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.     

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.     

A note on government policy and the new ‘intrapreneurship’ in Bulgaria

Conclusion I have attempted in this paper to highlight the recent emergence and rapid growth of a particular type of intrapreneurship in the Bulgarian economy. This intrapreneurship involves the creation of new smaller establishments within existing large-scale industrial firms. These semi-autonomous auxiliary plants are exempt from part of the bureaucracy which constrains the larger addition, they have provided a higher rate of technological advance, a better supply of consumer goods, a greater utilization of labor resources, and a higher return to human capital.Only through the continued development of a small-firm sector can the Bulgarian economy meet the challenge currently posed by its western counterparts. Whether the next step from intrapreneurship to entrepreneurship is taken may hold the key for industrial development in Bulgaria.     

The indefensibility of insider trading

The article, Inside Trading Revisited, has taken the stance that insider trading is neither unethical nor economically inefficient. Attacking my arguments to the contrary developed in an earlier article, The Ethics of Inside Trading (Journal of Business Ethics, 1989) this article constructs careful arguments and even appeals to Adam Smith to justify its conclusions. In my response to this article I shall clarify my position as well as that of Smith to support my counter-contention that insider trading is both unethical and inefficient. Patricia H. Werhane is the Henry J. Wirtenberger Professor of Business Ethics at Loyola University, Chicago. She is the author or editor of seven books including Ethical Issues in Business,edited with Tom Donaldson, in its third edition, Persons, Rights, and Corporations, Profits and Responsibility,and Philosophical Issues in Human Rights,edited with David Ozar and A. R. Gini. She is past president of the Society for Value Inquiry, founding member, past president and Executive Director of the Society of Business Ethics, and Chairperson of the Ethics Advisory Council of Arthur Andersen & Co. She serves on the editorial boards of the Journal of Business Ethics,the Journal of Value-Based Management, and Public Affairs Quarterly,and is Editor-in-Chief of Business Ethics Quarterly.Her book, Adam Smith and his Legacy for Modern Capitalismis forthcoming with Oxford University Press.     

What is business in America?

This paper, presented at the Conference on Value Issues in Business at Millsaps College, is divided into three parts. The first sketches the logic of the evolution of U.S. business and suggests reasons for its remarkable success. The second assesses the power of U.S. business in modern society, both from an economic and political perspective. The third attempts to formulate the underlying philosophy of U.S. business using ideals such as the work ethic, entrepreneurism, democracy, and equality. Some of these ideals, the paper suggests, are irreconcilable. Thomas J. Donaldson is Associate Professor of Philosophy at Loyola University of Chicago. His publications in the area of business ethics include numerous articles and two books, Ethical Issues in Business co-edited with Patricia Werhane, and Corporations and Morality.     

Learning to solve the right problems: The case of nuclear power in America

Three general types of problems entail different strategies. Continuing to seek solutions to tame problems when we face messes, let alone wicked problems, is potentially catastrophic hence fundamentally irresponsible. In our turbulent times, it is therefore becoming a strategic necessity to learn how to solve the right problems.

But then, you may agree that it becomes morally objectionable for the planner to treat a wicked problem as though it were a tame one, or to tame a wicked problem prematurely, or to refuse to recognize the inherent wickedness of social problems. Rittel and Webber (1973).

Jonathan King is Associate Professor of Management at the College of Business at Oregon State University. His primary research interests are in the areas of moral philosophy and modern technology. His most important publications are Confronting Chaos and Common Knowledge of the Second Kind,Journal of Business Ethics (1989).     

A Network-based Approach on Opportunity Recognition

This paper argues that individuals differ in terms of their perception of opportunities because of the differences between the networks they are embedded in. We focus on two aspects of individuals embeddedness in networks, that is, (1) individuals belonging to residential areas that are more or less likely to be characterized by network cohesion, and (2) individuals differential access to network contacts based on the level of human capital they hold. Our analyses show that the nature of ones residential area influences the perception of entrepreneurial opportunities. Further, we find a positive effect for education, i.e., people with a higher educational level are more likely to perceive entrepreneurial opportunities compared to those with a lower educational level.     

