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Internationalization patterns of small and medium-sized enterprises

Olli Kuivalainen, Sanna Sundqvist and Sami Saarenketo
School of Business, Lappeenranta University of Technology, Lappeenranta, Finland, and

Rod McNaughton
Conrad Centre for Business, Entrepreneurship and Technology, University of Waterloo, Waterloo, Canada
Abstract
Purpose The purpose of this paper is to present an overview of the conceptual frameworks and concepts with which the research on internationalization patterns of small and medium-sized enterprises (SMEs) should be conducted. Design/methodology/approach A comprehensive overview of concepts and a conceptual framework to study internationalization patterns of SMEs is offered. Findings The complexities of existing definitions and methodologies for researching internationalization patterns are highlighted, and a synthesis of the issues is provided. An integrative model of internationalization pathways, and their antecedents and outcomes is presented. Research limitations/implications It is recommended that future research focuses especially on the time dimension of internationalization patterns. Future research can contribute to the literature by adopting a longitudinal approach with larger samples and more detailed cases to capture the dynamics of internationalization. Practical implications Practitioners might map their positions, and look for challenges and opportunities with regard to their chosen internationalization pattern. They can also benchmark other firms pathways and fine-tune their own approach to internationalization. Originality/value The paper integrates a large body of research in an important research area in international marketing. It also provides guidance on how to conduct future research in the area, and introduces the content of this special issue of the International Marketing Review. Keywords Small to medium-sized enterprises, International business, Internationalization, Patterns, Pathways, Born globals, International new ventures Paper type Viewpoint

International Marketing Review Vol. 29 No. 5, 2012 pp. 448-465 r Emerald Group Publishing Limited 0265-1335 DOI 10.1108/02651331211260331

Introduction After more than two decades of research on the internationalization of small firms and new ventures, the literature characterizes several stereotypical patterns (paths or pathways) of small- and medium-sized enterprise (SME) internationalization with respect to timing of entry, geographic range, and intensity of commitment to foreign markets. Within the field of international marketing, the origin of literature on internationalization patterns is the notion of stage (or process) models that characterize internationalization as an incremental and linear process during which firms progress from limited exploration of international markets through various stages of increasing commitment as they learn and gather resources (e.g. Johanson and Wiedersheim-Paul, 1975; Johanson and Vahlne, 1977, 2009). This incremental model describes one possible internationalization path. The phenomenon of born-global (BGs) firms or other types

of international new ventures (INVs), in which firms commit to international markets soon after founding, is frequently posited as a challenge to traditional stage models (e.g. Oviatt and McDougall, 1994; Knight and Cavusgil, 1996) and may be seen as another internationalization path. From an international marketing perspective the choice between these two ends of the continuum is clear: a firm either first concentrates on a few markets or it rapidly diversifies into a large number of international markets and conducts marketing activities in all of them (Mas et al., 2006). However, internationalization is more complicated than a simple process of market selection: the level of internationalization does not necessarily steadily increase. Firms can retrench or de-internationalize (Benito and Welch, 1997), they can internationalize rapidly after a long period of domestic focus (Bell et al., 2001), and there may be several episodes of internationalization that eventually emerge as a long-term pathway of internationalization ( Jones and Coviello, 2005). The longitudinal development of internationalizing SMEs, and the performance implications of different internationalization pathways, are under-researched. Zahra and George (2002), for example, in their review of international entrepreneurship pose the question of what happens after the internationalization and conclude that only a few studies look at this issue. There is still a paucity of empirical research on whether accelerated internationalization (or another internationalization path) plays a role in determining long-term survival, success and/or growth. The few studies that have investigated this report contradictory or ambiguous findings (e.g. Bloodgood et al., 1996), are based on small samples (e.g. Gabrielsson et al., 2008), or focus on a limited number of pathways (e.g. Mudambi and Zahra, 2007). Consequently, this paper has two goals. First, we present an overview of the conceptual frameworks and concepts with which internationalization pathways can be researched. We highlight the complexities of existing definitions, the methodological problems related to these, and explore possible strategies to overcome definitional and measurement challenges. Second, we introduce the content of this special issue of the International Marketing Review. The aim of this special issue project was to present studies that explicitly deal with the internationalization patterns (or paths/pathways) of internationalizing SMEs (e.g. INVs, BGs, born-again global firms), and that consider the antecedents and performance outcomes of these patterns. Though there is considerable research on the drivers and outcomes of internationalization, there is no integrative framework that identifies and explains the different pathways that companies follow during their internationalization. This gap limits our understanding of internationalization behavior and processes of accelerated internationalization. For example, we have yet to fully explain why early internationalizing firms follow different pathways, and if their choice leads to different performance outcomes. We hope the issue serves its purpose and contributes to the ongoing discussion about the internationalization of SMEs and to the emerging domain of international entrepreneurship. Internationalization patterns, pathways, or what? Calof and Beamish (1995, p. 116) defined internationalization as the process of adapting firms operations (strategies, structures, resources, etc.) to international environments. There are, however, numerous terms with which SMEs internationalization process is described, and it is not clear what this type of process perspective should mean. Bell et al. (2003), for example, use terms such as patterns, pathways, and trajectories interchangeably to describe the internationalization

