This paper aims to provide a novel way of thinking about firm internationalization. We offer a stylized view of family firms as internationalizers who choose to engage in “boundary-spanning” across global product markets while engaging in “boundary-buffering” to insulate themselves from global financial markets.
The case of Germany, with its large stock of internationalized family firms, shows how boundary-buffering vis-à-vis global capital markets can be compatible with successful and sustained internationalization and boundary-spanning in global product markets. Statistics are supplied.
To compensate for the lack of resources stemming from their abstinence from global financial markets, German family firms draw on country-specific conditions favorable to the proliferation of large internationalized family firms. Insights from the German case serve to derive propositions.
The developed concept of an internationalization pathway for family firms contrasts with the much more established concept of an internationalization process for family firms. The contrast between a “pathway” and a “process” amounts to the distinction between ends and means: the internationalization pathway (as defined here) has largely to do with strategic choice, whereas the internationalization process (as defined in the literature) focuses more on barriers to internationalization and means for overcoming them.
Lehrer, M. and Celo, S. (2017), "Boundary-spanning and boundary-buffering in global markets: A German perspective on the internationalization of family firms", Review of International Business and Strategy, Vol. 27 No. 2, pp. 161-179. https://doi.org/10.1108/RIBS-09-2016-0053
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