Trust and Co-operation in Business Relationship Development: Exploring the Influence of National Values

This paper makes an initial exploration of whether and to what extent different national values may affect the development of business relationships between individuals in different countries, by specifically examining the development of trust and co-operation between people. It first identifies key factors that may determine the nature and effect of trust in business relationships. Trust based on calculus, knowledge, and identification are distinguished. Inhibitions to co-operation are also identified, which include the perceptions of economic value, of social returns, of risk, and of competence of the potential co-operating parties. A model of trust formation and its impact on co-operation enabling detailed interpretation of empirical data is presented.

Notions of national values developed in previous research are outlined, and a set of formal tabulated propositions regarding how these may be expected to influence different aspects of trust formation in different European countries is developed. The relevance and applicability in understanding different approaches to business development in different countries is then explored. The trust relationships of three matched case companies, one each from France, Holland and the United Kingdom are examined in terms of the propositions detailed, by means of verbal protocol analysis. Marked differences were found between the three individual business leaders, and these largely matched the theoretical propositions generated. Different types of trust relationships were sought and required by the individuals examined, and they each needed different co-operation criteria to be addressed before they would co-operate.

This study is only exploratory, and stereotypes need to be avoided, but more concrete propositions can be suggested as to why and how national values influence business to business relationships. National values appear to influence the relative importance placed by individuals in the types of trust they require to co-operate with others, and the criteria they implicitly employ in deciding whether to co-operate or not.     

Fragmented networks and transnational entrepreneurship: Building strategies to prosper in challenging surroundings

Transnational entrepreneurship studies highlight the importance of personal profiles, institutions, and networks in creating and succeeding in this type of entrepreneurship. Even so, less is known about migrants whose networks are fragmented and closed, facing challenging environments at home and abroad. This paper aims to study the attributes of transnational entrepreneurs with small and fragmented networks, from post-conflict environments, who can perform an important role in the socioeconomic development and internationalization level of their countries of origin due to the cross border mobilization of resources they encourage. For that reason, the specific case of Colombian transnational entrepreneurs who have been able to overcome those obstacles with their transnational business is analyzed with the intention of understanding how they manage those shortcomings when engaging in transnational entrepreneurship. In aiming to obtain a deeper understanding of their characteristics, similitudes, differences, and motivations, the research uses multiple case studies. The main findings suggest that transnational entrepreneurs form purposeful–strategic networks to compensate their lack of amalgamated social systems, and that they have special qualities that distinguish them from other Colombian migrants and transnational entrepreneurs. Moreover, Colombian transnational entrepreneurs focus their business in the international market, using strategically their knowledge of both the local and foreign environment, while their main interest to do so is not altruistic but business oriented. Governments from post-conflict countries should promote transnational entrepreneurship while facilitating network formation and institutional trust through diverse strategies. Finally, implications for further research are drawn.     

International entrepreneurship in resource-rich landlocked African countries

Despite the increase in research about international entrepreneurship, relatively little is known about the process in Africa. This is due to the disparity between the actualization of business ventures and global perceptions of African entrepreneurs. As a result of the diversity of countries within the African continent, the nature of international entrepreneurship varies with cultural and historical context. To address this research gap, we discuss how international entrepreneurship in Africa differs to the more studied traditionally North American and European perspective. To do this we develop a number of research propositions for resource-rich landlocked African countries (Botswana, Zambia, and Zimbabwe) that have unique characteristics in terms of how they approach international entrepreneurship. The research propositions suggest that resource-rich landlocked African countries need to focus on informal networks and cultural attributes as a way to differentiate themselves in the international marketplace. Managerial implications and theoretical research suggestions for differentiating resource-rich landlocked African countries from the more resource scarce and coastal countries are stated.     

The Influence of Culture on Trust Judgments in Customer Relationship Development by Ethnic Minority Small Businesses

This paper explores the influence of culture on trust judgments in customer relationship development by ethnic minority small businesses (EMSBs). Chao and Moon's “cultural mosaic” of overlapping “cultural tiles” is used to develop a generic conceptual model regarding the relationships between multiple cultural identities, trust, and customer relationship development. Drawing on qualitative data from semistructured interviews with 134 Turkish EMSBs in London (United Kingdom), our findings contribute to the understanding of how different cultural tiles influence the dimensions of trust judgments in relationship development between EMSBs and different customer groups. Seven propositions and a theoretical framework regarding these relationships are offered for future research.     

