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The purpose of this study is to develop internationalization process theory by examining the relationship between small- and medium-sized enterprises (SMEs) international experience and their degree of insidership in newly opened business networks.

The study applies a quantitative approach. Data were collected on-site at 203 SMEs having entered the Baltic States, Poland, Russia and China. The data are analysed with structural equation modeling in SmartPLS.

The paper reveals that international experience is positively associated with both the country and customer experience in the newly opened business network. Country experience, in turn, is strongly associated with a firm's degree of insidership in the business network. Conflicting with the hypothesized model, no support is found for the direct relationship between international experience and insidership. Nor does the analysis reveal any significant relationship between a firm's customer experience, in terms of variation, in the newly opened business network and the degree of insidership in the network.

The paper empirically discriminates different types of international experience derived from theory and examines their relationship with the degree of firm insidership in newly opened business networks.

Theoretically this paper advances internationalization process theory by developing its network aspect as well as discriminating different experience types and their role in predicting network insidership in newly opened business networks.

The purpose of this paper is to utilize key insights from social network theory (SNT) to enhance understanding of overcoming the liability of outsidership as a prerequisite for firm internationalization. Specifically, it examines the influence of structural attributes of networks on the motivational stance of both network insiders and outsiders in relation to overcoming the liability of outsidership. A related aim is to explore the role of network positions of insider actors in terms of its impact on the speed of market entry.

The paper draws on the extant literatures on firm internationalization, particularly the liability of outsidership, and SNT to identify to what extent SNT can be utilized to deeply understand the process of overcoming the liability of outsidership. The authors put forward eight propositions linking structural and positioning attributes of networks with overcoming the liability of outsidership.

SNT provides strong potential for a more comprehensive understanding of the internationalization phenomena through shedding light on the relationship between the liability of foreignness and the liability of outsidership. The paper demonstrates that while the cost of overcoming the liability of outsidership is higher in closed target network as compared to open networks, the expected benefits of an insidership position in closed or open networks are affected by the outsider firm’s perception of the liability of foreignness in the market it wishes to enter. Considering the differential enabling characteristics of closed and open networks in terms of facilitating tacit knowledge sharing as opposed to explicit information flows, the authors reveal that liability of foreignness operates as a negative moderator for the relationship between network structure and the willingness of the outsider to invest in gaining insidership. The analysis of the paper also shows that the positional attributes of the network insider are relevant in outsiders’ motivation in terms of the speed of market entry that they seek to achieve.

This study theoretically contributes to the internationalization research through integrating SNT with the liability of outsidership understanding of firm internationalization. This is a timely attempt as no systematic application of the conceptual apparatus of SNT in the internationalization research context has been studied. It adds a more coherent inside-out perspective into the overcoming the liability of outsidership discussion which has been extensively dominated by an outside-in perspective.

Integrating network attributes from studies of social networks, business relationships and small- to medium-sized enterprise (SME) internationalization, this study adopts a perceptual view of a firm’s focal “net” of relationships to examine foreign market entry mode choice. This study aims to examine how the interaction between knowledge-intensive service (KIS) firm’s network ties, embeddedness and position is related to choice of mode and subsequently the firm’s perceived insidership status within its focal net.

This research is based on qualitative interviews with 25 small- to medium-sized KIS firms engaged in direct exporting or foreign direct investment (FDI). This study derives an empirically grounded framework of four distinct network patterns of these KIS firms through an iterative process of triangulation between cases and theory.

The four network patterns illustrate the complex interaction between network attributes and entry mode choice by KIS firms. The findings suggest formal ties and centrality in closed network relationships provide the “central controller” firm discretion over their entry mode choice. Resource-intensive FDI by “opportunistic investors” proved essential to securing centrality through formal, institutional ties. Less optimal patterns lacking institutional ties and centrality, however, precluded choice of FDI by “specialized exporters” and “client followers.” The study finds that entry modes are less likely to be influenced by the firm’s embeddedness in open or closed network relationships, but rather by the desire to achieve a more central network position and legitimacy through more formal, less imitable ties.

