IDEAS home Printed from https://ideas.repec.org/a/taf/glecrv/v39y2010i3p291-315.html
   My bibliography  Save this article

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

Author

Listed:
  • Chyong Ling Judy Chen
  • Susan Margaret Belcher

Abstract

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.

Suggested Citation

  • Chyong Ling Judy Chen & Susan Margaret Belcher, 2010. "The Importance of Absorptive Capacity in the Road to Becoming a “Giant Lion”—ASUSTek Computer Inc," Global Economic Review, Taylor & Francis Journals, vol. 39(3), pages 291-315.
    • Handle: RePEc:taf:glecrv:v:39:y:2010:i:3:p:291-315
    DOI: 10.1080/1226508X.2010.513142
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/1226508X.2010.513142
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/1226508X.2010.513142?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Pankaj C. Patel, 2019. "Opportunity related absorptive capacity and entrepreneurial alertness," International Entrepreneurship and Management Journal, Springer, vol. 15(1), pages 63-73, March.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. 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.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RGER20 .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.