Factors Of Internationalization

1280 Words6 Pages
1. Introduction
Globalization of economy and the aggressive competition motivate companies to explore ways of internationalization and contribute significantly to nation 's economic development. During last decades, various scholars had examined Internationalization as a phenomenon from different point of views, such as strategic management, international management and small business management (Korsakienė & Tvaronavičienė, 2012). Firms internationalization is considered an important measure of competitive performance at both national and regional levels. Internationalization participates in revenue growth of the firms as a result of economic scale and scope, management knowledge and manufacturing efficiency (Korsakiene, 2014). The internationalization
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SMEs are dynamic, flexible and have a significant role in job creation. Due to economic internationalization and process of globalization, SMEs are faced with international competition and pushed to compete in international markets. An increasing number of SMEs are aiming to take advantage of new conditions and starting to enter new markets (Daszkiewicz & Wach, 2012).

The contributions of SMEs to country’s economic growth makes the study on the internationalization of SMEs very popular among researchers. There are many studies conducted on SMEs internationalization from various perspectives and among them are the process of internationalization, factors for internationalization and barriers to internationalization. Various definitions of internationalization were being used by researchers and it varies depending on the interest and phenomenon of the study (Abdullah & Zain, 2011).

Expanding to international markets presents an essential opportunity for growth and value creation and exposes unique challenges in addition to common challenges in domestic markets. Therefore the scholars concentrating on the issues of internationalization have strived to characterize the main motives and barriers of internationalization (Korsakienė & Tvaronavičienė,
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There is no general agreement on the internationalization definition beyond the indication of increasing the firm involvement in international operations. Thus, a universal accepted definition of "Internationalization" is elusive. This led to a different interpretations of this concept being found in the literature. Rational economic analysis explains that the internationalization is a pattern of investment in foreign markets. Another traditional perspective considers this phenomenon as an on-going process of evolution whereby the firm increases its international involvement as a function of increased knowledge and market commitment. This is a sequential learning process of increased international involvement and gradual resource commitment. Recently, strategic process-based view of internationalization has emerged. Welch and Luostarinen defined the internationalization as "the process of increasing involvement in international operations", which can be treated both at the level of particular national economies as well as particular companies. In this context, Calof and Beamish define internationalization as "the process of adapting firm 's operations (strategy, structure, resources) to international environments". In the same line, Andersen conceptualizes it as "the process of adapting exchange transaction modality to international market" (Rialp & Rialp,
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