The findings demonstrate the importance of network structure, a position of centrality, and strength of professional and institutional ties to small KIS firm internationalization. By adopting a more finely grained examination of the interaction between key attributes of the firm’s focal net, this study provides a valuable first step in conceptualizing the complexities associated with networking and adoption of export/investment internationalization modes.

There are a number of implications for the strategic and operational facets of smaller KIS firm internationalization. To avoid excessive network liability for resource-deficient SMEs, practitioners should consider network positioning as a strategic activity, with the costs associated with building and maintaining networks offset against economic- and resource-related returns.

The authors contribute to a better understanding of entry mode choices of KIS by taking a network perspective that accounts for the combined effects of different network attributes. The four network patterns identified extend current theoretical knowledge on the role of networks for entry mode choices of small KIS by highlighting that entry mode choices reflect the particular firm’s focal net and its attempt to achieve insidership status through high centrality and formal ties.

The management of reputation and status is central to creative professional service firms (CPSFs) rendering the internationalisation process a particular challenge. The authors build on arguments that internationalisation requires moving from outsidership to insidership within client networks and focus on how CPSFs build signals about quality to start this process. The paper aims to discuss these issues.

The exploration draws from the international business, professional services and organisational status bodies of literature. A multiple case study design was developed comprising ten Irish architecture firms. In-depth semi-structured interviews were conducted.

The findings clarify how relationships start in the internationalisation process through signal building about quality. This allows CPSFs to join client networks moving from outsidership to insidership. The findings systemise three different approaches for CPSFs: from outsidership to insidership within a local market network, within a global industry network and within a global project network.

Research within other sectoral and geographical contexts could support transferability of the findings.

The study has implications for international business strategies as it identifies multiple paths to relevant network insidership and the tactical responses managers can use to achieve this.

The authors believe that incorporating signal-building mechanisms into the internationalisation process is a novel approach to theorizing about how CPSFs move from outsidership to insidership. The authors offer important theoretical insights into the international business, professional service firm and organisational status literatures. CPSF business leaders should benefit as it helps them to focus on a portfolio of signal-building approaches that can start the internationalisation process.

The purpose of this paper is to analyse insidership vs outsidership, enriching the revisited Uppsala model with the resource-based view, transaction cost economics and internalisation theory. The authors also address empirical gaps affecting the role of dyadic business relationships (BRs) (customers/suppliers/research institutions/competitors) and business networks and their effect on international performance. Finally, the authors research whether insiders’ firm-specific advantages have a stronger effect on international performance than outsiders’.

The authors work with an unbalanced panel data set of 14,231 firm-observations (period: 2000-2010). First, the author use ANOVA models (with pooled and panel data) in order to test the Uppsala basics. Second, the authors refine the research through dynamic Tobit models.

The authors find that insiders perform significantly better than outsiders. When analysing the impact on international performance, the authors confirm that not only do dyadic BRs with customers or suppliers have a positive effect, but so do BRs with research institutions; however, business networks with customers and suppliers have a negative impact. Finally, when testing interactions, the results point at technological skills as an alternative means to overcome the liability of outsidership.

Prior studies on this topic have been broadly focused on testing the original Uppsala (1977) model. However, the authors advance it by reconciling the revisited Uppsala (2009) model with the main international business theories as well as testing and refining its content in line with Johanson and Vahlne’s guidelines.

Small and medium-sized exporters (SMEs) are driven to develop a network entry strategy to tap into a new foreign market. The purpose of this paper is to draw on the network perspective to evaluate how a network gatekeeper facilitates a foreign SME exporter’s entry into local business networks in China.

The single case study method was adopted. The Ule New Zealand Mall, an online shopping platform that sells New Zealand products in China, was selected in this case study. The authors applied the critical incident technique to evaluate the position of New Zealand Post (as a home country-based network gatekeeper), the roles within the position, and the key outcome of the network gatekeeping.

