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ISSN 1822 7260 SOCIAL SCIENCE. 2013. Nr.

2 (80)

Internationalization Decision of a Born Global: the Case of Information


Technology Companies

Jurgita Sekliuckiene and Simona Maciulskaite


Kaunas University of Technology
Donelaicio 73, LT-44029 Kaunas, Lithuania

http://dx.doi.org/10.5755/j01.ss.80.2.4644

Abstract changes, to envisage new trends, and to operate not only in


local market (Gonzalez and Sieglinde, 2012). Changes in
Internationalization of companies is becoming a the international business environment influence the
necessity on purpose to play an active role in the emergence of born global companies, their international
market and maintain a competitive advantage. A rapid activities, and decision-making.
rise of small and medium sized enterprises (SMEs) on Firms that undertake international business from an
an international level has been interpreted like a born early stage in their development have been emerging
global phenomenon. worldwide, in significant numbers (Weerawardena et al.,
An operating trajectory of born global companies is 2007). Born global firms are entrepreneurial, focusing on
characterized by a rapid expansion outside the country, technology, and dynamic; they can adapt to a constantly
as quickly as possible after company establishment. changing environment, make flexible decisions, build
Dynamism, orientation to technology, innovation into business strategy, and gain competitive
entrepreneurship, and flexibility helps gain a advantage in an international market since the day of
competitive advantage against traditional companies. establishment (Alimien, 2012; Kontinen and Ojala, 2012).
Partnerships and networking become Recent studies have shown the importance of born
internationalization accelerators of the born global global companies in terms of their features, activity in
companies. As a matter of fact, the internationalization international markets, ability to provide innovations,
decision of born global companies is especially relevant growth, etc. (Weerawardena et al., 2007; Gabrielsson et al.,
in today's research. 2008; Slotte-Kock and Coviello, 2010). Several studies
The article presents a framework showing how born have sought discovering forms and obstacles of
global companies internationalize their activities. The internationalization by seeking to unveil factors
framework has been approved in the Lithuanian influencing their performance, comparing born global to
information technology companies. The empirical traditional companies (Sheppard and McNaughton, 2012;
research results have revealed the expression of the Kontinen and Ojala, 2012). Alimiene (2012) has analysed
internationalization decision making of Lithuanian the standardization and adaptation of marketing decisions
SMEs. Theoretical and empirical results are beneficial in the context of internationalisation of company activities,
for born global SMEs, seeking to internationalize their and Casas and Dambrauskaite (2012) have analyzed the
activities. impact of external business environment factors on the
Keywords: internationalization, born global internationalization of Lithuanian born global companies,
company, entrepreneurship, information technology to mention just a few. Features affecting organizational
industry. entrepreneurship have been analysed by a number of
researchers, e.g., Hisrich (2009), Harris and Wheeler
Introduction (2005).
The problem of internationalization decision making
With the growth of international business integration has been mainly analyzed in the traditional company case
and globalisation, the internationalisation of company (Slotte-Kock and Coviello, 2010; Alimiene, 2012). The
activities has become a necessity seeking to survive and circumstances prevailing a business environment,
develop own business, regardless of company size, managers abilities to analyze, to understand the
managed resources, and the nature of activities (Dib, environment, to predict the opportunities and threats, or
Rocha and Silva, 2010; Kontinen and Ojala, 2012; personal relationships affect the decision-making of
Kuvykaite and Alimiene, 2012). With the advent of global-born companies (Meyer and Peng, 2005; Slotte-
economic globalization, internationalization has become Kock and Coviello, 2010). Therefore, it is essential to
one of the most important strategies for many firms that highlight the internationalization assumptions, affecting
seek opportunity to achieve further growth (Zeng et al., incoming operating decisions of born global companies.
2009). Todays environment determines that companies It has been revealed that the research, which analysed
have to be able to adapt to rapid business environment activity solution internationalization in born global

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J. Sekliuckiene, S. Maciulskaite. Internationalization Decision of
Social Sciences / a Born Global: the Case of Information Technology Companies
Socialiniai mokslai. 2013. Nr. 2 (80) of Lithuania

