Organisational-Level Attributes of Micro-Multinationals. The Evidence From European SMEs

Wąsowska, Aleksandra

doi:10.1515/ijme-2017-0006

Abstract

This paper investigates organisational-level attributes that allow European SMEs to choose equity-based modes of entry to foreign markets, thus becoming micro-multinationals. We hypothesize that international R&D cooperation (hypothesis 1) and using digital marketing (hypothesis 2) by SMEs increase their likelihood of becoming a mMNE. These hypotheses are tested through a logistic regression analysis based on a large sample of European companies drawn from the Flash Eurobarometer study. Separate regression models are estimated for companies originating from EU-13 and EU-15. Hypothesis 1 is supported by both samples. Hypothesis 2 is supported in the EU-15 sample. Our identification of organisational-level attributes that increase the likelihood of SMEs choosing equity-based internationalisation contributes to International Entrepreneurship entry mode literature.

References

Adler, P. S., Kwon, S-W. (2002), Social Capital: Prospects for a New Concept, The Academy of Management Review, Vol. 27, No. 1, pp. 17–40.
Search in Google Scholar Back to article
Airaksinen, A., Luomaranta, H., Alajääskö, P., Roodhuijzen, A. (2015), Statistics on small and medium-sized enterprises, Dependent and independent SMEs and large enterprises, Eurostat, retrieved from http://ec.europa.eu/eurostat/statistics-explained, accessed: November 15, 2016.
Search in Google Scholar Back to article
Arenius P., Gabrielsson, M., Sasi V., (2005), Rapid internationalisation enables by the Internet: the case of a knowledge intensive company, Journal of International Entrepreneurship, Vol. 3, No. 4, pp. 279–290.
Search in Google Scholar Back to article
Arwidson, J., Dreber, P., Kolsjo, M. (2014), Searching for the micro-multinationals, PwC.
Search in Google Scholar Back to article
Brouthers, K. D., Nakos, G. (2004), SME entry mode choice and performance: a transaction cost perspective, Entrepreneurship Theory & Practice, Vol. 28, No. 3, pp. 229–247.
Search in Google Scholar Back to article
Buckley, P. (1989), Foreign Direct Investment by Small and Medium Size Enterprise: The Theoretical Background, Small Business Economics, Vol. 1, No. 2, pp. 89–100.
Search in Google Scholar Back to article
Cheng, H.-L., Yu, C.-M. J. (2008), Institutional pressures and the initiation of internationalisation: evidence from Taiwanese small- and medium-sized enterprises, International Business Review, Vol. 17, No. 3, pp. 331–348.
Search in Google Scholar Back to article
Ciszewska-Mlinaric, M. (2016), Export intensity, geographic diversification and the role of public support. The evidence from ‘Old’ and ‘New’ Europe SMEs, 8^th International Scientific Conference ENTRE 2016: ‘Advancing Research in Entrepreneurship in the Global Context’, Cracow.
Search in Google Scholar Back to article
Coviello, N., Munro, H. (1997), Network Relationships and the Internationalisation Process of Small Software Firms, International Business Review, Vol. 6, No. 4, pp. 361–386.
Search in Google Scholar Back to article
Coviello, N. E., McAuley, A. (1999), Internationalization and the smaller firm: a review of contemporary empirical research, Management International Review, Vol. 39, No. 3, pp. 223–256.
Search in Google Scholar Back to article
Dimitratos, P., Amoros, J. E., Etchebarne, M. S., Felzensztein, Ch. (2014), Micro-multinational or not? International Entrepreneurship, networking, and learning effects, Journal of Business Research, Vol. 67, pp. 908–915.
Search in Google Scholar Back to article
Dimitratos, P., Johnson, J. E., Slow, J., Young, S. (2003), Micro-multinationals: New types of firms for the global competitive landscape, European Management Journal, Vol. 21, No. 2, pp. 164–174.
Search in Google Scholar Back to article
Dunning, J. H. (1988), The eclectic paradigm of international production: a restatement and some possible extensions, Journal of International Business Studies, Vol. 19, No. 1, pp. 1–31.
Search in Google Scholar Back to article
Ebben, J., Johnson, A. (2005), Efficiency, Flexibility, or Both? Evidence Linking Strategy to Performance in Small Firms, Strategic Management Journal, Vol. 26, pp. 1249–1259.
Search in Google Scholar Back to article
European Commission (2015), Internationalisation of small and medium sized enterprises, Flash Eurobarometer 421.
Search in Google Scholar Back to article
Hennart, J-F., Slangen, A. (2014), Yes, we really do need more entry mode studies! A commentary on Shaver, Journal of International Business Studies, Vol. 46, pp. 114–122.
Search in Google Scholar Back to article
HSBC (2016), The rise of micro-multinationals, HSBC Commercial Banking.
Search in Google Scholar Back to article
Ibeh, K., Johnson, J., Dimitratos, P. et al. (2004), Micromultinationals: Some Preliminary Evidence on an Emergent ‘Star’ of the International Entrepreneurship Field, Journal of International Entrepreneurship, Vol. 2, pp. 289–303.
Search in Google Scholar Back to article