The study discovers two key roles of network gatekeepers: bridging the gap in trust between outsider networks and insider networks; and reducing the costs of experiential learning for SME exporters. Finally, this study concludes that the “brokered insidership” position acquired by SME exporters is the key outcome of network gatekeeping in foreign market entry.

This study advances the understanding of theories of structural holes, business network and gatekeeping. The authors articulate the critical position assumed by a network gatekeeper in bridging two otherwise disconnected business networks, and their key roles in networking. The study also proposes a new network concept – “brokered insidership”.

The paper aims to explore how small- and medium-sized enterprises (SMEs) in the health-care sector overcome the liability of being an outsider, instead of gaining a position as an insider in new networks in markets abroad and subsequently internationalizing. The following research questions are posed: How do firms in complex health-care markets build network relationships? How is business market knowledge developed and legitimacy acquired to overcome the liability of outsidership?

The paper uses a multiple-case methodology in a nested case study of health-care SMEs, which allows for in-depth study of the importance of network relationships, business market knowledge development and legitimacy building to enter a target market; the study maps the activities and different actor roles as the entry process unfolds. The study draws on empirical evidence from 13 companies as well as industry and interest organizations.

The results provide support for process-based explanations of how, but also of why the internationalization of health-care SMEs takes place in distinctive sequential phases, where it is necessary to complete one phase before it is possible to embark on the next. The study answers the calls for more empirical studies capturing how firms actively enter networks to overcome the liability of outsidership, become insiders and subsequently internationalize.

The principal contribution of the authors’ study is to add to the body of research on internationalization and advance the understanding of how to build an insidership position in relevant networks by overcoming the liability of outsidership. By choosing to study firms in the health-care sector, the authors also contribute to the limited research on firms entering markets characterized by a high level of complexity.

The chapter provides an economic explanation and perspectivation of strategic asset seeking of multinational enterprises from emerging economies (EMNEs) as a prominent feature of today’s global economy.

The authors apply and extend the “springboard perspective.” This perspective submits that EMNEs acquire strategic assets in developed markets primarily for use in their home markets.

The authors succumb that the springboard perspective is alluring theoretically as well as empirically as it suggests that when EMNEs acquire strategic assets, they experience liabilities of foreignness (LOF) that are low relative to those of MNEs from developed markets. The authors concede to this LOF asymmetry but also point out that liabilities of outsidership (LOO) can offset or weaken the home-market advantage of some EMNEs when competing with MNEs.

LOO appears as the more relevant concept to use when explaining strategic asset seeking of EMNEs. A set of propositions are formulated to guide empirical testing.

The insights gained from using the springboard perspective and the LOO concept are non-trivial: They basically predict future dominance of ‘insider’ EMNEs at the expense of MNEs from developed markets.

This chapter deals with firms’ relationships in particular with political actors when expanding in emerging markets. Our main purpose is to illustrate the importance of including such relationships when describing how firms develop insidership in networks in these markets. Emerging markets are often described as if they pose similar challenges but we will focus on the heterogeneity and how firms handle the diversity of the non-business foreign environment. Based on experiences from three Western multinationals — Sandvik, Ericsson and ABB — the main challenges in China, South Africa and Turkey are described. In addition to relationships with political actors, the discussion indicates the importance of also including other non-business actors, such as NGOs. The cases also illustrate that knowledge acquired in one cultural setting may not easily be transferred to another since the contexts are so different.

The disruption global digitally based firms are imposing on the positions of established multinational telcos is not just in degree, but also in kind. As such, the telcos are entering a period of VUCA. Although digitally based competitors could suffer from liabilities of “outsidership,” we argue that the physical presence of telcos in local markets will be insufficient to avoid a future as utilities or dumb-pipes. One significant issue as they confront VUCA is therefore whether telcos are able to develop and apply dynamic capabilities.