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activities of SMEs. We think it is important to distinguish between a pattern and a path (or pathway). Jones and Coviello (2005, p. 292) suggest that [y]internationalization may be captured as patterns of behavior, formed by an accumulation of evidence manifest as events at specific reference points in time. The notion of behavioral patterns suggests a firm (and its managers) tend to have a recurrent response when faced with similar situations. Thus, an internationalizing SME may go through a number of patterns which form part of a distinct (and sometimes stereotypical) internationalization path/pathway (Kuivalainen and Saarenketo, 2012; Jones and Coviello, 2005 express a similar idea using the term dynamic international profile). The concept of an internationalization path/pathway relates to the how question about the internationalization process. We suggest that a pathway can be understood as consisting of several phases or stages during which a firm follows or shows a certain behavioral pattern related to its internationalization. For example, early and rapid internationalization can be seen as a specific start-up pattern of internationalization for a firm (Kuivalainen et al., 2012). After initial internationalization, another specific type of behavior may follow when a firm increases (or decreases) its commitment and presence in international markets. This pattern could, for example, be seen as a growth phase (Kuivalainen and Saarenketo, 2012), or growth and resource accumulation phase (Gabrielsson et al., 2008). These patterns are similar to those characterized in the early stages of traditional life-cycle models, but in this case form part of the BG ijo et al., 2005; Luostarinen and Gabrielsson, 2006; internationalization pathway (A Gabrielsson et al., 2008; Lindqvist et al., 2010). These phases are not necessarily sequential (as in stages models), rather there can be large variety in patterns and development among SMEs. This may stem from entrepreneurial behavior, capabilities, and other internal triggers, or from external influences such as customer networks ( Jones, 1999; Mathews and Zander, 2007). The end result of this process may take place when a BG firm becomes a mature BG (Kuivalainen et al., 2007) or micro-multinational (Dimitratos et al., 2003), for example. Other outcomes may include survival (vs bankruptcy) (Mudambi and Zahra, 2007), de-internationalization (Bell et al., 2003), and subsequent re-internationalization (Welch and Welch, 2009), or a merger or acquisition with another firm (Kuivalainen et al., 2012). Existing measures, typologies, and how they fit with pattern and pathway thinking An important approach to conceptualizing various pathways is to analyze the degree of internationalization (DOI) or a static international fingerprint (Kutschker et al., 1997) at various points during a firms life-cycle. The activities conducted and organizational structures within which these activities are implemented change and develop during a firms life-cycle. The specific process of internationalization development and its relationship to a firms overall strategy can be studied in parallel. These life-cycles can work in unison (as in the case of a BG firm in which the general firm life-cycle and international development life-cycle are more or less the same) or a firm can have a long history of operating in their domestic market before their internationalization life-cycle actually begins (as in the case of born-again globals). A methodological issue is how to define and measure the stereotypical patterns of behavior that distinguish internationalization paths. The various measures used to measure DOI (and consequently to classify the phases of internationalization) can be categorized under three themes: first, scope (diversification vs concentration); second, scale (or extent/intensity); and third, time. These three dimensions were identified by Zahra and George (2002) in their review of international entrepreneurship research,

