Mikael Hilmersson

Reducing Uncertainty in the Emerging Market Entry Process: On the Relationship Among International Experiential Knowledge, Institutional Distance, and Uncertainty

In three institutional environments, this study examines the uncertainty-reducing effects of experiential knowledge of varying specificity in the market entry process. The goal of the study is to answer the research question: What is the uncertainty-reducing effect of experiential knowledge of varying specificity in markets with different institutional distances from a firms home base? The authors develop a theoretical model using the most recent developments in internationalization process theory. They test the model with a data set collected on-site at 203 small and medium-sized enterprises with entry experience into the new Eastern European Union member-states, Russia and China. The analysis shows no support for the claim that internationalization knowledge reduces uncertainty in the market entry process. Rather, the analysis reveals that societal knowledge of the entering firm has an uncertainty-reducing effect in markets that are relatively less distant from its home market. The analysis also shows that international experiential knowledge of high specificity, an important type of marketing knowledge, provides the greatest uncertainty-reducing effect.

Small and medium-sized enterprise internationalisation strategy and performance in times of market turbulence:

This article examines the relationship between the strategies utilised by small and medium-sized enterprise (SMEs) for international expansion, and their performance during market turbulence. Analysing the strategy process of firm internationalisation, three main dimensions of this unfolding process are condensed: the scale, scope and speed of firm internationalisation. The influence of these three dimensions on performance during market turbulence is explored using a hypothesised model tested through an integrated dataset combining data pertaining to firm strategy, and performance. The analysis demonstrates that the scope and speed of internationalisation render a positive performance effect, whereas the scale of internationalisation does not. The article contributes to knowledge regarding sustainable and successful internationalisation strategies during times of market turbulence.

Experiential knowledge types and profiles of internationalising small and medium-sized enterprises:

Although experiential knowledge is a well-documented construct in the internationalisation literature, research on the multidimensionality of the construct remains limited and we do not know how different knowledge combinations among internationalising SMEs are composed. This article answers the research questions: is experiential knowledge in the internationalisation process a multidimensional construct, and is there a pattern to be found among the experiential knowledge profiles of internationalising SMEs? In the article, the multidimensionality of the concept is established and four experience-based knowledge profiles of internationalising firms are identified. First, four types of experiential knowledge are extracted: internationalisation, institutional, business network and social network knowledge. Second, four experiential knowledge profiles are identified: masters, institutional experts, social networkers and learners. The article concludes that experiential knowledge is a multidimensional construct and that internationalising SMEs develop heterogeneous experiential knowledge profiles.

The effect of international experience on the degree of SME insidership in newly opened business networks

Purpose - The purpose of this study is to develop internationalization process theory by examining the relationship between small- and medium-sized enterprises (SMEs) international experience and their degree of insidership in newly opened business networks. Design/methodology/approach - The study applies a quantitative approach. Data were collected on-site at 203 SMEs having entered the Baltic States, Poland, Russia and China. The data are analysed with structural equation modeling in SmartPLS. Findings - The paper reveals that international experience is positively associated with both the country and customer experience in the newly opened business network. Country experience, in turn, is strongly associated with a firms degree of insidership in the business network. Conflicting with the hypothesized model, no support is found for the direct relationship between international experience and insidership. Nor does the analysis reveal any significant relationship between a firms customer experience, in terms of variation, in the newly opened business network and the degree of insidership in the network. Research limitations/implications - The paper empirically discriminates different types of international experience derived from theory and examines their relationship with the degree of firm insidership in newly opened business networks. Originality/value - Theoretically this paper advances internationalization process theory by developing its network aspect as well as discriminating different experience types and their role in predicting network insidership in newly opened business networks.

Perceived institutional distance in the emerging market entry process

We claim that difference in business environments is the result of differences between institutions. In this paper, a network perspective is taken on business markets and we set out to examine how differences in institutions are perceived in business relationships between firms originating from disparate business networks. The concept of perceived institutional distance is developed in three sequential stages. First, we conceptually develop the concept as an anchored theoretical construct. Second, we try out the concept empirically. Third, we verify the dimensions in which perceived institutional distance is manifested. The study reports from an on-site survey of 203 SMEs with experience of entering emerging markets. Five dimensions in which perceived institutional distance is manifested are presented: patience and rationality from the cognitive institutional pillar, distrust and reliability from the normative pillar, and sanctions from the regulative pillar.

Time, Temporality, and Internationalization: The Relationship Among Point in Time of, Time to, and Speed of International Expansion

Speed of internationalization is a multidimensional concept with performance consequences, but little is known about the interrelatedness between different time-related concepts. The authors address this deficiency by developing three hypotheses, which are confronted with a data set collected on site at 203 small and medium-sized enterprises. The analysis reveals that (1) the longer the time to internationalization, the lower the speed of international expansion; (2) the earlier the point in time when internationalization starts, the lower the speed of international expansion; and (3) there is an antagonistic interaction effect revealing that the negative effect on the speed of international expansion caused by a longer time to internationalization is moderated by the point in time when internationalization starts. The study contributes to theory by examining the interrelatedness between temporal concepts in the internationalization literature and by showing how the underlying mechanisms influencing internationalization speed change over time. For managers, insights into the importance of time and temporality for successful international expansion are provided.

Political knowledge, political turbulence and uncertainty in the internationalization process of SMEs

Purpose – The purpose of the study is to examine the political sources of uncertainty in the internationalization process of small- and medium-sized enterprises (SMEs). Design/methodology/approach – The authors theoretically derived a research model embracing three hypotheses. These hypotheses are tested on a sample of 203 on-site interviewed SMEs. Regression analysis is used to test two individual hypotheses and one interaction effect. Findings – The regression analysis reveals that political knowledge possessed by the firm reduces uncertainty in the internationalization process. Political turbulence is shown to increase uncertainty in the internationalization. The interaction shows that political turbulence obliterates the uncertainty reducing effect by political knowledge. Research limitations/implications – The authors identifies two main political sources of uncertainty in the internationalization process of SMEs. For managers and business researchers, it is shown that experiential knowledge is usefu...

Business networks, firm strategy, opportunity development and strategic outcomes: a conceptualization of the initial phase of firm internationalization

The development of international opportunities is a central catalyst of the firm internationalization process. Previous research has suggested a link between a firm’s network characteristics and the process with which it develops opportunities. In this chapter we integrate findings from the literature on international entrepreneurship with the network view on firm internationalization. We conceptualize the internationalization process by connecting the concepts of business network, firm strategy, international opportunity development and strategic outcomes. Four groups of propositions are developed on the direct and indirect relationships between these constructs. This contributes to the literature by conceptualizing the early stage of firm internationalization and laying the conceptual groundwork for future research examining and testing the ways in which different types of opportunities are developed and the strategies for firms to follow in this process.

Experiential knowledge profiles in internationalizing SMEs : The ability to sustain market positions in the new turbulent era of global business

Purpose – This study sets out to establish experiential knowledge profiles of small- and medium-sized enterprises (SMEs) entering emerging markets and to examine how the different abilities contain ...