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.     

The resource dynamics of early internationalising Indian IT firms

Building on the resource-based view of the firm, this study explores how firms entering into early internationalisation combine different resources to discover the international market opportunities. Based on an in-depth analysis of case studies of five knowledge-intensive firms from India, this study suggests that the differences in the extent of resources available and their combinations influence the early stage of the internationalisation process and pace of learning in the foreign markets. This study contributes to the existing research on international entrepreneurship by explaining how new international ventures overcome the challenges of internationalisation by wisely utilising a broad set of available and potential resources during their early internationalisation efforts and gradually shift the focus on the internalisation of resources. Moreover, this study suggests that the effects of the combination of resources vary across different ventures. A strong combination can increase internationalisation and minimise the risks of failure in new international ventures.     

International Opportunity Recognition among Small and Medium‐Sized Family Firms*

Current research in the field of entrepreneurship emphasizes the importance of opportunity recognition as a key element in the entrepreneurial process. It has been recognized that network ties, activeness and alertness, and prior knowledge are related to how entrepreneurs recognize new opportunities. However, it is unclear how important these factors are when a firm explores opportunities for entry into a foreign market. In this exploratory case study, covering the international opportunity recognition of eight family‐owned small and medium‐sized enterprises (SMEs), we found that the firms in question mainly recognized international opportunities by establishing new formal ties rather than using existing informal or family ties. The findings also indicated that due to the small size and the flexibility of the management team in family SMEs, these firms were able to react quickly to new international opportunities. However, there was no direct relationship between the prior knowledge of the firms and their international opportunity recognition. In addition, we found that trade exhibitions formed the primary context for the international opportunity recognition of the SMEs in this study. These findings motivate a set of five propositions that may lead to further studies on this topic.     

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.     

Innovation as an internationalisation determinant of Brazilian technology-based SMEs

The general objective of this article is to analyse innovation as a determinant of the internationalisation patterns of Brazilian technology-based SMEs (small and medium enterprises) in different sectors and with different technological features. The theoretical background of this article centres on the typologies of innovation, SMEs’ internationalisation patterns, and innovation as an internationalisation determinant. The main theoretical contributions of this qualitative study are its analysis of innovation of the firm, focusing on the type of innovation, the degree of novelty, and the degree of control over the innovation process as determinants of their internationalisation patterns, and the influence of the external organisational environment on innovation and internationalisation. In terms of managerial implications, we highlight the effect of these factors on the competitiveness of case firms in international markets. Finally, our suggestions for future studies include the need for research replication in other emerging markets, the inclusion of both mature and young technology-based SMEs in the sample, the use of longitudinal data for case studies, and the validation of this qualitative study through a quantitative study that includes a larger sample of technology-based SMEs.

     

Organisational capabilities and internationalisation of the small and medium-sized information and communications technology firms

Especially in changing and unpredictable global environments where small knowledge-intensive information and communications technology (ICT) firms often operate, knowledge-based organisational capabilities are seen to contribute most to the performance. In this paper we explore the internationalisation process of small knowledge-intensive firms by studying the effects of a firm’s organisational capabilities on internationalisation and performance. We use a sample of 124 (of which 55 operate internationally) Finnish small and medium-sized firms. International experience is confirmed to be a significant determinant of internationalisation and international performance. In addition, financial capabilities prove to be a significant indicator of the degree of internationalisation: excellent investment expertise, connections with venture capitalists and good financial management are important capabilities for a small firm with high international growth aspirations.     

The impact of transport costs on new venture internationalisation

This paper investigates the importance of transport costs in new venture internationalisation, i.e. of firms that start exporting before they are 3 years of age. It does so by merging two large international datasets, on the firm level (covering 49,584 firms) as well as on the country level (covering 154 countries). It is found that transport costs matter significantly for new venture internationalisation, for older firms’ decision to export, as well as the extent of the latter’s subsequent exports. Export costs, the quality of transport infrastructure and domestic logistics costs affect new venture internationalisation even when controlling for a range of standard determinants. New international ventures behave differently from older firms in two important ways: (1) Transport costs affect the probability that they will export but not the extent of their subsequent exports and (2) their probability of exporting is affected negatively by their networking, domestic success and ISO status, whilst in the case of older firms, these factors have a positive impact. Various recommendations for policy and further research are made.     

