Abstract
The choice of entry mode in foreign markets is an important strategic decision with major consequences for the success in international new ventures (INVs). It is generally accepted that these firms choose relatively low-commitment entry modes to operate in foreign markets. Nevertheless, this study extends previous international entrepreneurship research, including insights on antecedents of international new ventures’ choice of higher commitment entry modes in foreign markets. The paper also goes further than previous international entrepreneurship research, by addressing the strategic consequences of rapid entry into foreign markets. Additionally, the results of this work encourage international entrepreneurs to look beyond the explicit value of experiential market knowledge to realize the potential value of international market orientation as an antecedent to higher commitment entry modes. The model proposes a positive effect of entrepreneurial orientation and early international entry on international market orientation which, in turn, is positively related to higher commitment entry modes. The hypotheses were tested on country-level data from Spain, using a structural equation model to analyze relationships between the latent variables.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
References
Armstrong, J. S. and T. S. Overton. 1977. “Estimating Non-Response Bias in Mail Surveys.” Journal of Marketing Research 16 (August): 396-402.
Armario, J. M., Ruiz, D. M. and E. M. Armario. 2008. “Market Orientation and Internationalization in Small and Medium-Sized Enterprises.” Journal of Small Business Management 46 (4): 485-511.
Aspelund, A., Madsen, T. K. and O. Moen. 2007. “A Review of the Foundation, International Marketing Strategies, and Performance of International New Ventures.” European Journal of Marketing 41 (11/12): 1423-1448.
Atuahene-Gima, K. and A. Ko. 2001. “An Empirical Investigation of the Effect of Market Orientation and Entrepreneurship Orientation Alignment on Product Innovation.” Organization Science 12 (2): 54-74.
Autio, E. 2005. “Creative Tension: The Significance of Ben Oviatt’ and Patricia Mcdougall’ Article: Toward a Theory of International New Ventures.” Journal of International Business Studies 36: 9-19.
Barringer, B. R. and A. C. Bluedorn. 1999. “The Relationship Between Corporate Entrepreneurship and Strategic Management.” Strategic Management Journal 20: 421-444.
Becherer, R. C. and J. G. Maurer. 1997. “The Moderating Effect of Environmental Variables on the Entrepreneurial and Marketing Orientation of Entrepreneur-Led Firms.” Entrepreneurship: Theory & Practice 22 (1): 47-59.
Bell, J., Crick, D. and S. Young. 2004. “Small Firm Internationalization and Business Strategy - An Exploratory Study of ‘Knowledge-Intensive’ and ‘Traditional’ Manufacturing Firms in the UK.” International Small Business Journal 22 (1): 23-56.
Bilkey, W. J. and G. Tesar. 1977. “The Export Behaviour of Smaller-Sized Wisconsin Manufacturing Firms.” Journal of International Business Studies 8 (1): 93-98.
Blesa, A. and E. Bigné. 2005. “The Effect of Market Orientation on Dependence and Satisfaction in Dyadic Relationships.” Marketing Intelligence & Planning 23 (3): 249-265.
Blomstermo, A., Eriksson, K. and D. D. Sharma. 2004. “Domestic Activity and Knowledge Development in the Internationalization Process of Firms.” Journal of International Entrepreneurship 2: 239-258.
Brouthers, K. D. 2002. “Institutional, Cultural and Transaction Cost Influences on Entry Mode Choice and Performance.” Journal of International Business Studies 33 (2): 203-221.
Brouthers, L. N. and G. Nakos. 2004. “SME International Entry Mode Choice and Performance: A Transaction Cost Perspective.” Entrepreneurship Theory & Practice 28 (3): 229-247.
Burgel, O. and G. C. Murray. 2000. “The International Market Entry Choices of Start-Up Companies in High Technology Industries.” Journal of International Marketing 8 (2): 33-62.
Cavusgil, T. 1980. “On the Internationalization Process of Firms.” European Research 8 (November): 273-281.
Chetty, S. and C. Campbell-Hunt. 2004. “A Strategic Approach to Internationalisation: A Traditional Versus ‘Born Global’ Approach.” Journal of International Marketing 12 (1): 57-81.
Cohen, W. M. and D. A. Levinthal. 1990. “Absorptive Capacity: A New Perspective on Learning and Innovation.” Administrative Science Quarterly 35: 128-152.
