Globalization and Entrepreneurship

Globalization and Entrepreneurship

Policy and Strategy Perspectives

The McGill International Entrepreneurship series

Edited by Hamid Etemad and Richard Wright

The contributors to this collection provide a wealth of new analyses of both traditional and emerging aspects of entrepreneurship, from a variety of national perspectives and from a variety of disciplines. Globalization has begun to dismantle the barriers that traditionally segregated local business opportunities and local firms from their international counterparts. Local markets are becoming integral parts of broader, global markets. As globalization proceeds apace, entrepreneurs and small businesses will play a more prominent role on the global business arena. The volume is divided into three sections. The first looks at the internationalization process itself while the second focuses on factors facilitating this process in small and medium-sized firms. The last section examines emerging dimensions in management policy.

Chapter 11: Managing Relations: The Essence of International Entrepreneurship

Hamid Etemad

Subjects: business and management, entrepreneurship, international business


Hamid Etemad* INTRODUCTION Competition in international markets was traditionally the realm of large companies, with smaller businesses remaining local or regional. The global competitive environment has changed dramatically. The drivers of globalization are removing the barriers which segmented the competitive environments of small and large firms. Firms of all sizes are beginning to share the same competitive space (Etemad, 1999; Dana et al. 2000 and 2001). As a consequence, it is increasingly difficult for independent, small firms to thrive on their own unless they become internationally competitive – whether they actually enter the international markets or not. As smaller firms are increasingly forced to compete in the new global arena, new forms of internationalization are devised and utilized. They cover a wide range: collaborative networks, strategic alliances, integrated outsourcing, etc., some of which are rival models to the operations of multinational enterprises (MNEs). Such new arrangements are used by newly internationalizing competitors to compete in the global marketplace with others, including MNEs. However, neither traditional internationalization models nor theories of entrepreneurship can adequately explain them. These new models of international business involvement require a new, or modified, approach to explain them as they rely on different kinds of relations, capabilities and skills. Paramount among them is the ability to manage such inter-firm relationships. The primary objective of this chapter is to demonstrate that internationalization is increasingly based on the management of an enterprise’s commercial, industrial, personal and even political interactions – i.e., simply, relations, regardless of size – with...

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