Strategic group influence on entry mode choices in foreign markets

This study examines imitation behavior in the foreign entry mode of the members of a strategic group within the industry. Following the institutionalist perspective, we argue that legitimating actors (trade associations, training institutions and investors, among others) can exert pressure on strategic group members to conform to institutionalized organizational practices and structures. We hypothesize that a company’s choice of foreign entry mode is determined by the previous choices of other companies within the strategic reference group. Thus, the probability of entry with a wholly owned subsidiary (versus shared-control entry) increases when the number of wholly-owned subsidiaries established by companies within the strategic reference group of the home-country is higher. We analyze 351 foreign direct investments of 30 Spanish banks in 55 countries between 1986 and 2008. Our results reveal imitation behavior between members of the strategic group and highlight the important role of the strategic group in strategic thinking.     

Theoretical foundations of equity based foreign market entry decisions: A review of the literature and recommendations for future research

This paper reviews the theoretical foundations of the equity based foreign market entry (FME) decisions literature. We analyse 1055 academic FME papers published over four decades (1970–2013). We identify and analyse the theories that informed and guided FME research over time. Our review indicates that scholars have recently started to challenge some of the core assumptions of established theories, draw on and integrate insights from multiple theoretical perspectives which, in turn, generated a multiplicity of approaches for studying FME decisions and their performance outcomes. The paper discusses the explanatory power of the different theories, assesses the relevance of the different theoretical perspectives to our understanding of current FME phenomena and recommends directions for further research.     

Social capital dynamics and foreign market entry

This paper explores the dynamics of social capital in 121 new foreign market entries (FMEs) of 24 Swedish and New Zealand small- to medium-sized enterprises in the early and later phases of their internationalization. Its main contribution is the systematic assessment of the roles and forms of social capital over time and across countries, thus providing greater insight into the social capital concept. We separate social capital into efficacy and serendipity roles (economic dimension) and direct and indirect relationships (structural dimension). Efficacious and direct social capital is associated with early FMEs, while serendipitous and indirect social capital is more prevalent with later FMEs, indicating that social capital changes with (and is dependent on) FME. Moreover, while geographical proximity does not appear to affect the economic dimension of social capital, it is important for the structural dimension.     

Foreign market entry mode choice of small and medium-sized enterprises: A systematic review and future research agenda

Despite significant differences between small and medium-sized enterprises (SMEs) and large multinational enterprises (MNEs), the majority of extant foreign market entry mode choice literature has focused on MNEs. The current state of knowledge regarding SME foreign market entry mode choice is equivocal. The present paper reviews the current state of SME foreign market entry mode choice literature and maps future research directions. To this end, we systematically analyze 33 relevant journal articles for their theoretical frameworks and contextual dimensions. Based on this review, we identify gaps in the literature and develop an agenda to guide future scholarship in this important domain of research in taking SME-specific characteristics into consideration.     

Factors influencing employee perceptions of customer service climate

This study examines the relationships between certain organizational variables and employees' perceptions of the customer service climate in their organization. In addition, the role of organizational commitment in this process is examined. Results indicate that rewarding employees for service excellence, allowing their voice to be heard by upper management, providing employees with the information and technology needed to do their jobs, providing adequate training to customer contact employees, allowing employees enough time to get their tasks done, and providing a work environment conducive to getting work done are all positively associated with employee perceptions of customer service climate. Based on mediated regression and a LISREL analysis, these relationships are all found to be partially mediated by organizational commitment. These results are consistent with previous customer service research, which has found organizational support and rewards to be positively related to customer service. We extend this literature by showing that organizational commitment may be a key variable linking organizational support and rewards to customer service. Implications of these findings are discussed and suggestions for further research are offered.Lincoln National Corporation     

New financial service development for banks in Taiwan based on customer needs and expectations

The purpose of this study aims to employ an analytic approach to analyze efficient managerial strategies for advancing new service development (NSD) by involving viewpoints of customer needs and expectations within a financial service context. This paper uses a sample of potential banks' credit card applications, customers' preferences and satisfaction ratings, and new credit card service data with the applications of both analytic hierarchy process and VlseKriterijumska Optimizacija I Kompromisno Resenje to analyze customer satisfactions and preferences simultaneously. Then, it applies the importance–performance analysis technique to diagnose managerial strategies for reducing the customer gaps between customer perceptions and expectations. The study emphasizes the importance of analyzing customer preferences and reducing gaps between customer satisfactions of perceptions and expectations to ensure NSD success.     