The Distinctiveness of Entrepreneurship in Transition Economies

This paper is concerned with the distinctiveness of entrepreneurship and small business development in countries that are at different stages of transformation to market based economies. Following a discussion of the potential relevance of selected conceptualisations of entrepreneurship to transition conditions, the authors present original empirical data referring to the characteristics of entrepreneurs and their businesses from countries at different stages of market reform. Distinctive features of entrepreneurial behaviour identified reflect the unstable and hostile nature of the external environment and the scarcity of key resources, particularly capital. In an unstable and weakly structured environment, informal networks often play a key role in helping entrepreneurs to mobilise resources, win orders and cope with the constraints imposed by highly bureaucratic structures and often unfriendly officials. Moreover, the social context inherited from the former socialist period appears to affect both the attitudes and behaviour of entrepreneurs and the attitudes of society at large towards entrepreneurship.     

It is not whom you know,it is how well you know them: Foreign entrepreneurs building close guanxi relationships

Within the growing body of Chinese entrepreneurship literature, guanxi is increasingly recognized as an important indigenous Chinese business practice with important implications for firm performance and success. Guanxi is defined as relationship or connection. China’s continued economic growth and forecasts of it becoming one of the world’s largest consumer markets present multinational corporations and foreign entrepreneurs alike with unprecedented economic opportunities. Thus, greater insight is required into how foreign entrepreneurs, as outsiders, establish and develop close guanxi relationships. Conceptualizing guanxi as a dynamic process, this paper explores the underlying interactions and processes foreign entrepreneurs engage in to establish and build a strong emotional connection and trust with their closest guanxi partner. Using an exploratory single case study approach, data from 15 foreign entrepreneurs operating legally registered small- and medium-size enterprises (SMEs) in Shanghai was collected and analyzed. In addition, self-administered structured questionnaires that utilize the McAllister trust scale were used to measure 20 foreign entrepreneurs’ levels of cognitive and affective trust toward their closest guanxi partner. Overall, the findings of the study provide an in-depth understanding of the complex interplay and functioning of third-party and anticipatory bases. In so doing, the study’s outsider perspective addresses a critical gap in the literature that yields initial yet important insights that contribute to a better understanding and appreciation of the inherent nuances and differences in relationship-building processes in cross-cultural settings. Furthermore, these findings bring to the fore the need to consider the ways in which this indigenous Chinese business practice may be evolving in the face of increasing internationalization.     

The entrepreneurial experience and strategic orientation of high-tech born global start-ups: An analysis of novice and habitual entrepreneurs

A new type of “born global” (BG) firm has attracted the attention of international business researchers, encouraging the development of international entrepreneurship theory as a separate field of research. This theory proposes that the development of BG start-ups depends on their entrepreneurs, such that their strategic orientation can explicate their accelerated foreign growth and performance abroad. However, empirical analyses of BG start-ups are rare, with a few studies that examine their different manifestations. This study therefore investigates the role of entrepreneurial experience in influencing the different manifestations of strategic orientation, through a comparison of eight Italian, Internet-based BG start-ups founded by either novice or habitual entrepreneurs. Following a case-based approach, the conceptual framework presents the strategic orientation of BG start-ups as a multidimensional construct, comprising learning, market, and entrepreneurial orientations. Some propositions suggest how the different levels of entrepreneurial experience among novice and habitual entrepreneurs may influence the strategic orientation of their BG start-ups and offer insights for researchers interested in strategic orientation and entrepreneurial experience.     

Universally-enabling and context-binding resources in new venture internationalization: Evidence from venture capital backed start-ups in an emerging market

Integrating institutional and effectuation theories, we examine the relationship between entrepreneurs’ means and internationalization in an emerging market. Results indicate that some means, such as technical expertise or business network membership, transform into valuable internationalization resources despite difficult institutional conditions. Others, however, such as industry or international experience, are best deployed locally. Findings also indicate that means such as entrepreneurial experience and number of founders act as catalysts of internationalization, allowing for other means to transform into internationalization resources. We extend effectuation theory by showing how different means transform into internationalization resources and contribute to research at the intersection of institutional theory and international entrepreneurship by expanding our understanding of universally-enabling and context-binding internationalization resources. In so doing, we identify a boundary condition to international entrepreneurship theories that emphasize the role of individual resources during venture internationalization by revealing a context in which certain traits exhibit nonstandard relationships with internationalization.     

Network view of MNCs' socio-political behavior

While business networks and relationships in international and industrial marketing studies are explored extensively, relationships between firms and socio-political actors are rarely been studied. This paper addresses this gap and examines how MNCs manage their relationship with socio-political organizations. The study builds from the proposition that business firms, besides their actions in business market, have to manage their socio-political market. The study aims to develop a theoretical view that is based in business networks and contains the three concepts of legitimacy, commitment and trust. The proposition is that business firms behave proactively towards the actors in the socio-political environment which is related to their business goals. The three conceptual elements will enable us to understand more deeply the varieties in the firms' managerial behavior. Two cases test the concept in the model — those of Daewoo Motor Company (a South Korean MNC) and the Swedish MNC, Vattenfall. The study will contribute towards deeper understanding of socio-political market and how firms manage their socio-political relationships. The conclusions describe the theoretical and managerial implications.     

