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Article
Publication date: 9 April 2018

Guido Bortoluzzi, Selma Kadic-Maglajlic, Maja Arslanagic-Kalajdzic and Bernardo Balboni

The purpose of this paper is to examine the curvilinear effects of firm innovativeness (i.e. product, organisational and marketing innovation) on international expansion as well…

1544

Abstract

Purpose

The purpose of this paper is to examine the curvilinear effects of firm innovativeness (i.e. product, organisational and marketing innovation) on international expansion as well as the effect of expansion on performance in the developing countries (DCs) setting.

Design/methodology/approach

Research hypotheses are tested using survey data obtained from firms located in four South-East European DCs. Covariance-based structural equation modelling is used to test the proposed conceptual framework.

Findings

Empirical findings support the hypothesised U-shaped relationship between product innovation and organisational innovation and the level of international expansion of firms in developing markets. The authors found an inverse U-shaped relationship between marketing innovation and the level of international expansion. Furthermore, the existence of a strong positive link between the level of international expansion and firm performance is also confirmed.

Research limitations/implications

While this research utilises a sample of firms from a homogenous group of DCs, further research could use a more heterogeneous sample and thus control the model for various contingency effects (e.g. environment turbulence, market structure and competitive dynamics).

Practical implications

When it comes to product and organisational innovation, international expansion is achieved only with a higher level of innovativeness. On the contrary, beyond a certain level, further investments in marketing innovation do not have additional positive effects on international expansion.

Originality/value

This study is one of the first that explicitly focuses on examining the non-linear effects of innovativeness on international expansion in the DC context.

Details

International Marketing Review, vol. 35 no. 2
Type: Research Article
ISSN: 0265-1335

Keywords

Article
Publication date: 11 November 2009

Thomas Hutzschenreuter

Internationalization is of high relevance and has been discussed intensively. However, different internationalization paths have been proposed by theoretical models and have been…

Abstract

Internationalization is of high relevance and has been discussed intensively. However, different internationalization paths have been proposed by theoretical models and have been observed in reality. In this study, we examine the internationalization path of 52 German firms over a period of ten years using comprehensive and rich data on all new ventures established by these companies within this period. We find four distinct patterns of internationalization and propose a stage model of internationalization based on these findings. Our results show different challenges for managers depending on the stage of internationalization and render interesting starting points for further research.

Details

Multinational Business Review, vol. 17 no. 4
Type: Research Article
ISSN: 1525-383X

Keywords

Article
Publication date: 13 April 2023

Luis Miguel Bolivar, Cristóbal Casanueva and Ignacio Castro Abancéns

Multinational enterprises (MNEs) strive to expand into new markets either by exploiting their resource base or by gaining access to partner companies that own the required…

Abstract

Purpose

Multinational enterprises (MNEs) strive to expand into new markets either by exploiting their resource base or by gaining access to partner companies that own the required resources. Thus, companies face the compete–cooperate–coopete decision. The purpose of this study is to determine the effect of MNEs’ networks of interorganisational alliances, and their interaction with resource ownership, and market attractiveness, on the choice of international expansion modes, whether they are sole venture (competitive) or collaboration agreements (cooperative) or both (coopetitive).

Design/methodology/approach

A biprobit model is used to analyse more than 50,000 new international operations by 164 MNEs in a five-year window. A moderation analysis is carried out to reveal the interaction between network centrality, resource ownership and market size.

Findings

The results show the extent to which the competitive–collaborative contradictory forces attenuate each other in different market scenarios. This study’s contribution advances the resolution of the resource allocation dilemma by recognising the conditions for the selection of each expansion mode: sole venture, cooperation and coopetition.

Originality/value

Mainstream international business theory claims that firm’s own resources and transaction outcomes are generally sufficient to explain their international expansion decisions, whereas network and social capital theories focus on the role of relationships and network embeddedness. Both perspectives seem to neglect the fact that firms frequently develop both factors simultaneously. This study bridges these perspectives and reveals the interplay between resource ownership, alliance network centrality and market size for MNEs’ expansion mode choice.

