Causes of rigidity in SMEs' export commencement decision

Today, small-medium sized enterprises (SMEs) collectively contribute to the largest percentage of job creation in OECD countries. SMEs have become increasingly international since the turn of the century despite being smaller in size in comparison to large multinational firms, and notably, exporting is the most favoured mode of international market entry utilised by SMEs in their internationalisation strategy. Governments around the world have acknowledged the importance of export promotion and have employed policies that are targeted at increasing the export activity of SMEs. However, in many countries, the involvement of SMEs in export operations remains rather low. Within Australia, for example, only about one-third of local SMEs are exporting and this raises an important question as to why there is such a huge percentage of non-exporters. Much scholarly research that focuses on this problem has concentrated on the broad concept of 'export barriers' that act as obstacles to a firm's export development. This paper takes a different approach to previous studies and proposes that a firm's resistance to commence exporting can be better understood through an analysis of the behavioural decision process during its pre-export state. Using a sample of Australian SMEs, the factors that are important in preventing a firm’s initial export commencement decision are categorised and discussed through the use of factor analysis.

Using global formulary apportionment for international profit allocation: The case of Indonesia's mining industry

My thesis examined an alternative approach, referred to as the unitary taxation approach to the allocation of profit, which arises from the notion that as a multinational group exists as a single economic entity, it should be taxed as one taxable unit. The plausibility of a unitary taxation regime achieving international acceptance and agreement is highly contestable due to its implementation issues, and economic and political feasibility. Using a case-study approach focusing on Freeport-McMoRan and Rio Tinto's mining operations in Indonesia, this thesis compares both tax regimes against the criteria for a good tax system - equity, efficiency, neutrality and simplicity. This thesis evaluates key issues that arise when implementing a unitary taxation approach with formulary apportionment based on the context of mining multinational firms in Indonesia.

Internationalization of Chinese and Korean firms

This article compares and contrasts the growth of Chinese and Korean multinational enterprises (MNEs). The article identifies the similarities and differences between Chinese and Korean MNEs in terms of motivations for internationalization, expansion strategies, and paths. The goal of this article is to contribute to the literature by shifting focus on host-country conditions to home-country conditions in explaining the drivers for firms' internationalization. We conclude that firms are motivated to expand abroad when faced with domestic competitive disadvantages resulting from absence or deficiency of one or more of Porter's Diamond attributes in their domestic market. Implications for further studies are also explored.

Meta-regulation approach to raise social accountability In global supply firms

This Article proposes a meta-regulation approach to address the gap between the objectives, commitment, practice and outcome in the accountability practice of the global supply chain in the developing countries. The literatures on the accountability practice in the global supply chains typically focuses on the strategies for raising corporate social accountability standards in multinational buying firms and seldom focuses on this strategies in the outsourced firms in the developing countries. This article tries to fill this void by examining the situation in Bangladesh, the third largest RMG supply country in the world. It conceptualizes a meta-regulation approach with the aim of raising social accountability practice in this industry. It shows that this regulation approach is suitable to effectively raise this practice standard in a perspective where the non-legal drivers are meagrely low, global buying firms are highly profit driven and the governmental agencies are either inadequate or highly corrupt.

The relationship between Internet use and perceived performance in retail and professional service firms

lnformation technology (IT) and, in particular, the Internet is dramatically impacting on the services sector. This paper specifically investigates the relative impact of several forms of internet use on perceived performance for two groups of service organisations - retail service firms and professlonal health service firms. Using a mailed out self-administered questionnaire, 625 completed questionnaires were obtained and 43 per cent of respondents reported that they used the lternet. Thus the final usable sample in the study comprised 262 respondents. Results showed that the Internet does significantly influence perceived performance in both types of service firms. However,there are differences in the forms of lntemet use between the two service groups and their relative effect on performance. For retail firms, use of transactional function, such as ordering, selling and payment was found to be positively related to increases in perceived performance. In contrast, for professional health service firms, the ability to search for information on products and/or services was found to be positively associated with perceived performance. Finally, theoretical and managerial implications of the findings of this study are discussed.

The adjustment of leadership styles in intercultural workplace – some evidences from the multinational construction companies in Hong Kong

This study investigates the existence of intercultural adjustment in the multicultural construction workplaces by examining the leadership orientations (task-/people-orientation), communication and conflict resolution skills (high/low-context culture), and power relationship styles (high/low power distance) of local Chinese and the British expatriate project managers in the multinational construction companies in Hong Kong. A sample of project managers (N = 40) and their subordinates (N = 61) were surveyed using the structured questionnaires. Statistical techniques (independent-samples t-test, and Pearson correlation analysis) were employed to evaluate the data. The results revealed a number of interesting findings. First, it was found that both project manager groups equally considered the importance of task performance and interpersonal relationship. The results of correlations analysis provide support for the linkages of the length of working abroad with the change in task/people orientation for Chinese and expatriate managers. The analysis revealed that those Chinese managers who have the longest length of time living or working in Western countries tended to measure higher on task-orientation. Similarly, those British expatriate managers who have the longest period of working in Hong Kong tended to be less task-orientated. Second, local Chinese managers were found to be more confrontational when they strongly disagree with their team members than their British expatriate counterparts. It would appear that stress from project deadline which increase the directness and terseness in communication acts, and retain the composure of project managers in dealing with the subordinates. Finally, our findings show that there is significant difference between local Chinese and British expatriate managers in their power relationship with subordinates. This implies that although the intercultural adjustment might influence perceptions of local and expatriate managers, some dominant deep-rooted cultural values and beliefs are still not easily altered. Conclusions are presented along with suggestions for future studies.

