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Article
Publication date: 11 November 2019

William W. Baber, Arto Ojala and Ricardo Martinez

The purpose of this paper is to study how digital business models evolve when entrepreneurs move to new digital platforms and how this evolution is related to effectuation…

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Abstract

Purpose

The purpose of this paper is to study how digital business models evolve when entrepreneurs move to new digital platforms and how this evolution is related to effectuation and causation logics.

Design/methodology/approach

This study applies a multiple case study approach to investigate how digital business models change in small, Japanese high-tech firms providing their innovations through different digital platforms. To investigate digital business models, this study considers the elements that comprise general business models. The case firms were selected based on size, products and transitions from physical to various digital platforms. Semi-structured interviews were conducted with the key decision-makers from the case firms.

Findings

The findings show that through digital transformation, the case firms’ digital business models evolved by following effectuation logic as well as causal logic. All the firms employed causal logic when moving to new platforms, among other actions. The case firms used effectual logic with success for product development and adjustments to their network. Especially firms providing video games relied on effectuation for high impact products. Effectual logic did not play a role at all in changes to value delivery and had only little impact on revenue structures.

Originality/value

This research helps understand how digitalization of platforms and subsequent moves to newer digital platforms improve a firm by changing the business model elements through effectuation and causation logics. This research extends the understanding of digital business model transformation to a more granular level, business model elements.

Details

Journal of Small Business and Enterprise Development, vol. 26 no. 6/7
Type: Research Article
ISSN: 1462-6004

Keywords

Article
Publication date: 7 March 2008

Arto Ojala and Pasi Tyrväinen

The purpose of this paper is to investigate market entry decisions of the US software SMEs by analyzing the impact of the most obvious factors (cultural distance…

3725

Abstract

Purpose

The purpose of this paper is to investigate market entry decisions of the US software SMEs by analyzing the impact of the most obvious factors (cultural distance, geographical distance, country risk, and three market size variables) in traditional internationalization theories to target country selection. By investigating the influence of these commonly cited macro‐level factors, this study proposes the best indicator for market entry decisions of the US small and medium‐sized software firms.

Design/methodology/approach

This study uses a quantitative research approach applied to a sample of 100 US small and medium‐sized software firms.

Findings

Empirical findings in this study indicate that vertical (software) market size in a target country is the best single indicator for market entry decision and in themselves explain 63 percent of market entries. Thus, the findings in this study suggest that the vertical market size gives a better explanation for market entry decisions of software SMEs than the earlier widely used variables.

Research implications/limitations

Integrating earlier findings related to firm‐level factors with findings of macro‐level factors will help theory development and will facilitate obtaining a more holistic view of internationalization of knowledge‐intensive SMEs.

Practical implications

Findings in this study imply that managers should take an active role when they develop network relationships for the market entry. If a firm takes a passive role in networking, it might lose market opportunities available in the leading markets and end up in countries where the real market potential is low.

Originality/value

This paper highlights vertical market size, which has been largely ignored in earlier studies, as the most important indicator for international market entry decision.

Details

Management Decision, vol. 46 no. 2
Type: Research Article
ISSN: 0025-1747

Keywords

Article
Publication date: 10 August 2010

Tanja Kontinen and Arto Ojala

The purpose of this paper is to investigate how psychic distance affects the internationalization process, foreign market entry (FME), and entry mode choice of Finnish…

2908

Abstract

Purpose

The purpose of this paper is to investigate how psychic distance affects the internationalization process, foreign market entry (FME), and entry mode choice of Finnish small and medium‐sized family enterprises (family SMEs) operating in France.

Design/methodology/approach

The paper reports findings from an in‐depth case study covering four Finnish manufacturing family SMEs operating in the French market. The data were analyzed using the Uppsala model and distance creating and distance‐bridging factors encountered in the FME to France.

Findings

The findings reveal that the family SMEs mainly followed a sequential process and favored indirect entry modes before entering the French market. The French market was psychically distant, but the case firms were able to overcome the distance by using different distance‐bridging factors. Based on the findings, it can be argued that psychic distance has an especially important role in the internationalization and the FME of family SMEs, mainly because of their general cautiousness caused by family presence.

Research limitations/implications

Although the case study method made it possible to acquire detailed knowledge about the firms' internationalization, the findings can be generalized only to some extent.

Practical implications

Managers of family SMEs and family members should be provided with the capacity to overcome distance‐creating factors, they might encounter in their FME. The decision to internationalize is a strategic change that will most probably change the historical harmony of the firm.

Originality/value

Prior research has mainly focused only on general internationalization pathways of family SMEs. In addition and contrast to the previous studies, this paper investigates the role of perceived psychic distance in family SMEs' FME and entry mode choice in a certain target market.

Details

Journal of Small Business and Enterprise Development, vol. 17 no. 3
Type: Research Article
ISSN: 1462-6004

Keywords

Article
Publication date: 19 June 2009

Timo Pykäläinen and Arto Ojala

The purpose of this paper is to develop a framework that explains international activities of open source software (OSS) firms.