Details

Multinational Business Review, vol. 31 no. 2
Type: Research Article
ISSN: 1525-383X

Keywords

Open Access
Article
Publication date: 20 August 2020

Lauri Haapanen, Pia Hurmelinna-Laukkanen and Kaisu Puumalainen

In this study, the authors explore how sensing and seizing of market opportunities, asset reconfiguration and top management team (TMT) consensus on these elements jointly relate…

3212

Abstract

Purpose

In this study, the authors explore how sensing and seizing of market opportunities, asset reconfiguration and top management team (TMT) consensus on these elements jointly relate to a firm's international expansion. By doing this, the authors contribute to the existing literature by addressing dynamic managerial capabilities at the TMT level instead of considering them as individual executives' traits. The authors use the qualitative comparative analysis (QCA) method to analyze our data from 261 TMT executives in 63 firms. The findings indicate that sensing, seizing and reconfiguration capabilities are highly relevant for internationalization but in different configurations for specific stages and elements of international business. Presence of sensing as a part of configurations is observable, especially in connection to a firm having foreign customers and explicit internationalization strategies, while configurations where seizing and reconfiguration emerge are connected to firms showing continuity in the international markets. The authors’ results also indicate that a lack of TMT consensus in connection to dynamic managerial capabilities is a driving force that allows the firm not to stagnate with regards to internationalization. Yet, lack of TMT consensus combined with low reconfiguration capabilities seems to generate negative results, which suggests that different views are not helpful if the firm is incapable of changing its approaches.

Design/methodology/approach

This study uses data gathered with a questionnaire where the executives select either “yes” or “no” in response to statements describing the firm situation with regard different managerial aspects and progress of international growth. The authors analyze these data from 261 TMT executives from 63 firms using the QCA method.

Findings

The findings indicate that sensing, seizing and reconfiguration capabilities are highly relevant for internationalization but to different extents for specific elements of international business; generally, while sensing is needed, in particular, for having foreign customers and internationalization strategies in the first place, seizing and reconfiguration became relevant for continuity in the international markets. Consensus or rather lack of it on these elements also plays a role. It seems that some disagreement is a driving force that allows the firm not to stagnate with regards to internationalization. However, TMT disagreement combined with low reconfiguration capabilities seems to generate negative results, which suggests that different views are not helpful if the firm is incapable of changing its approaches.

Research limitations/implications

The findings contribute to existing knowledge by exploring how managerial capabilities influence firm-level dynamic capabilities from the point of view of the TMT. The authors also add to existing research that has often focused on the relationships between TMT executives' demographic traits and TMT consensus and, further, the (subsequent) firm performance by looking at different configuration rather than linear linkages. Together, these notions further mean that the authors change the point of view on diversity. The authors consider the consensus on existing managerial dynamic capabilities rather than evaluate the functional diversity or the TMT executives' agreement on strategic moves.

Practical implications

All capabilities are important. TMT does not need to agree on everything, as long as they acknowledge where their problem areas are, and they can capture at least some of the relevant trends and opportunities. In fact, having some lack of consensus seems to be a driving force that allows capabilities to be questioned and potentially keeps (false) under-appreciation of existing capabilities from becoming a barrier to international expansion.

Originality/value

Unlike previous studies that have focused on the relationship between the TMT executives' demographic characteristics and firm performance or the relationship of the demographics and TMT strategic consensus at a general level – or studies that have explained international performance with TMT consensus (or with dynamic managerial capabilities), this study brings forth how the dynamic managerial capabilities and the TMT executives' strategic consensus with regard to these capabilities influence the firm's international expansion. Here, the authors consider internationalization widely, looking at whether the firm has foreign customers or international expansion strategy in place, and whether there this activity is sustained and continuous (with repeated trading and long-term international contracts, in particular). To our knowledge, there is no research on TMT strategic consensus that explains how the unanimity among executives on dynamic managerial capabilities connects to the firm's international expansion.

Details

Cross Cultural & Strategic Management, vol. 27 no. 3
Type: Research Article
ISSN: 2059-5794

Keywords

Article
Publication date: 13 April 2015

Marta Fernández Olmos and Isabel Díez-Vial

– The purpose of this paper is to examine the effect of the chosen specific internationalization pathway on the relationship between internationalization and firm performance.

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Abstract

Purpose

The purpose of this paper is to examine the effect of the chosen specific internationalization pathway on the relationship between internationalization and firm performance.

