Internationalisation and the Small Business
6 important questions on Internationalisation and the Small Business
Focussing on SE internationalisation, 3 theories can be identified
- Incremental internationalization model
- network theory
- resource based perspective
Incremental internationalization model
- SE adopt evolutionary approach to foreign markets
- depending their commitment & investment as they gain international market knowledge & experience
- Start in markets similar to their own
- 4 stages: no export, export via independent representatives, sales subsidiaries, production
To initiate international activity, org. must be influenced by stimulating factors.
Four categories of these stimulating factors
- Internal pro-active: SE exploits own unique internal competencies
- Internal reactive: responding to pressures from internal environment
- External pro-active: active exploitation by management of market possibilities
- External reactive: reaction to factors from external environment
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Stimulating factors for internationalisation are not enough.
Also 3 facilitating factors
- decision maker characteristic: self confidence, experience, motivation, flexibility, age, network in foreign countries etc.
- firm characteristics: implementation process, analyzing & planning, export etc.
- The environment: domestic environment and the foreign markets attractiveness, legal systems, government barriers etc.
4 categories of barriers in SE internationalization
- Internal domestic: lack of experienced personell
- Internal foreign: adapting product to foreign market safety standards
- External domestic: lack of government support or infrastructure
- External foreign: foreign government imposed restrictions
Fig. 24.1, blz. 482, recomendates to assist internationalization by SE categories.
4 categories/quadrants
- I: less entrepreneurial & non-internationalized; introduce change agents, provide training, helps with foreign market network
- II: entrepreneurial & non-internationalized; provide consultants, support & training, encourage best practice
- III: less entrepreneurial & internationalized; seek positive reinforcement, encourage networking
- IV: entrepreneurial & internationalized; facilitate participation in networks, assist foreign countries, ease market access
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