Abstract

Purpose

The purpose of this paper is to develop a framework that explains international activities of open source software (OSS) firms.

Design/methodology/approach

This paper reviews relevant literature related to international operations of knowledge‐intensive firms, especially in the software industry. Theoretical development is based here on a combination of the network approach, international new venture theory and inward–outward internationalization.

Findings

The findings in this study suggest that the international activities of OSS firms can be divided into project activities and business activities. Project activities include inward and outward linkages, and partner identification. Business activities include domestic and partner network activities that can lead to international business as well.

Research implications

For scholars, the framework provides a new approach to explain many international activities of OSS firms by integrating three international business theories. In addition, it provides good starting point for further empirical examination.

Practical implications

The framework helps managers gain a better understanding of complex circumstances embedded into the international activities of OSS firms. With that better understanding, the managers can focus their activities, which helps further to improve their firms' competitiveness engendered by the international activities in the OSS development.

Originality/value

The framework developed in this study is believed to be the first serious attempt to provide a deeper theoretical understanding of international activities of OSS firms.

Details

Management Research News, vol. 32 no. 7
Type: Research Article
ISSN: 0140-9174

Keywords

Article
Publication date: 7 September 2012

Tanja Kontinen and Arto Ojala

The purpose of this paper is to increase understanding of the internationalization of family firms; to investigate how the framework by Bell et al. on the…

5584

Abstract

Purpose

The purpose of this paper is to increase understanding of the internationalization of family firms; to investigate how the framework by Bell et al. on the internationalization patterns of firms could explain the internationalization pathways taken by family‐owned small to medium‐sized enterprises (SMEs); and to identify typical patterns and features in the various pathways taken by family‐owned SMEs.

Design/methodology/approach

This paper reports findings from an in‐depth multiple case study with eight Finnish family‐owned SMEs.

Findings

The ownership structure had the most important role in defining the internationalization pathways followed by the family‐owned SMEs: a fragmented ownership structure led to traditional internationalization pathway whereas a concentrated ownership base led to born global or born‐again global pathways.

Practical implications

Family entrepreneurs should carefully consider the division of ownership and seek to build new relationships in foreign markets, in addition to their primary co‐operators.

Originality/value

The authors extend the integrative model of small firm internationalization by Bell et al. toward family‐owned SMEs and highlight the most important dimensions in the different internationalization pathways of family SMEs. The ownership dimension is integrated within discussion on differing internationalization pathways. The authors utilize a family business specific perspective (the stewardship perspective), in order to understand the specific features of internationalization among family SMEs, and also how these features differ between family SMEs and other firms.

Details

International Marketing Review, vol. 29 no. 5
Type: Research Article
ISSN: 0265-1335

Keywords

Article
Publication date: 14 September 2015

Sylvie Chetty, Arto Ojala and Tanja Leppäaho

– The purpose of this study is to examine the decision-making process for entrepreneurial firms when entering foreign markets and how and why they entered those markets.

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Abstract

Purpose

The purpose of this study is to examine the decision-making process for entrepreneurial firms when entering foreign markets and how and why they entered those markets.

Design/methodology/approach

A nascent theory in entrepreneurship called effectuation is combined with internationalization process theory as the conceptual framework to study decision-making under uncertainty. The central concept in both these theories is relationships and how they can be used to gain knowledge and thus reduce uncertainty and in the case of effectuation to co-create opportunities to enter foreign markets. The research design involves a multiple case study of software firms from Finland and New Zealand.

Findings

It was found that entrepreneurs differentiate between foreign market selection and foreign market entry during their internationalization process, potentially using different decision-making processes in them. They tend to interweave effectuation and causation logics as substitutes in their decision-making. Uncertainty during foreign market entry is not always a barrier because it can provide opportunities depending on the logic used. In addition, there is evidence that entrepreneurs who have existing relationships in foreign markets tend to use effectuation to select and enter foreign markets.

Originality/value

This paper transposes effectuation from its original field of entrepreneurship research to the context of internationalizing entrepreneurial firms. Consequently, it contributes toward understanding the decision-making process for selecting and entering foreign markets.

Details

European Journal of Marketing, vol. 49 no. 9/10
Type: Research Article
ISSN: 0309-0566

Keywords

Article
Publication date: 17 February 2012

Tanja Kontinen and Arto Ojala

The aim of this study is to discuss how social capital is developed in the internationalization process of small and medium‐sized family enterprises (family SMEs).

1400

Abstract

Purpose

The aim of this study is to discuss how social capital is developed in the internationalization process of small and medium‐sized family enterprises (family SMEs).

Design/methodology/approach

This paper reports findings from an in‐depth multiple case study with four Finnish manufacturing family SMEs. The data were analyzed through the perspectives of structural holes, network closure, and the interplay between these two mechanisms.