Dynamic managerial capability portfolios in early internationalising firms

It is acknowledged that dynamic capabilities can underlie internationalisation of firms, yet extant research has tended to examine the role of capabilities in international entrepreneurship in separate studies, neglecting that international enterprises tend to develop different bundles or portfolios of capabilities that may have differing impacts on their internationalisation. Applying the concept of dynamic managerial capabilities, this study illustrates how different capability portfolios of entrepreneurial decision-making and network capabilities explain early internationalisation of small- and medium-sized enterprises (SMEs). Employing a machine learning method through artificial neural network (ANN) analysis, the findings show how early internationalisation is predicted by a portfolio of different dynamic managerial capabilities. This study thus contributes to the international entrepreneurship literature by outlining the capability portfolios necessary for early internationalisation and proposing a taxonomy for capability portfolios for early and late internationalising firms, by clarifying the role of dynamic managerial capabilities in early and successful entrepreneurial internationalisation and by introducing the ANN methodology as a useful tool in the research corpus of the international entrepreneurship domain.     

Spillovers through backward linkages and the export performance of business services. Evidence from a sample of Italian firms

We provide evidence on the role of spillovers through vertical linkages in service firms’ internationalisation process. We combine input–output coefficients with region-level information on downstream manufacturing sector exports to build a measure of spillovers through backward linkages, which we assess as a systematic determinant of Italian BS firms’ export status. Once considered firm and sector specificities, export spillovers especially matter for exporting to high-income economies outside Europe. This finding originates from higher sunk costs stemming from greater distance to the destination market and tougher competition within the destination market. Furthermore, the spillovers’ geographical scope is mainly local. We thus contribute to international business theory by generalising existing evidence from case studies on the importance of buyer–supplier relationships for service firms’ internationalisation across several BS sectors. Our research carries important implications for international business practices as well, as joining networks with internationalised customers may play an important role in enhancing BS firms’ exports, regardless of the BS supplied.     

Strategic resource decisions to enhance the performance of global engineering services

This paper extends our understanding of the internationalisation and firm performance (I-FP) relationship of service firms by considering the influence of strategic decisions on three types of slack resources. The research focusses on an important type of service operations ? global engineering services, which are a major part of the global economy and represent a distinctive business model in the contemporary business environment. In doing so, we theorise the I-FP relationship by addressing the knowledge-intensive, project-based and people-centric features of engineering service firms (ESFs); and test the relationship with a carefully assembled dataset containing 12 years’ data from 242 ESFs. We identify a negative overall I-FP relationship, i.e. ESFs’ international expansion leads to worse financial performance in general. The presence of slack resources explains why such a result exists. Our findings have significant implications, both for future research on internationalisation and performance and for firms to effectively deploy their resources to support global service operations in a strategic manner.     

Digitally immersive,international entrepreneurial experiences

This study explores how entrepreneurs acquire international experiences within physical and digital business environments, and how these experiences influence the way international opportunities are recognised and exploited. Based on multiple case study evidence, including in-depth interviews with international entrepreneurs from 16 small virtual service firms, findings suggest entrepreneurs who interact with digital technologies in a responsive way in international settings may promote the emergence of a new type of experience: “digital internationalisation experience”. This new type of experience, in turn, contributes to enhanced idea generation and opportunity confidence that enable international entrepreneurial exploitation.     

The firm's location in the home country and internationalisation: Some evidence from Greek smaller firms

The literature on the firm's international behaviour and growth is extensive. However, certain parameters which exert influence on the international growth of the firm and bear important practical and theoretical interest are comparatively underinvestigated. Such a parameter is the geographic location of the internationalised firm within its home country. Few studies have examined the impact of this variable on the firm's international behaviour and performance. The following article deals with this issue by investigating internationalisation ventures by small and medium-sized enterprises based in a small EU country, namely Greece.     