companies is relevant, but quite fragmented. There is no born globals internationalize rapidly, compared to
general research methodology for the born global traditional organizations. Typically, born globals enter the
companies internationalization decisions investigation. In foreign market place within the first three years of
With the aim to answer problem questions, formulated in domestic establishment (Freeman and Cavusgil, 2007;
this paper, the methodological approach of this Hartsfield, Johansen, and Knight, 2008; and Freeman,
investigation refers to the aspects of market search and Hutchings and Chetty, 2012). According to Saarenketo et
selections (Lewin et al., 2008; Slotte-Kock and Coviello, al. (2004), most of born global companies are smaller,
2010). It has already been indicated that there is lack of formed by entrepreneurs or a few employees, have limited
such research in Lithuania. A better understanding and resources, and are established in a small-market country.
closer analysis of the problem can help understand born These companies, fostering a global vision and
global internationalization phenomenon in a small presentation of the company to the world as one big market
emerging country like Lithuania. The research problem can from firms inception (Gabrielsson et al., 2008), are mostly
be defined along the following question: what are the found in high-technology based sectors (Kontinen and
preconditions for internationalization decisions, which Ojala, 2012; Cavusgil and Knight, 2009).
underlie the operating of born global companies? 2. Niche oriented. In comparison with traditional firms,
The aim of the paper is to reveal what strategic born global companies are more specialised and niche
decisions-making is undertaken by born global firms, oriented with unique, innovative products that are either
seeking to internationalize their operations. In achieving more custom made, or more standardised (Dib et al., 2010;
the goal, an internationalization decision making Freeman et al., 2012). They target a narrow customer
conceptual framework of born global companies is segment which might be geographically distributed
developed. The framework is further tested in a dynamic (Aspelund and Moen, 2010). Offering new and distinctive
information technology (further IT) sector. products to niche markets contributes to superior
The following research methods are employed: international performance of these born globals; this
systematic and comparative analysis of scientific literature, happens by creating a buffer against competition, allowing
qualitative research, employing a semi structured these firms to have a type of monopolistic advantage
interview, and content analysis research methods. (Knight and Cavusgil, 2004). Born global firms see
In the first part of the article, the features of born global themselves as owning or possessing a source of
companies are discussed. The second part introduces the competitive advantage in foreign markets by way of their
development of the model. The third part of the article expertise, unique product features, better technical service,
provides research methodology, and the final part presents knowledge competences, or a combination thereof
research results, based on the internationalization decision (Evangelista, 2005; Kudima, Yip and Barkema, 2008).
making of the born globals. According to Knight and Cavusgil (2004), it is likely that
knowledge competency of born globals is built up through
Features of the born global companies that acquisition of knowledge-based resources and learning
in foreign markets. Further, well-built knowledge
Companies, which start the activity in international competency may serve to prevent limited resources from
markets quite soon after the establishment, have been restricting the potential growth opportunities of born
widely investigated in the frame of numerous studies on globals in their internationalization process, thus providing
the same phenomenon under different concepts: high a competitive basis for international success. Many born
technology start-ups, international new ventures, globals are focusing on the attribute of quality in their
international entrepreneurs. It has been noticed that most of products and services to achieve a competitive advantage
the researchers analyzing activities of these companies (Knight and Cavusgil, 2004).
describe them like born global (Weerawardena et al., 2007; 3. Entrepreneurship. According to Cavusgil et al.
Gabrielsson et al., 2008; Casas and Dambrauskaite, 2011; (2008) and Gabrielsson et al. (2008), born globals have
Alimiene, 2012). Alimiene (2012) has found out that born unique entrepreneurial characteristics. International
global companies are often called the phenomenon of entrepreneurship of these companies is associated with
internationalization, because they are exceptional, international orientation and experience, with proactive,
disproving the hitherto prevailing perception that a firm risk taking behaviour that crosses national borders, level
should gradually carry out internationalization only after a of technical and know-how knowledge (Dib et al., 2010;
relatively long time, having developed a strong position in Hartsfield et al., 2008). Firms entrepreneurial orientation
the local market. contributes to its ability to create processes, practices, and
According to Hagen et al. (2012), dynamic companies decision making activities that are linked with successful
appear to start their activities in international markets very entrance into foreign markets (Knight and Cavusgil, 2004;
fast right after their establishment, getting involved in Roudini and Osman, 2012). The managers of firms that
activities in many foreign countries and taking on serious follow an international entrepreneurial orientation stress
commitment for those countries very quickly almost from the importance of having a proactive and innovative
the beginning of their activities. The main characteristics approach to operating in international markets. This
of the born globals are: orientation in foreign environments supports firms
1. Early and rapid internationalisation. Despite awareness of key strategic initiatives that enable
deficiencies in human, financial, and tangible resources, international success (Knight and Cavusgil, 2004). Pro-

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J. Sekliuckiene, S. Maciulskaite. Internationalization Decision of
Social Sciences / a Born Global: the Case of Information Technology Companies
Socialiniai mokslai. 2013. Nr. 2 (80) of Lithuania

