Psychic Distance, its Impact and Coping Modes

Child, John; Rodrigues, Suzana B.; Frynas, Jędrzej George

doi:10.1007/s11575-008-0136-3

Cited by 109 publications

(83 citation statements)

References 38 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…It is, however, a country in which one would expect foreign entrepreneurs to experience considerable difficulty, and where they would therefore need to rely heavily on social capital both domestically and in Brazil. The psychic distance between Brazil and the UK is high due to the mutually low familiarity with each country"s language and culture, and the bureaucratic complexities of the Brazilian regulatory system (Child, Rodrigues, & Frynas, 2009). The liability of foreignness in Brazil is also high.…”

Section: Scope and Methodsmentioning

confidence: 99%

“…They therefore have to rely heavily on external parties to help them deal with the uncertainties. They often attempt to enhance their ability to cope with a complex environment through collective organization among themselves and/or by seeking help from trusted partners with close knowledge of the environment in question (Child et al, 2009). In the case of internationalizing SMEs, the partners they seek out in their domestic environment can include export promotion agencies and other members of export clubs.…”

Section: Initiationmentioning

confidence: 99%

See 1 more Smart Citation

Building social capital for internationalization

Rodrigues

Child

2012

Rev. adm. contemp.

Self Cite

View full text Add to dashboard Cite

ResumoCapital social pode ser definido como relacionamentos sociais que conferem benefícios atuais ou potenciais. Trata-se, portanto, de um tipo particular de recurso. As pesquisas recentes chamam atenção para a maneira como conexões e relacionamentos (networking), tanto domésticos quanto internacionais, podem ser crucialmente importantes para pequenas e médias empresas (PMEs) que buscam exportar ou Investir no exterior. Contudo pouco ainda se sabe sobre como as empresas iniciam, desenvolvem e mantêm o capital social. O presente artigo tem por base o estudo de 32 PMEs britânicas que exportam ou, tentam exportar, para o Brasil e de agências institucionais britânicas, cujo papel consiste em facilitar a condução de negócios entre as PMEs britânicas e brasileiras. O estudo abordou tanto as funções do capital social para as PMEs quanto o processo por meio do qual isso foi desenvolvido. A pesquisa apresentada neste trabalho confirma o valor do capital social no empreendedorismo internacional. O capital social pode facilitar a obtenção de informação e interpretação das oportunidades de mercado, além de outras vantagens. A pesquisa também confirma a importância vital da confiança interpessoal na sustentação do capital social entre pequenas empresas.Palavras-chave: capital social; confiança; internacionalização; PMES; setor petróleo e gás. AbstractSocial capital may be defined as social relationships that confer actual or potential benefits. It can therefore be understood as a particular type of resource. Recent research has drawn attention to how connections and relationships (networking) both at home and abroad can be crucially important for small and medium-sized enterprises (SMEs) seeking to export or invest abroad. However, relatively little is known about how SMEs initiate, develop and maintain network relationships. This paper reports a study of 32 British SMEs exporting, or attempting to export, to Brazil and of domestic institutional agencies whose role was to facilitate business conducted between British and Brazilian SMEs. The study explored both the functions of social capital for the SMEs and the process whereby it was developed. Its findings confirm the value of social capital in international entrepreneurship. It can provide information, interpretation, market opportunities, and some degree of protection against the risks associated with foreignness, newness and smallness. The study also confirms the vital importance of personal trust in sustaining social capital between small firms.

show abstract

Section: Scope and Methodsmentioning

confidence: 99%

Section: Initiationmentioning

confidence: 99%

Building social capital for internationalization

Rodrigues

Child

2012

Rev. adm. contemp.

Self Cite

View full text Add to dashboard Cite

show abstract

“…Babichenko (2006) further developed that framework, and defined PD as "the sum of the distance-creating factors minus the sum of the distance-compressing and distance-bridging factors" (p. 215). Later, examining British SMEs exporting to Brazil, Child, Rodrigues, and Frynas (2009) indicated specific distance-bridging factors, which may be influenced by the company and which lowered uncertainty in foreign markets. The authors listed the following factors: company ownership (in family owned businesses the owner/manager is responsible for the well-being of the family and the company, which results in a more conservative approach), education or training obtained in a foreign country, previous experience in a foreign country, presence of a trusted friend or a loyal employs, personal network, cooperation with a trusted foreign partner, and employment of professional managers.…”

