Paradoxes of psychic distance and market entry by software INVs

2015 ◽  
Vol 27 (1) ◽  
pp. 34-59 ◽  
Author(s):  
Paresha Sinha ◽  
Mingyang (Ana) Wang ◽  
Joanna Scott-Kennel ◽  
Jenny Gibb
Keyword(s):  
Market Entry ◽  
Cultural Distance ◽  
New Ventures ◽  
Open Economies ◽  
Secondary Data ◽  
International New Ventures ◽  
Psychic Distance ◽  
Small Open Economies ◽  
Content Type ◽  
Market Expansion

Purpose – This paper aims to examine the role of psychic distance during the process of international market entry by software international new ventures (INVs) from small, open economies. Specifically, we investigate how home market and global industry contexts influence market-entry strategies, and how psychic distance influences initial then subsequent market-entry choice decisions. Design/methodology/approach – Using Atlas.ti7 software, this paper adopts a qualitative, multi-case analysis of ten software INVs based in New Zealand. Thematic coding of interview and secondary data revealed three core processes: pre-entry considerations, market selection criteria and post-entry evaluation, across the stages of initial and subsequent market entry. Findings – In the context of the global software industry, the key driver of proactive market entry by INVs from small, open economies is market size rather than psychic distance. During the process of market expansion, firms encounter the psychic distance paradox (PDP). A second paradox arises when, despite experiential learning, managerial perceptions of psychic distance increase, making entry into more distant markets less, rather than more, likely and reactive, rather than proactive. Originality/value – This paper addresses contextual differences in software versus more traditional sectors, and the influence of psychic distance on market entry rather than outcomes. Specifically, extending our understanding of the PDP, we find perceptual psychic and cultural distance ignored as criteria for initial market-entry decisions, and initial positive attitudes toward risk-taking become less apparent during subsequent entries.

scholarly journals International new ventures market expansion through collaborative entry modes

2018 ◽  
Vol 35 (6) ◽  
pp. 890-913 ◽  
Author(s):  
Pushyarag N. Puthusserry ◽  
Zaheer Khan ◽  
Peter Rodgers
Keyword(s):  
Small And Medium Enterprises ◽  
New Ventures ◽  
Entry Mode ◽  
Foreign Market ◽  
International New Ventures ◽  
Structured Interviews ◽  
Entry Modes ◽  
Content Type ◽  
Market Expansion ◽  
The Uk

PurposeThe purpose of this paper is to examine the role that different collaborative entry modes play in how international new ventures (INVs) expand into international markets.Design/methodology/approachThe paper’s arguments are based on the INVs and social network literatures. In order to investigate the entry modes adopted by British and Indian small and medium information and communication technology (ICT) firms into each other’s markets, the paper outlines the results of qualitative semi-structured interviews with the key decision makers of ten British and ten Indian ICT firms.FindingsThe findings contribute to the relatively under-researched area of how INVs enter foreign markets through collaborative entry mode. The findings suggest that INVs utilize both equity and non-equity modes of collaboration to expand their international operations. The findings also indicate that financial and non-financial resources always limit the market expansion and internationalization of such companies. Against this background, the INVs rely on building collaboration as one of the safest methods for foreign market expansion and successful internationalization. The collaborative entry mode is enhanced by entrepreneurs’ prior experience, social ties and knowledge of the foreign market.Research limitations/implicationsSet against the backdrop of an ever-increasing trend of internationalization of small and medium enterprises (SMEs), the paper offers important implications for understanding the conditions and factors behind the choice of collaborative and non-collaborative entry modes by INVs in particular and SMEs more broadly.Originality/valueThe paper is one of the few studies that have examined the role of collaborative entry modes choice adopted by INVs from two of the largest economies – the UK and India.

scholarly journals The roles of deals and business networks in innovation processes

IMP Journal ◽  
2017 ◽  
Vol 11 (1) ◽  
pp. 25-50 ◽  
Author(s):  
Per Ingvar Olsen ◽  
Håkan Håkansson
Keyword(s):  
New Technology ◽  
New Ventures ◽  
Innovation Process ◽  
Secondary Data ◽  
International New Ventures ◽  
Business Networks ◽  
Global Business ◽  
Financial Flows ◽  
Content Type ◽  
Innovation Processes