Johanson J., Vahlne, J. E. (1977), The Internationalization Process of the Firm: a Model of Knowledge Development and Increasing Foreign Market Commitments, Journal of International Business Studies, Vol. 8, No. 1, pp. 23–32.
Search in Google Scholar Back to article
Johanson, J., Vahlne, J-E. (2009), The Uppsala Internationalization Process Model Revisited – From liability of foreignness to liability of outsidership, Journal of International Business Studies, Vol. 40, No. 9, pp. 1411–1431.
Search in Google Scholar Back to article
Jones, M. V., Coviello, N., Tang, Y. K., (2011), International entrepreneurship research (1989–2009): A domain ontology and thematic analysis, Journal of Business Venturing, Vol. 26, pp. 632–659.
Search in Google Scholar Back to article
Kacprzyk, A., Doryń, W., (2014), Innovation and economic growth in European Union. Panel data analysis, Lodz Economics Working Papers, No. 4/2014.
Search in Google Scholar Back to article
Laufs, K., Bembom, M., Schwens, Ch., (2016), CEO characteristics and SME foreign market entry mode choice: The moderating effect of firm’s geographic experience and host-country political risk, International Marketing Review, Vol. 33, No. 2, pp. 246–275.
Search in Google Scholar Back to article
Laufs, K., Schwens, Ch. (2014), Foreign Market Entry Mode Choice of SMEs: A Systematic Review and Future Research Agenda, International Business Review, Vol. 23, No. 6, pp. 1109–1126.
Search in Google Scholar Back to article
Li, J., Zhong, J. (2003), Explaining the growth of international R&D alliances in China, Managerial and Decision Economics, Vol. 24, pp. 101–115.
Search in Google Scholar Back to article
Lichtenthaler, U., Lichtenthaler, E. (2004), Alliance functions: implications of the international multi-R&D-alliance perspective, Technovation, Vol. 24, pp. 541–552.
Search in Google Scholar Back to article
Lu, J., Beamish, P. (2001), The internationalisation and performance of SMEs, Strategic Management Journal, Vol. 22, pp. 565–586.
Search in Google Scholar Back to article
Matherws, J., Zander, I. (2007), The international entrepreneurial dynamics of accelerated internationalisation, Journal of International Business Studies, Vol. 38, No. 3, pp. 387–403.
Search in Google Scholar Back to article
Medina, J. C., Ramirez, A. M., Noriega, C. (2013), Use and Perception of Digital Marketing Tools for Micro-Enterprises in Tijuana, Management Dynamics in the Knowledge Economy, Vol. 1, No. 3, pp. 347–365.
Search in Google Scholar Back to article
Mittelstaedt, J. D., Harben, G. N., Ward, A. W. (2003), How small is too small? Firm size as a barrier to exporting firms from the United States, Journal of Small Business Management, Vol. 41, No. 1, pp. 68–84.
Search in Google Scholar Back to article
Mroczek, K. (2014), Transaction cost theory – explaining entry mode choices, Poznan University of Economics Review, Vol. 14, No. 1, pp. 48–62.
Search in Google Scholar Back to article
North, D. (1990), Institutions, institutional change and economic performance, Cambridge University Press, Cambridge.10.1017/CBO9780511808678
Search in Google Scholar Back to article
Oviatt, B. M., McDougall, P. P. (1994), Toward a Theory of International New ventures, Journal of International Business Studies, Vol. 25, No. 1, pp. 45–64.
Search in Google Scholar Back to article
Prashantham, S. (2011), Social Capital and Indian Micromultinationals, British Journal of Management, Vol. 22, No. 1, pp. 4–20.
Search in Google Scholar Back to article
Ramachandran J., Pant A. (2010), The liabilities of origin: an emerging economy perspective on the cost of doing business abroad, in Devinney T., Pedersen T., Tihanyi L. (eds.), The Past, Present, and Future of International Business and Management, Emerald, Bingley, pp. 231–265.10.1108/S1571-5027(2010)00000230017
Search in Google Scholar Back to article
Ruzzier, M., Hisrich, R., Antoncic, B. (2006), SME internationalization research: past, present, and future, Journal of Small Business and Enterprise Development, Vol. 13, No. 4, pp. 476–497.
Search in Google Scholar Back to article
Scott, W. R. (1995), Institutions and organisations, Sage, London.
Search in Google Scholar Back to article
Shi, Y., Ho, P., Siu, W. (2001), Market Entry Mode Selection: The Experience of Small Hong Kong Firms Investing in China, Asia Pacific Business Review, Vol. 8, No. 1, pp. 19–41.
Search in Google Scholar Back to article
UNCTAD (2016), World Investment Report 2015.
Search in Google Scholar Back to article
Vasilchenko, E., Morrish, S. (2011), The Role of Entrepreneurial Networks in the Exploration and Exploitation of Internationalization Opportunities by Information and Communication Technology Firms, Journal of International Marketing, Vol. 19, No. 4, pp. 88–105.
Search in Google Scholar Back to article
Williamson, O. E. (1985), The Economic Institutions of Capitalism: Firms, Markets, Relational Contracting, Free Press; Collier Macmillan, London.
Search in Google Scholar Back to article

Organisational-Level Attributes of Micro-Multinationals. The Evidence From European SMEs

Abstract

Paradigm

My account