Andreas P. Petrou

Entrepreneurial Orientation and International Performance: The Moderating Effect of Decision‐Making Rationality

This research examines how entrepreneurial orientation (EO) influences international performance (IP) of the firm taking into account the moderating effect of decision-making rationality (DR) on the EO-IP association. Such an investigation is significant because it considers the interplay of strategic decision-making processes supported by the bounded rationality concept in the entrepreneurship field. Drawing from a study on activities of 216 firms in the United States and United Kingdom, the evidence suggests that DR positively moderates the EO-IP association. The findings suggest that managers can improve IP by combining EO with rational (analytical) processes in their strategic decisions.

Bank Foreign Affiliate Performance in the Face of Pervasive and Arbitrary Corruption

This study investigates the financial performance of foreign bank affiliates in light of their experience with pervasive and arbitrary corruption. To achieve this, we draw on the resource dependence theory and the institutional theory to explain how pervasiveness and arbitrariness affect financial performance through operating costs, risks of defaults and business growth. Using data on 122 foreign bank affiliates in 37 countries, we find that pervasiveness has a negative influence on the affiliates performance, and, the joint interaction of pervasiveness and arbitrariness strengthens this relationship. The latter is significant for affiliates operating in developing countries, which may indicate that arbitrariness is damaging when corruption is pervasive. This study advances the literature on corruption at firm-level, and the literature on bank internationalization. Moreover, findings have implications for managers, who need to recognize how the interaction of these two dimensions of corruption compromise their foreign operations.

The effects of formalisation, hierarchical decentralisation and lateral communication: strategic decision-making processes on SME international performance

Purpose – This chapter seeks to examine the relationship between three strategic decision-making processes (SDMPs) and international performance of small- and medium-sized enterprises (SMEs). Methodology/approach – Drawing on a sample of 528 SMEs based in four countries (United States, United Kingdom, Greece and Cyprus), the chapter explores the relationship between formalisation, (hierarchical) decentralisation, lateral communication and international performance. The chapter also investigates the moderating effects of dynamism on the aforementioned relationship. Findings – Results indicate that formalisation and decentralisation have a positive effect on international performance; whereas lateral communication has no effect. Some evidence exists to support the moderating role of dynamism on the process–international performance link in that decentralisation produces positive effects in stable settings whereas lateral communication produces positive effects in dynamic ones. Research limitations/implications – This chapter focuses on three SDMP dimensions and one characteristic of the external environment. Future studies are also needed to replicate the findings reported here in other national settings. Also, future studies should consider additional variables. Practical implications – International performance of the SME can be influenced by how managers are involved in their SDMPs. Social implications – Given the high role that SMEs have in modern economies for employment and growth, we identify SDMPs that are conducive to their international performance. Originality/value – This study lies at the intersection of two streams of two complementary streams of research: strategic decision-making and international entrepreneurship. It is one of the first attempts to involve the SDMP stream of research in internationalisation.