Internationalising in small, incremental or larger steps?

By H. Barkema, Rian Drogendijk. 2007

402 citations recorded by the source corpus.

We argue that companies may enter foreign environments either incrementally, as suggested by long-established theory, or by taking larger steps that may result in lower initial performance but, through learning and experience, lead to increased performance in future expansions. This idea is corroborated by the experience of Dutch companies entering into Central and Eastern Europe. We also find that expansion steps may be too large, thereby limiting the exploration of foreign environments. Our study suggests that sequential internationalisation strategies do still matter, and that companies have to balance exploitation and exploration in internationalisation.

Subfields: Accounting, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/2cf374d82326c4f7b923a021a7ce47f55ed8048b

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Citations in the corpus

Institutional distance and local isomorphism strategy (2012, background): “In short, experience allows foreign entrants to improve decision making, coordinate operations more efficiently, overcome distance-related costs, and ultimately improve performance in the host market (Barkema & Drogendijk, 2007; Henisz & Delios, 2002).”
Towards a more balanced treatment of culture in international business studies: The need for positive cross-cultural scholarship (2014, background): “From an organizational learning perspective this implies that “learning is optimal if new knowledge is neither too similar to, nor too different from, existing knowledge” (Barkema & Drogendijk, 2007: 1136).”
Cultural differences, MNE learning abilities, and the effect of experience on subsidiary mortality in a dissimilar culture: Evidence from Korean MNEs (2013, methodology): “Barkema and Drogendijk (2007) found that Dutch MNEs lacking international experience were not able to learn from their previous experiences in CEE countries, which are culturally distant from the Netherlands.”
Sequencing the expansion of geographic scope and foreign operations by “born global” firms (2011, background): “In the short term, managers prefer gradual and incremental expansions of their geographic scope and foreign operations in order to avoid the risks associated with radical internationalization moves (Barkema & Drogendijk, 2007).”
Capabilities as a mediator linking resources and the international performance of entrepreneurial firms in an emerging economy (2010, background): “Barkema and Drogendijk (2007) believe international experience helps companies to benefit from their previous international business experiences and thus has a positive impact on international performance.”
LINKING THEORY AND CONTEXT: "STRATEGY RESEARCH IN EMERGING ECONOMIES" AFTER WRIGHT ET AL. (2005) (2012, neutral): “Central research questions concern the interaction between three sets of variables: firstly the organizational antecedents including a firm’s absorptive capacity and past experience (Barkema and Drogendijk, 2007; Minbaeva et al., 2003); secondly the processes put in place by organizations, such as t”
Organising new business in a turbulent context: Opportunity discovery and effectuation for IJV development in transition markets (2009, neutral): “An international opportunity discovery and effectuation is, thus, more about creating a meaning based on scattered and ambiguous information rather than deriving a decision within a limited decision space and based on exact information (Barkema and Drogendijk 2007).”