Section: Jmbace 23mentioning

confidence: 99%

“…The authors listed the following factors: company ownership (in family owned businesses the owner/manager is responsible for the well-being of the family and the company, which results in a more conservative approach), education or training obtained in a foreign country, previous experience in a foreign country, presence of a trusted friend or a loyal employs, personal network, cooperation with a trusted foreign partner, and employment of professional managers. Three possible ways of dealing with difficulties raised by psychic distance, (which can be grouped as active and passive modes), were denoted (Child et al, 2009): a) bridging -active utilization of distance reducing factors, which leads to lowering transaction cost; b) avoiding -avoiding transaction costs or transferring the problem onto other partners within the companies network; and c) non-coping -which means that the company was not able to find a proper response to the negative aspects of psychic distance. Kontinen and Ojala (2010) have supported these findings in their research on Finnish SMEs operating in France, indicating that in order to overcome distance, SMEs use distance-bridging factors.…”

Section: Jmbace 23mentioning

confidence: 99%

The Psychic Distance Concept: A Review of 25 Years of Research (1990–2015)

Ciszewska-Mlinarič¹,

Trąpczyński²

2016

JMBACE

View full text Add to dashboard Cite

Purpose: There have been numerous studies analyzing the role of psychic (and cultural) distance in the internationalization process focused on relationships between distance and market selection, entry mode, or subsidiary performance. Still, cumulative findings of this body of research are mixed and inconclusive. Thus, this review aims for a rigorous presentation of past research on psychic distance, with particular focus on the aspects of international business operations affected by psychic distance in the light of empirical studies. Methodology:This review encompasses 55 papers, both empirical and conceptual, published between 1990-2015 in top IB, international marketing, and management journals. In general, the papers under review were published in 27 journals, with the vast majority of them being published in 2005 or later. The vast majority of reviewed papers are of empirical character (47 papers), while eight are conceptual. Findings:Since 2005, the number of articles published in top academic journals that featured the term "psychic distance" in the title has quadrupled. Common research topics include not only the core domain of internationalization process and performance, but also focus on understanding the concept of psychic distance, analyzing its antecedents and coping modes. Other studies have addressed the performance implications of psychic distance in conjunction with variables like strategy adaptation to foreign markets. Research limitations/implications:While the present review is limited in the number of papers taken into account, it does provide an initial overview of the structure of the field. However, the comparability of findings of different studies is limited by factors such as firm samples or presence of multicultural nations. In terms of directions for further research, promising topics include the relationship between perceived and 'real' distances or the effectiveness of different coping modes.Originality/value: The present paper identifies key research streams related to psychic distance and its role for international business. Based on an analysis of their content, it outlines several avenues for further investigation.

show abstract

“…Researchers on the internationalization of small firms point out that liability of smallness adds more di culty for small companies than dealing with liability of foreignness (Child et al, 2009). In the emerging market context, of all the dimensions of PD, the perceived risk (uncertainty) associated with the institutional di↵erence could be a very important component of PD.…”

mentioning

confidence: 99%

Contextualization of Evolving Patterns in the Internationalization of Small Firms

2015

Linköping Studies in Science and Technology. Dissertations

View full text Add to dashboard Cite

The internationalization of SMEs has been recognized as one of the important paths to growth in SMEs. However, internationalization is also a resource and competence-demanding process. This is especially true for smaller-sized SMEs – the small and micro-sized firms – which have a large resource constraint, making internationalization even more challenging. Although this group of small firms counts for an average of over 98% of the total population of enterprises in EU countries, extant research on the internationalization of this group is still limited. Therefore, the main purpose of this dissertation is to contribute to a better understanding of evolving patterns of internationalization in the smaller-sized SMEs. The study uses emerging market entry along the internationalization of small firms as a context to probe the dynamics of perceived risk (uncertainty) and perceived opportunity in different foreign markets which influence the important decisions of small firms during their internationalization. The main study takes a longitudinal approach and uses mixed methods to investigate the features in both the initial period and the continued period of internationalization. It mainly builds on a multiple-case study of 12 Swedish firms, which have/had emerging market entry experience and/or involvement. This study illustrates influences from the environmental, organizational and individual levels on evolving patterns of internationalization in the investigated firms. This dissertation concludes that critical decisions and actions taken in the internationalization process depend on interactions among the influence and resources from the three levels. Such interactions form a conditional preference on perceived risk (uncertainty) and perceived opportunity during the internationalization of small firms. The study further proposes that the dynamics in the internationalization process are caused by a prospect-guided change mechanism. This dissertation contributes to the literature by: differentiating patterns of internationalization; enriching the study of “born global” in the continued period of internationalization; introducing a new perspective on the interpretation of dynamics in the internationalization; and increasing the understanding on the interactions of resources from three levels on the internationalization of small firms

show abstract

Psychic Distance, its Impact and Coping Modes

Cited by 109 publications

References 38 publications

Building social capital for internationalization

Building social capital for internationalization

The Psychic Distance Concept: A Review of 25 Years of Research (1990–2015)

Contextualization of Evolving Patterns in the Internationalization of Small Firms

Contact Info

Product

Resources

About