Initial internationalization of Chinese privately owned enterprises—the take‐off process

In the first quarter of 2010, China showed the highest quarterly growth (12%) of any country ever. Although privately owned enterprises (POEs) are an important factor behind this immense growth, knowledge about how they have become key exporters is scarce and largely overlooked, especially regarding how they started to go abroad. Two major take‐off processes from the domestic market to the foreign market are studied. The critical importance of the development of the local emerging market behind the possibilities of taking off is stressed, as well as how firms change between indirect and direct export modes. The research is based on an abductive case study research approach, where primary data is collected through interviews in the Yangtze River region. The case study involves six privately owned family firms run by strong and dominating entrepreneurs. Major empirical and theoretical conclusions, including nine propositions, summarize the article and indicate areas for further research. © 2012 Wiley Periodicals, Inc.     

Building trust—Evidence from Vietnamese entrepreneurs

In the context of underdeveloped market institutions, entrepreneurs in a transition economy are forced to rely on trust-based partnerships. In the absence of effective market institutions and sufficient elapsed time, these entrepreneurial firms find a great need to actively and intentionally develop trust with their partners. The current literature, however, has virtually overlooked the possibility of trust being intentionally developed in interfirm relationships. This study develops a model that links trust development strategies, trust, and interfirm collaboration, and reports an empirical test of that model in Vietnam. The results support the general thesis that trust can be intentionally developed to facilitate interfirm relationships.     

Internationalization of Chinese Firms: What Role Does Guanxi Play for Overcoming Their Liability of Outsidership in Developed Markets?

This article explains how managers of Chinese firms can use guanxi when entering and expanding in developed markets. The empirical basis for the investigation is formed by interviews with 29 managers at 17 Chinese business‐to‐business firms internationalizing to Europe. The results generated are twofold. On the one hand, existing guanxi was largely irrelevant for initially entering the European market. On the other hand, Chinese firms managed to successfully overcome the liability of outsidership by building new guanxi‐like relationships with their Western business network partners after a certain period of time. Six propositions give insights on the process for Chinese firms to become insiders in the business networks of developed countries. The propositions were combined into two comprehensive models that give implications for future research and for management practice. © 2016 Wiley Periodicals, Inc.     

Nationality and work role interactions: A cultural contrast of Israeli and U.S. entrepreneurs' versus managers' needs

The globalization of business ventures and the parallel search for sources of international competitive advantage have stimulated research relating cultural differences to entrepreneurial and managerial behaviors. Recent work by McGrath, MacMillan, and Scheinberg (1992) encouraged studies of managers and entrepreneurs in different cultures, suggesting that these comparisons may “… shed additional light into the interrelations between social structure, wealth creation, and cultural beliefs” (McGrath el at. 1992, p. 116). This study follows that advice.Cultural differences are powerful determinants of behavior, and many studies support the notion that managerial behavior must adapt to the national cultural setting to achieve success. A growing stream of entrepreneurial behavior research has explored differences in motivational needs between entrepreneurs and non-entrepreneurs of different countries, and found parallel differences across cultures. Given these views, we might expect to find need differences between entrepreneurs and managers within countries however, some entrepreneurship researchers have concluded that U.S. managers and entrepreneurs are more alike than different.To better understand need profile differences between and within cultures, we use a theory that suggests that culture is an important determinant of work behavior. The process through which culture affects work behaviors is described in “Cultural Self-representation Theory” (Erez and Earley, 1993). Based upon this theory, inferences from the entrepreneurial archetype, and analysis of the contrast between the cultures of Israel and the U.S., we propose that: (1) entrepreneurs and managers have different motivational needs within some national cultures, and (2) across national cultures there are systematic differences in motivational needs. Based on these premises, an interaction hypothesis between work role and nationality is suggested because of the importance of both culture and work role in determining motivational need differences. Data are collected from over 370 Israeli and U.S. entrepreneurs and managers.Results support cultural self-representation theory for the Israeli-U.S. and entrepreneur-manager case, because interactions between nationality and work role are exposed for various needs. This finding suggests that cultural differences are indeed important for understanding management motivational needs in different nations, and that the effectiveness of entrepreneurial approaches to management may be culture-sensitive. The study illustrates work-role differences between Israeli managers and entrepreneurs. We confirm past conclusions about U.S. entrepreneur-manager need similarities, and suggest that these need similarities are supported by the individualistic culture within U.S. organizations.     

Domestic market context and international entrepreneurs’ relationship portfolios

The importance of relationships to international entrepreneurs’ internationalization is well recognized, but we still know little concerning how entrepreneurs find, develop and use different types of relationships for their internationalization. In a study based on international entrepreneurship and network theories, we examine how having or not having a domestic market affects the relationship portfolios developed by born global software entrepreneurs. We find it profoundly influences the personal relationship strength they seek in new international relationships, and their activeness towards developing new relationships that are embedded in foreign markets. Further, the analytical model we develop shows how and why the presence of a domestic market influences international entrepreneurs’ portfolios of relationships.     