activeness means acting in anticipation of future problems, Kock and Coviello, 2010). According to Alimiene (2012),
needs, or changes and implies taking the initiative, the company acting in accordance with the international
aggressively pursuing ventures, and being at the forefront market, adopts strategic business development solutions
of efforts to shape the environment in ways that benefit the which depend on companys experience and activities
firm (Thai and Chong, 2008). Risk taking reflects the carried out in the domestic market. Decisions related to
propensity to devote resources to projects that entail a international business are dependent on companys unique
substantial possibility of failure, but also chances for high competencies, developed over time (Korsakiene and
returns. The risk decreases with the maturity of the Tvaronaviciene, 2012).
company (Gabrielsson et al., 2008). In the initial stage of internationalization, the decisions
In an effort to perform well in foreign markets, the on access, entrance, and business methods to international
early internationalizing small firms often capitalize on markets are being made. Born global companies often take
networks. Both social and business aspects of networking internationalization decisions being infant, according to
are important for the understanding of firms international their evaluation of motivation, goals, and available
development (Gabrielsson et al., 2008). Networks can help resources. At a later stage of development, the firm makes
the firms acquire the knowledge, capabilities, and routines a decision about the potential of development of the local
that enable them to overcome their resource limitations market through product adaptation, through the product
(Knight and Cavusgil, 2004). According to Fan and Phan line development as well as through the creation of new
(2007) and Freeman et al. (2012), most of born global products or services for specific local market needs. After
companies belong to strong industrial clusters, strategic the adoption of these decisions for increasing efficiency,
alliances or networks with the operating company operations in the local markets are coordinated, equal
concentrated in one place, but serving customers mechanisms are created for the coordination of a general
throughout the global market. strategy and its integration in different international
Knight and Cavusgil (2009) have found that these markets. The solutions of companys expansion into
companies, taking the advantage of their managerial international markets allow the transfer of knowledge,
competence, establish social networks much faster than experience, and competitive advantages from one national
large companies uptake global market information and use market to another (Slotte-Kock and Coviello, 2010;
it effectively in their operational development. The Alimiene, 2012). According to Lewin et al. (2008), the
existing networks (such as customers, importers, suppliers, following are the aspects of market search and selections,
etc.) may help born global companies expand their market mostly discussed and decision-bearing: 1) companys
in other countries and find better market opportunities readiness for internationalization, 2) the eligibility of
(Zeng et al., 2009). Mainela and Puhakka (2011) have products and services in foreign markets, 3) the selection
found out that a network can also provide small companies of countries and attractive target market, 4) the evaluation
with the competitive advantage due to potentiality of of the demand of products in the sample of target market,
resource sharing and getting the knowledge from the 5) the selection of qualified business partners, distributors,
network members which might enable them to reduce the suppliers and service providers, 6) expected sales by
disadvantages and be helpful in enjoying a successful market. It is useful to identify potential sales volumes and
internationalization process. According to research, we can possible obstacles which would help company face lower
learn that networking and partnership become accelerators barriers in the market selection process. In the market
of companies which have entrepreneurial characteristics. selection and search process firms make relationships with
partners and get involved in networking for successful
Internationalization decision of a born global adaptation to a new market.
company model development Active monitoring of the business environment and
cooperation with partners can help retain the market
Internationalization decisions are described as one- position and network; it can help create a new product and
sided, influenced by the expanding business opportunities the successful development of company's
and knowledge. The company which starts international internationalization process which is adapted to the newly-
activities must be interested in both national and formed business environment (Vaiginiene, 2009; Cavusgil
international economy. It is important to evaluate the risk and Knight, 2009). It is crucial for an organizations to seek
of the business activity in a particular country, to take to discover new markets and opportunities that would
investment decisions, to determine the size and the better adapt and compete in a global environment. The
characteristics of various markets, and to use the resources expansion into international markets gives companies
of the company in the most efficient way (Langviniene, opportunities for growth and creates value (Gonzalez and
Sekliuckiene and Vengrauskas, 2010). Brouthers and Sieglinde, 2012). According to Korsakiene and
Hennart (2007) indicate that decision-making is strict and Tvaronaviciene (2012), companys ability to enter foreign
accurate conduct as well as successful strategy formation. markets is associated with firms tangible and intangible
The circumstances prevailing in a business environment, resources. A company with valuable, rare and hardly
the ability of managers to analyze, understand, and predict imitable resources has a competitive advantage not only in
the emerging opportunities or threats and personal local, but also in an international market. Solutions related
relationships are the factors which influence the decisions to international business are dependent on company's
of born global companies (Meyer and Peng, 2005; Slotte- unique competencies which were developed over time.

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J. Sekliuckiene, S. Maciulskaite. Internationalization Decision of
Social Sciences / a Born Global: the Case of Information Technology Companies
Socialiniai mokslai. 2013. Nr. 2 (80) of Lithuania

Kalinic, Sarasvathy and Forzos (2013) indicate that Alimiene (2012), Kalinic et al., 2013 have noticed that
entrepreneurs are able to take high commitment and to effective decision-making is influenced by managers and
perform effective international operations. employees flexibility and their ability to adapt to external
Entrepreneurship has an impact on the success of financial changes. Nielsen and Nielsen (2011) indicate that the
and strategic activities in the international market as well effectiveness of international strategic decisions of the
as on the born global firms operating decisions taken leader depends on his/her background and experience.
(Zhang, Tansuhaj and McCullough, 2009). Managers should encourage their employees to take the
The choice of the internationalization decision can be initiative and not to be afraid to make mistakes. According
influenced by external opportunities, threats, or company's to theoretical arguments, the internationalization decision
internal weaknesses which get highlighted after a strategic model of born global companies is formed and presented
analysis (Valentinavicius, 2009). According to below (Figure 1).
Sekliuckiene (2013), companies are forced to Decisions to internationalize company activities
internationalize their activity due to unfavourable through the process of market search and selection as well
conditions in the local market (large concentration in the as through the forms of intervention make influence on
market, small markets, absence of demand, the policy companys outcomes which postulate further plans in the
implemented by the government towards local companies). international market. The evaluation of the international
Other factors functioning in the international market and performance effectiveness and its results is one of the most
host market foster companies to undertake the important instruments for checking the sustainability of the
internationalization process. Pull motives are related to the selected enterprise strategies and solutions for international
aim of foreign countries to attract as many direct foreign activities. According to Valentinavicius (2009),
investments as possible to the country. Consumer needs, performance assessment is based on the determination of
behavior, geography are also important to born global the key indicators of economic performance (sales, profits,
companies decisions to internationalize operations. etc.).

Internationalizations tasks and motives. Internationalization decision - making

Analysis of the business environment: political, economic, demographic, social cultural, ecologic, competitive, technological

External factors: Internal factors:


partnerships and networking, financial and non-financial entrepreneurship, capabilities and competencies of managers
support of the governance, taxation policy in home market, and personnel, knowledge and experience, innovativeness;
instability of home market, support of foreign market products uniqueness, technologies, scale and scope of the
governance, reclamation of information technologies, company, financial resources, etc.
intensity of competitiveness, limitation of the market, etc.

Search and selection of the potential markets

Company's readiness for internationalization (SWOT and PEST analysis, etc.).