and appear in many studies focussing on BGs or INVs. These dimensions have their roots in the mainstream international business literature, for example, Tallman and Li (1996) suggested the use of measures of scale and scope to define firms internationalization strategy. Time is also an important conceptual dimension as it adds dynamism; both the overall development of a firm and its internationalization are a function of time ( Jones and Coviello, 2005). An important internationalization pathway is represented by the concept of BGs, especially as many studies portray BGs as a challenge to the traditional stages models of SME internationalization. We see BGs as early adopters of internationalization (i.e., organizations that from or near founding seek superior international business performance and sell their outputs in multiple countries), a view that is shared by other researchers (e.g. Knight and Cavusgil, 2004; Rialph et al., 2005). This definition distinguishes the temporal dimension (early and from or near founding) from the market scope dimension (multiple countries). The scale of operations (i.e. sales) is also implicit. Other conceptualizations include a vision or global mindset (e.g. Knight and Cavusgil, 1996; Luostarinen and Gabrielsson, 2006) but we consider these to be antecedents to a BG pathway rather than a characteristic of that path. Another issue is that many researchers use the terms BG and INV as synonyms. The latter term stems from the work of Oviatt and McDougall (1994). They presented a typology of small, rapidly internationalizing firms based on the number of countries involved and the amount of coordination of value-chain activities. Oviatt and McDougall (1994) distinguish some possible pathways of rapid internationalization, for example, young internationalizing firms that quickly diversify geographically were called multinational traders or more committed global start-ups. True BGs having a large geographical presence and high foreign sales to total sales (FSTS) ratio, resemble these so-called global-start ups. However, the majority of research on BGs only focusses on export activity, rather than the full range of possible value chain activities. Surprisingly few studies that use the original Oviatt and McDougall (1994) typology exist: Pulkkinen and Larimo (2007) and Baum et al. (2011) are the primary examples. However, a number of recent studies of BGs focus on identifying types of early and rapidly internationalized firms, and comparative research has matured beyond simply studying only differences between BGs and traditionally internationalizing SMEs. The various types identified include born regionals (Lopez rd and Sharma, et al., 2009; Johanson and Vahlne, 2009), born internationals (Majkga 1999; Kundu and Katz, 2003), and true BG (Kuivalainen et al., 2007). The latter term describes firms that operate in a number of regions, whereas the first two describe firms that focus on a geographically concentrated set of international markets. A final issue is how these classifications are developed, and the associated tools for theory development and empirical testing. While some researchers use pre-defined criteria to define BGs (e.g. Knight and Cavusgil, 2004; Kuivalainen et al., 2007), others take a data-driven approach and use cluster analyses to identify types of internationalizing firms (e.g. Aspelund and Moen, 2005; Knight and Cavusgil, 2005), and a few combine these methods to validate the typology (Kuivalainen et al., 2012). Research using either method is dominated by cross-sectional data, and few studies classify firms based on longitudinal development. The actual path is not analyzed, rather the analysis is limited to a short period, and/or there are a small number of measurement points. Longitudinal studies of INVs or BGs are rare, despite research focussed on patterns and processes among internationalizing SMEs

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being one of the oldest sub-domains in international entrepreneurship research ( Jones et al., 2011). Toward a holistic model Two key research questions are whether internationalization pathways have different antecedents, and if they lead to different outcomes. In this section we review the available evidence and suggest a model to focus further research. Antecedents Identifying antecedents of internationalization pathways involves considering a multitude of determinants at the firm level, managerial level, and environmental level. Figure 1 presents our simplified model of the antecedents and outcomes of internationalization paths, with timing, scale, and scope of internationalization being the primary characteristics that distinguish between different internationalization pathways. At the firm level, resources, knowledge and strategies affect foreign entry decisions, and some of these antecedents support internationalization whereas others may inhibit a firm from entering international markets. For example, the literature on SME internationalization stresses liabilities of newness and smallness (e.g. Hymer, 1976; Zaheer and Mosakowski, 1997; Zahra, 2005; Mudambi and Zahra, 2007; Johanson and Vahlne, 2009). However, others point to the learning advantage of newness, arguing that early internationalizers may benefit from learning flexibilities and a lack of constraining administrative heritage (e.g. Autio et al., 2000; Blomstermo et al., 2004; Schwens and Kabst, 2009). At the manager level, managerial characteristics,
Antecedents Internationalization patterns
Time: precocity

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Outcomes

Managerial level
Mindset Experience Entrepreneurial orientation (risk taking, proactiveness, etc.) Early patterns P 1 Scope 1: # of countries Scope 2: # of regions Scope 3: distance Scale 1: FSTS Scale 2: mode P 2 P 3 Late patterns P 4 P 5 P 6

International financial performance

International growth performance

Firm level
Resources Knowledge Strategic orientation Networks Capabilities Liabilities

Performance relative to firm goals

Firm survival

Environmental level
Industry factors Environmental dynamism, uncertainty, turbulence Different types of environments: market, competitive, technology, customer, regulatory Distance Country of origin

Value: market value, brand value, etc.

Figure 1. Model of internationalization patterns, antecedents, and outcomes

Soft issues: company image, employer brand?

