GLOBAL MINDSETS AND INTERNATIONALIZATON OF R&D INTENSIVE SMEs: A MULTIPLE CASE STUDY FROM TURKEY

Year 2019, Volume: 7 Issue: 2, 275 - 312, 30.08.2019

Mahmut Hızıroğlu , Elif Akkaya

https://doi.org/10.22139/jobs.558875

Abstract

The main purpose of this study is to explore the role
of the Global Mindset on the internationalization of Turkish small and
medium-sized enterprises (SMEs). Although the studies on the relationship
between global mindset and internationalization have predominantly focused on
large enterprises as the primary unit of analysis (eg Bartlett and Ghoshal,
1989; Adler and Bartholomew, 1992; Harvey and Novicevic, 2001; Begley and Boyd,
2003; Beechler et al. 2004, Bouquet, 2005; Levy et al. 2007; Javidan and Bowen,
2013), in recent years, there has been a growing interest on the relationship
between global mindset of SMEs and their internationalization behavior (eg Nummela
et al. 2004; Weerawardena et al. 2007; Lazaris and Freeman, 2018; Kyvik, 2006;
Mughan and Kyvik, 2010; Kyvik, 2011; Felicio et al., 2012; Felicio et al. 2013;
Kyvik et al. 2013; Felicio et al. 2015; Felicio et al. 2016). In particular, two
complementary streams of research in global mindset of SMEs have evolved:
Individual role and institutional role on the formation of global mindset and
SME internationalization. The first stream of research has mostly dealt with
the mindset-forming role of top management on the formation of a global mindset
and their firms’ internationalization behavior. This stream of research often
associates the antecedents of global mindset with the decision makers’ work
experience, education background, language skills and personal characteristics such
as cognitive flexibility, teamwork and interpersonal skills argues. The second
stream emphasize the effect of institutional and industrial contexts on the
formation of a global mindset of SMEs.

The starting point of this research is that studies
which combine both of these streams of research is rare. Institutional
environment of developed and emergent countries differs and matters on
formation of global mindset. Since institutions enable the market mechanism to
function effectively in the market economy (Peng et al, 2008) firm strategies
and decision makers’ behaviors are affected accordingly (Meyer et al., 2009). Additionally, culture
and individual cognitions are significantly interrelated (Goktan and Gunay,
2011), Looking at both individual and institutional and market conditions that
shape the formation of a global mindset are especially necessary in countries
with different levels of institutional development, market conditions and
cultural structure. In this regard, it is important to explore the role of
global mindsets on internationalization process of SMEs in a country such as
Turkey, where the institutional, economic and cultural backgrounds of SMEs are disparate.
In order to increase our understanding of the role of global mindsets in this
process, this research aims to answer a set of interrelated research questions
as follows: (a) Do Turkish R&D intensive SMEs have global mindsets, and if
so, what are the main ideas that shape the thinking of those who have global
mindsets. (b) How do institutional environment, domestic market conditions,
managers’ cognitive features influence on global mindsets, and (c) what are the
main mechanisms of internationalization of R&D intensive SMEs?

In this paper, a qualitative and exploratory research
approach has been adopted to explain the role of the global mindset on the
internationalization process of SMEs. A multiple case study was considered to
be an appropriate method for this study as it allows us to best understand the
process in a holistic manner. Issues revolving around the formation of global mindset
in R&D intensive SMEs, the characteristics of the global mindset and their
role on internationalization can be far more effectively discussed using a
comparative approach.

The research focuses on SMEs from the biotechnology
sector with intensive R&D. Within the scope of the research, 19 biotechnology
companies in total were studied. The biotechnology industry was considered the
most desirable industry-setting for a number of reasons. Firstly, the
biotechnology industry has been widely acknowledged in literature as a
knowledge-intensive industry (Grinstein & Goldman 2006), which makes the
firms in this industry theoretically desirable for this research as they may
follow different internationalization patterns. Secondly, since the
internationalization process of R&D intensive sectors has a high potential
to follow a different pattern from the traditionally-accepted gradual and
sequential internationalization, the companies in this sector can gain the
status of an international firm with international R&D joint venture even
before they produce products or services.

There are two main reasons why this research focuses
on R&D intensive SMEs. Firstly, the antecedents and outcomes of the
formation of Global Mindset in SMEs are an emerging topic and have received
more attention from the scholars recently. However, most of these studies are
generalized without considering R&D intensive SMEs. Given the different
patterns of internationalization and their potential for a rapid
internationalization, R&D intensive SMEs are included in this study. Secondly,
and more importantly, R&D intensive SMEs in an emerging country such as
Turkey, whose share of advanced technology and R&D intensive sectors in
exports is quite low, are uniquely positioned to contribute the innovation
ecosystem of the country. Therefore, investigation of the main ideas that shape
the thinking of managers of SMEs who have global mindsets, factors that shape
the formation of global mindsets, and main mechanisms of internationalization
of R&D intensive SMEs is quite important for a country characterized by
weak institutional environment and low level of economic development.

This study had several key findings with the most
important being that the primary motivation of R&D intensive SMEs with a
global mindset in internationalization is the desire of achieving prestige. This
is particularly important in terms of the activities of the company in its
country of origin. The motivation for internationalization for firms in the
literature is addressed in broad categories such as firm-specific factors,
environmental factors and firm characteristics (Katsikeas and Piercy 1993);
however, prestige is not adequately discussed. In our study, the determination
of such an element can be evaluated as a country-specific characteristic.

Another motivation for internationalization which this
study found is the desire to contribute to the national economy. A significant
number of SMEs state that companies in the local markets should contribute to
the national economy through internationalizing. This motivation is also not
included in related literature of internationalization.

