The role of the internet in the internationalisation of small and medium sized companies

It is now recognised that many firms are “born global’ and initiate international business from inception or shortly thereafter. They have been influenced by both globalisation and the impact of new ICT technologies. This paper examines the role of the Internet in the internationalisation of a cross national sample of small entrepreneurial firms from Canada, Ireland, Australia and New Zealand. The findings are presented, including the role of the Internet in marketing, distribution, business processes and market intelligence and competitor analysis. The role of the Internet as a knowledge building tool is discussed, and areas for future research are presented.     

Empowerment of SME websites—Development of a web-empowerment scale and preliminary evidence

The emergence of the Internet and the World Wide Web has been argued to fundamentally reshape economic conditions and business practices of firms. It is seen as a promoter of rapid internationalisation of companies, particularly small and medium enterprises. In the aftermath of the burst of the electronic-bubble business practitioners and academics look with scrutiny on successful web-strategies, relevant dimensions of online-success and try to identify viable website practices which enable long-term rewards. The literature offers a rather patchy pattern for successful web-strategies and consumer perspectives on what is expected from websites is hardly available. Within this paper, we introduce the dimension “web-empowerment”. This is a multidimensional construct comprising of consumer views on various dimensions of relevant and successful websites. The web-empowerment scale is based on a large sample from Austria, and developed according to scale development procedures. The relevance of this construct and practical issues in the context of a cross-country sample of SME’s is empirically examined. The paper concludes by offering implications for SME practitioners and for research.     

How international entrepreneurship characteristics influence Internet capabilities for the international business processes of the firm

This research explores the relationship between international entrepreneurship characteristics and the use of Internet capabilities for the international business processes of the firm. It has been suggested, that the accumulation of a firms Internet capability can assist international operations, especially when operating in fast changing dynamic Internet environments. However, international entrepreneurship characteristics which are seen as a precursor to leveraging Internet capabilities are still vague. Given this finding, eight case studies of small and medium sized travel and tourism firms were selected to investigate the influence of international entrepreneurship characteristics, and Internet capabilities for international business processes. Based on the eight in-depth case studies, the results signify that successful international entrepreneurial firms which encompass high levels of international innovativeness and proactiveness behaviour integrate Internet capabilities to a greater degree. Our findings also indicate that the prior international business experience, international risk-taking propensity and international networking characteristics are not necessarily precursors to successful integration of Internet capabilities for international business processes. On the contrary, international business experience and international networks actually lead to a reliance on traditional mechanisms of internationalisation and can dilute the development of Internet capabilities for international business processes.     

Experience,age and exporting performance in UK SMEs

We consider the determinants of SME exporting performance using a survey of internationally engaged UK SMEs. We first develop a model incorporating organisational and prior managerial learning effects. Our empirical analysis then allows us to identify separately the positive effects on exporting from the international experience of the firm and the negative effects of firm age. Positive exporting effects also result from grafted knowledge – acquired by the recruitment of management with prior international experience. Innovation also has positive exporting effects with more radical new-to-the-industry innovation most strongly linked to inter-regional exports; new-to-the-firm innovation is more strongly linked to intra-regional trade. Early internationalisation is also linked positively to the number of countries to which firms export and the intensity of their export activity. We find no evidence, however, relating early internationalisation to extra-regional exporting, suggesting that early-exporting SMEs tend be ‘born regional’ rather than ‘born global’.     

Strategic business and network positioning for internationalisation

Despite growing research interest in the internationalisation of professional service firms, little research has investigated the implications of home market business positioning for network positioning in professional service firm internationalisation strategy. This paper develops theory in the service industries by investigating strategic positioning in professional service firm internationalisation through analysis of a case survey of 53 architectural practices. The results of this empirical analysis allow us to develop a configuration analysis of strategic positioning for professional service firm internationalisation as the principal theoretical contribution of this paper.     