Note: Figure 1 is simplified and thus does not include possible reciprocal relationships between antecedents, or the direct effects of antecedents on outcome variables

orientations, and mindset are frequently cited antecedents. Many studies confirm the pivotal role of the international experience of the entrepreneur and/or top management in INV (e.g., Reuber and Fischer, 1997); and that firms with more internationally experienced management (Nummela et al., 2005) or a global mindset (Nummela et al., 2004), or entrepreneurial orientation ( Jantunen et al., 2005; Kuivalainen et al., 2007) are more likely to follow a path that is characterized by earlier, quicker and larger scale and scope of international activities. Finally, environmental factors can affect firms internationalization either by pushing firms toward international markets or by forming entry barriers. As examples, industry conditions that require an international presence to be competitive will tend to push firms to internationalize (Bloodgood et al., 1996), while environmental turbulence may inhibit internationalization because of limited resources and knowledge. Internationalization patterns As our model distinguishes internationalization pathways in terms of combinations of scale, scope, and temporal measures, the antecedents to internationalization need to be considered from three perspectives: (1) (2) (3) factors that differentiate early vs late internationalizers (i.e. a firms precocity or tendency to enter international markets earlier than others); how different antecedents contribute to the scale and scope of internationalization; and how antecedents may change over time.

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Additionally, there may exist feedback relationships among antecedents (like knowledge) and characteristics of internationalization (like scope and scale, or entry/ operation modes) as more direct entry modes may offer firms better chances to learn from international markets, and thus help firms in their subsequent entries. In the middle of Figure 1, we use the focal dimension of time to distinguish the two main pathways. Timing (when internationalization begins and how quickly and consistently it proceeds) is the key differentiating factor between internationalization paths. BGs, for example, may follow a similar development process to traditionally internationalizing firms in their operational development ( Johanson and Vahlne, 2009), but the development phases these firms go through are condensed into a shorter timeframe (Hashai and Almor, 2004) (or some of the developments may have taken place even before the foundation of the firm (Madsen and Servais, 1997). Although no exact time frames have been suggested for firms following a traditional path, two main assumptions are implicit: first, there is a long gap between the foundation of the firm and its subsequent commencement of international operations and second, it takes time for a firm to reach a higher DOI (in terms of both scale and scope). Much of the existing literature focusses on precocity as the key temporal characteristic (i.e. the time-lag between the founding of a firm and the commencement of internationalization) (Zucchella et al., 2007). Precocity is an important measure in distinguishing INVs or BGs from traditionally internationalizing SMEs and bornagain globals. However, there is little agreement on the definition of precocious internationalization, with some researchers using a limit of two years (e.g. Rennie, 1993; Moen and Servais, 2002), three years (e.g. Knight and Cavusgil, 2004), or even five years after founding (e.g. Acedo and Jones, 2007).

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Internationalizing pathways are further distinguished by their scale and scope. Measures of the scale of internationalization relate to the extent of a firms international operations. The classic measure of scale is export intensity (FSTS ratio) (Sullivan, 1994). Researchers focussing on early and rapidly internationalizing SMEs have used a range of FSTS ratios to indicate significant internationalization, with the most frequent being 25 percent (Knight, 1997; Knight and Cavusgil, 2004), though most acknowledge pre-defined cut-off ratios are somewhat arbitrary (Knight and Cavusgil, 2004, p. 133). Other measures of the extent of internationalization are operation mode (and its subsequent changes) and the amount of foreign assets (e.g. Rugman and Verbeke, 2008). However, during the early phase of internationalization, it is clear that exporting is the dominant operation mode. Typically SMEs cannot afford large foreign direct investments or choose not to do so for operational reasons (Dalli, 1994; Brouthers and Nakos, 2004). Operation modes may, however, change as learning effects increase the capabilities of the firms and when their resource and knowledge bases grow (Benito et al., 2009). The international marketing literature is nearly unanimous in identifying two main market scope strategies: market concentration (i.e. geographically narrow or limited scope) and market diversification (i.e. multiple markets or broad geographic scope) (Ayal and Zif, 1979; Yeoh, 2004). Measures of scope usually relate to the number of countries or regions in which a firm sells its products or services (e.g. Reuber and Fischer, 1997; Zahra et al., 2000; McNaughton, 2003). The literature on BGs implies such firms sell to multiple national markets, but there are no exact definitions, and context is also important. For example, Reuber and Fischer (1997) focus on Canadian software firms and analyze their scope of operations in three regions Canada, North America, and outside North America. This type of operationalization would not be suitable in a Swedish or Finnish context, for example, as they have more neighboring countries and are members of the European Union. There are several possible ways of addressing the issue of context. One is to define BGs as having more national markets than there are neighboring countries. This makes them conceptually different from SMEs that follow a traditional internationalization path and only internationalize to close-by countries. There are other possible measures: to be classified as BG, a firm might have to operate in multiple continents (e.g. in each of the triad regions), or generate more than 50 percent of sales outside its home continent (Luostarinen and Gabrielsson, 2006). Another possibility is to assess scope of internationalization from the perspective of firm functions. A simple measure is the diversity of the nationalities of employees and their location in different regions. Additional measures could be developed by measuring operational scale indicators at the regional level (e.g. measuring the FSTS ratio at the regional level (Kuivalainen and Saarenketo, 2012; Rugman and Verbeke, 2004, 2008). For the sake of creating a simple model, we focus attention on the key measures of the number of target countries (multiple vs fewer), regions (worldwide vs closer regions), and distance between home and foreign markets. Outcomes Nearly 20 years ago Oviatt and McDougall (1995, p. 39) concluded that No one knows whether the survival probability for global start-ups will be any better or worse than for domestic new ventures. Unfortunately this is still largely true as empirical studies reporting the outcomes of various internationalization patterns are largely missing (for some exceptions see Zahra, 2005; Sapienza et al., 2006; Mudambi and Zahra, 2007;

