Understanding decision making in internationalizing small and medium-sized firms
Description
Despite widespread research on the internationalization of firms, few integrative studies in relation to the decision-making process before internationalization takes place exist in the literature. This study suggests an integrative model which identifies the influences of competitive environment, economic and socio-political environment, and institutional environment on the firms' internationalization decision-making process. This study, using a logistic model applied to a sample of Colombian small and medium-sized companies, analyzes the key factors in the decision process to internationalize their operations. A low degree of fit between the results and the established hypotheses can be observed. Many interesting findings related to the main streams of internationalization decision-making research about competitive factors have been explained, but this study did not find evidence of a relevant influence of economic, socio-political, and socio-cognitive factors on the decision-making process of internationalizing of Colombian small and medium-sized firms. Two reasons may explain why this study did not find support for that influence: First, the low participation of Colombian firms in social networks and, second, the firms' adaptation to operate in the difficult and lasting economic and socio-political situation of Colombia Future research into the internationalization decision-making field may be oriented toward decisions about the choosing of target countries or decisions about the mechanisms of coordination and control of foreign operations