The document discusses the concept of "born global" firms. It defines born globals as businesses that seek international sales and resources from inception. The rise of born globals represents a new era of rapid globalization and internationalization among small firms. Factors driving this change include new technologies, global markets, internationally-mobile human capital, and managers with international experience. The document examines definitions, characteristics, and implications of born globals, proposing they be considered uniquely in internationalization theory and policy support programs.

1. Expert: Marcello EUSANI
The Born Global
concept:
The rise of a new regime in
trade, commerce &
internationalization of firms?

2. DEFINITIONS
PROPOSALS
CONCLUSIONS
BORN GLOBALSBORN GLOBALS
Project

3. DEFINITIONSDEFINITIONS
Project

4. History of the Born Global conceptHistory of the Born Global concept
Project
 The ‘Born Global’ concept was coined in a survey for The Australian
Manufacturing Council by the McKinsey Consultants
 In Australia, a new breed of exporting companies, which contributed
substantially to the nation's export capital, was then emerging. The
creation of these exporters though not unique to the Australian
economy, reflects 2 fundamental phenomena of the 1990s:
1.Small is beautiful
2.Gradual internationalization is dead

5. BORN GLOBALBORN GLOBAL
Project
 The Australian project consisted of an analysis of new exporters
amongst the small and medium sized manufacturing firms. This
meant that the focus was not on new – entrepreneurial – firms as
shown in other researches
but on firms, which have recently begun to export
 the focus was on companies with growing export within the last 5
years before the survey was conducted: the so-called emerging
exporters

6. BORN GLOBALBORN GLOBAL
the Australian casethe Australian case
Project
 Amongst the Born Global firms, in Australia, there are several high-
tech firms, but the typical firm uses well-known technology
 These firms have experienced higher growth rates than other
industries in Australia and a large growth in their export compared to
their home-market sales
 A major factor in the explanation of the Born Global phenomenon
(McKinsey & Co., 1993) is the management’s commitment to
internationalization
 Another major factor is the firm’s ability to standardize production,
marketing, etc. in a global niche instead of developing customized
products

7. Outdated internationalization pathOutdated internationalization path
Project
new types of international firms: export behavior
and internationalization processes of firms
firm is assumed to build a stable domestic position
before starting international activities

8. Causes of new regimeCauses of new regime
Project
• Dramatic increases in speed, quality and efficiency of international
communication and transportation have reduced the transaction costs
of multinational interchange
• Increasing homogenization of many markets in distant countries has
made the conduct of international business easier to understand by
everyone
• Upshot of business executives and entrepreneurs exposed to
international business
• International financing opportunities are increasingly available
• Human capital is internationally mobile
• Internationally sustainable advantage is increasingly recognized to
depend on the possession of unique assets
• Valuable unique assets permit firms with more constrained resources
to enter the international arena
• Rush to emerging markets

9. New wave of globalizationNew wave of globalization
Project
- Firms are often reported to start international activities right from their
birth, to enter very distant markets right away, to enter multiple countries
at once, to form joint ventures without prior experience
- High risk, high-potential economies
- SMEs that have provided much growth in international trade and
investment:
• Middle class owned businesses
• Family conglomerates
• Formidable incumbents or powerful partners
- The explanation for this new picture of internationalization of firms is
claimed to be more global market conditions, new developments in
transportation and communication technologies, and the rising number of
people with international experience

10. BORN GLOBALSBORN GLOBALS
Project
 We define an international new venture as a business organization
that, from inception, seeks to derive significant competitive advantage
from the use of resources and the sale of outputs in multiple countries
 The distinguishing feature of these start-ups is that their origins are
international, as demonstrated by observable and significant
commitments of resources (e.g. material, people, financing, time) in
more than one nation

11. BORN GLOBALSBORN GLOBALS
consequences for the management of theconsequences for the management of the
internationalization of small firmsinternationalization of small firms
Project
 export promotion policy
 development towards new organizational forms
 the rapid internationalization of new firms (as we see in the Born
Globals, the International New Ventures, etc) is just a part of
changed management discourse due to changed environmental
settings

12. PROPOSALSPROPOSALS
Project

13. BORN GLOBALSBORN GLOBALS
their identificationtheir identification
Project
categorize such firms as something unique from a managerial point of
view
see the issue with regard to governmental support programs
include infant multinationals with lack of long-standing administrative
heritage

14. BORN GLOBALSBORN GLOBALS
Project
“…when studying a Born Global firm, the time perspective should be
extended beyond its birth
 Probably, many of its ”genes” have roots back to firms and networks in
which its founder(s) and top managers gained industry experience
Basically, in many instances it may be doubtful whether a Born Global
can be considered a new company
In a legal sense the company may be new, but were its skills and
capabilities not often born and matured prior to its legal birth?”

15. BORN GLOBALSBORN GLOBALS
nowadaysnowadays
Project
A large and increasing number of firms can be classified as Born
Globals
The Born Global phenomenon presents an important next challenge
to traditional internationalization theory
Newly established firms are important in terms of generating
innovation and developing competitive economies

16. CONCLUSIONSCONCLUSIONS
Project

17. INNOVINT & BGINNOVINT & BG
Project
• Born globals are growth-oriented
• Potential for extreme high growth
• Managers of such firms face challenges related to the development of
products, recruitment, finance and international sales within a short
period of time
• Policy regarding export promotion initiatives may have significant
influence upon the development of born globals

18. Why should we studyWhy should we study
Born Global firms?Born Global firms?
Project
1. to learn how to manage the internationalization of a small firm,
e.g. cross-cultural problems, market expansion and export mode
2. to understand the societal aspect of internationalization – often
raised as a question of export promotion programs
3. to realize that gradual internationalization is dead

19. Born Global & INNOVINTBorn Global & INNOVINT
Project
1. Why do we suddenly find a large group of firms, which are highly
internationally active right from the foundation of the firm?
2. How is the Born Global phenomenon connected to other trends in
the international business environment, e.g. the rapid
internationalization of markets, hypercompetition and the change to
an information intensive economy?

20. Which public tools?Which public tools?
Project
 National or European innovation or SME supporting measures don’t
address the needs of high growth firms in general
 Newly established, internationally focused firms are an important
target group
 What kind of support schemes for born globals as many important
variables change fast in global markets
 Born global firms point to marketing competence as a major
competitive weakness

21. Settore Attività Economiche
e Innovazione
Servizio Politiche per l’Innovazione
e lo Sviluppo Locale
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