“Fake it until you make it”: business model conceptualization in digital entrepreneurship

Digital business model research spans the disciplines of information systems, marketing and entrepreneurship. Despite the growing research in the area there is a lack of understanding of how digital entrepreneurs identify business opportunities and conceptualize those in a business model. The literature on business models lacks consistent terminology and specification of critical components. Through an explorative study of digital entrepreneurs we examine how entrepreneurs identify business opportunities and how they translate them into a workable business idea. Although entrepreneurs typically have difficulty explaining their business model components we identified that critical features in our simplicity framework include three main modules, transaction/matching, marketing and back-office components, and simplicity in terms of value proposition, conceptualization approach and usability. This research proposes that a parsimonious view of digital business models, aligned with the lean start-up idea, makes sense for theory development and in terms of usefulness for entrepreneurs.     

MSI deliberations and context: The influence of Southeast Asian business systems on member justifications and approaches to anti-corruption

Multi-stakeholder initiatives (MSIs) convene stakeholders from different contexts to deliberate on corporate social responsibility (CSR) issues. Extant research focuses on the deliberative potential of internal governance structures yet neglects the influence of broader sociopolitical contexts on the members that participate in them. Anti-corruption is one CSR issue that MSIs increasingly address which is particularly context dependent. Therefore, this study examines how different sociopolitical contexts influence members’ justifications and approaches to anti-corruption during MSI deliberations and ultimately, how this impacts the MSI’s approach to anti-corruption. Through a single case study of an MSI, the ASEAN CSR Network which is situated in Southeast Asia with members representing business and CSR organizations in six different countries, the findings show that the different National Business Systems clearly influence the member justifications and approaches to anti-corruption. Further, the MSI reinforces and promotes the adoption of the different national business system-related justifications and approaches ultimately, leading to an MSI approach to anti-corruption which is a composite of the different national business system-related approaches. This paper makes three contributions to the literature on MSI deliberations. First, it proposes a novel framework that links the influence of national business systems to member justifications and approaches to anti-corruption during MSI deliberations by leveraging the orders of worth framework. Second, it shows that the concept of compromise may be more relevant to understanding and evaluating MSI deliberations than the notion of consensus. Third, it contributes through the empirical study of an MSI developed in Southeast Asia addressing anti-corruption.     

Cultural interpretations of destructive acts and trust in Japanese supply channel relationships

This paper investigates the way culture influences Japanese inter-firm exchange processes, arguing that isomorphism (e.g., due to macro-force flux and convergence) is eroding traditional Japanese management practices and increasing heterogeneity. The role of culture in the development of routines and relationship capabilities across firm boundaries is particularly important in Japanese firms. Traditional Japanese business values engender confidence in a business partnership's conformity and harmony. However, cultural erosion is shifting Japanese attributions of and responses to destructive acts in channels relationships, which has implications for appraising and sustaining trust and success. Based on a qualitative investigation of Japanese subsidiaries’ supply relationships, our study furnishes academics and practitioners with a set of research propositions on culturally influenced destructive act cognitions and behavioural responses. These provide novel insights into the modern face and unfulfilled promise of inter-firm relationships with the Japanese.     

International network extension processes to institutionally different markets: Entry nodes and processes of exporting SMEs

This article is about how SMEs reduce their liability of network outsidership in the process of establishing a network insider position in foreign business networks. By examining how SMEs establish insidership positions in institutionally different business networks, the authors contributes to the network approach to firm internationalization. From a detailed longitudinal and retrospective case study of four SMEs from mature market entering emerging country markets and four SMEs from such immature markets entering mature markets, the authors develop propositions based on intra-group and inter-group analysis. The propositions concern the parties to which the exporter initiates and develops relationships when plugging into the foreign network (the entry node), and how the firm reaches an insider position in this network (the entry process). Three distinct network types are identified along this entry process: the exposure network, the formation network and the sustenance network.     

How different are the entrepreneurs in the European Union internal market?—An exploratory cross-cultural analysis of German, Italian and Spanish entrepreneurs

Little research has analyzed the similarities or differences between entrepreneurs from different European Union countries. The European Union is a single market, but also an international business arena where the entrepreneurs from any member state can make their first move in the direction of internationalizing their business. This work presents an exploratory study of the personal values and attitudes of European entrepreneurs based on a cross-cultural analysis of entrepreneurs from Germany, Italy, and Spain. The analysis uses Hofstede’s model to study the cultural and social values of these entrepreneurs, and their personal values have emerged from case studies. The results show that the entrepreneurs of the three different nationalities share a similar pattern of personal values. These findings are discussed and proposals for further empirical research suggested.