Social networks in the initiation of a high-tech firm's internationalisation

Abstract

Entering foreign markets is often challenging for small firms due to the limited resources available for internationalisation. Through social networks, firms can gain access to and mobilise external resources in order to aid the initiation of internationalisation. The present study is concerned with the initiation of the internationalisation in small high-technology firms. The paper develops an empirically grounded framework for understanding the roles a social network can play in the initiation of internationalisation. The framework acknowledges personal relationships as sources of critical information about foreign business opportunities and potential international business partners. Moreover, social relationships can open doors in international business. This study brings forward the very active role that the social network can play as a mediator in the small firm's internationalisation. The mediation can provide the small firm publicity, contacts and legitimacy resulting in first international contacts and development of international business relationships.

The Importance of Locally Embedded Personal Relationships for SME Internationalisation Processes From Opportunity Recognition to Company Growth

“…Personal rela#onships facilitate the iden#fica#on of new market opportuni#es (Manolova et al, 2010;Ellis, 2011;Kon#nen and Ojala, 2011;Harris andWheeler, 2005, Chandra et al, 2009;Crick and Spence, 2005;Komulainen, Mainela and Tah#nen, 2006;Sharma and Blomstermo, 2003). However, most of the literature focuses on the role of interna#onal, or cross-border networks and personal rela#onships.…”

Contextualization of Evolving Patterns in the Internationalization of Small Firms

“…Especially during the new venture period, knowledge, skills, networks and competence of the founder and TMT of a small firm are its most valuable resources. Extant empirical studies show that social capital (Melén, 2009) and relationship can open the door to distant markets (Komulainen et al, 2006;Ellis, 2011). Founder teams' previous international experience and vision also set a direction for their firms' internationalization (Freeman and Cavusgil, 2007).…”

“…Resources which might not be available within such small firms need to be identified and mobilized via external channels (Coviello and McAuley, 1999). Current studies on the rapid internationalization of SMEs also point to the critical influence of entrepreneurs in the smaller firms (Blomstermo et al, 2004;Harris and Wheeler, 2005;Komulainen et al, 2006). Treating SMEs as a homogeneous group might neglect the important influence of larger resource constraints on the decisions and behavior in the internationalization of the smaller firms.…”

The Importance of Locally Embedded Personal Relationships for SME Internationalisation Processes – from Opportunity Recognition to Company Growth

“…Personal relationships facilitate the identification of new market opportunities (Manolova et al, 2010;Ellis, 2011;Kontinen and Ojala, 2011;Harris andWheeler, 2005, Chandra et al, 2009;Crick and Spence, 2005;Komulainen, Mainela and Tahtinen, 2006;Sharma and Blomstermo, 2003). However, most of the literature focuses on the role of international, or cross-border networks and personal relationships.…”