Most of the research on internationalization behavior has concluded that firms are gradually entering international markets. However, in the last 20 years, a new type of business has emerged that does not follow a gradual internationalization model, but is characterized by rapid commitment to international activity. Oviatt and Dougall named these businesses Born Globals. Discovery of new initiatives, enactment, exploitation and exploitation of opportunities across national borders to create their future goods and services. Past research in this area focuses on identifying factors that may explain the extraordinary speed at which certain new initiatives can overcome international barriers. However, some researchers suggest that in order to advance their understanding of born globals, they need to be able to analyze the factors that can affect their competitiveness once they are created.
Traditionally, the lack of market information is that it constitutes a key variable to proactively seek international opportunities. Therefore, it is seen as one of the biggest obstacles that small businesses have to overcome in their internationalization process. McNaugthon shows that companies that want to expand their knowledge of foreign markets have a broader perspective and have a higher chance of seizing the opportunities that arise within them.
If we try to identify the main source of this knowledge, it is possible to see that traditional progressive models attribute a fundamental role to the firm’s experience at home and abroad in the process of knowledge production and hence internationalization. However, in the case of born globals, experience-based knowledge cannot be considered as the only source of information about the foreign markets these firms use because their experience is minimal. Therefore, it becomes necessary to investigate how born globals manage to learn and interpret markets and translate them into specific actions that affect the development of skills that help them remain dynamic in international markets. Many marketing scholars argue that market orientation plays a decisive role in the international success of new businesses due to its contribution to effective knowledge management. Knight and Cavusgil enable new international enterprises to better understand their customers’ current and future needs of their market orientation. And it points out that it offers a more valuable proposition to optimize the development of different actions that can meet these needs.
In addition, based on the social perspective, the entrepreneurship study highlights the importance of the connections entrepreneurs establish with members of their networks as they facilitate quick access to information and knowledge associated with the latest trends in new markets. These are some of the key resources initially not available for firms. However, from a theoretical point of view, there seems to be a strong complementarity between market orientation and membership in business networks. However, as shown in some studies, little is known about how these factors come together. In this context, Loane and Bell emphasize the need for research attention to the mechanisms and routines that enable new international initiatives to generate and manage information through the relationships they establish in networks. In contrast, Evanschitzky reports the importance of examining their effects on competitiveness and firm performance in the light of insufficient information to date.
In this context, this study covers the mutually complementary nature of both factors in a single structure known as network market orientation (network market orientation). Thus, although previous studies have emphasized its importance in the context of relationships between firms, they have analyzed it not as a business-to-business phenomenon per se, but as the sum of market orientations of various individual firms. The present study differently analyzes the role of network market orientation and understands it as an orientation jointly formed by the different members of the network. However, the impact of any organizational factor is often subject to considerable causal uncertainty regarding the way firms maintain their capacity to use the information generated to continue seizing emerging market opportunities.
The adoption of a network market orientation that promotes a cognitive effort and a collective approach to learning improves understanding of the new and changing links between action and performance. In this way, recognizing the need to face changes in existing routines can help overcome this uncertainty. In line with this idea, it provides continuous commitment to build new resources and capabilities, restructure existing ones and thus adapt to new market demands. For this, it is essential that born globals complement their adoption of a network market orientation with their dynamic absorption capability. Specifically, this absorption capability relates to the absorption of external information into the firm’s internal knowledge base. It is very important for each company to develop this capability individually, as it ensures that external information produced in the context of the network is perfectly understood, absorbed and used successfully by the company.
As a result, this study analyzes the way born globals start by adopting a network market orientation to access and systematically manage information from foreign markets, and how this orientation contributes to building a dynamic absorption capability that will assist them. In this way, it aims to contribute to the existing literature and facilitates its consolidation abroad by taking advantage of the knowledge produced. To achieve this goal, it first presents the theoretical framework used to formulate hypotheses regarding the impact of network market orientation on the international competitiveness and performance of born globals. The experimental work done to test the hypotheses is then reported by an analysis of the results obtained and the main results. Finally, the limitations associated with this study and future lines of research are described.
Availability of Network Market Orientation for Born Global Actors
The international entrepreneurship literature increasingly emphasizes the role of business networks in the learning and knowledge generation process in born globals. The relationships an entrepreneur builds with other network members such as family members, customers, distributors and providers are important. This provides importance for entrepreneurs to know some conditions and some of these conditions are as follows:
• To generate more different and valuable information about the needs of new customers and conditions of the business environment,
• Avoiding positive and negative conditions and knowing how to benefit,
• Accessing the skills and resources needed to do this,
Networks therefore offer born globals a way to compensate for the limitations of innovation and smallness. It also provides the opportunity to improve speed and other aspects of knowledge, such as access to valuable complementary information on topics such as foreignness, technology, distribution channels and customer bases, information exchange and coordination. Networks are therefore key for born globals to abandon the idea that the generation of new knowledge is a purely internal process, to develop a broader knowledge base beyond what they can achieve alone.
This is especially important to keep in mind that born globals are characterized by a lack of necessary resources. There are processes involved in relational information management in the adoption of a network market orientation. The research of Helfert and his team identified the relational information management mechanism developed jointly by members of a network. These information management mechanism definitions are as follows:
Information exchange processes to meet customers’ needs,
Coordination processes aimed at synchronizing network links through formal and informal routines,
Matching processes required to tailor certain characteristics of a network member,
Conflict resolution mechanisms designed to resolve unexpected contexts,
Helfert and his team represent an important step in the study of this structure. In fact, previous research has been limited to taking into account the aggregate of market orientations in individual companies or to adapting original market orientation models (behavioral and cultural) to the network environment. Helfert and his team and Monferrer and his team have defined network market orientation as a strategic orientation jointly formed by different members of the business relations network. This strategic orientation involves performing specific activities and basic shared behaviors (harmony, coordination, conflict resolution, and change) based on the creation of an expanded intellectual capital in an environment of trust, cooperation and commitment. These activities aim to increase the competitiveness of the network and its individual members in an effort to provide superior value to end customers by meeting their needs.
Author: Ozlem Guvenc Agaoglu