Operationalizing the resource based view for nascent and young firms : developing scales for resource advantages and disadvantages

Principal Topic: It is well known that most new ventures suffer from a significant lack of resources, which increases the risk of failure (Shepherd, Douglas and Shanley, 2000) and makes it difficult to attract stakeholders and financing for the venture (Bhide & Stevenson, 1999). The Resource-Based View (RBV) (Barney, 1991; Wernerfelt, 1984) is a dominant theoretical base increasingly drawn on within Strategic Management. While theoretical contributions applying RBV in the domain of entrepreneurship can arguably be traced back to Penrose (1959), there has been renewed attention recently (e.g. Alvarez & Busenitz, 2001; Alvarez & Barney, 2004). This said, empirical work is in its infancy. In part, this may be due to a lack of well developed measuring instruments for testing ideas derived from RBV. The purpose of this study is to develop a measurement scales that can serve to assist such empirical investigations. In so doing we will try to overcome three deficiencies in current empirical measures used for the application of RBV to the entrepreneurship arena. First, measures for resource characteristics and configurations associated with typical competitive advantages found in entrepreneurial firms need to be developed. These include such things as alertness and industry knowledge (Kirzner, 1973), flexibility (Ebben & Johnson, 2005), strong networks (Lee et al., 2001) and within knowledge intensive contexts, unique technical expertise (Wiklund and Shepard, 2003). Second, the RBV has the important limitations of being relatively static and modelled on large, established firms. In that context, traditional RBV focuses on competitive advantages. However, newly established firms often face disadvantages, especially those associated with the liabilities of newness (Aldrich & Auster, 1986). It is therefore important in entrepreneurial contexts to expand to an investigation of responses to competitive disadvantage through an RBV lens. Conversely, recent research has suggested that resource constraints actually have a positive effect on firm growth and performance under some circumstances (e.g., George, 2005; Katila & Shane, 2005; Mishina et al., 2004; Mosakowski, 2002; cf. also Baker & Nelson, 2005). Third, current empirical applications of RBV measured levels or amounts of particular resources available to a firm. They infer that these resources deliver firms competitive advantage by establishing a relationship between these resource levels and performance (e.g. via regression on profitability). However, there is the opportunity to directly measure the characteristics of resource configurations that deliver competitive advantage, such as Barney´s well known VRIO (Valuable, Rare, Inimitable and Organized) framework (Barney, 1997). Key Propositions and Methods: The aim of our study is to develop and test scales for measuring resource advantages (and disadvantages) and inimitability for entrepreneurial firms. The study proceeds in three stages. The first stage developed our initial scales based on earlier literature. Where possible, we adapt scales based on previous work. The first block of the scales related to the level of resource advantages and disadvantages. Respondents were asked the degree to which each resource category represented an advantage or disadvantage relative to other businesses in their industry on a 5 point response scale: Major Disadvantage, Slight Disadvantage, No Advantage or Disadvantage, Slight Advantage and Major Advantage. Items were developed as follows. Network capabilities (3 items) were adapted from (Madsen, Alsos, Borch, Ljunggren & Brastad, 2006). Knowledge resources marketing expertise / customer service (3 items) and technical expertise (3 items) were adapted from Wiklund and Shepard (2003). flexibility (2 items), costs (4 items) were adapted from JIBS B97. New scales were developed for industry knowledge / alertness (3 items) and product / service advantages. The second block asked the respondent to nominate the most important resource advantage (and disadvantage) of the firm. For the advantage, they were then asked four questions to determine how easy it would be for other firms to imitate and/or substitute this resource on a 5 point likert scale. For the disadvantage, they were asked corresponding questions related to overcoming this disadvantage. The second stage involved two pre-tests of the instrument to refine the scales. The first was an on-line convenience sample of 38 respondents. The second pre-test was a telephone interview with a random sample of 31 Nascent firms and 47 Young firms (< 3 years in operation) generated using a PSED method of randomly calling households (Gartner et al. 2004). Several items were dropped or reworded based on the pre-tests. The third stage (currently in progress) is part of Wave 1 of CAUSEE (Nascent Firms) and FEDP (Young Firms), a PSED type study being conducted in Australia. The scales will be tested and analysed with a random sample of approximately 700 Nascent and Young firms respectively. In addition, a judgement sample of approximately 100 high potential businesses in each category will be included. Findings and Implications: The paper will report the results of the main study (stage 3 – currently data collection is in progress) will allow comparison of the level of resource advantage / disadvantage across various sub-groups of the population. Of particular interest will be a comparison of the high potential firms with the random sample. Based on the smaller pre-tests (N=38 and N=78) the factor structure of the items confirmed the distinctiveness of the constructs. The reliabilities are within an acceptable range: Cronbach alpha ranged from 0.701 to 0.927. The study will provide an opportunity for researchers to better operationalize RBV theory in studies within the domain of entrepreneurship. This is a fundamental requirement for the ability to test hypotheses derived from RBV in systematic, large scale research studies.