Coviello, N. E. 2006. “The Network Dynamics of International New Ventures.” Journal of International Business Studies 37 (5): 713-731.
Coviello, N. E. and M. V. Jones. 2004. “Methodological Issues in International Entrepreneurship Research.” Journal of Business Venturing 19 (4): 485-508.
Coviello, N. E. and H. J. Munro. 1995. “Growing the Entrepreneurial Firm Networking for International Market Development.” European Journal of Marketing 29 (7): 49-61.
Coviello, N. E. and H. J. Munro. 1997. “Network Relationships and the Internationalization Process of Small Software Firms.” International Business Review 6 (4): 361-86.
Covin, J. G., Green, K. M. and D. P. Slevin. 2006. “Strategic Process Effects on the Entrepreneurial Orientation-Sales Growth Rate Relationship.” Entrepreneurship Theory & Practice 30 (1): 57-81.
Covin, J. G. and M. P. Miles. 1999. “Corporate Entrepreneurship and the Pursuit Competitive.” Entrepreneurship Theory and Practice 23 (3): 47-64.
Covin, J. G. and D. P. Slevin. 1989. “Strategic Management of Small Firms in Hostile and Benign Environments.” Strategic Management Journal 10: 75-87.
Davidsson, P. 2004. “Scott Shane, A General Theory of Entrepreneurship: The Individual Opportunity Nexus (Book).” International Small Business Journal 22 (2): 206-209.
De Clercq, D., Sapienza, H. J. and H. Crijins. 2005. “The Internationalization of Small and Medium-Sized Firms.” Small Business Economics 24: 409-419.
Deshpandé, R., Farley, J. and F. Webster. 1993. “Corporate Culture, Customer Orientation, and Innovativeness in Japanese Firms: A Quadrad Analysis.” Journal of Marketing 57 (1): 23-37.
Dess, G., Lumpkin, G. and J. Covin. 1997. “Entrepreneurial Strategy Making and Firm Performance: Tests of Contingency and Configurational Models.” Strategic Management Journal 18 (1): 2-23.
Dickson, P. and K. Weaver. 1997. “Environmental Determinants and Individual-Level Moderators of Alliance Use.” Academy of Management Journal 40: 404-425.
Ekeledo, I. and K. Sivakumar. 2004. “International Market Entry Mode Strategies of Manufacturing Firms and Service Firms.” International Marketing Review 21 (1): 68-101.
Elg, U. 2002. “Inter-Firm Market Orientation: Its Significance and Antecedents in Distribution Networks.” Journal of Marketing Management 18 (7/8): 633-656.
Elg, U. 2007. “Market Orientation as Inter-Firm Cooperation: An International Study of the Grocery Sector.” European Management Journal 25 (4) : 283-297.
Erramili, M. K. and C. P. Rao. 1993. “Service Firms’ Internacional Entry-Mode Choice: A Modified Transaction Cost Analysis Approach.” Journal of Marketing 57 (July): 19-38.
Etemad, H. and R. Wright. 2003. “Internationalization of SMEs: Toward a New Paradigm.” Small Business Economics 20: 14.
Ghauri, P. N., Tarnovskaya, V. and U. Elg. 2008. “Market Driving Multinationals and their Global Sourcing Network.” International Marketing Review 25 (5): 504-519.
Gleason, D. C. and J. Wiggenhorn. 2007. “Born Globals, the Choice of Globalization Strategy, and the Market’ Perception of Performance.” Journal of World Business 42 (3): 322-335.
Green, K. M., Covin, J. G. and D. P. Slevin. 2008. “Exploring the Relationship between Strategic Reactiveness and Entrepreneurial Orientation: The Role of Structure-Style Fit.” Journal of Business Venturing 23 (3): 356-383.
Hambrick, D. C. 1981. “Specialization of Environmental Scanning Activities among Upper Level Executives.” Journal of Management Studies 18 (3): 299-320.
Hashai, N. and T. Almor. 2004. “Gradually Internationalising “Born Global” Firms: An Oxymoron?” International Business Review 13: 465-483.
Hessels, J. and A. Van Stel. 2007. Export Orientation Among New Ventures and Economic Growth. Erasmus Research Institute of Management (ERIM) Report Series 2007-008, Erasmus University Rotterdam, Rotterdam.