Kuivalainen et al., 2012). There are several approaches to describing and categorizing the outcomes of internationalization patterns (see Sheth and Sisodia, 2002; Kuivalainen et al., 2006 for strategic and market position related measures). One possibility, especially among INVs, is to focus on ownership changes; that is if a firm has stayed independent, had an IPO, or been taken over by another firm. In the model, we propose several potential exemplary categories of outcomes, including international financial performance and the international growth of the organization as it evolves along its internationalization path. International growth refers both to short-term and long-term performance, and thus also captures the later internationalization of early internationalizing firms. The context and firm specificity of internationalization decisions makes it difficult to measure their effects on outcomes, as does the dynamic nature of the phenomenon in which changes in internationalization may substantially lead changes in international performance. Figure 1 leaves two important questions unsolved: first, what are the alternative patterns among early and late internationalizing firms and second, how do these patterns evolve over time? By presenting a few exemplary patterns, Figure 2 sheds some light on these broad questions. As discussed earlier, DOI measures provide snapshots of firm development over time, which can be used to describe the internationalization path. Figure 2 demonstrates the importance of unified definition and operationalization of internationalization patterns. Using only one or two DOI subdimensions in our operationalization, it is still possible to identify a set of different patterns. For example, agreeing that the BG pattern describes firms that are early internationalizers, deriving at least 25 percent (or some other large percentage) of their sales from foreign markets and operating in multiple countries, we end up with several patterns, four of which are shown in Figure 2. Very little is known about pattern changes: how firms patterns change and why they change. In Figure 2, we have divided pattern changes into three broad categories: internationalization paths, de-internationalization paths, and mixed paths. In internationalization paths, changes in firms DOI are always positive, i.e. a firm increases its DOI by either increasing the scope (the number of regions, distance) or scale (operation mode). In the de-internationalization path, the development is reverse, whereas in mixed paths changes in some of the DOI dimensions are positive and in others they are negative. In addition to scale and scope dimensions, we have incorporated a time dimension that reflects the speed of a firms pattern changes, and thus subsequent international growth and development. A noteworthy issue is the reverse patterns that underlie de-internationalization and withdrawal from international markets. Particularly during a time of economic turmoil and crises in the Euro zone and the rest of the world, it is vital to understand the drivers and consequences of these reverse patterns. The form of de-internationalization and decreasing commitment from operations in an international market is expected to be dependent on the very type of pathway that the company followed to the international market. Furthermore, depending on the entrepreneurs capability to learn from the withdrawal and possible mistakes, another outcome may be re-internationalization at some later time. The papers in this issue Our call for papers on internationalization pathways prompted submissions of 65 papers. This huge response indicates the attention this pertinent issue is receiving internationally. We received submissions from Europe, USA, Canada, LatinAmerica,

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Early internationalization patterns BG DOI dimension Low Rapid incremental Born regional

Late internationalization patterns Born again Slow global incremental Low High Low High Late regionals Low High

High Low High Low High a bcd

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Scope 1: # of countries Scope 2: # of regions Scope 3: distance Scale 1: FSTS Scale 2: mode Potential internationalization paths, i.e. DOI positive a b: + mode c d: + mode a c: + regions + distance acd b a: mode: d c: mode: c a: regions distance b c: + regions + distance mode c b: regions distance + mode
A BCD

Potential deinternationalization paths, i.e. DOI negative

Mixed paths

Figure 2. Examples of potential patterns and pathways

Africa and Asia, and Oceania. The scope of topics spanned the range from comparisons of internationalization paths to papers focussed on single paths and their performance consequences, and specific situations such as strategic alliances or internet companies that have special internationalization pathways. Methodologically there was a rich variety, with researchers using case studies and interviews, secondary panel data, and cross-sectional survey data. Some papers also collected measures at multiple points in time in an attempt to follow what happens after initial internationalization.

