficiency. The research shows that the relationship between an expatriate executive’s cultural intelligence and team efficiency is mediated by their ability to recognize international opportunity and moderated by openness to experience. Additional leadership development on cultural intelligence of expatriate executives will improve international efficiency and wider multinational efficiency.