Eligibility of the products and services in foreign markets (evaluation of the customers needs, supply of competitors products;
factors, that prevent products sales determination, etc.).
Selection of countries and attractive target market (market size and growth, market intensity, demand, income level,
consumption level, etc.).
Evaluation of the demand of products in the sample of target market (possible selling amount, etc.).
Selection of qualified business partners (requirements for possible partners, evaluation of reliability; guidelines for partnership
and networking, etc.).
Expected sales by market (arrangement of sales forecasts, evaluation of factors, that determine sales scope, etc.).

Tiktin pardavim
Barriers for internationalization

External barriers: Internal barriers:


political and legal, institutional, economical, market conditions, organizational and management barriers (lack of knowledges (logistics,
geographical, cultural, specific to market, country. marketing, operation, know how, loss of control of business operations
etc.), financial and physical resources (lack of financial resources, size
and scale), nonfinancial resources (lack of information, lack of new
services, lack of human resources, etc.)

.
Resul: financial, nonfinancial

Figure 1. Conceptual framework for internationalization decision of born global

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J. Sekliuckiene, S. Maciulskaite. Internationalization Decision of
Social Sciences / a Born Global: the Case of Information Technology Companies
Socialiniai mokslai. 2013. Nr. 2 (80) of Lithuania

However, it is also important to evaluate non-economic hypothesis verification, the significance level of 0, 05 has
outcomes which are implemented for the investment been chosen. The empirical study was carried out in
strategy (for example, the increase of company prestige, April May 2013.
the improvement of working conditions and customer
service conditions, ect.). When good performance is Results
reached, companies again start considering the options for
further development, carry out the search and the selection The investigation has aimed at revealing what part of
of the new markets. The number of foreign countries and the researched IT companies start their activity
their characteristics is also one of the basic indicators for immediately after their establishment as a company, and
international activities effectiveness of born global when IT sector companies start cross-border activities.
companies. Most of the companies involved in the study (32 percent)
start international activities from the very beginning of
Research methodology their establishment, 21 percent of participants indicated
that the activity was started after 1 year from the
The aim of the empirical research has been exploring establishment date. 25 percent of surveyed participants
the operating decisions of internationalization at claimed that the internationalization activity in their firm
Lithuanian born global in information technology (IT) started 2-3 years after the establishment of the company,
companies. The research has been grounded on the the rest said it was after 4-5 years, or later than 5 years
relevant literature analysis (Lewin et al., 2008; Korsakiene after the establishment. The study results demonstrate that
and Tvaronaviciene, 2012; Kalinic et al., 2013; Slotte- all the companies started international operations at their
Kock and Coviello, 2010, Alimiene, 2012). In order to own expense. Only one firm took a bank loan, while the
generate empirical data, a survey has been designed. The other two companies had benefitted from the structural
following investigating blocks have been formed: funds of the European Union.
motives and factors that have impact on involvement Lithuanian IT sector companies operate in different
of born global firms in international activities; parts of the world: the United States, European Union
search and selection of potential markets; countries, Eastern Europe, Asia, and Africa. Most of the
barriers for internationalization; companies offer their information technology services to
factors affecting the decisions and entrepreneurship the United States, Latvian, and German markets. The
of the companies; results have shown that companies export services to
the importance of partnership and networking in born different countries in order to diversify business risk and to
global companies activities; protect themselves from possible economic crisis and
results and effectiveness of born global companies. currency depreciation. It has turned out that companies
Primary data collection has been carried out among 28 work in various markets for different period of time, which
information technology companies managers. Companies shows that Lithuanian IT sector of international
are located in the largest towns of Lithuania: Kaunas, development keeps growing.
Siauliai, Klaipeda, and Vilnius. For the study, semi Motives and factors influencing the involvement of
structured interview has been used, built on the following born global companies in international activities. The
criteria and characteristics of born global companies: 1) the pursuit of profit prompts Lithuanian IT sector enterprises
company carries out international activities, 2) company's to initiate international activities. The very small
definition is consistent with that of SMEs; 3) the income Lithuanian market also serves as a push motive, since
derived from foreign markets makes up to over 25 percent. companies do not have a possibility to expand their
Referring to the created framework and the criteria business and to find a segment of the market for the
elaborating them, the semi - structured questionnaire has services provided (In Lithuania there was no market
been formulated. which can be oriented for the services; Simply, the
The results of the study have shown that the income Lithuanian market is too small for us; small
from international markets in several companies is 100 Lithuanian market; In Lithuania we did not find our
percent, that is why these companies are solely oriented market segment). For the Lithuanian IT sector
only to foreign markets. Characteristic data of the companies, the aim to base in foreign markets is not so
researched organizations have revealed that in the majority important, and the least important thing relates to
of companies there work quite few employees: 11 competitors operating in local market. The analysis of the
companies involved in the research had up to 10 working results, calculated using Spearmans correlation
employees, 8 companies had from 14 to 50 employees, the coefficient, has determined that there is a moderate
remaining researched companies had up to 80 employees, relationship between risk distribution and small market of
and only one company had 210 workers. The selected Lithuania (r=0,431*, p=0,022, p>0,5). Based on this data,
companies provide information technology services. For it may be assumed that a small Lithuanian market and risk
the investigation results, process Statistical Package for distribution are interrelated motives which predispose
Social Sciences, content analysis, and ordinal variables company internationalization. If one factor strengthens,
have been applied. The strength of the relationship respectively, the importance of another factor in
between ordinal variables has been studied by using international activity also grows.
Spearman's correlation coefficient. For the statistical

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J. Sekliuckiene, S. Maciulskaite. Internationalization Decision of
Social Sciences / a Born Global: the Case of Information Technology Companies
Socialiniai mokslai. 2013. Nr. 2 (80) of Lithuania