Findings

The material in the paper demonstrated that family entrepreneurs had a large number of structural holes when launching international operations, but also after several years of running international operations. Instead of trying to span structural holes, they concentrated merely on developing the network closure with agents and subsidiary staff. The case firms spent a lot of resources on finding suitable network ties and on developing good network closure with the selected social capital ties.

Research limitations/implications

There are some aspects that might differ depending on the home and target country of firms. For instance, firms in some Asian countries are able to utilize emigrant relationships that help them with networking, which was not the case here with Finnish family SMEs.

Practical implications

Family entrepreneurs seem to have a tendency to concentrate on a limited number of foreign partners, and to neglect the building of new relationships that could help them in future challenges.

Originality/value

This study: responds to calls for more research on network development in the entrepreneurial process, especially in the context of internationalization; introduces the notions of network closure and structural holes to the internationalization context; and reveals how social capital restricts and facilitates family SMEs' international operations.

Details

Journal of Small Business and Enterprise Development, vol. 19 no. 1
Type: Research Article
ISSN: 1462-6004

Keywords

Article
Publication date: 15 May 2009

Arto Ojala and Pasi Tyrväinen

The purpose of this paper is to investigate the internationalization behavior of knowledge‐intensive small‐ to medium‐sized enterprises (SMEs) by using macro‐level psychic…

3453

Abstract

Purpose

The purpose of this paper is to investigate the internationalization behavior of knowledge‐intensive small‐ to medium‐sized enterprises (SMEs) by using macro‐level psychic distance indicators and managers' perceptions of psychic distance.

Design/methodology/approach

This study uses both quantitative and qualitative approaches. In the quantitative approach, the impact of psychic distance to the internationalization behavior is analyzed by using bivariate correlation analysis. The qualitative case study approach is employed to investigate managers' perceptions of psychic distance as regards market entries.

Findings

Findings of this study indicate that psychic distance has an impact on the market entry of knowledge‐intensive SMEs. However, there are other factors, such as market size, opportunity seeking behavior, and actions taken by managers, which make the effect of psychic distance less visible in macro‐level quantitative analyzes.

Research limitations/implications

This study is limited by small sample size in both quantitative and qualitative studies. However, the findings offer interesting insights for further studies related to this phenomenon.

Originality/value

This study compares macro‐level and individual‐level analyses of psychic distance and indicates reasons why psychic distance should be analyzed with the help of individual‐level perceptions of psychic distance.

Details

European Business Review, vol. 21 no. 3
Type: Research Article
ISSN: 0955-534X

Keywords

Article
Publication date: 31 October 2011

Arto Ojala and Pasi Tyrväinen

The purpose of this paper is to examine value networks in cloud computing. It demonstrates the kinds of value offered by such networks to firms within a given network, and

6290

Abstract

Purpose

The purpose of this paper is to examine value networks in cloud computing. It demonstrates the kinds of value offered by such networks to firms within a given network, and considers how and why the network may change over time.

Design/methodology/approach

The paper reports on a longitudinal case study, including a total of seven semi‐structured open‐ended interviews, conducted with five informants from the case firm.

Findings

It was found that cooperation in value networks provides not merely financial benefits, but also knowledge, among other intangible benefits. Value networks should be evaluated as a whole, since there may be indirect connections – i.e. the value comes not directly from customers, but through the partners in the network. The study also shows the dynamic nature of value networks, as illustrated by changes in a network that were based on transformations in the market environment, and on product development.

Originality/value

This paper contributes to an understanding of value networks and their dynamics, and of cloud computing. In addition, the paper looks at a value network in cloud computing from the service provider's point of view – an aspect that has been neglected in previous studies.

Details

Journal of Business Strategy, vol. 32 no. 6
Type: Research Article
ISSN: 0275-6668

Keywords

Article
Publication date: 22 February 2011

Arto Ojala and Hannakaisa Isomäki

Entrepreneurship and small businesses in Russia have been of academic interest for over 15 years. This paper seeks to bring together current knowledge concerning the…

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Abstract

Purpose

Entrepreneurship and small businesses in Russia have been of academic interest for over 15 years. This paper seeks to bring together current knowledge concerning the phenomenon, and to suggest further directions for research.

Design/methodology/approach

The study consists of a systematic review of 48 refereed empirical articles on entrepreneurship and small businesses in Russia.

Findings

From the articles reviewed it appears that entrepreneurs in Russia use non‐material resources to overcome the financial and institutional obstacles, which still seem to afflict the market. However, theoretical and methodological issues are, in many cases, poorly reported and this undermines the scientific rigour of the studies they report.

Research limitations/implications

Because of the wide scope of the studies reviewed the results included here provide somewhat broad‐brush descriptions of the phenomenon. However, it is believed that the findings are valuable for an understanding of the current situation for entrepreneurship and small businesses in Russia. The findings may also stimulate more in‐depth research in this increasingly important topic.

Originality/value

To the best of one's knowledge, no literature review on this topic has previously been published in academic journals.

Details

Journal of Small Business and Enterprise Development, vol. 18 no. 1
Type: Research Article
ISSN: 1462-6004

Keywords

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