Uncertainty and Decision-Making in SME Internationalization: The Importance of Control, Prediction, and Knowledge

Luis Oliveira, Wensong Bai, Martin Johanson, Milena Ratajczak-Mrozek, Barbara Francioni

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract

We investigate the role of market uncertainties as determinants of the adoption of control and prediction in the internationalization of small-and medium-sized enterprises (SMEs). Building on the possibility that uncertain markets may lead to trade-offs between these strategies, as suggested by the convergence between effectuation and internationalization research, we differentiate between uncertainties originated in SMEs’ home and host countries. We test our hypotheses with a cross-country data set encompassing 597 SMEs surveyed in Brazil, China, Poland, and Italy. Our results indicate that home-country uncertainty is related to the adoption of control strategies, while host-country cultural uncertainty is related to prediction efforts. Moreover, internationalization knowledge emerged not as a moderator of these relationships but as a relevant antecedent of both control and prediction. Our findings have implications for the use of effectuation in the study of SME internationalization and also for the conceptualization of the effectuation process itself.

Original languageEnglish
Title of host publicationInternational Business in a VUCA World
Subtitle of host publicationThe Changing Role of States and Firms:
EditorsRob van Tulder, Alain Verbeke, Barbara Jankowska
PublisherEmerald Group Publishing Ltd.
Chapter17
Pages333-355
Number of pages23
Volume14
ISBN (Electronic)9781838672553, 9781838672577
ISBN (Print)9781838672560
DOIs
Publication statusPublished - 21 Oct 2019
Externally publishedYes

Publication series

NameProgress in International Business Research
PublisherEmerald Group Publishing Ltd
Volume14
ISSN (Print)1745-8862

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    Oliveira, L., Bai, W., Johanson, M., Ratajczak-Mrozek, M., & Francioni, B. (2019). Uncertainty and Decision-Making in SME Internationalization: The Importance of Control, Prediction, and Knowledge. In R. van Tulder, A. Verbeke, & B. Jankowska (Eds.), International Business in a VUCA World: The Changing Role of States and Firms: (Vol. 14, pp. 333-355). (Progress in International Business Research; Vol. 14). Emerald Group Publishing Ltd.. https://doi.org/10.1108/S1745-886220190000014018