Born globals, the choice of globalization strategy, and the market's perception of performance

2016

Int Entrep Manag J

Few studies have investigated the factors that enhance entry mode choice in the context of international new ventures (INVs). In this paper, we hypothesize that the characteristics of INVs' products or services can explain their preference for equity entry modes. We also hypothesize that the inter-firm networks in which INVs are embedded play a deciding role in their choice of non-equity entry modes. When INVs are in inter-firm networks in which activities are developed to manage them, non-equity entry modes are preferred. We have adopted an effectuation approach to study the influence of different inter-firm network management activities on entry mode choice. In short, we have studied the effect of developing inter-firm network knowledge exchange, coordination, adaptation, conflict resolution and resource sharing management activities. In this paper we attempt to contribute to international entrepreneurship studies by reconciling the most widely accepted approaches to entry mode choice (Transactional Cost Economics, Organizational Capabilitiesbased and Network perspective) and international new ventures. Our findings show that the technological complexity of INVs' products/services explain their preference for equity entry modes. Additionally, the development of network management activities among the networked firms determines the INVs' preference for non-equity entry modes. Our results draw a decision model that differs from the ones derived from previous perspectives, which highlight the role of different characteristics of international new ventures.

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Section: Entry Modes and Invs From The Transaction Cost Economies Andmentioning

confidence: 99%

Entry mode choices in the international new ventures context. A study from different theoretical perspectives

2016

Int Entrep Manag J

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“…We adopt this theory because INVs lack resources and so their choice of foreign market entry modes cannot be principally resource-based. It is more reasonable to suppose that this choice may be based on the capacity of INVs to leverage a collection of fundamental capabilities and on each method's effectiveness in transferring INV capabilities (Gleason & Wiggenhorn, 2007). By doing this, we are also following recent calls in international entrepreneurship (IE) for further integration of concepts from the RBV of firms (Knight & Cavusgil, 2004;Jantunen et al, 2005;Weerawardena et al, 2007).…”

Section: The Influence Of Marketing Capabilities On Entry Mode Choicementioning

confidence: 99%

“…But the preference for higher commitment entry modes is also based on their capacity to leverage marketing capabilities (Gleason & Wiggenhorn 2007). Aspelund et al, (2007) report that the most obvious disadvantage resulting from lower commitment entry modes, such as licensing or indirect exporting, is the reduced learning which is often a consequence of using partners that are responsible for the direct contact with foreign customers.…”

Section: The Influence Of Marketing Capabilities On Entry Mode Choicementioning

confidence: 99%

“…Consequently, a lack of resources does not necessarily determine the choice of entry mode in INVs (Gleason & Wiggenhorn, 2007). On the contrary, it could be suggested that INVs may try to protect their marketing capabilities by using entry modes that involve greater commitment of resources in foreign markets.…”

Section: The Influence Of Marketing Capabilities On Entry Mode Choicementioning

confidence: 99%

See 1 more Smart Citation

International new ventures as “small multinationals”: The importance of marketing capabilities

Journal of World Business

2012

This paper aims to explore how marketing capabilities contribute to the international expansion of international new ventures, and the influence of these capabilities on the entry mode these firms choose. Specifically, the study examines how marketing This study extends previous international entrepreneurship research, including insights on antecedents of international new ventures' choice of higher commitment entry modes in foreign markets. Additionally, the results of this work encourage international entrepreneurs to look beyond the explicit value of experiential market knowledge to realize the potential value of marketing capabilities as an antecedent to higher commitment entry modes.

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“…It is more reasonable to suppose that this choice may be based on the capacity of INVs to leverage a collection of fundamental intangible resources (Gleason and Wiggenhorn 2007). In this regard, Weerawardena et al (2007) highlight foreign market knowledge and the process by intangible resources that can influence the choice of higher resource commitment entry modes in foreign markets.…”

Section: Introductionmentioning

confidence: 99%

Factors enhancing the choice of higher resource commitment entry modes in international new ventures

International Business Review

Monferrer

2012