Internationalization and network development

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Theoretical & managerial implications of internationalization process. Comparison of opposite approaches: Uppsala process model vs Born Gobals

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Internationalization and network development

  1. 1. Internationalization and network development Mariia Kreposna
  2. 2. 1. Updated (2009) Uppsala model 2. Born Global vs Process Model 3. Channels, Distributors, Agents 4. Managerial implications Contents
  3. 3. Revised Uppsala internationalization model Single company analysis Company usually a producer Stages, decision making Multiple company analysis The network and relationships within it Nodes and threads, actors/activities/resources
  4. 4. Revised Uppsala internationalization process model • Interaction • Knowledge • Outperforming competitors • Individual & organizational learning Knowledge • Strengthening or weakening the network Commitment • Domestic and foreign networks Opportunity development • Technical • Legal • Economic • Personal ties Trust
  5. 5. Geographical market Size of investment Organizational changes Access to resources The NETWORK determines…
  6. 6. Relationship commitment Learning Creating Trust building Commitment decisions Market knowledge Market commitment Current activities State Change Network position The basic mechanism of internationalization: state and change aspects (Johanson & Vahlne 1977: 26) Knowledge Opportunities
  7. 7. Born Globals Technology Short time -> global 50% foreign sales Strategy
  8. 8. Behavioral approach Stage pattern Test markets Minimize risk Process Model
  9. 9. Born Global Firm Process Model Market International Home Experience No Yes Extend of int. Many markets Stepwise penetration Strategy Full internationalization Int. is not the core Information communications to reach market Not so important Time to internationalize Quick (0-3 years) Slow, time is not important
  10. 10. Business network… … the bridge to foreign markets
  11. 11. Channels MNCs as integrator MNCs as distributor Network Internet Combina tion
  12. 12. Provide Facilitate Enhance Help Agent’s role information, structure / infrastructure communication, interpretation, understanding learning building-up image and reputation
  13. 13. Factors of globalisa tion Knowledge The best one/ combination MNC Agent Subsidiary Theories Partners
  14. 14. Entrepreneurial outlook • Calculate risks • Be proactive • Flexibility as asset Managerial outlooks Drivers for internationalization • Customer driven • Provider driven • Increase profits Regional issues • Government control • Environment stability
  15. 15. KEEP CALM and MANAGE NETWORKS

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