Internationalization of Korean banks during crises: The network view of learning and commitment

Lee, Joong Woo; Song, Hong; Kwak, Jooyoung

doi:10.1016/j.ibusrev.2014.06.009

Cited by 13 publications

(6 citation statements)

References 24 publications

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“…In this regard, our study departs from certain research streams that explore Asian- or Korean-context studies but adopts a different research setting such as external shocks, i.e. the global financial crisis (Lee et al , 2014), and the formal institutions of a single host country (Li et al , 2019). While we recognize that KCBs and chaebols are unique to Korea, chaebols account for 84% of Korean GDP.…”

Section: Discussionmentioning

confidence: 99%

Revisiting foreign market entry motivations: the case of Korean commercial banks

Jung¹,

Zhu²,

Nguyen

2021

CCSM

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PurposeThis study examines what motivates firms to go and remain abroad despite uncertain profit potential. In a departure from probing traditional market-seeking, profit-driven motives, the authors explore how domestically driven, sociocultural motivations may shape the foreign market entry decisions of Korean commercial banks (KCBs). The authors argue that, due to the power imbalance between KCBs and their chaebol clients within the historical and cultural contexts of their relationships, KCBs' foreign market entries may depend more on their clients' presence in these markets than on their profit potential.Design/methodology/approachThe authors focus on the foreign market entries of KCBs and their client firms. Using the data of 8 KCBs and their client firms belonging to the 60 business groups (chaebols) of Korea, the authors analyze 6,577 observations involving the dyadic relationship between a KCB and its client firm in 15 host countries from 2005 to 2014.FindingsThe authors find that the number of clients' subsidiaries operating in foreign markets may increase the likelihood of KCBs entering these markets. Moreover, when KCBs earn more domestic profit from client firms, the potential Korean market in the host country is greater, and the institutional distance between the host country and Korea is smaller.Practical implicationsIn addition to the critical role of a bank-centered financing system in advancing a developing country and its firms, the authors’ findings suggest that firms should pay attention to the local diaspora and the institutional distance between the host and home countries in order to manage power-imbalanced relationships and make them sustainable.Originality/valueThe study contributes to the literature on foreign market entry by demonstrating how the home country's sociocultural factors may worsen the power imbalance, thereby pushing firms to make seemingly irrational decisions to go and stay abroad. That is, KCBs' foreign operations may be a way of seeking relational benefits with client firms, which would serve as a source of long-term domestic market profits. The authors’ findings thus highlight the need to consider how sociocultural factors may also shape firms' decision-making in their international business.

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Section: Discussionmentioning

confidence: 99%

Revisiting foreign market entry motivations: the case of Korean commercial banks

Jung¹,

Zhu²,

Nguyen

2021

CCSM

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“…The case method is susceptible to researcher bias, and the findings are not generalizable to the population of interest (Yin, 2009). However, the intent of this study is not generalization but instead to illuminate mechanisms and important variables, processes and interactions during financial firm internationalization (Ahmad, 2012; Lee et al , 2014; Isaac and Michael, 1990, p. 48). In contrast to relativist inquiries, such as those described by Eisenhardt (1989), social constructionist studies do not generate theory from pattern recognition but instead make direct observations within a single organization with retrospective accounts of what happened (Stake, 2006; Langley, 1999).…”

Section: Methodsmentioning

confidence: 99%

“…The pioneers of the Uppsala model called for case studies to understand the strategic considerations and contextual aspects of the Uppsala model (Vahlne and Johanson, 2013; Vahlne et al , 2011). Moreover, the literature contains several case studies of firm internationalizations, including financial services (Parada et al , 2009; Sun, 2009; Ahmad, 2012; Boojihawon and Acholono, 2013; Lee et al , 2014; Amaratunga and Baldry, 2001). However, we argue that prior studies of the Uppsala model give insufficient attention to business model evolution.…”

Section: Methodsmentioning

confidence: 99%

Improving productivity of a financial firm: business model evolution in the Caribbean

Parker¹,

Lawrence²

2020

IJPPM

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PurposeThis study explores the role of business model as a state variable during transformation of a financial institution to become a multinational enterprise. Prior studies of the Uppsala model overlooked business model evolution for cross-border productivity and performance.Design/methodology/approachThe research design employs the resource-based view for an in-depth case study of JMMB, a family-managed Jamaica-based financial firm, using data from primary and secondary sources, covering the period 1992 to 2014.FindingsJMMB's business model was the channel through which resources and capabilities gave rise to an innovative product for successful positioning in an international network. This was augmented by strong family orientation toward customer service, a distinctive asset that shaped the nature and trajectory of the business model. Cross-border alliancing and risk management were crucial dynamic capabilities for replicating the business model in foreign markets.Research limitations/implicationsWhile the observations are not generalizable to other firms, they indicate that a business model is a key unit of analysis for understanding how the firm makes the transition to become a multinational enterprise.Practical implicationsFinancial institutions may internationalize in a small island, developing stages through a strategy of focused product differentiation based on disruptive innovation with cross-border partnerships for ease of market entry and experiential learning.Social implicationsThe research has identified opportunities for effective and efficient work methods in pursuit of productivity gains.Originality/valueThe study is the first to illustrate business model as a state variable in the Uppsala model of multinational enterprise evolution for a financial firm.

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“…To achieve this objective the paper uses an explanatory qualitative case study methodology (Yin, 1981, p. 61), (P. Ghauri, 2004); (P. N. Ghauri & Grønhaug, 2005, p. 196). Qualitative case studies have long history in the organizational and international relations literature (Allison, 1971;Pressman & Wildavsky, 1973); (Ferrier, 2001); (Levy, 2008); (J.-W. Lee, Song, & Kwak, 2014)) and all the studies cited in the introduction above are qualitative case studies building a narrative from the available qualitative empirical data. Hence, in developing my argument, I depart deductively from resource dependency theoretical proposition and use empirically grounded interpretation of the evidence related to Russia's resource gaps, give alternative explanations of these evidence in relations to Ukraine's resources and form a conclusion based on the explanation in most agreement with these evidence as suggested by (Yin, 1981).…”

Section: Theoretical Perspectives and Methodologymentioning

confidence: 99%

Russia’s war with Ukraine is to acquire military industrial capability and human resources

Johannesson

2017

Journal of International Studies

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Abstract. The Russia-Ukraine war presents a serious challenge as to understanding of President Putin's geopolitical intentions. This article uses a resource dependence perspective to explain Russia's motives for invading Ukraine. The invasion is driven by Russia's resource gaps in military-industrial capacity and human resources, and the fact that these resource gaps could be substantially mitigated by control over Ukraine's resources. The findings suggest implications for further research, policy and international business developments.

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Internationalization of Korean banks during crises: The network view of learning and commitment

Cited by 13 publications

References 24 publications

Revisiting foreign market entry motivations: the case of Korean commercial banks

Revisiting foreign market entry motivations: the case of Korean commercial banks

Improving productivity of a financial firm: business model evolution in the Caribbean

Russia’s war with Ukraine is to acquire military industrial capability and human resources

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