Business models and market entry mode choice of small software firms

So far the critical choice of the entry mode for a target country has been examined ignoring the special features of firms. Particularly, the impact of the wide variation of business models of software firms has been ignored. This multi case study investigates the relation between the business model and the entry mode, of eight software firms. The results imply that the product strategy and the service and implementation model of a software firm are closely connected to the entry mode choice, while the distribution model of intangible software products does not seem to have an impact on the operation mode.     

Motives,choice of entry mode,and challenges of bank internationalization: Evidence from China

This study examines the motives, entry mode choice, and challenges of the international expansion in an emerging country context. Data were collected via interviews from 30 senior managers based on a sample of 10 Chinese commercial banks (CCBs) involved in international expansion over the period of 2001–2013. This study finds greenfield and mergers and acquisitions are the most popular foreign entry mode used by CCBs. The motives of emerging market banks’ internationalization appear to be intrinsically linked to market development to serve customers operating in overseas market, government policies, and strategic knowledge sourcing. In terms of challenges, the study finds lack of management resources/technical capacity, culture, adapting to the host country regulatory environment, and lack of experience to be the main challenges to bank internationalization.     

Distance and divestment of Korean MNC affiliates: the moderating role of entry mode and experience

In this study, we examine the impact of cross-national distance on the divestment of foreign affiliates. On the basis of the nine dimensions of cross-national distance (Berry et al. 2010. “An Institutional Approach to Cross-National Distance.” Journal of International Business Studies 41 (9): 1460-1480), we empirically examine the impact of each measure of distance on the divestment of affiliates. Using a data set of 1697 multinational corporations (MNCs) headquartered in Korea and their 2435 affiliates in 67 host countries from 2000 to 2010, we find that distance created by economic, financial, political, administrative, cultural, demographic, knowledge and global connectedness leads to the divestment of foreign affiliates. We also find that the positive relationship between cross-national distance and affiliate divestment is likely to become stronger when an MNC enters the host country through a joint venture and weaker for affiliates with greater experience in the host country.     

Chief executive officers' dispositional optimism,host country's rule of law,and foreign market equity mode choice of Ghanaian small and medium‐sized enterprises

Despite a growing interest in the influence of managerial characteristics on firms' strategic decision‐making process, scholarly knowledge is limited with regard to how and when psychological attributes of executives affect firms' foreign entry mode decision. Building on behavioral decision‐making theory, we address this gap by investigating the effect of chief executive officers' (CEOs') optimism on firms' foreign market equity mode choice. In addition, we examine the moderating influence of the host country's rule of law on this relationship. Using primary data from 227 small and medium‐sized enterprises (SMEs) in Ghana, we found that increases in the levels of CEOs' optimism are related to the increases in preference for equity entry mode. This relationship is amplified when CEOs perceive the host country to have stronger rule of law. The findings have theoretical, managerial, and policy implications for SMEs' foreign market entry mode strategy.     

Strategy antecedents of modes of entry into foreign markets

Although a firm's choice of mode of entry to a foreign market is central to the implementation of international strategy, we have only limited understanding of the effects of international strategy on the choice. This study explores the effects of business relatedness and corporate international experience. Data were collected on 173 ventures of Swedish manufacturing firms that were present on the German market, and multivariate techniques were applied to test hypotheses. It was found that product/market relatedness and intangible resource relatedness between the foreign business unit and the industrial firm's core business unit favored a full control entry mode based on sole ownership. This finding was also valid for importance of foreign markets. Further, market importance moderated the two relationships regarding business relatedness. Contributions to the literature are discussed.     

SME foreign market entry mode choice and foreign venture performance: The moderating effect of international experience and product adaptation

Firms’ foreign market entry mode choice attracts considerable research attention. However, the performance implications of this choice remain inconclusive, particularly in the context of small and medium-sized enterprises (SMEs). The present paper draws on the resource-based view (RBV) and develops a theoretical model specifically tailored to the context of SMEs in order to study the relationship between entry mode choice and foreign venture performance. Testing hypotheses on 133 German SMEs, we show that international experience as a resource and product adaptation as a capability improve the performance of non-equity entry modes by mitigating liabilities of smallness inherent to SMEs. We furthermore find empirical support for the joint moderating effect of international experience and product adaptation on the focal relation. Our findings contribute to the SME foreign market entry mode literature and have implications for practitioners and future research.     

Cultural Fit and the Choice of International Market Entry Scale of Chinese Firms

Previous research on how cultural distance impacts the choice of entry mode shows contradictory findings. This study uses a strategic fit perspective to examine the impact of distinct cultural factors as predictors of equity entry scale of Chinese firms. Findings from a sample of 667 Chinese firms demonstrate that the effects of cultural fit on equity entry scale vary across cultural dimensions. Whereas a collectivism cultural fit motivates Chinese investors to secure a high-equity entry scale in foreign firms, a lower power distance cultural fit (“misfit”) leads to higher entry involvement.     

