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

1. Internationalization and
network development
Mariia Kreposna

2. 1. Updated (2009) Uppsala model
2. Born Global vs Process Model
3. Channels, Distributors, Agents
4. Managerial implications
Contents

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. 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. Geographical market
Size of investment
Organizational changes
Access to resources
The NETWORK
determines…

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. Born Globals
Technology
Short time -> global
50% foreign sales
Strategy

8. Behavioral approach
Stage pattern
Test markets
Minimize risk
Process Model

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. Business network…
… the bridge to foreign markets

11. Channels
MNCs as
integrator
MNCs as
distributor
Network Internet
Combina
tion

12. Provide
Facilitate
Enhance
Help
Agent’s role
information, structure / infrastructure
communication, interpretation,
understanding
learning
building-up image and reputation

13. Factors
of
globalisa
tion
Knowledge
The best one/
combination
MNC
Agent
Subsidiary
Theories
Partners

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. KEEP
CALM
and
MANAGE
NETWORKS