Purpose The purpose of this paper is to analyze the roles of deals in innovations processes, based on the definition of a deal as the interaction of social-material value-creating processes with money-handing processes. Design/methodology/approach The paper is based on a study of the historical emergence of transaortic valve implantation (TAVI) as an innovative new technology in the area of thoracic surgery in a global setting. The study is based on a combination of interviews and secondary data analysis. Findings The authors found that deals play important roles in innovation processes as critical junctions that mark entries to different phases and generate major shifts in location as well as combination of resources, activities and actors. These shifts include radical changes in control, where actors in possession of resources necessary to bring the project through the next phase, move in to take control – thereby expanding their businesses to new growth niches. Based on the analysis of seven deals, the authors argue that the innovation process is a combined push and pull process where later stage entrepreneurial interests play very significant roles. Deals may also represent radical turning points and moves of the projects that set the project off in a different direction, usually also associated with shifting ownership control rights through the innovation and scaling process. The authors also argue that inventions in the periphery will tend to move to the areas with the most competent relevant business networks capable of adopting and expanding the innovation to a global business operation. The innovation process is not primarily about creating new resources and activities, but about recombining existing resources, competencies and activities. Supplier networks play particularly important roles in these processes. Research limitations/implications The authors suggest that the study indicates that IMP researchers should turn more attention to studying business deals and financial flows and influences – in particular in studies of innovations and innovation processes – to investigate the mechanisms by which new innovations interact with and transform existing business networks. Social implications This work highlights why and how an innovation that may initiate anywhere in the periphery, will tend to move to the most competent and capable networks around the globe, that are the most relevant to the needs of the innovation project. Hence, the more powerful business networks and eco-systems will tend to pull interesting inventions in from their periphery, and grow them effectively. Originality/value The paper expands the efforts in IMP theorizing to include financial/monetary interactions more explicitly into business network theory. It also aims at clarifying core IMP arguments toward entrepreneurship research, in particular research on international new ventures.

Enhancing the understanding of international new ventures: a service-oriented perspective

2017 ◽  
Vol 40 (5) ◽  
pp. 494-516 ◽  
Author(s):  
Sven M. Laudien ◽  
Birgit Daxböck
Keyword(s):  
Market Entry ◽  
New Ventures ◽  
New Venture ◽  
International New Ventures ◽  
Service Orientation ◽  
Entry Modes ◽  
Content Type ◽  
New Venture Internationalization ◽  
Holistic Understanding ◽  
Service Oriented

Purpose This paper aims to challenge the up to now mainly product-centered view on international new ventures by analyzing the influence of service orientation on new venture internationalization behavior. It especially focuses on the utilization of specific market entry modes as a result of a growing service orientation. Design/methodology/approach Newness and complexity of the topic call for a qualitative-empirical research approach. Therefore, the paper is based on an in-depth multiple-case study of six international new ventures operating in fashion and lifestyle industry. Findings This paper shows that service-oriented international new ventures make use of different market entry modes at the same time. Service-related capabilities allow them to especially use cooperative market entry modes to fuel lacking market knowledge and thus to overcome resource constraints in value creation processes. Originality/value The paper contributes to a more holistic understanding of international new ventures, as it provides empirical evidence for the importance of service-related aspects in new venture internationalization. Furthermore, the paper extends international new venture research by not only considering an early international market entry but also other aspects of internationalization such as the type of offerings or the preferred market entry modes.

scholarly journals The making of information nations

2019 ◽  
Vol 33 (1) ◽  
pp. 12-26 ◽  
Author(s):  
Merlin Stone ◽  
Jon Machtynger ◽  
Liz Machtynger ◽  
Eleni Aravopoulou
Keyword(s):  
Information Technology ◽  
Global Economy ◽  
New Ventures ◽  
Secondary Data ◽  
Social Implications ◽  
Education Policies ◽  
Content Type ◽  
And Mathematics ◽  
High Level ◽  
Practical Implications