Foreign market entry mode of service firms: The case of U.S. MBA programs

While international expansion has become an important strategic imperative on the part of knowledge intensive service firms such as U.S. business schools, little empirical support is available on how these business schools enter foreign markets. If U.S. based business education programs are expected to prosper in light of the potential onslaught of international competition, expansion to overseas markets will be one of the most sought after options available. A poor choice in market entry strategy, or the lack of international market entry, can result in a negative impact on the educational institution. This research focuses on developing, measuring, and empirically testing a framework of key factors influencing international market entry mode choice of U.S. business schools by using primary data from faculty and administrators of U.S. Master of Business Administration (MBA) schools.     

Added distance,entry mode choice,and the moderating effect of experience: The case of British MNEs in emerging markets

Distance has been viewed as a crucial determinant of the internationalization strategy of firms. Nonetheless, in recent years, there has been considerable debate with regards to, first, the type of distance considered most important when it comes to explaining the internationalization strategy of firms, and, second, how distance should be measured. In our study, we argue that a developed market multinational enterprise (DMNE)’s decision regarding the mode of entry into an emerging market (EM) will be affected by the geographic and administrative distance between the locations in which the MNE has previously held operations. Drawing our arguments on transaction costs economics (TCE) and Internalization Theory, we propose that, for low and high geographic and administrative distance, DMNEs will opt to enter EMs via a wholly owned subsidiary, while for moderate levels of distance via a joint venture. Furthermore, we argue that DMNEs’ previous international experience in EMs will have a positive effect on the suggested U‐shaped relationship, alleviating the negative effects associated with the coordination and knowledge dissipation costs incurred as a result of the level of distance. Our study contributes to existing literature both theoretically—notably via the examination of under‐researched facets of distance on entry mode choice—and also methodologically—through the adoption of a novel methodological approach in measuring distance. We test our hypotheses against a data set comprising 316 entries of FTSE 250 British MNEs in 39 EMs spanning the period 1971–2010.     

物流服务质量影响因素与顾客忠诚度

物流服务是现代服务业的一个重要组成部分,物流服务质量对提升企业竞争力具有重大影响。影响物流服务质量的因素主要有信息能力、配送能力、售前售后服务能力、匹配能力和创新能力。其中,售前售后服务能力、信息能力、配送能力对物流顾客感知满意度的影响具有显著性,匹配能力和创新能力对顾客感知满意度的影响较为显著。顾客感知满意度显著影响顾客的忠诚度,并且两者之间存在较大的路径系数。     

Mode of entry mode into a foreign market: the case of U.S. mutual funds in Canada

U.S. mutual fund companies offer funds in Canada through two channels: foreign direct investment or trade in advisement services. The total value of U.S.-controlled funds amounts to 18% of the Canadian equity fund market. This paper investigates how the fund-level and firm-level characteristics affect the channel used to enter the Canadian market. Empirical results indicate that the funds offered through FDI are not especially successful in the U.S. market but are associated with dominant companies, whereas the funds offered through trade in advisement services are highly successful in the U.S. market and are from companies with relatively few successful funds.     

The impact of entry modes on the organisational design of international hotel chains

This paper reports on a study of organisation design within the international hotel chains that simultaneously employ multiple market entry modes. A multiple case study reveals the use of different divisional designs for different types of entry mode within individual chains. These are driven by the desire to maintain strong control over hotel brands. The study concludes that current designs may inhibit the international hotel chains from achieving their organisational potential and recommends that managers look to break down these ‘communities of design’ barriers.     

The impact of manager's animosity and ethnocentrism on multinational enterprise (MNE) international entry‐mode decision

For MNEs, entry‐mode decision is undeniably critical. While the literature has identified several determinants of foreign entry‐mode choice, few have examined the impact of manager's animosity and ethnocentrism. This article is an attempt to fill this gap by examining the independent effect of manager animosity and ethnocentrism as well as the moderating effect of cultural intelligence on entry mode. Data were collected through surveys targeting upper‐level managers in the U.S., U.K., and Germany to examine how animosity and ethnocentrism would shape their decision to enter Iran, a host market largely perceived negatively in the West. Multivariate multiple regression was used to test the hypothesized effects and to capture the multidimensional aspect of entry modes. We found that, in general, manager's animosity and ethnocentrism do negatively affect the choice of an entry mode and that cultural intelligence has the potential to neutralize that negative effect.