Factors influencing the internationalisation of new ventures in the Irish aquaculture industry: An exploratory study

This paper offers exploratory insights into the factors influencing the emergence of new export ventures operating in a low-technology sector: the aquaculture industry—a largely understudied context in international entrepreneurship. Peculiarities of new industries can make them particularly favourable to the creation of new ventures, and yet research has been limited examining the role of industry and environmental conditions in the emergence of international new ventures. As industry context and stage of firm development influences the appropriateness of theories for explaining firm internationalisation, this study in particular seeks to address two research questions: Firstly, what are the factors influencing the internationalisation of new ventures in a low-technology sector: the Irish aquaculture industry? Second, what role does industry structure play in influencing the internationalisation of new ventures in the Irish aquaculture industry? A qualitative methodology is used to explore these research questions using three case studies of new export ventures operating in the aquaculture sector in Ireland.     

Barriers to Internationalisation: A Study of Entrepreneurial New Ventures in New Zealand

This paper presents the findings of a study of the perceptions of the barriers to internationalisation by 561 New Zealand Entrepreneurial New Ventures (ENVs). Significant differences in the perception of the barriers are identified according to the level of international activity of New Zealand ENVs. Exporters and likely exporters consider the main barriers to internationalisation to be finance and cost-related factors. A lack of New Zealand government incentives are also seen to be major barriers for these two groups with likely exporters also perceiving their lack of international experience to be a hindrance. By comparison non-exporters perceive firm size to be the biggest barrier to internationalisation followed by a lack of market knowledge and experience. Industry was found to have no influence on the perception of barriers to internationalisation, however, firm size does have an impact.     

Business group affiliation and SMEs’ international sales intensity and diversification: A multi-country study

This study examines the impact of business group (BG) affiliation on international sales intensity and diversification in small and medium-sized enterprises (SMEs) by using a multi-country sample of over 13,000 SMEs from 34 European countries. Drawing on the revised Uppsala internationalization model and network theory, this paper suggests that the effects of BG affiliation on international sales intensity and diversification depend on the geographical dispersion of the BG network ties, the size and the age of the firm, and the institutional support in the home country. Thus, we find that interfirm networks in the form of BGs are a double-edged sword that can have both favorable and unfavorable consequences for international sales, depending on the geographical dispersion of the BG’s ties. In addition, the results reveal that BG affiliation is more beneficial for smaller SMEs and SMEs in countries with lower institutional support that are more dependent on the network resources embedded within BG networks.     

Internet marketing capabilities and international market growth

The Internet has been shown to facilitate elements of internationalisation such as information accumulation and network opportunities. However, there is limited understanding of how the Internet combined with marketing capabilities drives international market growth. This study, based on a sample of 224 Australian firms, develops and tests, using structural equation modelling (SEM), a conceptual model of Internet marketing capabilities and international market growth. Results indicate that firms deploying Internet marketing capabilities will benefit due to the reduction of information uncertainty and increased capacity to develop international network capabilities. Moreover, Internet marketing capabilities indirectly lead to international market growth when the firm has a high level of international strategic orientation and international network capabilities. Overall, Internet marketing capabilities enhance the firm's ability to generate other internal capabilities within the firm, which in turn have a positive impact on the international market growth of the firm.     

To go or not to go? Opportunities as triggers of commitment to internationalisation

This paper extends our theoretical understanding of how international opportunities trigger the knowledge-commitment cycle and lead to growth. Longitudinal data from seven international firms was analysed to build a deep, processual understanding of the opportunities developed by the case study firms. Utilizing an abductive approach, the complexities and contextual dynamics of internationalisation processes were explored as they evolved, revealing that path-breaking opportunities are major events that disrupt the ongoing process of regular opportunity development and provide new knowledge that triggers a greater commitment to internationalisation. While firms may discover path-breaking opportunities at different points in their trajectory over hermeneutic and chronological time, key commitments to international markets are made when such opportunities are in hand or clearly in sight. Our use of an abductive process illustrates its intricacies and suitability for explaining temporal phenomena.     

