Sylvie Chetty

Internationalisation of Small to Medium-sized Manufacturing Firms : A Network Approach

How do firms use business networks when they internationalise? To answer this question, a longitudinal case study of four manufacturing firms in a small open economy such as New Zealand is used. This paper includes a dynamic element in the study of internationalisation by using Johanson and Mattssons (1988) model [Internationalization in industrial systems -- a network approach. In P. J. Buckley, & P. N. Ghauri, The internationalization of the firm: a reader (pp. 303-321). London: Academic Press]. This model uses social exchange theory to illustrate how firms develop network relationships organically to internationalise. In New Zealand, however, government export promotion programmes encourage formal structured networks. This paper identifies the theoretical gap in the literature, which is the focus on organically developed networks rather than formal structured ones. The studys findings illustrate the dynamics of how firms interact with their network partners to extend, penetrate and integrate their international markets. Networks can help firms expose themselves to new opportunities, obtain knowledge, learn from experiences, and benefit from the synergistic effect of pooled resources. Another contribution of this paper is that it identifies weaknesses and various other factors that influence the model, thus advancing the literature.

A Strategic Approach to Internationalization: A Traditional Versus a “Born-Global” Approach

This article is based on a study of 16 in-depth case histories of New Zealand firms. It uses both the traditional and the “born-global” approaches as a framework to study the internationalization processes of the firms. The authors use the histories to conduct a systematic analysis of the extent to which firms that might be categorized as following a traditional or born-global internationalization path differ in the strategies they have used and in their prior motivations and capabilities. The main findings are that many attributes of the born-global model also characterize firms that began their internationalization along traditional lines but were radically transformed in the process of achieving global reach. This study identifies the consequences of rapid international growth, referred to as “the gusher,” among these firms and the destabilizing effects of the experience as the firm is taken in unexpected directions. The authors conclude that the born-global model has much in common with the internationalization of small entrepreneurial firms and that its most distinctive elements lie in the models relevance to an increasingly globalized world economy and in the more aggressive learning strategies that are required to follow this path.

Collaborating with competitors to acquire resources

This paper uses both a survey and a case study from New Zealand to explore the role of network relationships in the internationalisation of small and medium-sized enterprises. These networks can take various forms so we explore whether one type of network supports internationalisation more than the other, and whether the type of networks created will determine the type of resources the firm acquires. We further explore these issues by categorising respondents as domestic, early international or late international firms, which we term the internationalisation strategy of the firm. The findings from the survey show that the willingness to access external resources, especially from horizontal or competitor-based networks, may be a defining aspect of the international firm. For international firms, horizontal networks represented the principal source of external physical, organisation, technical and reputation resources while, for domestic firms, the more critical network for these resources was socially/vertically related to the firm. The case study confirms and expands on the critical role of horizontal networks for enhancing physical, organisational, technical and reputation resources. In addition, international firms emphasised different resources, with late international firms focusing on external human resources and early international firms focusing on external reputation and organisational resources.

Paths to internationalisation among small‐ to medium‐sized firms

The internationalisation of small‐ to medium‐sized enterprises (SMEs) is considered in the context of the overall configuration of strategy in these firms. This paper is based on in‐depth case studies of the internationalisation path of ten small‐ to medium‐sized manufacturing firms in New Zealand. Two distinct paths are identified, one of global, the other of regional scope. These are argued to be the product of two distinct configurations of strategy, requiring different choices in product and market scope, mode of market development, and location of manufacturing. The patterns of internationalisation produced by these configurations are in some respects at variance with the predictions of stages models of internationalisation derived from larger enterprises and economies. The influence of these configurations and the characteristics of SMEs in particular those of the decision maker on the pace of internationalisation are also considered. A conceptual model is developed from the findings of this study by integrating internationalisation theories and SME characteristics.