Design/methodology/approach

This paper analyses the internationalization pathway among small- and medium-sized enterprises which internationalize through exporting and are more limited in terms of the resources they can leverage across markets.

Findings

Empirical evidence obtained from a sample of wineries in La Rioja shows that the internationalization – export performance relationship is characterized by a U-shaped curve for firms with a gradual internationalization pathway, and an S-shaped curve for firms with an accelerated internationalization pathway.

Research limitations/implications

This empirical study on the impact of export intensity on performance has acknowledged the importance of costs caused by the liability of foreignness and the transaction and coordination costs involved in each market expansion process. However, it has not examined the effect of differences in absorptive and coordination capabilities at the firm level.

Practical implications

The findings about the role of the specific internationalization pathway in driving export intensity and performance appear to be relevant from a public-policy perspective. Local policies aimed at promoting exports have been widely based on the argument that firms can improve their performance through increasing their level of international sales. However, empirical evidence shows that these efforts may not work as well as was thought, unless combined with the right market expansion pathway and the optimal level of exports associated with this international market expansion.

Social implications

Most studies on the effect of international market expansion on firm performance have not considered the influence of the specific market expansion pathway chosen. In taking this factor into account, this paper contributes to the existing body of work by developing an integrative theoretical framework that explores how the pathway of internationalization impacts on firms’ performance.

Originality/value

Most studies on the effect of international market expansion on firm performance have not considered the influence of the specific market expansion process chosen. In taking this factor into account, this paper contributes to the existing body of work by developing an integrative theoretical framework that explores how the process of international market expansion impacts on firms’ performance.

Details

European Journal of Marketing, vol. 49 no. 3/4
Type: Research Article
ISSN: 0309-0566

Keywords

Article
Publication date: 1 July 1996

Hayley Myers and Nicholas Alexander

Considers the direction of the international expansion of European food retailers, and suggests that international retail studies have been criticized for a lack of empirical…

3265

Abstract

Considers the direction of the international expansion of European food retailers, and suggests that international retail studies have been criticized for a lack of empirical research. Discusses the results of a survey which sought the views of the main board directors of all major food retail companies based in six European Union countries: France, Germany, Italy, The Netherlands, Spain and the UK. Observation of previous international activity reported in the literature suggests that the direction of international retail expansion is primarily determined by three factors of geography, culture and economic development. Considers the observable trends in the light of the empirical results presented. Presents these findings within a conceptual framework which suggests that, over time, retailers move from a reluctant, through cautious, to an ambitious stage in their international development. Analyses and discussess respondents’ propensity to internationalization and proposes a conceptual development.

Details

International Journal of Retail & Distribution Management, vol. 24 no. 6
Type: Research Article
ISSN: 0959-0552

Keywords

Article
Publication date: 28 March 2008

Jody Evans, Kerrie Bridson, John Byrom and Dominic Medway

In the light of recent changes in the international environment, the purpose of this paper is to consider whether the drivers of, and impediments to, retail internationalisation…

11726

Abstract

Purpose

In the light of recent changes in the international environment, the purpose of this paper is to consider whether the drivers of, and impediments to, retail internationalisation and the business strategy adopted have also changed.

Design/methodology/approach

Interviews were conducted with 12 UK and US retailers. These exploratory data were combined with a review of the literature to explore changes in the drivers and impediments of retail internationalisation.

Findings

Findings of this study suggest that, while a variety of factors drive retail internationalisation, profit growth is the most dominant motivator. In terms of impediments to foreign expansion, domestic market conditions were a barrier to the initiation of foreign expansion, whilst the regulatory environment and previous experiences presented obstacles in the process of internationalisation. Interviewees also expressed a desire for increased standardisation, while acknowledging the need for a substantial degree of adaptation in response to cultural differences.

Research limitations/implications

The research findings are limited in terms of their generalisability.

Originality/value

Much of the existing research into retail internationalisation was conducted in the 1990s. Given the substantial changes that have occurred over the past 15 years, the value of this paper lies in the updating of knowledge.

