Abstract
Recent research suggests that the capabilities needed for the survival of international new ventures (INVs) may be at odds with the original aims that had brought them into the international markets. INV mortality is exacerbated by uncertainty and lack of familiarity with the host market environment, which elevates the liabilities of newness, smallness, and foreignness in the initiating companies. We investigate the key factors that determine the post-entry survival of developing economy INVs by analyzing in-depth seven software INVs originating in the developing economy of Pakistan. These INVs survived the 2000 dotcom crisis and the 2008 global financial crisis, and continue to grow. Based on a dynamic capability view on the INVs’ internationalization and survival from sensing-seizing-reconfiguration angles, we find the founders’ entrepreneurial orientations and network development capabilities (sensing), specialized product focus and niche market development (seizing), and transformation and renewal capabilities (reconfiguration) are the key capabilities that enhance the post-entry survival of these INVs. Importantly, we find that a stable leadership and the post-entry international experience of the leadership team continuously feed into facilitating the creation and maintenance of dynamic capabilities. This paper identifies key strategic aspects that determine the post-entry survival of the developing economy INVs.
Original language | English |
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Pages (from-to) | 149-160 |
Number of pages | 12 |
Journal | International Business Review |
Volume | 27 |
Issue number | 1 |
Early online date | 6 Jul 2017 |
DOIs | |
Publication status | Published - Feb 2018 |
Bibliographical note
AcknowledgementsWe would like to thank Pervez Ghauri and two anonymous reviewers for their insightful comments and suggestions during the review process. We are also grateful to Oded Shenkar, Charles Dhanaraj, and the participants of the Academy of International Business 2013 Annual Meeting held in Istanbul, Turkey for their valuable comments on an earlier draft of this paper.
Keywords
- Dynamic capability
- International new venture
- Internationalization
- Post-entry survival
- Specialization
- Stable leadership