From Global Mindset to International Opportunities: The Internationalization of Chinese Smes

Abstract

Following China’s “One Belt One Road” global economic expansion strategy, Chinese small and medium-sized enterprises (SMEs) along with state-owned, large corporations are increasingly seeking business opportunities internationally. Little is known about the process of small firms’ international opportunity creation and discovery in this particular context. This study examines the role of Chinese SME manager’s global mindset in driving their international opportunity identification through two key activities in their internationalization process: international knowledge based and networking activities. Data were collected from a survey of 191 small and medium-sized enterprises in China. The results of structural equation modelling show that Chinese SME managers’ global mindset has a positive effect on both international networking and knowledge acquisition activities, which in turn have positive effects on the development of international opportunities. The findings suggest that SMEs, while going through the internationalization process, rely extensively on social interaction with foreign business partners to obtain knowledge of the customers and institutions in the foreign market.

Cross-border network ties of returnee entrepreneurs and foreign market diversity

“…Global mindset has been associated with firm internationalization (e.g. Felicio, Duarte and Rodriquez, 2016; He et al, 2020). Indeed, the literature suggests that internationalization is often driven by managers' desire to pursue growth in international markets (Oviatt and McDougall, 1994).…”

“…Individuals with a global mindset view entry into various foreign countries as an opportunity to enhance their growth (Englis and Wakkee, 2015). This desire motives them to be more proactively engaged in identifying international opportunities and making efforts to exploit such opportunities (He et al, 2020). Given that cross-border network ties allow access to foreign market knowledge and information that might not available in home country markets (Wang, 2020), we expect that returnee entrepreneurs with a global mindset are more willing to learn from people in their cross-border networks and more proactively interact with such network members to seek every possible opportunity in foreign markets.…”

Regional expansion of emerging market SMEs: the roles of domestic market environmental uncertainty and international alliance partner diversity

“…Thus, cross-cultural knowledge absorption is the ability of an SME to effectively integrate and exploit knowledge, "which provides an individual within the organization with a common vision to achieve interaction" (Zhang et al, 2018, p. 629), thereby promoting regional expansion. The relatively heterogeneous cultural characteristics of countries within the Asia-Pacific region mean that cultural adaptability and cross-cultural knowledge absorption will be a significant asset to the internationalization success of SMEs (He et al, 2020). Since IAPD involves different partners, the successful knowledge exchange among them requires that all partners receive the same information and benefit from joint interactions (Nyamrunda & Freeman, 2021).…”

The Role of Network Ties on SMEs Internationalization Process in the Developing Countries Emerging Markets: A Comparison between Mongolia, China, and Malaysia

“…On the bright side of the globalization phenomenon is the encouragement for large enterprises and SMEs to expand their business beyond the domestic market and compete globally with fewer barriers (Chelliah et al, 2010;Abdullah and Zain, 2011). It also helps reveal their capabilities and develop an entrepreneurial orientation for the owner-managers to enhance their competitive advantage in a rapidly changing environment and be competent enough for aggressive competition (He et al, 2020). Ahimbisibwe et al (2020) specified that compared SMEs in developing countries to MNEs possess a limited resource, market knowledge, and skills.…”