Social Capital and Its Influence on Changes in Internationalization Mode Among Small and Medium-Sized Enterprises

This article explores how social capital influences a firm to change its internationalization mode. The authors use an in-depth qualitative study to identify 36 internationalization mode changes in ten New Zealand and ten Swedish small and medium-sized enterprises. This article contributes to the internationalization mode literature by focusing on relationships and mode change. Using the network approach, the authors develop three categories of social capital and discuss their role in influencing mode change. The roles include the efficacy role, the serendipity role, and the liability role of social capital. These three roles incorporate both the positive and the negative aspects of social capital. The liability role is the most frequently observed form of social capital to influence mode change. The most frequent type of mode change is toward a high-control internationalization mode.

Dimensions of internationalisation of manufacturing firms in the apparel industry

The economic deregulation, in 1984, in New Zealand was followed by an influx of cheap imports which most affected the apparel industry. Firms which wanted to survive decided to export. Studies the dimensions of internationalisation of those firms. A modified version of Welch and Luostarinen’s model is used as it provides a broad framework to study internationalisation. Five case studies of small to medium‐sized manufacturing firms provide an overview of the dimensions of internationalisation and propose that a firm can be more internationalised in some dimensions than in others. Psychological and geographical distance still plays an important role in a firm’s internationalisation. The study confirms that regional trading agreements and economic deregulation have expedited the internationalisation of firms.

Internationalization and innovation in a network relationship context

Purpose – The aim of this paper is to study how network relationships are used in the internationalization and innovation of small and medium‐sized enterprises (SMEs) in the software industry. The paper seeks to use the extant literature to develop a matrix consisting of incremental internationalization and innovation and radical internationalization and innovation.Design/methodology/approach – The paper is based on an in‐depth qualitative study of ten software firms in New Zealand. The unit of analysis is the firm. Multiple sources of data collection are used, but the main method of data collection is semi‐structured interviews.Findings – The ten firms in the study fall into four distinct groups, depending on the type of internationalization and the type of innovation, and each group has particular types of network relationships. Firms with limited network relationships have incremental internationalization and innovation, but those with diverse network relationships have radical internationalization and...

Mutual commitment and experiential knowledge in mature international business relationship

This paper examines how market knowledge and market commitment are developed in mature supplier/customer relationships in international markets. It reports the empirical testing of a model of increasing commitment and experiential knowledge development in international business relationships. The assumption is that the connected relationships in a business network are the basis for forming a relationship and it will influence how the focal relationship develops. The model shows the process when a supplier increases his or her knowledge of the business network that a foreign customer is embedded in and what happens as their relationship with the customer becomes mature, stable and profitable. In this situation the firm does not invest as much as it did early on in the relationship but diverts its attention to firms that are more embedded in the local business network context. The model thus explicates a process of transition as a firm moves from one mature relationship to create new relationships as it increases its foreign market involvement.

Innovation Types and Network Relationships

We examine network relationships, particularly the type and strength of these relationships and how firms use them in order to commercialize different types of innovations. We conduct an in–depth case study of four small firms to provide insight on how and why a portfolio of network relationships (e.g., suppliers, distributors, customers, and research institutes) helps small new innovative firms to gain resources. We develop a framework of four innovation types and expand on how successful commercialization for each innovation type requires certain types and strength of relationships. Both types (systemic and autonomous) of radical innovations require strong collaborative ties with customers, whereas incremental innovations are commercialized through different types of downstream networks.

The Process of Exporting in OwNner-controlled Firms

SYLVIE CHErrY IS SENIOR LECTURER IN kmarketing at Victoria University of Wellington, New Zealand, and R. T. Hamilton is Professor of Management at the University of Canterbury, Christchurch, New Zealand. The main purpose of this paper was to identify how similar firms become exporters and, once embarked, why some perform better than others. It is based on the findings of a multi-case study investigation of exporters and non-exporters within two major New Zealand manufacturing industries. The discussion is set in the context of the academic literature on exporting and the findings should be of interest to ownermanagers in smaller firms considering exporting and to those framing policy to support exporting.