An Investigation into the Overseas Expansion of Small Asian-Owned U.K. Firms

This paper contributes to the growing body of knowledge in international entrepreneurship by reporting on a qualitative empirical investigation into the overseas expansion processes of small Asian (originating from the Indian sub-continent)-owned firms operating in the U.K. clothing industry. The key decision makers within these firms frequently identified themselves as an active, and important, influence upon the actual activities of their firms as international operators. For some firms though, a more passive approach to internationalisation could be identified, whereby the receipt of unsolicited orders had an effect on some firms' timing of overseas market entry. The balance between the nature of opportunities, that frequently derived from cultural networks, and the constraints of a limited resource base with which to exploit those opportunities, also had a major impact on the direction and pace of certain firms' overseas expansion. The findings suggest a general tendency to adopt an incremental approach to internationalisation within this mature trade sector. The cultural and business experience of managers, however, was found to have an effect on the pace and direction of the overseas expansion. Recommendations on the likely efficacy and effectiveness of public/private sector interaction within the area of international entrepreneurship involving entrepreneurs from Asian backgrounds are offered.     

Cautious International Entrepreneurs: The Case of the Mittelstand

This paper investigates the international entrepreneurial behaviour of Mittelstand firms (German small and medium sized enterprises). Analysis of a survey of the international marketing strategies of Mittelstand firms revealed three clusters of firms, two that had below and one above average international activities. None of the clusters displayed born global type of internationalisation processes. However, this does not mean that they adopt passive approaches to internationalisation. The results suggest that Mittelstand firms engage in entrepreneurial behaviour that is proactive and innovative but which is cautious, sequential, and risk adverse. The implications of this analysis for future research in the area of international entrepreneurship are considered.     

International Entrepreneurship Research: What Scope for International Business Theories?

International entrepreneurship (IE) research has commonly neglected significant perspectives applied by international business scholars. Explanations for the emergence and growth of international entrepreneurial firms largely focus on the resource-based view and the network perspective. While these approaches are useful, we suggest that IE would benefit significantly from a greater emphasis on its international nature. Therefore, theories of international business should be employed in conjunction with other approaches in order to appropriately emphasize the international character, holistically study the IE notion, and considerably broaden the scope of IE examination. Suggestions for relevant research directions are discussed.     

Towards an Integrative Model of Small Firm Internationalisation

Firm internationalisation has long been regarded as an incremental process, wherein firms gravitate towards psychologically close markets and increase commitment to international markets in a gradual, step-wise, manner through a series of evolutionary stages. However, much of the recent literature provides clear evidence of rapid and dedicated internationalisation by born global firms. Typically, these are smaller entrepreneurial firms that internationalise from inception, or start to shortly thereafter. Their main source of competitive advantage is often related to a more sophisticated knowledge base. In addition, the authors have found evidence of firms supporting this born global pattern of behaviour but also evidence of firms that suddenly internationalise after a long period of focusing on the domestic market. These born-again globals appear to be influenced by critical events that provide them with additional human or financial resources, such as changes in ownership/management, being taken over by another company with international networks, or themselves acquiring such a firm. Based upon the extant literature and our own research, we propose an integrative model that recognises the existence of different internationalisation pathways. We then explore differences in behaviour due to the firm's internationalisation trajectory and discuss the strategic and public policy implications.     

Changing Paradigms of International Entrepreneurship Strategy

This article identifies sweeping transformations taking place in the contemporary international business environment, and discusses their impact on international entrepreneurship. We focus on two overarching trends: (1) the demise of the nation-state as the relevant unit around which international business activity is organised and conducted; and (2) the demise of the stand-alone firm, with a hierarchic distribution of power and control, as the principal unit of business competition. We then discuss an alternate approach to internationalisation: one that involves a multi-polar distribution of power and control. Traditional approaches to internationalisation focus on the hierarchic centralised firm, with a uni-polar distribution of power and control. We suggest that the world is moving towards multi-polar networks of firms, involved in what we term symbiotic management: each entity benefits from working together within a multi-polar network. This includes large corporations as well as small and medium-sized enterprises (SMEs). As corporations out-source to specialised firms–increasingly SMEs–power and control are dispersed among independently owned firms that are cooperating voluntarily for increased efficiency and profit. The new paradigm moves from a focus on the firm, towards a focus on relationships within multi-polar networks. We conclude by illustrating how this emerging competitive paradigm may impact on the strategic management of small firms, with examples from a real-world company.     