The papers that made their way through the review process will be published in two issues in 2012 and 2013. This issue contains four papers, the first of which is authored by Olejnik and Swoboda. These authors use data collected by a survey of 674 German SMEs to identify and describe internationalization pathways and the determinants of the patterns. Three distinct internationalization patterns based on time, scale, and scope variables are identified: traditional, BG, and born-again global. Noteworthy in Olejnik and Swobodas paper is the inclusion of entry mode in their measure of scale, and the way DOI is measured. Deviating from the dominant approach of using predefined arbitrary thresholds, Olejnik and Swoboda base their classification on the results of latent class analysis. The classes are profiled by sets of internal capabilities. Olejnik and Swoboda provide interesting results concerning the changes across internationalization patterns, and identify 27 possible combinations of changes in these patterns. In the second paper, Kontinen and Ojala investigate and extend the applicability of Bell et al.s (2003) framework of internationalization paths using case studies of eight Finnish family-owned SMEs. The international pathways of these SMEs are described and antecedents of the chosen path are discussed. Similarly to Olejnik and Swoboda, Kontinen and Ojala also identify three pathways, namely traditional, BG, and born-again global. Their content analysis reveals six antecedents of the pathways, including managerial attitudes and behavior as well as product-level characteristics. An important implication arising from their study is the role of family ownership and decision-making centralization on the internationalization of SMEs. In the third paper, Sui, Yu, and Baum study the early internationalization patterns among Canadian exporting SMEs using a large (n 6,079) set of longitudinal secondary data. Sui et al. use both the INV and stage models of internationalization frameworks to develop a more fine-grained perspective on internationalization patterns. Three early internationalization pathways are detected among Canadian SMEs: BG, born regional, and gradual internationalization. Their model includes measures of firm resources and capabilities (firm size, labor productivity, product diversification), contributing to our knowledge about the influence of these antecedents. Finally, the paper authored by Li, Qian, and Qian, examines the early internationalization and performance of small US high-technology BG firms using secondary and mail survey cross-industry data. Although the authors do not specify patterns of international behavior explicitly, the scale, scope, and time aspects of internationalization are embedded in the study. The time aspect is controlled in the study design by focussing only on firms that internationalized within three years of founding. Scope and scale are measured by an innovative entropy measure of the distribution of foreign sales across four market regions. The paper contributes to an understanding of the drivers of early internationalization rather than multiple pathways. Antecedents are studied at the firm level and include experience, technology, and advertising intensity, alliance activity, and interactions among these factors. Opportunities for further research The papers published in this special issue provide partial insight into aspects of our model of internationalization pathways. The four papers cover DOI dimensions rather broadly, and in most cases time, scale, and scope are applied. The time dimension is well represented (although the identification of early internationalizing firms varies

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between three and eight years). Scale is often interpreted rather narrowly, using only FSTS, while scope is measured as number of countries or using Rugman and Verbekes (2008) regional vs global perspective. It became evident to us while editing this special issue that the most important way future research can contribute is by using more diverse measures of scale and scope, and expanding the period over which firms are studied to improve understanding of the pattern and speed of internationalization after the early and initial phase. The various ways in which timing and speed both define and influence internationalization pathways have unfortunately not been fully examined in the literature. We are still searching for answers to questions such as those posed by Kuivalainen et al. (2007, p. 266): when does the born globalness end, and what is the proper speed of internationalization for a born-global firm? Both longitudinal studies with large samples and detailed case studies are needed to further this research stream. The contributors to the special issue identify three distinct internationalization patterns: traditional, BG, and born-again global (Kontinen and Ojala; Olejnik and Swoboda), or incremental, born regional, BG (Sui et al.). However, distinguishing three (or four) focal pathways still offers a simplistic view of the phenomena (see Figure 2). The approaches advocated for example by Jones (1999) and Kuivalainen et al. (2012) might provide a more complex picture of the patterns and pathways. The inward, supply-side perspective should also be studied in a more detailed manner (see Knudsen and Servais, 2007). Internationalization pathways are influenced by interactions between the entrepreneur/management team, firm, and the environment in which a firm operates ( Jones and Coviello, 2005). The papers in this issue cover the upper left part of Figure 1, as the antecedents studied relate primarily to firm resources and managerial factors. However, the papers are not well grounded in theories that explain why these are important antecedents of internationalization paths. Future research might bring ideas from the capability perspective (as dynamic capabilities may relate to a firms ability to internationalize early and to adapt its internationalization behavior, Weerawardena et al., 2007), and/or a learning perspective to explain how the initial start-up patterns shape the outcomes (which stages model does well for firms following a traditional incremental internationalization path). Furthermore, environmental factors (like target country environmental turbulence, which may initially prevent adoption of some entry modes and further explain changes in operation modes) should be taken into consideration. The papers provide evidence from firms in the USA, Canada, Finland and Germany. This leaves considerable room to investigate internationalization pathways in very different national contexts. As proposed in our model (Figure 1), external environmental factors affect internationalization decisions, and thus data from non-western and emerging markets, among others, may offer new insights. Similarly the firms studied in the papers published in this issue are primarily exporters, leaving questions about the association between internationalization paths and entry and foreign operation modes. In addition, while the papers use rich and varied data and methods, including one with longitudinal secondary data, none are able to link pathways with international performance over time. A final aspect that we think can still be covered in more detail is the internal change in the rapidly and early internationalizing firms. The measures advocated in most of the papers (and even in this introduction) focus on external outcomes, for example, changes in the DOI. However, internal changes such as how management practices and

