Yuan and marketing: The perception of Chinese owner-managers

Entrepreneurship researchers point to the lack of any substantial assessment of the state of research into entrepreneurship in regions other than North America. Thus, to advance entrepreneurship research and build an indigenous model, this paper attempts to explain Yuan or external locus of control [cf. Rotter, J. B. (1966). Generalized expectancies for internal versus external control of reinforcement. Psychological Monographs, 80 (Whole No. 609)], in the context of Chinese owner-managers. This paper undertakes a narrative analysis of the interviews conducted with 48 Chinese, 26 Hong Kong and 28 Taiwanese owner-managers and/or chief marketing executives of small and medium enterprises about how Yuan affects their marketing practices. Four dimensions of Yuan (e.g., association, quality, matching and attitude) were identified. A two-dimensional model using the optimal scaling method was applied to determine the interdependence of the four dimensions. Four groups, namely Yuan accepters, anti-Yuan-ers, stuck in the middlers, and dedicated Yuan believers, emerged. The results suggest that Yuan believers tend to exhibit higher company performance.