In addition to the aforementioned motivations found by
our study which have otherwise been neglected by the literature, our findings
on the necessity of having a global mindset regarding R&D intensive SMEs
coincide with the academic literature. Considering internationalization as an
opportunity for market expansion, interpreting internationalization as a means
of learning competitiveness, being proactive, caring for foreign customers and
taking advantage of global opportunities are also features of many different
studies (eg Crick, 2007; Cavusgil and Godiwalla, 1982; Katsikeas and Piercy,
1993).

The key finding of the second research question is
that the cognitive factors affect the formation of global mindset. This is
because the most important factors affecting the formation of global mindset is
the desire to learn how processes work globally and SMEs’ low tolerance levels for
uncertainty. Although their learning focus is generally competitiveness, it is
possible to say that their high motivation for learning is as a result of their
low tolerance levels for uncertainty.

The institutional environment can also negatively
affect the formation of the global mindset. In Turkey, the government is the
most influential institutional actor (Whitley, 2000); therefore, the role of
the government cannot be ignored. The negative role of the institutional
environment, however, is not limited to the government. The low level of
university-industry cooperation, the limited impact of umbrella organizations,
and the weakness of the financial system, particularly those that support
entrepreneurship and innovation, such as risk capital companies, are other
factors that have a negative impact on the development of a global mindset in
SMEs.

When the internationalization mechanisms of R&D-intensive
SMEs are analyzed, the study
reveals that R&D activities
are a prominent mechanism in facilitating internationalization process. However,
despite the international R&D collaboration opportunities, the level and
speed of internationalization were low. To some extent this can be explained by
the fact that, despite having a high internationalization motivation, the
capacity of business development of the R&D intensive SMEs is insufficient
comparing to R&D capacity. This may be due to the fact that SMEs, which
often conduct international business development activities through
distributors and dealers, do not set up their own business units or do not
engage in business development activities through different networks.

The key contribution of this study lies in the
provision of new evidence from an emergent country and understanding of
formation of global mindsets of R&D intensive SMEs and their
internationalization mechanisms. The literature on the phenomenon of the global
mindset essentially deals with two different disciplinary axes: international
business and organizational behavior. While the international business
discipline focuses on the impact of the global mindset of managers on the
internationalization strategies of firms, organizational behavior literature
seeks to understand and categorize the cognitive structures necessary for
global mindset formation. When the case is approached in this binary way,
problems arise in the conceptualization of the subject which also cause an
inadequate or unclear research framework. This study deals with the global
mindset though drawing on both disciplines and contributes both to the
international business and organizational behavior literature by making some
points regarding formation of global mindsets of R&D intensive SMEs and explaining
their mechanisms of internationalization.

Keywords

Internationalization, R&D Intensive SMEs, Biotech Industry, Global Mindsets

KÜRESEL ZİHNİYET VE AR-GE YOĞUN KOBİ’LERİN ULUSLARARASILAŞMASI: TÜRKİYE BİYOTEKNOLOJİ SEKTÖRÜ ÖRNEĞİ

Abstract

Amaç: Bu çalışmanın amacı Ar-Ge yoğun KOBİ’lerinin
uluslararasılaşması üzerine küresel zihniyetin nasıl bir rolü olduğunu
keşfetmektir. Bu doğrultuda Ar-Ge yoğun KOBİ’lerin küresel zihniyete sahip olup
olmadıkları, küresel zihniyete sahip olanların daha çok hangi özellikleri
taşıdıkları, hangi unsurların Ar-Ge yoğun Türk KOBİ’lerinde küresel zihniyeti
etkilediği ve son olarak küresel zihniyete sahip Ar-Ge yoğun KOBİ’lerin
uluslararasılaşma mekanizmalarının neler olduğu araştırılmıştır.

Yöntem: Nitel ve
keşifler olarak tasarlanan çalışmada oluşturulan araştırma sorularına cevap
bulmak adına 19 biyoteknoloji firması ile mülakat yapılmıştır.

Bulgular: Çalışmadan elde
edilen bulgular Ar-Ge yoğun KOBİ’lerin küresel zihniyete sahip oldukları ve küresel
zihniyete sahip KOBİ’lerde uluslararasılaşmanın prestij sağlayacağı, ülke
ekonomisine bu yolla daha fazla katkı yapılacağı, rekabetçiliğin daha iyi
öğrenileceği ve pazarlarının bu yolla daha çok genişletileceği düşüncesinin daha
baskın olduğu görülmektedir. Bulgular ayrıca küresel zihniyetin oluşumunda kurum
yöneticilerinin bilişsel özelliklerinin ve pazar koşullarının daha belirleyici
olduğunu göstermektedir. Küresel zihniyete sahip Ar-Ge yoğun KOBİ’lerin hem
düzey olarak hem de hız olarak düşük bir uluslararasılaşma performansı
sergiledikleri ve özellikle Ar-Ge faaliyetlerinin uluslararasılaşmalarında
etkili olduğu görülmektedir.

Sonuç: Ar-Ge yoğun
Türk KOBİ’lerini referans alarak yapılan bu çalışma Türkiye gibi gelişmekte
olan bir ülkede küresel zihniyetin oluşumunda hangi unsurların daha çok etkili
olduğunu, küresel zihniyete sahip firmaların hangi özellikleri taşıdığını ve
hangi mekanizmalarla uluslararasılaştığını göstermesi bakımından kuramsal alana
katkıda bulunmaktadır. 

Keywords

Küresel Zihniyet, Uluslararasılaşma, KOBİ’ler, Ar-Ge

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