A Matter of Survival - Determinants of Rational Behavior in B-to-B Markets

The paper focuses on the question of whether the frequently stated industrial/consumer dichotomy with respect to the involved degree of rationality in decision making, namely that it is high in b-to-b and low in b-to-c markets, is in fact justified. We develop a universal framework to determine which factors lead to rational behavior. The framework may be used for determining if a given decision situation should be analyzed by means of an economic or rather a behavioral approach. When adapting this framework to evaluate decisions in business markets, we identify conditions under which rational behavior is unlikely. Thus, from a purely theoretical standpoint, the proposed dichotomy seems questionable. Whether or not, however, the identified conditions promoting ‘irrationality’ in both industrial and consumer markets in fact must be determined empirically. Therefore, we also suggest an empirical test for the universal framework.     

’E’ entrepreneurial SMEs: An Irish study of micro and macro influences

Internet-based technologies are strategically guiding the organisation of tradeable services through the development of flexible organisational structures at national and international level. Specifically for knowledge intensive business services, tasks can be mediated via technology rather than by direct physical engagement, providing enterprises with the opportunity for extensive market coverage. Many academic and political ideals thus assume that entrepreneurs have the ability to intuitively recognise technologically innovative opportunities and have the confidence to act on them. The main aim of the paper is to present the findings of a recent empirical study of Irish (Northern Ireland and the Republic of Ireland) knowledge-intensive service sector firms and shed some light on recent thinking in relation to ‘e’ entrepreneurial micro and macro-level influences. The micro-level findings reveal a relatively high level of ‘e’ entrepreneurial orientation and motivation. However, from a macro-level perspective, the overall conclusion is that firms in both regions of Ireland could benefit from a system that cultivates a more inclusive, networked and balanced regional innovation system, to foster technology-innovation led enterprise.     

Empirical Business Ethics Research and Paradigm Analysis

Despite the so-called ‘paradigm wars’ in many social sciences disciplines in recent decades, debate as to the appropriate philosophical basis for research in business ethics has been comparatively non-existent. Any consideration of paradigm issues in the theoretical business ethics literature is rare and only very occasional references to relevant issues have been made in the empirical journal literature. This is very much the case in the growing fields of cross-cultural business ethics and undergraduate student attitudes, and examples from these fields are used in this article. No typology of the major paradigms available for, or relied upon in, business ethics has been undertaken in the wider journal literature, and this article addresses that gap. It contributes a synthesis of three models of paradigms and a tabulated comparison of ontological, epistemological and methodological assumptions in the context of empirical business ethics research. The author also suggests the likely (and usually unidentified) positivist paradigm assumptions underlying the vast majority of empirical business ethics research published in academic journals and also argues for an increased reliance on less positivist assumptions moving forward.     

Twenty-five years of business systems research and lessons for international business studies

Since 1992, the national business systems (NBS) approach has been increasingly used to analyse not only firm characteristics, structures and strategies within NBS, but also the nature of international business and its interactions with both national and transnational institutions. In reviewing 25 years of NBS literature, we heed calls in IB journals urging researchers to use NBS notions and findings in IB research. Our systematic review of 96 articles analyses the patterns and contributions of NBS literature, revealing four thematic junctures: (1) comparative business systems, (2) firm internationalisation and the management/organisation inside MNCs, (3) the role of internationalisation in the development of organisational capabilities and innovation and (4) the emergence of transnational communities in and across firms and societies. Themes are described in terms of (a) the research questions (RQ) they focus on, (b) how NBS approach investigates the RQ and what are the major findings, (c) how IB frames and approaches the same RQ, (d) how does the NBS approach extend the perspectives of IB and (e) what are the problems faced by NBS in terms of developing further insights into the RQ. Our review contributes to the recent endeavour of IB research to institutionalism, encouraging a productive dialogue between IB and NBS research.     

