Conceptualizing accelerated internationalization in the born global firm: A dynamic capabilities perspective

Existing approaches at explaining accelerated internationalization of born global firms are incomplete as they do not capture the learning that is undertaken by these firms and their founders prior to the firm's legal establishment. Building on the extant literature and drawing on the dynamic capabilities view of competitive strategy, this paper presents a conceptual model of born global firm internationalization. We conjecture that a set of dynamic capabilities that are built and nurtured by internationally-oriented entrepreneurial founders enable these firms to develop cutting-edge knowledge intensive products, paving the way for their accelerated market entry. We develop propositions and offer concluding remarks.     

Contextualizing international strategy by emerging market firms: A composition-based approach

We present a composition-based logic toward international expansion by emerging market firms (EMFs) – firms that use compositional investment, compositional competition, and compositional collaboration to create a unique competitive advantage in global competition. This view explains how EMFs creatively adopt a composition-based international strategy, enabling them to compensate for their weaknesses while capitalizing on their strengths during global competition where they offer a competitive price-value ratio suited to mass global customers who are cost sensitive. We also explicated the working conditions (i.e., strategic resource-seeking motivation, subsidiary autonomy delegation, and cross-border sharing system) that fortify the outcome of composition. Using survey data from 201 EMFs, our analysis supports these key arguments. A composition-based lens provides a new understanding of why and how emerging market businesses can survive in international competition for some period of time without possessing traditionally defined monopolistic advantages.     

The Uses of Business History: A Contribution to the Discussion

This article relates the managerial enterprise (a firm in which decisions as to current production and distribution and allocation of resources for future production and distribution are made by salaried managers with little or no equity in the firms they operate in) to competitive success in the new capital-intensive industries that began to appear in the United States and Western Europe after the completion of modern transportation and communication networks. It begins by examining the reasons for the rapid rise of managerial firms in these industries, the global oligopolistic competition that ensued, and the organisational capabilities such competition engendered. It then reviews the competitive performance of such firms in global markets in chemicals, metals, electrical equipment, and heavy and light machinery in the early years of the century, motor vehicles in the inter-war years, and computers and semiconductors after World War II. These managerial firms grew by moving into foreign or related product markets. World War I, the Great Depression and World War II held back the full competitive impact of such growth until the 1960s. The response of US industrial firms to this intensive international, inter-industry competition of the 1960s brought unprecedented changes on the competitive capabilities of US managerial enterprises in such capital-intensive industries.     

Issues of Competitiveness

Abstract

This article investigates the forces that constrain Taiwanese-based corporations from improving quality and introducing and marketing new products. A total of 182 executives from the service and manufacturing sectors participated in the study. The results indicate that Taiwanese-based firms are optimistic about their competitive market position and about their respective industries. Furthermore, executives of these firms prefer to compete in regional and global markets. Absence of pride in a job well done, ineffective performance evaluation systems, and excessive government regulations were found to be the most important factors that may prohibit improvement in product quality. The results also reveal that various factors may hinder the development and marketing of new products. They are inattentiveness to consumer needs, top management's lack of attention to world competition and global opportunities, deterioration of the competitive spirit among employees and managers, absence of a flexible manufacturing strategy, volatile business environment, and too much focus on immediate results.     

A study on development strategy of Korean hidden champion firm: Focus on SWOT/AHP technique utilizing the competitiveness index

The purpose of this study is to offer development strategies for hidden champion firms; it is thought that in order to overcome Korea’s economic crisis and to secure new growth engines for sustained economic development, the country needs to foster more hidden champions that can lead global market. The study draws from an empirical survey of 61 Korean firms on hidden champion promotion list as well as 45 experts; the results were analyzed using SWOT/AHP model and a corporate competitiveness index to develop development strategies for Korean hidden champions. The results suggest that Korean hidden champions should seek opportunities for industrial growth based on technological strength, create competitive advantages in the market, and reduce their dependency on large corporations. Hidden champions should target market niche rather than competing with global firms; this is possible with competitive strengths based on specialist technology that will satisfy customers. Thus, authors argue that small- and medium-sized enterprises in Korea should focus on developing technological competences in order to possess specialist core technology that will support their growth in the global market.     

A resource-based analysis of sustainable competitive advantage in a global environment

The extant business literature on global competitive advantage has been dominated by a contingency-based approach, which advocates the attainment of fit between the firm's strategy, structures and processes and its competitive conditions. However, most support for this view has been anecdotal and rigorous empirical evidence has been lacking. This study adopts a more voluntaristic stance, and integrates perspectives from international business and strategic management to propose a resource-based model of global sustainable competitive advantage (GSCA). A series of hypotheses are presented on the nature of global resources and on the relationships between these resources and sustained superior performance. The model is tested on a sample of firms in the global automotive components industry with promising results. Conclusions are drawn and the implications for research and practice are outlined.     