The analysis of the data surveyed has shown that the potential market. However, firms do not always consider
external factors, compared to the internal ones, do not have potential entry into the market barriers. None of the
a significant impact on the international start-up activity of companies carry out substantial potential market
born global Lithuanian IT sector companies. Information evaluation. This fact demonstrates that companies do not
technology spread has the worst impact on firms; it may be spare so much time and attention to the selection process,
considered to contribute to accelerating firms presence in as it is recommended in scientific literature. Most of the
the foreign markets, their ability to compete with much companies involved in the study, prior to the selection of
larger companies. Partnership also affects company markets for cross-border activities, discuss the factors
internationalization. It is evident that networking and likely to affect sales, and develop sales forecast. Market
cooperation with partners provide valuable knowledge for size and cultural similarities make the biggest influence on
Lithuanian born global IT sector companies and make it the market choice. Distance is less valuable; cooperation
easy to start-up internationally, predisposes joint-ventures with partners and networking are appreciated.
start-up. Partially, the beginning of the international Barriers for internationalization. The analysis of the
activities of an enterprise is driven by the increasing investigation results suggests that the Lithuanian IT sector
competition in the internal market. companies do not face serious handicaps, when starting
Exploring the dependency between these factors, it has international activity. The examination of the survey
been noted that the connection between the three groups of results has shown that the lack of international experience
factors exists. The strongest link is between these three and companys lack of finance constitute major Lithuanian
factors: the development of information technology and IT sector internal barriers to internationalization. In the
non-financial support of public institutions (r=0,527**, words of the respondents, during the period of international
p=0,04, p<0,05). Among these factors there is a moderate, activity, companies have to cope with cultural differences
reliable to population connection. It can be assumed that and with the high costs of research of the markets. It can be
the accelerating development of information technologies assumed that in carrying out the research and gaining a
leads to greater support of non-financial public institutions better understanding of cultural differences, Lithuanian
and, as a result, companies are learning on their own more born-global IT sector companies are able to avoid hardship
often. It has been noticed that a statistically reliable link and adapt more effectively to new markets at the time of
exists between factors such as the development of internationalization. The surveyed companies also noted
information technologies and networking (r=0,525**, some more obstacles which were not identified in the
p=0,04, p<0,05). The interaction between these two links is questionnaire: the time gap (When we have a day, in
medium, which allows claiming that the accelerating pace America it is already night, so there is a little update in
of information technologies predisposes born global IT our employees work schedule), the existence of
sector companies to connect to networking. stereotypes (Often the customer thinks that small company
The search and the selection of potential markets. The is unreliable company. It complicates international
obtained results have shown that the Lithuanian IT sector activities) and corruption in one of the foreign markets
companies in the stage of preparedness for (Nigeria is booming with very high corruption). The
internationalization carefully evaluate potential markets analysis of the data has shown that there is a strong,
and investment opportunities. It has turned out that only statistically reliable link between the information on
few companies perform SWOT and PEST analysis of the international markets and a lack of customer needs
environment. In products and services for foreign markets (r=0,759**, p=0, p<0,05). That is, in the absence of
period, companies become aware of the factors, likely to information about international markets, companies do not
interfere with the sale of services in the new markets. Only seek information about clients; as a consequence, it
a part of companies analyzes consumer needs during the becomes a root cause of barriers to internationalization.
market selection period; however more attention is given Usually companies with international activities carry out
to competitors analysis. It has been noted that the political services by exporting or setting up branches in other
environment does not affect company decision making, countries, as well as participating in networking.
because the Lithuanian IT sector companies do not analyze Factors affecting companys activity decisions and
government powers. In the period of selection of countries entrepreneurship. The data has revealed that the
and target markets, companies become aware of potential Lithuanian IT sector companies systematically collect
market growth forecast and intensity of the market information about customers, competitors, and service
(purchasing power, income level). The level of sales. Only few companies in foreign markets perform
consumption is less evaluated by the firms. In a meantime, research. It can be assumed that this is due to high costs of
most of the born global companies do not evaluate political investigations. One Lithuanian IT sector company provides
risk and countrys susceptibility to exports. In the search of cheaper service, another company has higher prices;
markets, born global companies analyze potential sales however it has been noticed that companies focus more on
amounts in a new market and establish contacts with quality than on price. Companys decisions undertakings
partners. Only few companies consider requirements for are mostly influenced by the international environment.
partners before establishing the relationship. Survey results Cooperation with partners and networking as well as local
have revealed that, in the period of product and service market influence decisions only partially. The biggest part
demand evaluation, the companies examine the factors of the Lithuanian IT sector companies entered international
likely to impede the sales of products and services in the market quickly and immediately. These companies have

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J. Sekliuckiene, S. Maciulskaite. Internationalization Decision of
Social Sciences / a Born Global: the Case of Information Technology Companies
Socialiniai mokslai. 2013. Nr. 2 (80) of Lithuania