Is capitalism still viable?

This essay is an attempt to clarify the meaning of capitalism and to argue that this form of economic pattern will survive in the U.S. in the twentieth century. Capitalism should not be viewed as an abstraction which implies a religion, an ideology, a form of government, or a moral philosophy, but rather the private ownership of capital. Marx was wrong when he predicted the speedy decay of the capitalistic system in the West and when he claimed that a competitive system will lead to servitude and poverty for the masses; on the contrary, the American economic system is a grand success. Part of this success resulted from natural resources; part from America's being one of the largest free-trade areas; and part from the economic system, so-called capitalism, by which we have governed ourselves. The outcome is a greater measure of freedom, prosperity, leisure, and industrial sophistication. These achievements are hardly paralleled by any of the advanced countries of the world. Russell Kirk is a Distinguished Scholar of The Heritage Foundation in Washington, D.C. He is the author of twenty-three books and of several hundred essays. His books include The Conservative Mind; The Roots of American Order; and, recently, Decadence and Renewal in the Higher Learning.This article was originally published in The Hillsdale Review. Copyright © 1982 by Hillsdale Review Inc.     

Measuring Market Orientation: Generalization and Synthesis

This paper reports on an integrative, cross-nationalstudy which synthesizes and retests work of three separate groupsof researchers who in the late 1980s developed measurementsof a firm's Market Orientation. The projects resulted in threedifferent but syntactically similar Market Orientation scaleswhich, along with other measures, were used to support substantiveconclusions, particularly those involving firm Performance. Basedon a new study of 82 managers in 27 European and U.S. companies,we show that all three scales are reliable and valid. The scalesalso seem to generalize well internationally, both in terms ofreliability and prediction of Performance. We also show thatthe scales are similar to one another in terms of various validitymeasures and in terms of correlations with Performance measures.Finally, we synthesize a 10-item scale based on a more parsimoniousdefinition of Market Orientation as: the set of cross-functionalprocesses and activities directed at creating and satisfyingcustomers through continuous needs-assessment.     

Equal pay for equal work in the third world

If the principle of equal pay for work of equal value is valid, then the practice of paying workers in third-world countries at a lower rate than workers doing the same jobs in industrialized nations is unjust. Recently Henry Shue argued that the principle is not valid. In this paper I criticize Shue's arguments and offer additional arguments in support of his conclusion. Hugh Lehman is a Professor of Philosophy at the University of Guelph. His most important publications are Introduction to the Philosophy of Mathematics, Basil Blackwell, 1979, Mathematical Proofs, Gaps and Postulationism, The Monist 67, and Intuitionism and Platonism on Infinite Totalities, Idealistic Studies XIII. He also edited a special issue of Animal Regulation Studies 2 that contained papers from the conference: Ethical Issues Concerning the Use of Animals in Agriculture and Scientific Research.     

Business ethics: Conflicts,practices and beliefs of industrial executives

This paper presents the responses of 118 executives to a mail survey which examined their views of business ethics and various business practices. In addition to identifying various sources of ethical conflict, current business practices are also examined with respect to how ethical or unethical each is believed to be. Results are also presented which outline executive responses to four ethical business situations. Overall conclusions to the study are outlined, as well as future research needs.Scott J. Vitell is Assistant Professor of Marketing at the University of Mississippi. His most important publications include A General Theory of Marketing Ethics (1986) (with Shelby D. Hunt) and Marketing's Contribution to Economic Development: A Look at the Last 30 Years (1985) (with Van R. Wood). Troy A. Festervand is an Associate Professor of Marketing at the University of Mississippi. Dr. Festervand obtained his Ph.D. in 1980 from the University of Arkansas. His publications have appeared in the Akron Business and Economic Review, Journal of Small Business Management, and elsewhere. He is active in a number of organizations and a frequent participant at professional meetings.     