Allhoff on Business Bluffing

The moral status of business bluffing is a controversial issue. On the one hand, bluffing would seem to be relevantly similar to lying and deception. Because of this, business bluffing can be taken to be an activity that is at least prima facie morally condemnable. On the other hand, it has often been claimed that in business bluffing is part of the game and that therefore there is nothing morally questionable in business bluffing. In a recent issue of this journal, Fritz Allhoff puts forward a novel defence of business bluffing. In this article, I will examine Allhoff’s arguments for the moral acceptability of business bluffing and argue that they are implausible. Dr. Jukka Varelius is a Visiting Fellow in the Centre for Professional Ethics at the University of Central Lancashire, UK. His research concentrates on questions of biomedical ethics, psychiatric ethics, and business ethics. His publications include ‘Voluntary euthanasia, physician-assisted suicide and the goals of medicine’ Journal of Medicine and Philosophy 2006, 31 (2): 1--18, ‘Execution by lethal injection, euthanasia, organ-donation and the proper goals of medicine’ Bioethics, forthcoming, and ‘Autonomy, well-being and the case of the refusing patient’ Medicine, Health Care and Philosophy, forthcoming.     

Marketspace and the Internationalisation Process of the Small Firm

This empirical study explores the potential impact of the marketspace—the virtual world of digitised information—on the process of internationalisation within small technology-based firms (STBFs). Research findings demonstrate several effects relating to the firm's increased use of the marketspace for international business activities. In relation to internal resource-related effects, increased marketspace use is associated with: a stronger internal resource-base for international operations; and higher levels of internal international business information. Moreover, in relation to external resource-related effects, increased marketspace use is associated with: an increase in the firm's international orientation; an increase in the range and diversity of international business contacts; and an increase in unsolicited orders from foreign markets. This study confirms that the entrepreneur's prior Internet experience is a critical factor influencing use of the marketspace to support the firm's international operations. Similarly, organisational use of the marketspace (influenced by the previous experience of the entrepreneur) impacts upon certain aspects of the firm's internationalisation behaviour. Despite the significance of these findings, the marketspace is neither a replacement for traditional marketplace-based activities, nor is it a panacea that ensures effective small firm internationalisation. Complementary exploitation of both the marketspace and the traditional marketplace is likely to provide the optimal internationalisation route for small firms.     

Religion, Opportunism, and International Market Entry Via Non-Equity Alliances or Joint Ventures

One challenge that globalization has brought to business is that firms, as they expand their market globally through cross-border alliances, need to deal with partner firms from countries of different religious background. The impact of a country’s dominant religion on its firms’ international market entry mode choices has not been examined in traditional approaches. Focusing on hypothesizing the influence of Christian beliefs and atheism (i.e., the absence of belief in any deities), this research aims to fill the gap by exploring religion’s role in providing moral restraint on managers’ propensity for opportunism, which in turn affects these managers’ choices of their firms’ international market entry via non-equity alliances or joint ventures. A study of 22,156 cross-border alliances formed in 48 industries world-wide over 9 years provides new insight toward understanding religion’s influence on firms’ international market entry mode decisions through the ethical dimension of strategic leadership. This article would fit best under the International Management section for reviewing purposes.     

Reorienting the Business School Agenda: The Case for Relevance,Rigor, and Righteousness

This article contributes to the current debate regarding management education and research. It frames the current business school critique as a paradox regarding the arguments for ‘self-interest’ versus ‘altruism’ as human motives. Based on this, a typology of management with four representative types labeled: unguided, altruistic, egoistic, and righteous is developed. It is proposed that the path to the future of management education and research might be found by relegitimizing the ‘altruistic’ spirit of the classics of the great Axial Age (900-200 BCE) and marrying those ideas with the self-interest ideal of mainstream management theories based on economics. By advocating this, a business school agenda that is simultaneously rigorous, relevant, and righteous is promoted.     

The Long-Term Performance of Small Businesses: Are there Differences Between “Christian-Based” Companies and their Secular Counterparts?

Recent years have witnessed the proliferation of “Christian” companies in the U.S. These firms declare their belief in, and active pursuit of, the successful merging of biblical principles with business activities. Economic success, hard work, and biblical values are seen as capable of existing together in harmony. While the number of such businesses appears to be growing, there has been a dearth of any scientific study of these companies. No empirical research has been conducted to determine whether these religious values and behaviors have any significant impact on a company’s performance. The present study is designed to partially fill this gap. Specifically, it seeks to determine whether there are differences in long-term performance between self-proclaimed “Christian-based” businesses and their secular counterparts. Data were collected from 312 companies. A multivariate analysis of variance (MANOVA), followed by univariate ANOVAs, found significant differences between these two groups of firms on three of the four performance variables that were analyzed. Some explanations as well as limited generalizations and implications are developed.