IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

The Importance of Absorptive Capacity in the Road to Becoming a “Giant Lion”—ASUSTek Computer Inc

  • Chyong Ling Judy Chen
  • Susan Margaret Belcher
Registered author(s):

    In Taiwan, small businesses, which account for about 97% of all firms, spawned Taiwan's economic miracle in the 1980s. For the past two decades, the information technology (IT) industry has formed the backbone of Taiwan's economy. There are many theories that have identified a plethora of factors which contribute to the success of a small business. This case study applies the theory of absorptive capacity to ASUSTek Computer Inc., a small Taiwanese business founded on April 2, 1990 by four engineers with capital of NT$30 million (US$950,000) which has grown to become a global leader in the IT industry with a total revenue of NT$755 billion (US$24 billion) and market capitalization of NT$49 billion (US$1.5 billion) as of December 31, 2007. (Based on exchange rate US$1=NT$31.5. ASUS's revenue dropped to NT$668 billion in 2008 mainly due to the global financial crisis.) ASUS' business significantly took off after Jonney Shih joined the company as CEO in 1993. He remains a key anchor of ASUS. ASUS' ability to not only absorb, transform, and utilize new knowledge but develop new technology in-house to create and sustain competitive advantage in the market place has ensured the company's continuing success as well as propelling it to a position of leadership in the IT industry worldwide. This paper will discuss how ASUS' in-house R&D; apprenticeship-style on-the-job training; management leadership's organizational culture and structure—all of which stress learning and innovation; financial resources and conservative fiscal policy; as well as pro-business government policies have provided the foundation and environment for great absorptive capacity to develop and adapt technology, enabling ASUS to become a “Giant Lion” in the global computer industry.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://www.tandfonline.com/doi/abs/10.1080/1226508X.2010.513142
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

    Article provided by Taylor & Francis Journals in its journal Global Economic Review.

    Volume (Year): 39 (2010)
    Issue (Month): 3 ()
    Pages: 291-315

    as
    in new window

    Handle: RePEc:taf:glecrv:v:39:y:2010:i:3:p:291-315
    Contact details of provider: Web page: http://www.tandfonline.com/RGER20

    Order Information: Web: http://www.tandfonline.com/pricing/journal/RGER20

    No references listed on IDEAS
    You can help add them by filling out this form.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:taf:glecrv:v:39:y:2010:i:3:p:291-315. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.