Purpose The purpose of this paper is to identify the main characteristics of what have come to be called information nations and to identify some of the determinants of success in becoming an information nation. Design/methodology/approach The paper is based on a critical review of the literature and of secondary data on information technology and services from studies of the innovativeness of nations. Findings Success in becoming an information nation is not necessarily closely connected with investments in information technology and services by firms and policies supporting these investments by governments, or with education policies designed to support the development of science, technology, engineering and mathematics. Other factors, such as the vibrancy of capitalism, particularly the funding of new ventures, the culture of the nation and its focus on non-scientific determinants of innovation, such as design, are also important. Governments should be careful not to take credit for achievements when their policies are merely coincident with those achievements. Research limitations/implications The main limitations relate to the focus of this article on two sets of nations, South East/East Asia and two Western nations. The review of their performance is relatively high level and needs to be deepened, while the number of nations included in the research needs to be increased. Practical implications This paper has substantial practical implications for government policymakers, in terms of whether and how they should make policy at all in this area, and for companies trying to establish a long-term position in the global economy, in terms of being careful not to go against the very strong economic forces which favour certain kinds of activities in certain countries. Social implications This paper has significant social implications, because much of the thinking about developing information societies relies on generalisations about the creation of information nations that may not hold. Governments and social commentators are encouraged to approach the idea of making “big policies” in this area with some scepticism. Originality/value The content of this paper is not original, but the challenge to policymakers is relatively original, as too often the work of academics is sponsored by governments that are trying to legitimate the value of their own efforts.

Social-cognitive antecedents of new venture internationalization

2019 ◽  
Vol 14 (3) ◽  
pp. 462-479 ◽  
Author(s):  
Aleksandra Wasowska
Keyword(s):  
Self Efficacy ◽  
Social Cognitive ◽  
New Ventures ◽  
Foreign Market Entry ◽  
New Venture ◽  
International New Ventures ◽  
Actual Behavior ◽  
Positive Orientation ◽  
Content Type ◽  
New Venture Internationalization

Purpose The purpose of this paper is to investigate the social-cognitive antecedents of an entrepreneur’s internationalization intent and a firm’s behavior. Building on the insights of social-cognitive psychology, the author develops a conceptual model linking an entrepreneur’s positive orientation, self-efficacy beliefs, internationalization intent and actual behavior of the firm. Design/methodology/approach The author tests this model with a sample of 310 Polish firms (including 241 domestic and 69 international new ventures), drawing on data collected first in 2006 and then in 2007. Findings The author finds that self-efficacy mediates between positive orientation and internationalization intent, and that an entrepreneur’s internationalization intent predicts a firm’s behavior (i.e. foreign market entry). Moreover, firm age moderates the relationship between an entrepreneur’s positive orientation and internationalization propensity among new ventures. Research limitations/implications Overall, the findings demonstrate that social-cognitive theory is useful in predicting new venture internationalization. Practical implications Based on the findings, the author recommends that managerial education in international management combines the development of “formal” skills and cross-cultural competencies with experiential and vicarious learning. Originality/value The study combines insights from psychology and international business, thus responding to numerous calls for a more interdisciplinary and cognition-oriented focus on the international behavior of firms.

Marketing activity of international new ventures – application of the EMICO framework

2019 ◽  
Vol 34 (4) ◽  
pp. 779-791 ◽  
Author(s):  
Izabela Kowalik ◽  
Lidia Danik
Keyword(s):  
Business Processes ◽  
New Ventures ◽  
International New Ventures ◽  
Minor Importance ◽  
Marketing Activity ◽  
Structured Interviews ◽  
Content Type ◽  
Entrepreneurial Marketing ◽  
Qualitative Data Analysis Software ◽  
Eastern European Countries

