Internationalizing Firms (eBook)

Adriana Calvelli is Professor of International Management at the Parthenope University of Naples, Italy, where she conducts innovative research on internationalization and SMEs. Adriana has written many books and published papers in journals on international strategy, entrepreneurship, and cross-cultural management. Chiara Cannavale is Professor of Cross-cultural Management and International Management at the Parthenope University of Naples, Italy. President of the International Association of Cross-cultural Competence and Management (IACCM), Chiara has published several works on international strategies towards transition, cultural competences, and the impact of culture on international management, innovation and entrepreneurship.

Contents 5
List of Figures 6
1: Determinants of Internationalization 7
Can International Business Theories Interpret Current Business Internationalization Processes? 7
Does Dunning’s Eclectic Paradigm Help Interpret the Determinants for Entry into Foreign Countries? 15
An Interpretative Framework from A Resource-Based Perspective 17
References 26
2: International Strategy 30
A Key to Interpretation 30
The Role of Core Factors in Development Strategies 33
Internationalization for Diversification: The Risks of Extreme Diversification 44
Standardization Versus Adaptation 50
The Risks of a Systemic Disconnection 56
References 62
3: Market Entry Strategy 64
Introduction 64
The Main Steps of International Expansion 66
Choice of Entry Mode 75
Competitive Entry Modes: Import/Export 78
The Integration Processes: Foreign Direct Investment 87
Cooperative Modes 100
Countertrade 102
The Role of the Institutional Context and of Market Commitment in Firms’ Entry Choices 107
References 110
4: Outsourcing and Reshoring 116
Choices of Outsourcing to International Third Parties 116
Determinants of Outsourcing Choices: Beyond the Theory of Transactional Costs 118
New Forms of Outsourcing 122
Reshoring and Back-Reshoring 126
References 132
5: Key Risks of Internationalization 134
The Risks of Internationalization: An Introduction 134
The Financialization of Companies 136
The Role of the Function of Finance in Internationalized Companies 138
Creation of Supervision Nodes 142
Financial Risks and Counterparty Risks 145
Currency Risks 148
Price Risks 150
Credit Risk, Country Risk, and System Risk 151
Hedging Policies and Derivative Instruments 156
Currency Futures 157
Currency Options 160
Currency Swaps 162
Price Risk Hedging and Value Creation: Some Evidence from Jet Fuel 164
References 168
6: The Role of Culture in Internationalization 170
The Key Role of Cultural Competence 170
But Why Is the Context’s Culture So Important? 177
But What Is Culture? 180
Assumptions and Values 184
National Culture and Business Culture: A System of Interactions 191
Confrontation Between Business Culture and Cultural Change 193
Cultural Characteristics in Certain “Culturally Homogeneous” Contexts: Impact on Local Entrepreneurial Systems 197
USA–Japan 197
Japan–China 205
Korea: A Cultural Hybrid 208
India 214
The Many-Cultured Europe 219
References 221
Index 231