Hessels, J. and S. Terjesen. 2010. “Resource Dependency and Institutional Theory Perspectives on Direct and Indirect Export Choices.” Small Business Economics 34 (2): 203-220.
Hildebrant, L. 1987. “Consumer Retail Satisfaction in Rural Areas: A Reanalysis of Survey Data.” Journal of Economic Psychology 8: 19-42.
Hill, C. W. L., Hwang, P. and W. C. Kim. 1990. “An Eclectic Theory of the Choice of International Entry Mode.” Strategic Management Journal 11 (2): 117-128.
Jantunen, A., Puumalainen, K., Saarenketo, S. and K. Kyläheiko. 2005. “Entrepreneurial Orientation, Dynamic Capabilities and International Performance.” Journal of International Entrepreneurship 3 (3): 223-243.
Johanson, J. and J. E. Vahlne. 1977. “The Internationalization Process of the Firm: A Model of Knowledge Development and Increasing Foreign Market Commitment.” Journal of International Business Studies 8 (1): 23-32.
Johanson, J. and J. E. Vahlne. 1990. “The Mechanism of Internationalization.” International Marketing Review 7 (4): 11-24.
Jones, M. V. and S. Young. 2009. “Does Entry Mode Matter? Reviewing Current Themes and Perspectives.” In M.V. Jones, P. Dimitratos, M. Fletcher & S. Young (Eds.), Internationalization Entrepreneurship and the Smaller Firm. Evidence from Around the World (pp. 6-19). Cheltenham: Edward Elgar.
JÖreskog, K. G. and D. SÖrbom. 1993. LISREL 8. Structural Equation Modeling with the SIMPLIS Command Language. Hillsdale: Scientific Software.
Kalantaridis, C. 2004. “Internationalization, Strategic Behaviour, and the Small Firm: A Comparative Investigation.” Journal of Small Business Management 43 (3): 245-262.
Keh, H. T., Nguyen, T. T. M. and H. P. Ng. 2007. “The Effects of Entrepreneurial Orientation and Marketing Information on the Performance of SMEs.” Journal of Business Venturing 22 (4): 592-611.
Kim, W. C. and P. Hwang. 1992. “Global Strategy and Multinationals’ Entry Mode Choice.” Journal of International Business Studies 23 (1): 29-54.
Knight, G. 2000. “Entrepreneurship and Marketing Strategy: The SME Under Globalization.” Journal of International Marketing 8 (2): 12-32.
Knight, G. A. and S. T. Cavusgil. 2004. “Innovation, Organizational Capabilities, and the Born-Global Firm.” Journal of International Business Studies 35: 124-141.
Kohli, A. K., Jaworski, B. J. and A. Kumar. 1993. “MARKOR: A Measure of Market Orientation.” Journal of Marketing Research 30 (4): 467-477.
Kreiser, P. M., Marino, L. D. and K. M. Weaver. 2002. “Assessing the Psychometric Properties of the Entrepreneurial Orientation Scale: A Multi-Country Analysis.” Entrepreneurship: Theory and Practice 26: 71-92.
Kuivalainen, D., Sundqvist, S. and P. Servais. 2007. “Firms’ Degree of Born-Globalness, International Entrepreneurial Orientation and Export Performance.” Journal of World Business 42 (3): 253-267.
Laanti, R., Gabrielsson, M. and P. Gabrielsson. 2007. “The Globalization Strategies of Business-to-Business Born Global Firms in the Wireless Technology Industry.” Industrial Marketing Management 36 (8): 1104-117.
Liu, S. S., Luo, X. and Y. Shi. 2003. “Market-oriented Organizations in an Emerging Economy: A Study of Missing Links.” Journal of Business Research 56 (June): 481-491.
Loane, S. and J. Bell. 2006. “Rapid Internationalisation among Entrepreneurial Firms in Australia, Canada, Ireland and New Zealand.” International Marketing Review 23 (5): 467-485.
Lumpkin, G. T. and G. G. Dess. 1996. “Enriching the Entrepreneurial Orientation Construct - A Reply to Entrepreneurial Orientation or Pioneer Advantage.” Academy of Management 21 (3): 605-607.
Luo, Y. 2001. “Equity Sharing in International Joint Ventures: An Empirical Analysis of Strategic and Environmental Determinants.” Journal of International Management 7: 31-58.