entrepreneurship characteristics: the ability to respond percent...). One subject indicated that he had a temporary
quickly to changing customer needs and environmental decline in profit (Initially, the profit declined because
factors, the ability to take risky decisions, interest in future internationalization requires direct investments, but after,
forecasts, etc. companys indicators significantly went up).
The importance of partnership and networking in born Internationalization has positive values not only for
global company activities. Survey data has revealed that enterprise profitability, but also for the employee
born global IT companies collaborate with various development, because they are constantly involved in
organizations. Most of the researched subjects have stated various workshops, conferences in order to consolidate
that they collaborate with foreign market (where their firm company position in the Lithuanian market. Since the
operates) companies (Our main partners are foreign majority of the surveyed companies started their
companies; We have lots of benefits from the international activities from the very beginning of the
cooperation with foreign market companies). Also, company establishment, they were unable to capitalize on
many Lithuanian born global companies cooperate with positive or negative effects of the internationalization on
Lithuanian firms, operating in Lithuania (Cooperation the company operations (...Since internationalization was
with Lithuanian companies helps compete abroad; carried out as soon as possible, there is no comparison ...,
When task-specific knowledge is needed, then we appeal ... our company immediately engaged in international
to Lithuanian companies who have the necessary expertise activities ... ... activities of the company from the very
for that; We cooperate with a business support beginning were international..., ... as it was immediately
agency). Less than a half of survey participants focused from the very beginning not only towards the
(respectively 46 percent and 43 percent) cooperate with Lithuanian market, but also international, there was no
clients when providing services (Our customers are our difference..., ... We did not feel any difference because we
partners, since partnering with them improves our quality worked internationally from the beginning... ...we
of the service provided; Clients help us figure out pros immediately began to engage in international activities, so
and cons of the services provided in the most efficient I do not have a standard of reference...).
way; In collaboration with clients, we create new It was noted that the majority of the surveyed
products) and educational institutions (We take various Lithuanian born global IT sector companies plan business
projects in collaboration with universities, and it brings development in the near future and endeavour
benefits to all the parties: the company, students, and the strengthening their position in foreign markets, where they
university; One of our main partners is Kaunas were acting before: the Eastern countries, the countries of
University of Technology; I think that collaboration the European Union, the United States. More than half of
with universities brings us considerable benefits; the survey participants have indicated that, in their opinion,
Cooperating with educational institutions, we organize company profitability indicators should grow in the short
surveys). The most popular method for born global IT term. Companies intend to increase the number of
companies to find partners is the Internet and employees in order to increase the efficiency of services in
recommendations of friends and acquaintances. An active Lithuanian and foreign markets.
search is performed in Lithuanian institutions which
provide business support and affiliate search engines. A Conclusions
small part of the Lithuanian born global IT sector
companies is looking for partners in international In the theoretical framework of an internationalization
exhibitions, fairs, and conferences. The analysis of the decision of a born global, the following strategic decision
study has shown that 13 out of 28 surveyed subjects steps have been distinguished: analysis of the environment,
participate in networking. Then, 3 to 7 companies usually monitoring of external and internal company factors,
run in the network, few companies are involved in decision-making for company internationalization and
networking with 14-15 firms. The data has shown that the objectives related to the internationalization of company
Lithuanian IT sector companies see a number of activities, the market search and selection process,
advantages in networking. Acting in the network with decisions concerning the penetration form, and the
other companies, the companies gain a competitive evaluation of companys achieved outcomes.
advantage on local and foreign markets. A networking The results of the empirical research, performed at the
effect promotes and stimulates innovation which is very information technology companies on the basis of the
important seeking to maintain a competitive advantage in theoretical framework, have shown that the Lithuanian IT
local and foreign markets. sector born global company internationalization is
Born global companies results and effectiveness. The determined by external (IT development, partnership, and
investigation has been carried out to determine the effects networking) and internal factors (manager knowledge and
of the internationalization process upon born global skills, firms innovation, unique service) which become a
company activities. On the basis of the survey data, it can catalyst for motives to emerge. Before accessing
be noted that almost all the subjects have indicated that international markets, companies carry out certain actions
with the start of service providing internationally their in the market search and selection processes. They face
company profits had grown up to 50-70 percent. However, various obstacles, such as financial and information
there are firms, the profit of which had doubled (The first deficiency, lack of international experience, or stereotypes.
year turnover grew +100 percent, the second year +180 Involved in international activities, companies

23
J. Sekliuckiene, S. Maciulskaite. Internationalization Decision of
Social Sciences / a Born Global: the Case of Information Technology Companies
Socialiniai mokslai. 2013. Nr. 2 (80) of Lithuania