Competing on the edge: Implications of network position for internationalizing small- and medium-sized enterprises

Three generic competitive strategies attributed to internationalizing SMEs of targeting niches, differentiating products and leveraging networks fail to adequately explain how SMEs win customers in other countries against both large and small competitors. This study distinguishes competitive strategy (how firms compete) from competitive advantage, and from competitive engagements where firms deploy their competitive advantages to win customers within business network relationships. By abductively reasoning from the competitive engagements entered into by the internationalizing SMEs from the Fleet Management Systems industry segment in New Zealand, we show that these firms often compete with foreign rivals by using their position on the edge of a business network to leverage information asymmetries across structural holes. We contribute by integrating this conception of internationalizing SME competitive strategy with the business network foundations of the Uppsala internationalization process model.     

Born global or local? Factors influencing the internationalization of university spin-offs—the case of Halmstad University

A wealth of research in the past decades has examined born globals or international new ventures, which are firms that from inception view the whole world as a market and as a source to access resources. Many of these firms build their competitive advantage on high-tech knowledge. However, although many studies have shown how born globals can achieve success if they access resources through their relationships from actors in their networks, few studies have explored the relationship between born globals and universities. Universities are important actors in creating new technology knowledge, and many studies have shown how new firms, or so-called university spin-offs (USOs), are formed around universities. The current study explores why some USOs are successful in their international growth strategy and discusses the factors that influence and facilitate the internationalization process. The study investigates 10 USOs around the newly established Halmstad University in Sweden and finds that universities have a positive effect on firm creation and initial international growth. The regional competence base increases from the establishment of a local university, primarily by strengthening the regional human capital and by increasing university research. This study shows that researcher entrepreneurs’ ventures start as born globals, but that these firms do not continue to grow. Born global business models, per se, do not lead to competitive advantage and successful internationalization. Instead, a strategy built on customer focus and an ability to adapt to different customer demands lead to growth, and the location of growth is dependent on the size of the home market. This study also shows that student entrepreneurship can be a successful growth strategy for USOs focusing on both international and local markets.     

The evolution of alliances in the global airline industry: A review of the African experience

In an increasingly globalized world, alliances have proliferated in one industry after another, and the competitive game has shifted from firm versus firm to group versus group, leaving many firms operating on the margins of these constellations. Using the case of the global airline industry, this article examines how the shift from bilateral to multilateral alliances has left many African airlines operating on the margins of the global airline alliances groupings. We conjecture that a number of internal organizational factors, such as size and lack of access to scarce resources, and external factors, such as a slow market‐reform process and insufficient reform of state‐owned airlines, have hindered their success in a highly competitive environment. The theoretical, managerial, and policy implications of these findings are discussed. © 2011 Wiley Periodicals, Inc.     

Sales Training in a Dynamic Market

Abstract

The Singaporean hotel industry is examined, with particular emphasis on me differences between global and local sales force training. Empirical evidence indicates that there is a wide divergence between global and local practices. It appears that global firms perceive that sales training leads to greater sales force performance and view sales training as being part of their strategic marketing plan. Global firms also employ a more formal training curriculum, focus on “soft” competencies, and have an established training culture. Conversely, local firms rely upon “on-the-job training (OJT)” and appear not to understand that sales training programs can be a source of competitive advantage. Managerial implications and suggestions for future research are presented.     

Linking two dimensions of entrepreneurial orientation to firm performance: The moderating role of environment and industry life cycle