Lyon, D. W., Lumpkin, G. T. and G. G. Dess. 2000. “Enhancing Entrepreneurial Orientation Research: Operationalizing and Measuring a Key Strategic Decision Making Process.” Journal of Management 26: 1055-1085.
Madhok, A. 1998. “The Nature of Multinational Firm Boundaries: Transaction Costs, Firm Capabilities and Foreign Market Entry Mode.” International Business Review 7 (3): 259-290.
Madsen, T. K. and P. Servais. 1997. “The Internationalization of Born Globals: An Evolutionary Process?” International Business Review 7: 561-583.
Matsuno, K., Mentzer, J. T. and A. Özsomer. 2002. “The Effects of Entrepreneurial Proclivity and Market Orientation on Business Performance.” Journal of Marketing 66: 18-32.
McDougall, P. P. and B. M. Oviatt. 1996. “New Venture Internationalization, Strategic Change, and Performance: A Follow-Up Study.” Journal of Business Venturing 11 (1): 23-40.
McDougall, P. P., Shane, S. and B. M. Oviatt. 1994. “Explaining the Formation of International New Ventures: The Limits of Theories from International Business Research.” Journal of Business Venturing 9: 469-487.
Menon, A. and R. Varadarajan. 1992. “A Model of Marketing Knowledge Use Within Firms.” Journal of Marketing 56 (4): 53-71.
Milanow, H. and S. A. Fernhaber. 2009. “The Impact of Early Imprinting on the Evolution of New Venture Networks.” Journal of Business Venturing 24: 46-61
Miller, D. 1983. “The Correlates of Entrepreneurship in Three Types of Firms.” Management Science 29: 770-791.
Nakos, G. and K. D. Brouthers. 2002. “Entry Mode Choice of SMEs in Central and Eastern Europe.” Entrepreneurship Theory and Practice 27 (1): 47-64.
Narver, J. C. and S. F. Slater. 1990. “The Effect of Market Orientation on Business Profitability.” Journal of Marketing 54 (4): 20-35.
Nelson, R. R. and S. G. Winter. 1982. An Evolutionary Theory of Economic Change. Cambridge: Belknap Press.
Nonaka, I. 1994. “A Dynamic Theory of Organizational Knowledge Creation.” Organization Science 5 (1): 14-37.
Nunnally, J. 1979. Psychometric Theory. New York: McGraw-Hill.
Ocasio, W. 1997. “Towards an Attention-Based View of the Firm.” Strategic Management Journal 18: 187-206.
O’cass, A and D. Liem Viet Ngo. 2007. “Market Orientation Versus Innovative Culture: Two Routes to Superior Brand Performance.” European Journal of Marketing 41 (7/8): 868-887.
Oviatt, B. M. and P. P. McDougall. 1994. “Toward a Theory of International New Ventures.” Journal of International Business Studies 25: 45-64.
Oviatt, B. M. and P. P. McDougall. 2005. “Defining International Entrepreneurship and Modelling the Speed of Internationalization.” Entrepreneurship: Theory and Practice 29 (5): 537-553.
Pan, Y. and D. Tse. 2000. “The Hierarchical Model of Market Entry Modes.” Journal of International Business Studies 31: 535-554.
Pehrsson, A. 2007. “The Strategic States Model: Strategies for Business Growth.” Business Strategy Series 8 (1): 58-63.
Peteraf, M. A. and Bergen, M. E. 2003. “Scanning Dynamic Competitive Landscapes: A Market-Based and Resource-Based Framework.” Strategic Management Journal 24 (10): 1027-1021.
Podsakoff, P. M., Mackenzie, S. B., Lee, J. and N. Podsakoff. 2003. “Common Method Biases in Behavioral Research: A Critical Review of the Literature and Recommended Remedies.” Journal of Applied Psychology 88: 879-903.
Prashantham, S. 2005. “Toward a Knowledge-Based Conceptualisation of Internationalisation.” Journal of International Entrepreneurship 3 (1): 37-52.
Rialp, A., Rialp, J. and G. Knight. 2005. “The Phenomenon of Early Internationalizing Firms: What Do We Know After a Decade (1993-2003) of Scientific Inquiry?” International Business Review 14 (2): 147-166.