Learning,market selection and the evolution of industrial structures

Industrial economics is a rich source of puzzles for economic theory. One of them — certainly the most discussed — regards the co-existence of firms (and plants) of different sizes, displaying rather invariant skewed distributions. Other puzzles, however, concern the sectoral specificities in industrial structures, the persistence of asymmetric corporate performances and the dynamics of entry and exit. The paper reports some preliminary results on evolutionary modeling of the links between the microeconomics of innovation, the patterns of industrial change and some observable invariances in industrial structures.First, the paper reviews a few of these empirical regularities in structures and in the patterns of change. Second, the paper discusses the achievements and limits of interpretations of the evidence based on equilibrium theories. Finally, it presents a model where these regularities are explained as emergent properties deriving from non equilibrium interactions among technologically heterogeneous firms. Moreover, simulation exercises show that also the intersectoral variety in the observed industrial structures and dynamics can be interpreted on the grounds of underlying specificities in the processes of technological learning — which is called technological regimes — and of the processes of market interactions — i.e. market regimes.This research has undertaken within an on going project sponsored by the Italian Research Council (CNR, Progetto strategico,Cambiamento tecnologico e sviluppo economico). Support by the Consortium on Competitiveness and Cooperation Centre for Research in Management, University of California at Berkeley is also gratefully acknowledged.     

Confronting chaos

While it is common to observe that our society and world are becoming increasingly complex and fast paced, most of our theories provide no bases upon which to develop appropriate strategies. The need for developing holistic strategies is becoming urgent in two related areas: major interactive technologies and morality. Jonathan King is Associate Professor of Management at the College of Business at Oregon State University. He received his B.A. in philosophy from Antioch College (1965) and his M.B.A. in Finance (1975) and Ph.D. in Business, Government and Society (1980) from the University of Washington. His primary research interests are in the areas of moral philosophy and General Systems Theory. His most important publications are The Three Faces of Thinking, Journal of Higher Education (1986) and Prisoner's Paradoxes, Journal of Business Ethics (1988).     

Questioning the Domain of the Business Ethics Curriculum

This paper reassesses the domain of the business ethics curriculum and, drawing on recent shifts in the business environment, maps out some suggestions for extending the core ground of the discipline. It starts by assessing the key elements of the dominant English- language business ethics textbooks and identifying the domain as reflected by those publications as where the law ends and beyond the legal minimum. Based on this, the paper identifies potential gaps and new areas for the discipline by drawing on four main aspects. First, it argues that the domain of business ethics requires extensions dependent on the particular geographic region where the subject is taught. A second factor for broadening the scope is the impact of recent scandals, which arguably direct the focus of ethical inquiry towards the nature of the business systems in which individuals and corporations operate. Third, the impact of globalization and its result on growing corporate involvement in regulatory processes is discussed. Fourth and finally, business ethics reaches beyond the traditional constituencies of economic stakeholders as new actors from civil society enter the stage of ethical decision making in business. We conclude by suggesting that a reconsideration of the domain of business ethics, especially in Europe, is timely, but that to do so represents a major challenge to business ethics educators.     

Saturday Review's annual advertising awards

Saturday Review's long, commendable effort to identify corporations willing to promote the general good through their advertising was damaged in 1977 because of procedural changes in the awards. Prior to 1977 the named judges made the important distinction between public-service (non-image) and public-relations (corporate image) advertising. But in 1977 the judges were not named and the public service/public relations distinction was eliminated, replaced by the single category of public spirited ads. Most of these ads, however, were not public spirited, but were public relations ads. But in 1978 this deception was ended by the empaneling of a new kind of jury, one drawn from the S.I. Newhouse School of Public Communications. James Richard Bennett is Professor of English at the University of Arkansas, Fayetteville. He is the editor of Style, a Journal of Stylistics. He won the Fulbright Teaching Award in Yugoslavia in 1968–69. His most important publication is: Prose Style: A Historical Approach Through Studies, 1971.I wish to thank Professor Leonard White of the Department of Economics at the University of Arkansas for his advice concerning several of the ads discussed herein.     