The term “entrepreneurial orientation” has been used to refer to the strategy-making processes and styles of firms that engage in entrepreneurial activities. A popular model of entrepreneurial orientation (EO) suggests that there are five dimensions of EO—autonomy, innovativeness, risk taking, proactiveness, and competitive aggressiveness (Lumpkin and Dess 1996). This paper reports on two of those dimensions—proactiveness and competitive aggressiveness. Proactiveness refers to how firms relate to market opportunities by seizing initiative in the marketplace; competitive aggressiveness refers to how firms react to competitive trends and demands that already exist in the marketplace. Despite these distinctions, prior research has tended to equate these two concepts and argued that they have a similar effect on firm performance. This paper investigates how these two approaches are related to each other, how they are related to performance, and how their function differs in the environments in which firms exhibit these approaches to strategy making. These distinctions are important because proactiveness and competitive aggressiveness represent distinctly different avenues to entrepreneurial success.A field study was conducted in which 124 executives from 94 firms were surveyed. These were executives from non-affiliated, non-diversified firms who were actively involved in strategic decision making at the top level of the firm. All firms reporting had at least one respondent who was an owner. Analysis of the data was conducted in two phases. In phase 1, factor analysis was used to examine the distinctions between different dimensions of EO. Proactiveness and competitive aggressiveness emerged as two separate factors indicating that these two strategy-making modes were perceived differently by the executives in the study. In the second phase, the relationship of these two dimensions to performance was analyzed in various contexts. Initial tests found that proactiveness was positively related to performance but competitive aggressiveness tended to be poorly associated with performance.Subsequent tests of the EO-performance relationship indicated that the stage of industry life cycle tended to favor one entrepreneurial orientation over another. The performance of firms in the early stages of industry development was stronger when their strategy making was proactively oriented. In contrast, a competitively aggressive frame of mind was helpful to firms in more mature stages of industry development. These findings were supported by other tests of the business environment. In dynamic environments, characterized by rapid change and uncertainty, proactive firms had higher performance relative to competitively aggressive firms. In hostile environments, where competition is intense and resources are constrained, competitively aggressive firms had stronger performance.The findings suggest that these two different approaches to entrepreneurial decision making may have different effects on firm performance. The differences were particularly apparent in the way firms relate to their external environment. Proactiveness—a response to opportunities—is an appropriate mode for firms in dynamic environments or in growth stage industries where conditions are rapidly changing and opportunities for advancement are numerous. But such environments may not favor the kind of combative posturing typical of competitive aggressiveness. Firms in hostile environments, or in mature industries where competition for customers and resources is intense, are more likely to benefit from competitive aggressiveness—a response to threats. A further implication of this research is that the dimensions of an entrepreneurial orientation, often considered to be positively related to performance under all conditions, may not always be associated with successful outcomes. This study indicates that the dimensions of EO often vary independently rather than covary, suggesting that the extent to which an entrepreneurial approach to strategy making is useful will frequently depend on the organizational or environmental conditions under which such decisions are made.     

Global talent management and global talent challenges: Strategic opportunities for IHRM

The need for multinational firms to be as competitive in the global marketplace as possible has increased dramatically over the past twenty years. For international human resource management this has meant many strategic opportunities to international human resource management. An excellent example of such an opportunity is that which exists regarding the management of talent. This opportunity began to develop in the late 1990s with the advent of the challenge of “global talent management.” During the past few years this opportunity has expanded to include challenges dealing with talent shortages, talent surpluses, locating and relocating talent, and compensation levels of talent. Together, these conditions are all “global talent challenges”. In this article we describe these several global talent challenges and the strategic opportunities they present to firms and propose the implications of these for firms and for the field of international human resource management.     

Chinese FDI in New Zealand: What Are Chinese Investors Looking For?

In recent years, there has been unparalleled growth in outward foreign direct investment from China. Traditional Western‐dominated international business theory proposes that asset exploitation is necessary for firms undertaking foreign investment. However, more recently, studies suggest asset augmentation is more important for multinational enterprises from emerging countries. This article examines the acquisition by two Chinese firms—Agria and Haier—of two iconic New Zealand firms, each with a significant international presence—PGG Wrightson and Fisher & Paykel. The article determines that Agria and Haier invested to acquire strategic assets in order to strengthen their position in the Chinese market as well as build and sustain a global position. Strategic intent was an important factor in deciding where to invest, and strategic assets complementary to their own competitive advantages were sought by the Chinese firms. © 2016 Wiley Periodicals, Inc.     

Barriers to Innovation among Spanish Manufacturing SMEs

Innovation is widely recognized as a key factor in the competitiveness of nations and firms. Small firms that do not embrace innovation within their core business strategy run the risk of becoming uncompetitive because of obsolete products and processes. Innovative firms are a perquisite for a dynamic and competitive economy.
This paper reports on the results of a study that examined barriers to firm innovation among a sample of 294 managers of small and medium-sized enterprises (SMEs) in Spain. The study examined the relation between (1) product, process, and management innovation and (2) 15 obstacles to innovation, which can limit a firm's ability to remain competitive and profitable. Findings of the study show that barriers have a differential impact on the various types of innovation; product, process, and management innovation are affected differently by the different barriers. The most significant barriers are associated with costs, whereas the least significant are associated with manager/employee resistance. Additionally, the results demonstrate that the costs associated with innovation have proportionately greater impact on small than on larger firms.
The findings can be used in the development of public policy aimed at supporting and encouraging the innovation among SMEs in Spain. Government policies that encourage and support innovation among all firms, especially small firms, can help countries remain competitive in a global market. Public policy that encourages innovation can enable firms to remain competitive and survive, both of which have direct implications for employment and a country's economic viability. The results may also be insightful for managers who are attempting to encourage innovation. Understanding barriers can assist managers in fostering an innovative culture by supporting new ideas or by avoiding an attitude that creates resistance to new ideas.     

