An entry mode decision-making model for the international expansion of construction enterprises

Purpose – The purpose of this paper is to provide a new type of entry mode decision-making model for construction enterprises involved in international business. Design/methodology/approach – A hybrid method combining analytic hierarchy process (AHP) with preference ranking organization method for enrichment evaluations (PROMETHEE) is used to aid entry mode decisions. The AHP is used to decompose the entry mode problem into several dimensions and determine the weight of each criterion. In addition, PROMETHEE method is used to rank candidate entry modes and carry out sensitivity analyses. Findings – The proposed decision-making method is demonstrated to be a suitable approach to resolve the entry mode selection decision problem. Practical implications – The research provides practitioners with a more systematic decision framework and a more precise decision method. Originality/value – The paper sheds light on the further development of entry strategies for international construction markets. It not only introduces a new decision-making model for entry mode decision making, but also provides a conceptual framework with five determinants for a construction company entry mode selection based on the unique properties of the construction industry.

Export readiness index : construction and analysis

The internationalisation process of firms has attracted much research interest since the 1970s. It is noted, however, that a significant research gap exists in studies with a primary focus on the pre-internationalisation behaviour of firms. This paper proposes the incorporation of a pre-internationalisation phase into the traditional Uppsala model of firm internationalisation to address the issue of export readiness. Through extensive literature review, the concepts fundamental to the ability of an Uppsala type firm to begin internationalisation through an export entry mode are identified: exposure to stimuli factors, attitudinal commitment of decision makers towards exporting, the firm’s resource capabilities, as well as the moderating effect of lateral rigidity. The concept of export readiness is operationalised in this study through the construction of an export readiness index (ERI) using exploratory and confirmatory factor analysis. The index is then applied to some representative cases and tested using logistic regression to establish its validity as a diagnostic tool. The proposed ERI presents not only a more practical approach towards analysing firms’ export readiness but has also major public policy implications as a possible tool for government export promotion agencies.