systematically collect information about the market and Business Studies, 38, (7), 1113-1131.
http://dx.doi.org/10.1057/palgrave.jibs.8400308
rivals; they accept a wide range of solutions which depend
on the company heads entrepreneurship, his/her abilities 10. Freeman, S., & Cavusgil, S.T. (2007). Toward a Typology of
and qualities, and on the financial resources of the Commitment States among Managers of Born-Global Firms: A Study
company. of Accelerated Internationalization. Journal of International
Marketing, 15, (4), 140. http://dx.doi.org/10.1509/jimk.15.4.1
The networking effect and partnership support
between born global companies and their partners becomes 11. Freeman, S., Hutchings, K., & Chetty, S. (2012). Born Global and
an accelerator, enabling internationalization. It allows Culturally Proximate Markets. Management International Review,
competing successfully in international markets. 52, 425-460. http://dx.doi.org/10.1007/s11575-011-0109-9
Partnership with different institutions strengthens company
12. Gabrielsson, M., Kirpalani, V.H.M., Dimitratos, P., Solberg, C.A., &
positions in the international markets, helps acquire Zucchella, A. (2008). Born globals: Propositions to help advance the
knowledge and skills. Internationalization influences an theory. International Business Review, 17, (4), 385-401.
effective implementation of corporate activity, profit http://dx.doi.org/10.1016/j.ibusrev.2008.02.015
growth, staff and service quality improvement. Networking
13. Gonzalez, R.K., & Sieglinde, K. (2012). Internationalization Process
enhances cooperation between enterprises, development and Technological Capability Trajectory of Iguacu. Journal of
and implementation of new projects, and also customer Technology Management and Innovation, 7, (2), 117-129.
search; it provides an opportunity to share knowledge and http://dx.doi.org/10.4067/S0718-27242012000200010
experiences, to learn from partners. All of that empowers
14. Hagen, B., Zucchella, A., Cerciello, P., & Giovanni, D.N. (2012).
companies to compete successfully in the international International Strategy and Performance Clustering Strategic Types
markets. of SMEs. International Business Review, 21, (3), 369-382.
Further studies on internationalization strategic http://dx.doi.org/10.1016/j.ibusrev.2011.04.002
decision making should be oriented towards the detection
15. Hartsfield, S., Johansen, D., & Knight, G. (2008). Entrepreneurial
of specifics of the born global IT sector companies, the Orientation, Strategy and Marketing Capabilities in the Performance
formation of the internationalization decision making of Born Global Firms. International Business: Research, Teaching
specifics, and it should include a larger sample of the and Practice, 2, (1), 12-38.
surveyed parties.
16. Harris, S., & Wheeler, C. (2005). Entrepreneurs relationships for
internationalization: functions, origins and strategies. International
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http://dx.doi.org/10.1057/palgrave.jibs.8400167 vidutins mons, kurioms bdinga ankstyva internacionalizacija,
tinklaveika, vadov bei darbuotoj turima tarptautin patirtis bei
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185-193. http://dx.doi.org/10.1016/j.jwb.2010.05.003 gimusi globaliomis kompanij internacionalizacijos akseleratoriais.
Todl gimusi globaliomis kompanij internacionalizacijos sprendim
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Entrepreneurship Capability on International Performance in Born Pastaruoju metu padaugjo tyrim, kuriuose analizuojami gimusi
Global Firms. iBusiness, 4, 126-135. globaliomis organizacij bruoai, veikla tarptautinse rinkose. i
http://dx.doi.org/10.4236/ib.2012.42015 problematik tyr Knight (1996); Weerawardena et al. (2003);
Gabrielsson et al. (2008); Sui (2009); Slotte-Kock ir Coviello (2010) ir
31. Saarenketo, S., Kuivalainena, O., Puumalainen, K., & Kylaheiko, K. kt. Sheppard ir McNaughton (2012); Kontinen bei Ojala (2012), Slivinski
(2004). Dynamic knowledge-related learning processes in (2012) ir kt., savo tyrimuose analizuoja veiksnius, lemianius gimusi
internationalizing high-tech SMEs. International Journal of globaliomis organizacij internacionalizacij, internacionalizacijos
Production Economics, 89, (3), 363378. formas, barjerus, lygina jas su tradicinmis kompanijomis ir pan.
http://dx.doi.org/10.1016/S0925-5273(03)00185-3 Lietuvoje gimusi globaliomis moni specifik analizavo Alimien
(2012), tyrusi gimusi globaliomis ir tradicini moni marketingo
32. Sekliuckien, J. (2013) Lithuanian companies in emerging markets: sprendimus; asas ir Dambrauskait (2012) domjosi iorini veiksni
internationalization motives and barriers. Economics and taka Lietuvos globalioms kompanijoms ir kt. Antreprenerikumo
Management, 2013, (1). pasireikimo organizacijoje problematik tyrinjo Duobien (2006),
Pundzien (2006), Vaitkeviius (2007), Wunderer (2001), Hisrich,
33. Slotte-Kock, S., & Coviello, N. (2010). Entrepreneurship Research Antoncic (2003), Cartier (2007) ir kt.
on Network Processes: A Review and Ways Forward. Internacionalizacijos sprendim primimo problematika daugiausia
Entrepreneurship Theory and Practice, 34, (1), 3157. analizuojama tradicini kompanij atvejais (Chetty ir Campbell-Hunt,
http://dx.doi.org/10.1111/j.1540-6520.2009.00311.x 2004, Slotte-Kock ir Coviello, 2010; Alimien, 2012). Aplinkybs,
susiklosiusios verslo aplinkoje, vadov gebjimai analizuoti, suvokti
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Gabrielsson, M. and Kirpalani (eds.). Handbook of Research on Born ir Peng, 2005; Slotte-Kock ir Coviello, 2010). Todl itin svarbu irykinti
Globals, Edward Elgar Publishing, Cheltenham and Northampton, internacionalizacijos prielaidas, slygojanias priimamus gimusi
MA, 46-56. globaliomis kompanij veiklos sprendimus.
Mokslini tyrim analiz atskleid, jog tyrimai, analizuojantys
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100. http://dx.doi.org/10.1007/s10843-008-0021-y problemos suvokimas ir isamesn analiz gali padti geriau painti
gimusi globaliomis organizacij fenomen maoje greitai auganioje
36. Vaiginien, E. (2009). mons veiklos internacionalizacija alyje, tokioje kaip Lietuva. Straipsnyje siekiama atsakyti problemin
kintanioje verslo aplinkoje (Lietuvos tekstils ir aprangos sektoriaus klausim: kokie yra gimusi globaliomis kompanij internacionalizacijos
pavyzdiu). (Daktaro disertacija, Vilniaus universitetas, 2009). sprendimai? Straipsnio tikslas - atskleisti, koki strategini sprendim
imasi gimusios globalios mons, siekdamos internacionalizuoti savo
37. Valentinaviius, S. (2009). Verslo strategijos formavimo monje veikl. Tikslo siekiama parengiant konceptual internacionalizacijos
teoriniai aspektai. Verslas: teorija ir praktika, 10, (2), 130-141. sprendim primimo model gimusioms globaliomis kompanijoms.
ttp://dx.doi.org/10.3846/1648-0627.2009.10.130-141 Parengtas modelis testuojamas pasirinktame dinamikame informacini
technologij (toliau - IT) sektoriuje. Modelis padeda atskleisti veiksnius,
38. Weerawardena, J., Mort, G.S., Liesch, P.W., & Knight, G. (2007). kurie svarbs toki ali kaip Lietuva informacini technologij
Conceptualizing accelerated internationalization in the born global bendrovms, sitraukianioms tarptautin veikl.
firm: a dynamic capabilities perspective. Journal of World Business, Straipsnio autors detaliai teorikai pagrindia gimusi globaliomis
42, (3), 294-306. http://dx.doi.org/10.1016/j.jwb.2007.04.004 kompanij bruous: spari ir greit internacionalizacij, orientacij
niines rinkas, antreprenerikum, rizikos prisimim. Parodoma
39. Zeng, Xie, X.M., Tam, C.M., & Wan, T.W. (2009). Relationships tinklaveiklos, kaip galinanios intrernacionalizacij prielaidos svarba,
between business factors and performance in internationalization: an kadangi gimusios globaliomis kompanijos daniausiai usienio rink
empirical study in China. Management Decision, 47, (2), 308-329. eina pasitelkdamos tinklaveik ir partnerystes.
http://dx.doi.org/10.1108/00251740910938939 Internacionalizacijos prielaid galintos kompanijos priima
sprendimus dl veiklos tarptautinse rinkose. Brouthers ir Hennart (2007)
40. Zhang, M., Tansuhaj, P., & McCullough, J. (2009). International nurodo, jog sprendim primimas yra grieta, tiksli elgsena ir skmingas
Entrepreneurial Capability: The Measurement and a Comparison strategijos formavimas. Aplinkybs susiklosiusios verslo aplinkoje,
between Born Global Firms and Traditional Exporters in China. vadov gebjimai analizuoti, suvokti aplink ir nuspti atsirandanias
Journal of International Entrepreneurship, 7, (4), 292-322. galimybes ar grsmes, asmeniniai ryiai turi takos gimusi globaliomis
http://dx.doi.org/10.1007/s10843-009-0042-1 kompanij sprendim primimui (Meyer ir Peng, 2005; Slotte-Kock ir
Coviello, 2010). Todl straipsnyje pagrindiami internacionalizacijos
sprendim primimo etapai ir pateikiamas modelis, parodantis gimusi
globali kompanij internacionalizacijos sprendim sek bei