Asian firms and the restructuring of global value chains

Asian trans-national garment manufacturers are transforming the structure of global value chains in the apparel industry. Recent studies show such first tier suppliers undertaking a greater range of functional activities. In many cases, these firms originate from the so-called ‘Rising Power’ economies, particularly ‘Greater China’ and South Asia. We argue that such, transnational, Asian firms can play a pivotal and strategic role in shaping the geography and organisational restructuring of the global value chain. Drawing on secondary sources and primary research we illustrate how such firms manage complex international production linkages, and ensure the incorporation of Jordan into the global garment industry. The paper contributes to the understanding of the role of these firms and how their behaviour is driven by complex dynamics linked to their own business strategies, their linkages with buyers, and their ability to exploit production and trade opportunities while maintaining high levels of global locational flexibility.     

Exploring corporate entrepreneurship in privatized firms

This paper reports an analysis of whether state-owned enterprises (SOEs) increase their levels of corporate entrepreneurship after privatization. The study uses agency theory to discuss why SOEs display little entrepreneurial behavior and how privatization may alter this situation by changing firms’ systems of controls and incentives. The study also uses a sample of Spanish firms for its empirical research. Data on these firms were available for three years before and after privatization. The findings show that corporate entrepreneurship increases after privatization when firms are in highly competitive industries, either because competition was greater after privatization or because the firm was already in a highly competitive industry. In summary, corporate entrepreneurship in privatized firms seems to be favored by two factors, a change of ownership and competition.     

The rise of super-elite law firms: towards global strategies

This paper reviews the pressures towards globalisation reshaping the corporate law sector. It uses Yip's [Yip, G.S. (1996). Total global strategy (2nd ed.). Englewood-Cliffs, NJ: Prentice-Hall] framework of global industry drivers. The dominant view has been that the globalisation potential of the legal industry is low since there are few global legal products and many regulatory differences between markets. However, within the corporate law sector, strong regulatory differences between countries are outweighed by the combined impact of market, competitive and cost drivers. Evidence from this research shows that the balance of industry drivers is towards there being benefits to the pursuit of global strategies within this sector. In practice, a small number of very large corporate law firms are implementing global strategies in pursuit of specific sources of future competitive advantage. Thus a small ‘super-elite’ of globalising firms is emerging.     

Are the World's Largest Firms Regional or Global?

There has been vigorous debate about whether the world's largest firms are regional or global in their operations and strategy. Some authors argue that global vision and strategy are essential for most firms in today's interconnected world, while others claim that even the largest multinational firms are mostly confined to their home regions—and that global strategy is a myth. Using a novel data set of over 1,000 of the world's largest firms, we provide a new perspective on this debate. We show that these firms range from domestic to regional, transregional, and global, with the implication that global strategy is alive and well in international business. © 2015 Wiley Periodicals, Inc.     

Coordinating manufacturing and marketing in international firms

In this article, the authors argue that manufacturing experiences much of the turbulence and conflict imposed by the dynamic global marketplace through its relationship with marketing, because marketing is usually responsible for introducing changing competitive priorities and demand patterns to the organization. Through a survey of manufacturing and marketing managers within international firms, the authors develop a profile of manufacturing-marketing conflicts experienced in each of four international strategy environments: export, multidomestic, global, and transnational. As international strategies became more complex, firms made use of more techniques for coordinating between marketing and manufacturing, with more use of decentralized and informal approaches. Coordinating techniques included individual MBO-reward systems, joint task forces for problem-solving, and direct involvement of manufacturing and marketing in establishing the competitive priorities of the firm.     

A Comparative Study of Web-Based Technology Applications in Corporations

Due to the complexity of international trade and intense global competition, businesses today are facing challenges that were unthinkable a decade ago. To effectively respond to these challenges, companies continue to explore new ways to measure and extend value to their existing and new customer base. In the past, business practices have used expensive and time consuming tools to manage day-to-day operations. However, with technology advancing at a rapid speed, companies are forced to incorporate new technologies into their organizational decision processes to remain competitive and to maintain or expand market share. One technological tool that has become increasingly valuable to business firms is the internet. The evolution of the internet has resulted in numerous web-based tools that have proven to be flexible and data rich enhancements in a wide variety of business applications. This research examines how corporations utilize the internet in their internal and external business decision processes. The study highlights the benefits, similarities, and differences between SMEs and large firms with regard to the applications of these technologies.