Exploring brand identity and entrepreneurship as drivers of small specialist retailer internationalisation: a German case study

While the comparatively sparse literature on small specialist retailing typically supports a proactive interpretation of the drivers of retail internationalisation, a more differentiated picture exists with regard to understanding the role of the brand construct in this process. The wider marketing literature recognises that brand identity, as well as brand image, can inform the process of internationalisation; yet, research focusing on small specialist retail internationalisation remains underdeveloped in this regard. Neither the notion of a multi-faceted brand concept nor its function as a strategic device in the internationalisation process has been analysed with sufficient depth. Furthermore, a better understanding of how and to what extent brand identity is interdependent upon the characteristics and activities of the entrepreneur is yet to emerge. This paper explores the construct of brand identity and its role within small specialist retail internationalisation, and the related influence of the entrepreneur on the internationalisation process. A case study approach is adopted, examining one German small specialist retailer. Data collection involved semi-structured interviews with owner-managers and other senior management, an assessment of company documentation as well as participant observation, providing in-depth insights into distinctive internationalisation patterns. The study finds that a simple ‘either-or’ approach, in terms of characterising the retailer’s motivation to internationalisation as being either reactive or proactive, is inadequate in understanding this particular case. Whilst initial motivation was characterised as being reactive, the motivations underpinning further planned internationalisation are determined to be more proactive. More particularly, analysis reveals how brand identity is considered to play an important role in the internationalisation of the case study retailer, and highlights the numerous ways in which the characteristics and activities of the entrepreneurial owner-managers impact the firm’s internationalisation. This research contributes to retail and management research concerning SME internationalisation as well as to the retail branding literature.     

The network model of internationalisation and experiential knowledge

This study operationalised the network model of internationalisation [Johanson, J., & Mattsson, L.-G. (1988). Internationalization in industrial systems—a network approach. In N. Hood, & J.-E. Vahlne (Eds.), Strategies In Global Competition (pp. 303–321). New York: Croom Helm] to test the association between experiential knowledge, firm degree of internationalisation and market degree of internationalisation. Adaptations of Eriksson et al.’s three knowledge constructs [J. Int. Bus. Stud. 28 (2) (1997) 337] were employed in regression and ANOVA tests. The regression results indicate that internationalisation knowledge is re lated to firm internationalisation, foreign institutional knowledge is associated with both firm and market internationalisation, and foreign business knowledge is strongly related to internationalisation knowledge. The ANOVA results confirm that foreign institutional knowledge levels differ for the Early Starter, Late Starter, Lonely International and International among Others firms. Implications are drawn relating to the effect of different international strategies on the generation of internationalisation knowledge, the vicarious acquisition of foreign institutional knowledge, especially in relation to parent companies and government organisations, and the need to more effectively measure the outcomes of the ac cumulation of foreign business knowledge.     

Connected internationalisation processes: the case of internationalising channel intermediaries

Based on a network approach to internationalisation, the paper presents concepts for analysing companies’ processes of internationalising in a moving context of other firms internationalising. The analytical problem and research question of the study is: How are firms internationalising in a continuously moving context of other, connected firms that are internationalising concurrently? The idea of connected and overlapping network processes is introduced as an analytical tool for approaching the problem. The concept spatial overlapping is applied to analyse geographical aspects of overlapping internationalisation processes.These processes are illustrated with an empirical study of the internationalisation processes of channel intermediaries. The empirical aim of the study is to complement earlier research into the internationalisation of manufacturing firms, service firms, retail chains, etc. with a study that puts channel intermediaries in focus. Connected internationalisation processes are illustrated with a case from the electronic component distribution industry.Two issues are brought up in the analysis of the case: various ways of handling concurrent and connected internationalisation processes, and of handling the resulting spatial overlapping processes, including the redefinition of market regions, regionalisation. In the final implications, the handling of network contradictions and tensions emerging from connected internationalisation processes are elaborated on in a model suggesting further research into this line of internationalisation research.