‘I am we’ consciousness and dialog as organizational ethics method

There is a practical five-step method of ethics dialog developed by John Woolman, an 18th c. businessman and ethical activist, that was used by Robert K. Greenleaf, a 20th c. A.T.&T. Corporate Vice-President, that includes: (a) friendly, emotive affect; (b) discussion of mutual commonalities; (c) discussion of issue entanglements; (d) discussion of potential experimental solutions; and, (e) trial and feedback discussion. This method of dialog appears to proceed with a type of consciousness considered by John Woolman and Bernard Lonergan as one where the I is conscious that I and Others are part of a more foundational, larger and prior We. This type of dialog is different than Socratic dialog. The corresponding type of consciousness is different than the more derivative, e.g., two allies being united in their response to a common goal. It is also different than Buber's I and Thou appreciative consciounsess of the interestingness, value, diversity, and uniqueness of others. Woolman dialog as seen in four cases appears to be a concrete method that has some value both as an end in itself and as instrumental means that can: be issue effective, help build ethical organization/community culture, and help facilitate peaceful, evolutionary change and development. Limitations of the method are also considered. The method may also be a several hundred year anticipation of experiment based pragmatist philosophy that is anthropologically sensitive to cultural entanglements.

John Donne (17th c.)

Richard P. Nielsen is a professor in the Department of Organizational Studies, School of Management, Boston College. Related articles of his include: Dialogic Leadership As Organizational Ethics Action (Praxis) Method, Journal of Business Ethics(October 1990); Negotiating As An Ethics Action (Praxis) Strategy, Journal of Business Ethics(May 1989); Changing Unethical Organizational Behavior, Academy of Management Executive(May 1989); Arendt's Action Philosophy and the Manager as Eichmann, Richard III, Faust, or Institution Citizen, California Management Review(Spring 1984); and Cooperative Strategy, Strategic Management Journal(September–October 1988).     

Time and Internationalisation Theoretical Challenges Set by Rapid Internationalisation

The internationalisation process of firms has accelerated during the last few decades. Firms start their export operations earlier than before, and they reach a higher level of internationalisation more quickly than ever. All this constitutes a challenge to the theoretical basis that underlies studies of the internationalisation process.The time concept has a crucial role in today's appraisal of internationalisation research. The overall developments in internationalisation, the critiques and various time theories are moving research into the process away from the western idea of time (linear time in a positive direction) towards a more primitive notion (cyclical time with no fixed direction). This also challenges the applicability of traditional stages models. This paper focuses on export-adoption models.     

Consumption-Leisure Preference Structure: A New Explanation of the Evans-Jovanovic Results for Entrepreneurial Choice

This paper extends Evans and Jovanovics (1989) (EJ) model to explicitly consider the latent entrepreneurs consumption-leisure preference structure, and shows that an increase in his or her assets encourages entrepreneurial activity. This result indicates that EJs finding may hold without the assumption of liquidity constraints.     

Deception in commercial negotiation

Buyers and sellers of inputs of production, to the degree that they must negotiate directly with each other and cannot have recourse to more impersonal markets, share in certain aspects of bilateral monopoly. Under these circumstances, and assuming profit maximizing goals for each, deception often seems to be an unavoidable characteristic of negotiation.... I hate, detest, and can't bear a lie, not because I am straighter than the rest of us, but simply because it appalls me. There is a taint of death, a flavor of mortality in lies ... — JOSEPH CONRAD, Heart of Darkness.     

Market Structures with Multi-product Firms: Welfare Analysis and Policy Implications

In the real world firms operate in more than one market and consequently can exploit scope economies and/or demand complementarities. Introducing multi-product firms in the picture makes the standard assumption that more competition is always beneficial for social welfare less clear-cut. In this paper we show that a concentrated structure can be socially preferable in the presence of scope economies, whereas a fragmented structure has to be preferred when products are close substitutes. We also identify either analytically or numerically the socially optimal market structure when aggregate output (and then consumer surplus) or total welfare are used as ranking criteria. The analysis is useful for discussing which market structure should be favored by policy makers aimed at introducing competition in sectors which were previously monopolized by state-owned firms. To that respect, our findings point out that not only the level (number of firms) but also the form (type of firms) of competition matters.