25
J. Sekliuckiene, S. Maciulskaite. Internationalization Decision of
Social Sciences / a Born Global: the Case of Information Technology Companies
Socialiniai mokslai. 2013. Nr. 2 (80) of Lithuania

integruojantis veiksnius, svarbius gimusioms globaliomis kompanijoms


internacionalizuojant veikl.
Atliktas empirinis tyrimas, atskleid, koki strategini sprendim
imasi Lietuvos gimusios globaliomis informacini technologij sektoriaus
mons, siekdamos internacionalizuoti savo veikl. valgomajame tyrime
dalyvavo 38 IT moni vadovai, kuri mons veikia didiuosiuose
Lietuvos miestuose: Vilniuje, Kaune, Klaipdoje ir iauliuose.
Organizacijos, atrinktos tyrimui, atitiko iuos kriterijus bei gimusi
globaliomis kompanij bruous: 1) mon vykdo tarptautin veikl, 2)
mon atitinka smulkios ir vidutins mons (SMEs) kompanijos
apibrim; 3) pajamos, gaunamos i usienio rink, sudaro daugiau nei
25 % vis gaunam pajam. Atrinktos mons teikia informacini
technologij paslaugas. Empirinio tyrimo rezultatai parod, kad stipresn
tak tarptautins veiklos pradiai turi vidiniai nei ioriniai veiksniai.
Tarptautin veikl mons daniausiai vykdo paslaugas eksportuodamos
ar kurdamos padalin kitose alyse, dalyvaudamos tinklaveikoje.
Potenciali rink paiekos ir atrankos procesas susideda i etap,
kuri metu priimami sprendimai dl rink atrankos: analizuojamos
potenciali rink augimo prognozs ir intensyvumas, preliminarios
pardavimo apimtys naujoje rinkoje, mezgami santykiai su partneriais.
Priimamiems sprendimams daugiausiai takos vadovo
antreprenerikumas, gebjimai ir inios, darbuotojai mons
inovatyvumas bei informacini technologij pltra, tarptautin rinka.
Praddamos tarptautin veikl, mons susiduria su finans ir
informacijos apie tarptautines rinkas stoka, kultriniais skirtumais.
Partneryst su skirtingomis institucijomis stiprina moni pozicijas
tarptautinse rinkose, padeda gyti ini bei gebjim.
Internacionalizacija slygoja efektyvesn moni veiklos gyvendinim,
pelno augim, darbuotoj ir paslaug kokybs tobulinim.
Tolimesni internacionalizacijos strategini sprendim tyrimai turt
bti orientuoti gimusi globali IT kompanij specifikumo atskleidim,
internacionalizacijos sprendim formavimo specifik bei turt apimti
didesn tiriamj imt.
Reikminiai odiai: internacionalizacija, gimusios globaliomis
kompanijos, antrepreneryst, informacini technologij sektorius.

First received: May, 2013


Accepted for publication: June, 2013

26

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