Solving Paradox by Increasing Technological Capacity: A Critique of the Concept of Business Model Innovation at TikTok

ABSTRACT This paper comments on Yulun Ma and Yue Hu's (2021) recent article ‘Business Model Innovation and Experimentation in Transforming Economies: ByteDance and TikTok’. It argues that TikTok's international success is not due to so-called business model innovation; instead, it is because ByteDance has overcome three major hurdles facing emerging market firms pursuing internationalization. It also posits that the case of TikTok offers inspiration for theorizing paradox, namely, individuals and organizations can solve paradoxical tensions by increasing capacity through the use of advanced technologies.

Internationalisation strategies of emerging market firms: evidence from Sarawak, Malaysia

Purpose This study aims to explore the internationalisation paths and strategies adopted by firms from an emerging market and serves as a step towards examining the suitability of prevailing internationalisation theories in the context of emerging market firms. Design/methodology/approach This study adopted a qualitative methodology and gathered data through in-depth semi-structured interviews with 15 top managers of internationalised firms from the East Malaysian state of Sarawak. Data were analysed thematically. Findings The results revealed that the internationalisation strategies of firms from Sarawak can be classified under three main categories: motivations and markets, modes and measures. The constraints the firms faced were important determinants of their internationalisation strategies. The internationalisation paths and strategies of the firms were also found to exhibit both similarities to and deviations from the tenets of prevailing internationalisation theories. Originality/value The study contributes knowledge to the literature of both internationalisation theories and internationalisation strategies of emerging markets, in particular, it advances Fey et al.’s (2016) Five M Framework.

The effects of importing activities on technological and non-technological innovation: evidence from Chilean firms

PurposeThe authors analyzed the effects of importing activities on both technological and non-technological innovation in Chile. They contribute to the literature by hypothesizing and testing the idea that importing activities can foster the introduction of product, process, marketing and organizational innovations in emerging market firms.Design/methodology/approachThe authors used a combination of two economic surveys that included 1,347 Chilean companies. To test their hypotheses, they applied a variant of the Crépon-Duguet-Mairesse (CDM) model (Crépon et al., 1998) accounting for technological and non-technological innovation outputs. Specifically, four alternative innovation output indicators were used to measure the introduction of product, process, marketing and organizational innovations.FindingsThe results revealed that importing activities had positive effects on technological and non-technological innovation. Importers showed a significant advantage in the introduction of product, marketing and organizational innovations. Firms that both import and export (i.e. two-way traders) had an even greater advantage in the introduction of new or significantly improved products.Originality/valueThe authors demonstrated a relationship between importing activities and both technological and non-technological innovation that is novel and relevant, particularly at a historical moment when COVID-19 poses huge economic challenges to emerging market firms. As trade disruptions caused by the pandemic have predisposed some governments to favor protectionist policies, the authors warn that erecting barriers against imports can hamper the innovative success of local businesses.

Emerging Market Firms’ Response to U.S. Economic Recession and the Subsequent Period’s Performance

We investigated the changes in behaviors of firms in emerging markets in response to the U.S. economic recession and the impact of those changes in strategic behaviors on subsequent periods’ operating performances. Specifically, we adopted an event-study methodology, using a sample of emerging market firms, to investigate the nature of the effects of the U.S. economic recession on firms in emerging markets. Based on 5,887 firms in nine emerging countries, our results show that firms in emerging markets exhibit changes in strategy variables, and those changes have a significant effect on the subsequent periods’ operating performance. In addition, we found that the impact of changes in strategy variables on the subsequent periods’ operating performance is stronger among more resource-unconstrained firms than among more resource-constrained firms. We ascribe this latter finding to the lack of slack resources that are necessary to make changes in strategy variables during the aftermath of the global economic recession for more resource-constrained firms.