Purpose One of the approaches to study entrepreneurial marketing (EM) is the EMICO framework. The extant studies have not yet explored the application of this framework by international new ventures (INVs). To address this research gap, four Polish INVs from medium-tech sector have been studied to check whether this tool can be applied to investigate the companies from Central and Eastern European Countries and identify the hierarchy of elements in the EMICO framework. Design/methodology/approach Using semi-structured interviews and the card game method, the understanding and importance of the EM concept elements by the Polish entrepreneurs have been explored. The collected text has been analyzed using qualitative data analysis software. Findings The studied INVs in their international marketing activity attributed most importance to understanding and responsiveness toward customers, networking, innovation introductions based on gathering of information and on the constant communication with clients. Most of the EMICO framework dimensions were confirmed; however, the concepts of “exploiting markets” and “integration of business processes” had minor importance for marketing. Research limitations/implications Research findings are relevant mainly for the B2B companies. Originality/value The paper recommends a modified list of EMICO elements for use in future studies concerning the small- and medium-sized enterprise internationalization.

The role of formal industry clusters in the internationalization of new ventures

2014 ◽  
Vol 26 (5) ◽  
pp. 449-470 ◽  
Author(s):  
Ana Colovic ◽  
Olivier Lamotte
Keyword(s):  
Design Methodology ◽  
New Ventures ◽  
Global Markets ◽  
International New Ventures ◽  
Internationalization Process ◽  
Structured Interviews ◽  
Cluster Management ◽  
Intermediary Organization ◽  
Content Type

Purpose – The purpose of this study is to investigate the internationalization of international new ventures (INVs). Specifically, this research explores the ways in which a formal cluster can facilitate the internationalization process of these firms. Design/methodology/approach – The authors studied how four INVs benefitted from the actions of two clusters in France – Systematic and Mov’eo – as they internationalized. They conducted semi-structured interviews with the CEOs and other representatives of the INVs and with the members of the cluster management teams. Findings – The findings indicate that clusters can facilitate the internationalization of INVs by providing resources, networking opportunities and legitimacy to help them reach global markets and by increasing the speed of internationalization. Originality/value – By analyzing the specific role that a formal cluster plays in the internationalization of INVs, this research contributes to the literature examining the link between location and INV internationalization. The authors argue that the cluster’s role can be considered as that of an intermediary organization helping INVs to expand globally.

scholarly journals Have we made it? Investigating value-creating strategies in early internationalizing ventures

2016 ◽  
Vol 26 (5) ◽  
pp. 517-536 ◽  
Author(s):  
Romeo V. Turcan ◽  
Anita Juho
Keyword(s):  
International Entrepreneurship ◽  
New Ventures ◽  
Dynamic Capability ◽  
Future Research ◽  
International New Ventures ◽  
Organizational Survival ◽  
Content Type ◽  
Early Internationalization ◽  
Start Up ◽  
Survival And Growth

Purpose The extant research on early internationalizing ventures focuses primarily on these ventures’ start-up phase or their initial internationalization. Scarce attention is paid to how these ventures grow, if at all, beyond their start-up phase or initial internationalization phase. This paper aims to explore how international new ventures transition from the internationalizing phase to the phase of being international, and whether they actually made it to that phase. Understanding whether and how these ventures reach their “made-it” point would contribute to our understanding of how early internationalization affects a venture’s survival and growth. In this, the authors draw on the dynamic capability theory of the firm. Design/methodology/approach Given the scarcity of theoretical understanding and empirical evidence in this substantive area of research, the authors adopted a multiple case study methodology for the purpose of theory building. Following an intensity sampling strategy, they purposefully selected information-rich, but not extreme two-case companies. The authors initially collected unobtrusive data in the form of running records and mass-media news reports from the inception of the case companies. They then conducted in-depth interviews with key decision makers of the case companies, namely, their co-founders and CEOs. Critical incident technique guidelines for data analysis were employed. Findings Grounded in data, the following constructs emerged related to value creation: strategic experimentation, gestalt tensions and legitimacy lies. Entrepreneurs experiment with and reconfigure their venture at several levels: goal (vision), decision (strategic) and behavioral (tactical) levels of the organizational gestalt to reach a threshold level of practiced activity. Entrepreneurs’ strategic experimentation efforts are fueled by tensions that exist at these three levels of the organizational gestalt. During this experimentation process, entrepreneurs may tell legitimacy lies to legitimate their ventures in the eyes of their stakeholders. Research limitations/implications Given the instrument the authors used to explore the issues and concerns identified above, the results are limited in scope. However, a number of questions and conjectures are put forward to guide future research in this currently under-researched area of international entrepreneurship. The authors have also suggested using the concept of turning point in future research to advance the understanding of the dynamic capability view of international new ventures. Practical implications Understanding whether and how international new ventures reach their made-it points would contribute to the understanding of how early internationalization affects international new ventures’ organizational survival and growth. Originality/value The authors have put forward the concept of the made-it point to aid international entrepreneurship researchers to investigate the continued growth, evolutionary patterns and the organizational survival of international new ventures.

