Born globals: taking stock, looking ahead (original) (raw)

Born Globals: Taking Stock, Looking Ahead INTRODUCTION The research on born globals is developing fast. This new breed of firms challenges old, well established views of internationalisation. Unlike 'traditional' multinationals which experienced relatively slow, incremental internationalisation processes, usually anchored on a sound domestic business basis, born globals embrace the world, or significant parts of it, as their market since (or almost since) inception. They emerge as international players, taking profit from globalisation and technological advances in information and communication technologies (Knight and Cavusgil, 2004), and focussing on niche international markets. Yet this research field remains largely unchartered. Several research strands have developed, espousing different operational definitions and theoretical bases. The newcomer will see many 'trees', many studies following multiple approaches, and will be faced with the difficult to find to what extent such 'trees' are part of a same 'species'. This raises some discomfort, and doubts with regard to the soundness of research paths. More than ten years have elapsed since Rennie's (1993) seminal paper. Even though the survey carried out by Rialp et al (2002) made a good contribution, there is a need to improve the chartering of the field, especially on what concerns empirical studies. This is the purpose of the present paper: it will take stock of, and analyse extant literature, to look ahead, identifying convergence axes, under-researched topics, and new questions to be answered. The present paper will be organised in six sections, including this introduction. The second will present the main issues raised by born globals literature as well as the main focus of the paper. Then, the research design is explained, highlighting the method used for analysing the foundations of extant literature. The results obtained are present in section four. 3 Two axes will deserve particular attention: theoretical approaches and operational definitions used. Typologies of born global studies will be developed under each axis. The fifth section provides a discussion of the results. The paper closes with a concluding section, where several questions will be raised as possible 'milestones' for guiding further research on the topic. THE ISSUES The pioneering research carried out by Nordic scholars (Johanson and Wiedersheim-Paul, 1975; Johanson and Vahlne, 1977; Luostarinen, 1979) established a paradigm of the internationalisation process which has been dominant for more than twenty years. The main tenets of such a paradigm were (Petersen and Pedersen, 1997): at the theoretical level, the time-consuming accumulation of experiential market knowledge leads to an incremental foreign market commitment; and at the operational level, such incremental process is translated into step-wise establishment chains as well as into a geographical expansion pattern like "rings in the water" (Madsen and Servais, 1997). It has been increasingly recognised, however, that-in a "shrunk" world and in an "accelerated" time-incrementalism was being challenged by emerging international business requirements (Johanson and Vahlne, 1990 and 2003a; Petersen and Pedersen, 1997). In fact, a new type of firms got academic attention in the nineties, following an internationalisation pattern in sharp contrast with the incremental process postulated by the 'Nordic School'. Fast international reach, innovative moves, and multi-faceted cooperative arrangements characterised these firms, named as born globals (Rennie, 1993), international new ventures (Oviatt and MacDougall, 1994), instant exporters (McAuley, 1999) or even supranationals (Hamel, 1995). These firms-called hereinafter born-globals to use a general label-are undoubtfully a by-product of globalisation (Knight and Cavusgil, 2004), but they 4 are simultaneously furthering it. In today's turbulent environment, firms must adapt quickly in order to survive and to achieve success, and need to forge opportunities, identifying global niches, often without relying on 'lead' markets. Reasoning on a 'traditional' internationalisation approach it becomes puzzling how these firms-often with no previous business experience, lack of knowledge about foreign markets, and scarcely endowed with financial resources-can compete and thrive internationally. Since the work of Rennie (1993), numerous scholars have studied these firms, and a wealth of literature emerged. So far, some areas of consensus were developed. It has been argued that entrepreneurs play a key role in the foundation phase, providing technical competencies, using strong and weak ties to design, manufacture and market distinctive products or services. Social capital is often assimilated to a resource, providing the young firm the credibility needed to get the 'right' to enter strategic international networks. Additionally, it was found that these firms tend to adopt international niche market strategies, often supported by a complex network of partners along the value chain-or else, based on the vertical segmentation of businesses. Are we faced with a paradigm change (Kuhn, 1962) in the study of internationalisation processes? We are not in a position now to respond such a question. The answer requires a closer look at the key issues addressed by the born globals literature. It seems, however, that we are still at a pre-paradigmatic stage. In other words, making a parallel with the development of industries, we appear to be at a fluid stage (Abernathy and Utterback, 1978), where no dominant design has emerged so far. There are too many descriptions and characterisations of this kind of firm, but the field remains-as it was argued above-'unchartered' in general terms. There is, therefore, a need to analyse the work undertook so far, to build a basis for future progress as well as to achieve scientific legitimacy.