Details

International Journal of Retail & Distribution Management, vol. 36 no. 4
Type: Research Article
ISSN: 0959-0552

Keywords

Article
Publication date: 1 January 2006

Karise Hutchinson, Barry Quinn and Nicholas Alexander

The internationalisation of large multinational retailers is well documented and much research attention has been given to their motives and strategies for expansion. Yet, no…

15804

Abstract

Purpose

The internationalisation of large multinational retailers is well documented and much research attention has been given to their motives and strategies for expansion. Yet, no research in this field has specifically addressed the internationalisation of small‐ to medium‐sized companies (SMEs) operating in the retail industry. The theoretical insights from the literature revealed important gaps in extant research, which relate to the barriers, stimulants, drivers, facilitators, process, and market entry strategy of retail SME internationalisation.

Design/methodology/approach

This paper aims to fill these gaps. Since the intention of this study was not to describe, but rather to build theory from an unexplored area of research, an in‐depth case approach was deemed most appropriate. Therefore, the paper presents the findings from a number of case studies of SME retail internationalisation operating from the UK.

Findings

Key findings from this study not only confirm that smaller British retailers have both the potential and capability to enter international markets successfully, but provides initial insights into how they overcome the constraints of size and establish an international market strategy. The findings from this study also offer insights into the SME sector of the retail industry in the UK in terms of their experience and adoption of government exporting programmes, and details the main implications for managers of small international firms.

Originality/value

Although knowledge on SME retailer internationalisation, as it stands, is at a very early stage of development, this analysis of actual company activity in the UK retail industry provides important insights into a neglected area of international retail study and should help to develop the body of knowledge on SME internationalisation in general.

Details

International Marketing Review, vol. 23 no. 1
Type: Research Article
ISSN: 0265-1335

Keywords

Article
Publication date: 11 November 2010

Rolf Mirus and Bernard Yeung

We examine the mode of international expansion as an equilibrium governance contract between home country and host country factor owner. The focus is on agency costs, a form of…

Abstract

We examine the mode of international expansion as an equilibrium governance contract between home country and host country factor owner. The focus is on agency costs, a form of transactions costs. Two phenomena are shown to be related to the agency costs imposed by factor owners: (i) the choice of different modes of international expansion by one firm in different locations, and (ii) the simultaneous occurrence of several forms of foreign involvement in the same location. We attempt to characterize the dynamic relationship between the mode of an offshore operation and changes in factor market conditions that affect agency costs.

Details

Multinational Business Review, vol. 18 no. 4
Type: Research Article
ISSN: 1525-383X

Keywords

Article
Publication date: 26 February 2021

Gaston Fornes, Guillermo Cardoza and Maria Altamira

This study aims to understand whether business and political relations help emerging markets' SMEs to overcome the challenges posed by low institutionalization in their national…

Abstract

Purpose

This study aims to understand whether business and political relations help emerging markets' SMEs to overcome the challenges posed by low institutionalization in their national and international expansion. It focuses on the role that these relations play in determining access to government funding and contracts and to market information and business-related knowledge.

Design/methodology/approach

The data were collected from 828 SMEs in Brazil and China. The data analysis was developed in two stages: the first stage was based on multivariate regression analyses using the ratio of sales outside the companies' region of origin divided by total sales as a dependent variable and the survey's answers as independent variables; outward sales were taken at two different levels – national and international – to consider: (1) the different stages in the national and international expansion process, and (2) the fragmented nature of domestic markets in both Brazil and China. The second stage was based on a stepwise multiple regression as the relative importance of the variables was not known beforehand and the objective was to rank them according to the managers' perceptions.

Findings

Informal institutions, in particular business and political relations, can help to reduce uncertainty and overcome some disadvantages associated with weak institutionalization. They do this by providing access to trusted distribution channels, improving the familiarity with different institutional environments and strengthening the management of supply chains and commercial strategies to serve markets outside their region. Also, SMEs in emerging markets getting access to private sources of funding, market knowledge and government contracts through business and political relations are in a better position to expand nationally and internationally.

Originality/value

The research shows that the domestic environment, in particular one with low levels of institutionalization, impacts negatively the national and international expansion of SMEs and, more importantly, how firms can use business and political relations to overcome the obstacles posed by this environment. The findings also have implications for theory, practice and policymaking.

Details

International Journal of Emerging Markets, vol. 17 no. 8
Type: Research Article
ISSN: 1746-8809

Keywords

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