communication methods evolve when a firm moves between phases of international growth are almost unstudied in international entrepreneurship research (Kuivalainen and Harris, 2012). As we gain confidence in our knowledge of the antecedents, paths, and outcomes of internationalization, the next logical step is to focus on developing the managerial and organizational processes associated with successfully choosing and pursuing an internationalization path. Acknowledgments We would like to warmly thank the Editors of International Marketing Review Jeryl Whitelock and John W. Cadogan who agreed to host this special issue on the topical area; the always helpful team at Emerald; the authors of the articles, who worked and collaborated with us; and more than 90 reviewers for this issue who helped authors significantly within the development of their papers, and informed us on our editorial decisions. The names and affiliations of the reviewers are as follows: Agndal, Henrik Ahokangas, Petri Almor, Tamar Andersson, Svante Arenius, Pia Aspelund, Arild Baldegger, Rico J. Benito, Gabriel RG Blesa, Andreu Blomqvist, Kirsimarja Buttriss, Gary Crick, David Dellestrand, Henrik Eriksson, Taina Evangelista, Felicitas Evers, Natasha Felzensztein, Christian Filipescu, Diana Freeman, Susan Gabrielsson, Mika Gabrielsson, Peter Gray, Brendan sa Hagberg-Andersson, A ck, Johanna Hallba Hallikas, Jukka Hassett, Melanie Heiman, Bruce Hilmersson, Mikael Hisrich, Robert Hultman, Magnus Hurmerinta, Leila nell, Sara Ha Ibeh, Kevin Im, Subin Stockholm School of Economics, Sweden University of Oulu, Finland College of Management, Israel Halmstad University, Sweden University of Turku, Finland NTNU, Norway University of Fribourg, Switzerland BI Norwegian Business School, Norway University of Jaume I, Spain Lappeenranta University of Technology, Finland The Australian National University, Australia Victoria University of Wellington, New Zealand University of Uppsala, Sweden University of Turku, Finland University of Western Sydney, Australia National University of Ireland, Galway, Ireland ez, Chile Universidad Adolfo Iban Autonomous University of Barcelona, Spain The University of Adeleide, Australia University of Eastern Finland, Finland University of Vaasa, Finland University of Otago, New Zealand Hanken, Swedish School of Economics, Finland University of Vaasa, Finland Lappeenranta University of Technology, Finland University of Turku, Finland San Francisco State University, USA Linnaeus University, Sweden Thunderbird School of Global Management, USA University of Leeds, UK University of Turku, Finland Stockholm School of Economics, Sweden University of Strathclyde, UK San Francisco State University, USA

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Jantunen, Ari Jean, Ruey-Jer Bryan Jones, Marian Kirpalani, Manek VH. ren Kock, So ki, Marko Kohtama Kraus, Sascha heiko, Kalevi Kyla Larimo, Jorma Liesch, Peter Linares, Esmeralda Lindstrand, Angelika Littunen, Hannu Liuhto, Kari Loane, Sharon Madsen, Tage Koed McGaughey, Sara Meyer, Klaus Molina, Franciso Jose Castillo Morgan-Thomas, Anna Morrow, Trevor Nakos, George Naldi, Lucia Neubaum, Don Nummela, Niina ODwyer, Michelle ntyma ki, Eriikka Paavilainen-Ma Park, Taekyung Petersen, Bent Pihkala, Timo Rasmussen, Erik Renko, Maija Rialp, Josep Ritala, Paavo Roath, Tony Rose, Beth Rugman, Alan Ruzzier, Mitja Sainio, Liisa-Maija Sengupta, Sanjit Servais, Per Servantie, Vinciane Sinkovics, Rudolf Smirnova, Maria Tarkiainen, Anssi Terho, Harri Tolstoy, Daniel Tseng, Chi-Hsing Wakkee, Ingrid