Johnsonville Sausage LLC: finding new opportunities beyond the pork commodity markets

2019 ◽  
Vol 15 (3) ◽  
pp. 181-198
Author(s):  
Keith D. Harris
Keyword(s):  
Undergraduate Students ◽  
New Ventures ◽  
Public Information ◽  
Value Added ◽  
Secondary Data ◽  
Commodity Markets ◽  
Raw Material ◽  
Total Production ◽  
Content Type ◽  
The Cost

Theoretical basis This case used the interplay between individuals, firms and markets to examine how a company sustained success from its value adding activities. The theory of value creation was demonstrated by the leader’s ability to configure the firm’s tangible and intangible resources to create opportunities beyond the commodity markets. Also, what matters were not just the technical processes of developing value-added products, but how the company’s culture served as a link to new products, new markets and new ventures. Research methodology The case was based on primary and secondary sources. The primary sources face-to-face semi-structured recorded interviews with the protagonist at the company’s headquarters. The secondary data were from the company’s website, and public information about Johnsonville Sausage LLC. Supplemental information was gathered from market research firms. No names have been disguised. The case has been classroom tested with undergraduate students in a capstone course. The author has no personal relationship with the company. Case overview/synopsis Kevin Ladwig, Vice President, was concerned by the expanded production of ethanol, an attractive supplement to gasoline in the USA. Because most ethanol is processed from corn, expanded production of ethanol heightened the demand for corn. Since corn is a staple feed ingredient for animals, heightened demand for corn increased the cost of Johnsonville’s raw material – hogs. In fact, the cost of feed was Johnsonville’s major economic input in animal production from farrow to finish, accounting for up to 70 percent of the total production cost of hogs. The case introduces the nexus of food and energy markets and how the “Johnsonville Way” was used to convert an old idea into an innovation. Complexity academic level This case is appropriate for undergraduate and graduate courses in business and agribusiness management. It would also be appropriate for courses using concepts in innovation and organizational culture.

The Hybrid Structures of International New Ventures

2008 ◽  
Vol 9 (1) ◽  
pp. 33-42 ◽  
Author(s):  
Magne Sivert Berg ◽  
Arild Aspelund ◽  
Roger Sørheim
Keyword(s):  
Social Capital ◽  
New Ventures ◽  
International Market ◽  
Social Capital Theory ◽  
Hybrid Structures ◽  
International New Ventures ◽  
International Governance ◽  
Capital Theory ◽  
Market Expansion

This paper gives a social capital perspective on the internationalization process of new firms. The point of departure is international new ventures (INVs) and their frequent use of hybrid structures for government of international activities. The purpose is to shed new light on the INV phenomenon by studying the role of social relationships in the establishment, management and performance of international governance structures and access to resources for international market expansion. By combining knowledge from the international entrepreneurship literature with social capital theory, the authors construct several propositions on the relationship between properties of social capital embedded in the new firm and their ability to form effective international market channels and deliver high long-term performance. This conceptual study suggests that social capital is indeed conducive to the overall performance of INVs. However, empirical research is desirable – and, based on the propositions from this study, the authors propose a research agenda emphasizing the need for a longitudinal study of INV organizations with regard to the role of social capital in attracting and controlling international market resources.

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