Sapienza, H. J., Clercq, D. and W. R. Sandberg. 2005. “Antecedents of International and Domestic Learning Effort.” Journal of Business Venturing 20: 437-457.
Sharma, D. D. and A. Blomstermo. 2003. “The Internationalization Process of Born Globals: A Network View.” International Business Review 12: 739-753.
Slater, S. F. and J. C. Narver. 1995. “Market Orientation and the Learning Organization.” Journal of Marketing 59: 63-74.
Teece, D., Pisano, G. and A. Shuen. 1997. “Dynamic Capabilities and Strategic Management.” Strategic Management Journal 18 (7): 509-533.
Trulsson, P. 2002. “Constraints of Growth-Oriented Enterprises in the Southern and Eastern African Region.” Journal of Developmental Entrepreneurship 7( 3): 331-340.
Wagner, H. 2004. “Internationalization Speed and Cost Efficiency: Evidence from Germany.” International Business Review 13: 447-463.
Weerawardena, J. and A. O’cass. 2004. “Exploring the Characteristics of the Market-Driven Firms and Antecedents to Sustained Competitive Advantage.” Industrial Marketing Management 33(5): 419-428.
Weerawardena, J., Mort, G. S., Liesch, P. W. and G. Knight. 2007. “Conceptualizing Accelerated Internationalization in the Born Global Firm: A Dynamic Capabilities Perspective.” Journal of World Business 42 (3): 294-306.
Wei, Y., Liu, B. and X. Liu. 2005. “Entry Modes of Foreign Direct Investment in China: A Multinomial Logit Approach.” Journal of Business Research 58 (11): 1495-1505.
Westhead, P., Wright, M., Ucbasaran, D. and F. Martin. 2001. “International Market Selection Strategies of Manufacturing and Services Firms.” Entrepreneurship Regional Development 13: 17-46.
Wiklund, J. and D. A. Shepherd. 2003. “Knowledge-Based Resources, Entrepreneurial Orientation, and the Performance of Small and Medium-Sized Businesses.” Strategic Management Journal 24: 1307-1314.
Wiklund, J. and D. A. Shepherd. 2005. “Entrepreneurial Orientation and Small Firm Performance: A Configurational Approach.” Journal of Business Venturing 20 (1): 71-91.
Zaheer, S. 1995. “Overcoming the Liability of Foreignness.” Academy of Management Journal 38 (2): 341-363.
Zahra, S. A. 2005. “A Theory of International New Ventures: A Decade of Research.” Journal of Int.Business Studies 36 (1): 20-28.
Zahra, S. A. and G. George. 2002. “Absorptive Capacity: A Review, Reconcepualisation, and Extension.” Academy of Management Review 27 (2): 185-203.
Zahra, S. A, Ireland, R. D. and M. A. Hitt. 2000. “International Expansion by New Venture Firms: International Diversity, Mode of Market Entry, Technological Learning, and Performance.” Academy of Management Journal 43 (5): 925-950.
Zahra, S. A., Jennings, D. F. and D. F. Kuratko. 1999. “The Antecedents and Consequences of Firm-Level Entrepreneurship: The State of the Field Entrepreneurship.” Entrepreneurship: Theory and Practice 24 (2): 45-66.
Zheng, C. and S. Kavul. 2005. “Capability Development, Learning and Growth in International Entrepreneurial Firms: Evidence from China.” In Shepherd D.A., Katz J.A. (Eds.), International Entrepreneurship (pp. 273-296). London: Elsevier.
Author information
Authors and Affiliations
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2017 Academy of Marketing Science
About this paper
Cite this paper
Tirado, D.M., Pérez, A.B., Meliá, M.R. (2017). Higher Commitment Entry Modes in International New Ventures: The Influence of Strategical Orientations. In: Campbell, C.L. (eds) The Customer is NOT Always Right? Marketing Orientationsin a Dynamic Business World. Developments in Marketing Science: Proceedings of the Academy of Marketing Science. Springer, Cham. https://doi.org/10.1007/978-3-319-50008-9_38
Download citation
DOI: https://doi.org/10.1007/978-3-319-50008-9_38
Publisher Name: Springer, Cham
Print ISBN: 978-3-319-50006-5
Online ISBN: 978-3-319-50008-9
eBook Packages: Business and ManagementBusiness and Management (R0)