Lappeenranta University of Technology, Finland National Chengchi University, Taiwan University of Glasgow, UK Bloomsburg University, USA Hanken, Swedish School of Economics, Finland University of Vaasa, Finland t Liechtenstein, Liechtenstein Universita Lappeenranta University of Technology, Finland University of Vaasa, Finland The University of Queensland, Australia University of Valencia, Spain Stockholm School of Economics, Sweden University of Eastern Finland, Finland University of Turku, Finland University of Ulster, UK University of Southern Denmark, Denmark University of Strathclyde, UK University of Bath, UK University of Murcia, Spain University of Glasgow, UK University of Ulster, UK Clayton State University, USA nko ping International Business School, Sweden Jo Oregon State University, USA University of Turku, Finland University of Limerick, Ireland University of Turku, Finland Yeungnam University, South-Korea Copenhagen Business School, Denmark Lappeenranta University of Technology, Finland University of Southern Denmark, Denmark University of Illinois, Chicago, USA Autonomous University of Barcelona, Spain Lappeenranta University of Technology, Finland University of Bath, UK Aalto University, Finland University of Reading, UK University of Primorska, Slovenia Lappeenranta University of Technology, Finland San Francisco State University, USA University of Southern Denmark, Denmark Universidad de los Andes, Colombia The University of Manchester, UK St. Petersburg State University, Russia Lappeenranta University of Technology, Finland University of Turku, Finland Stockholm School of Economics, Sweden National Pingtung Institute of Commerce, Taiwan VU University of Amsterdam, Netherlands

Welch, Lawrence Wheeler, Colin Villar, Cristina Voss, Hinrich a ta nen, Juha Va Yamin, Mo Yeoh, Poh-Lin Yli-Renko, Helena Young, Stephen

The University of Melbourne, Australia University of Portsmouth, UK University of Valencia, Spain University of Leeds, UK Lappeenranta University of Technology, Finland The University of Manchester, UK Bentley College, USA University of Southern California, USA University of Glasgow, UK

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About the Guest Editors Olli Kuivalainen is Professor in International Marketing at the School of Business at Lappeenranta University of Technology, Finland. His research interests are in the areas of international entrepreneurship, and strategic management, marketing and internationalization of firms, the focus especially being on firms operating in the domains of media and information and communication technologies. He has published articles in Journal of World Business, Journal of International Marketing, Technovation, International Journal of Production Economics and Journal of International Entrepreneurship, among others. Olli Kuivalainen is the corresponding author and can be contacted at: Olli.Kuivalainen@lut.fi Sanna Sundqvist is Professor in International Marketing at the School of Business at Lappeenranta University of Technology, Finland. Her research interests address strategic marketing management (especially in an international context), innovations, and consumer behavior. She has published in Journal of the Academy of Marketing Science, Journal of International Marketing, Journal of Business Research, International Journal of Research in Marketing, Industrial Marketing Management and European Journal of Marketing among others. Sami Saarenketo is Professor in International Marketing and Vice Dean at the School of Business at Lappeenranta University of Technology, Finland. His primary areas of research interest are internationalization, international marketing and entrepreneurship in knowledge-intensive small firms. He has published on these issues in, for example, Journal of World Business, International Business Review, European Journal of Marketing, Technovation, International Journal of Production Economics and Journal of International Entrepreneurship. Rod McNaughton holds the Eyton Chair in Entrepreneurship, and is Director of the Conrad Business, Entrepreneurship and Technology Centre at the University of Waterloo. He holds PhDs in Marketing from Lancaster University Management School, and Economic Geography from the University of Western Ontario. Specializing in international marketing strategy, especially the rapid entry into overseas markets by knowledge-intensive new ventures, his researches on export channel selection, industrial clusters, internationalization, the software business, and the venture capital industry have been published in numerous refereed journals and books. Prior to joining the faculty at UW, he was Professor in Marketing at the University of Otago School of Business in New Zealand. His further interests include international marketing strategy, especially the early entry of new ventures into international markets, the choice of distribution channels in foreign markets, as well as export promotion.

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