Globel from the start Essay Example
7Global From The Start
GLOBAL FROM THE START
GLOBAL FROM THE START
It’s a critical review of StoyanTanev 2012,’ Global from start the characteristics of born: global firms in the technology sector’ Technology innovation management review.
With help of jones et al., (2011), Michael (1993) and Knight (1996) Stoyan 2012 explains what are born- global firms. In which he concludes that they are firms with ability to compete globally from the start.These companies can be started and can grow in global market rather than known way which companies start local develop a primary market and grows international. With these two opinions it’s important to know factors that contribute to born global success. He focuses on importance of ecosystems to global firmsin which he explains that ecosystems helps in being global and assist in performance of the company in gaining competitive advantage. He summarizes conditions for technology firms born global using a research on firms in England Kudina et al., (2008). He explains the characteristics of born global and what would enable technology companies to start in global niche since first day. He further adds research questions to be addressed by future researches on the topic(Cavasgil and knight 2009).
Most born-global firms are spread among other sectors apart from technology sector. This is similar to research done by madsen and servais that indicate in Denmark that born-global companies are wide spread from companies such as food, metal and consumer goods. Born global firms also regardless of sector adopt product differentiation creating product loyalty in foreign market niche. This can be achieved by having leadership in the technology hence taking advantage of opportunities available in the global market. These include designing products that are of higher quality than competitors.
He explains that most firms use direct international firms and thus focus on other firms in order to enter into foreign market. Some of methods they can use to enter into these markets he explains such as direct sales internationally, independentintermediaries and piggy backing. This is due to the fact these companies in these markets have a clear knowledge of markets. This includes knowing laws e.g. taxes and market niche of the products. This is similar to study done by Cavusgil and Knight (2009) who found out that for industries that are born global have to implement some strategies in order to have competitive strategies. These strategies included joint ventures with foreign companies by using things such as merges or franchise and direct investment in which they start companies in foreign market.
He says that the managers for these firms in their look of foreign markets they see it as a extensional market unlike other managers who look home market as primary market. They use their skills and knowledge in competing in international markets through innovation and taking risks.It’s similar to studies done by other researcher on similar topic who found out that for managers of born-global managers with their mindset as indicated in studies done in UK, Australia and New Zealand indicate thatthey have the following to be able to compete with others in foreign market. These include creativity in products they produce they should start on their own to meet customer needs others include the knowledge of the international market and also they should be resourceful not only on personal qualities but changing international markets unlike the primary companies they change often due to more competition.
For companies to be competitive Tanev (2012) explains that eco systems is very vital as it increases international performance hence competitive advantage. According to report by Yip and Barkema (2008) they support use of eco s system in which they state that for a firm to be successful it has to take into consideration three types of eco systems which are: ecosystems within the same industry, with local operations and foreign subsidiaries and local subsidiaries and client. They conclude that ecosystem create a competitive advantage.
He says born global as firms who start competing globally from the start. AccordingChetty (2004) on contribution of debate of definition of word “born global” he says that born global is not unique and being found in most countries there is no arguable difference traditional and global firms as for every firms to go go global they have to follow similar process of innovativeness and good management.
He says global firms export products within few years of starting and mostly they move through steps of internationalization. With use of Denmark and Australia results which they assume that the firms are formed with objective to go international. But this cannot be an objective in starting a company. Also this is not the case as for a company to go international is basically determined by nature and technology type used.(Moen 2002), from studies done in Norway and France they show that for a firm to be born global will be determined by the founders vision when he was incorporating the company if it included going national.(Gabrielsson and Pelkonen2008).
Similar to argument of the author according to Afuah (2003) for a company to go global and for success in foreign market innovation can be radical or incremental on basis of how the company is capable. Radical means that company knowledge is different from knowledge needed to exploit this foreign market. Incremental innovations means that for a company has to build on existing knowledge to make products but this not the case with other scholars view innovations as outcome of internalization hence argue not possible to go global. They say innovativeness and capabilities that are used for a company to go global and be successful in foreign market is a result of experience and capabilities that are gained from the local experience or internalization (Hessel 2011).
As per the article management of global born is related to ecosystem which is regard to as networking and presence of managerial entrepreneurship to be able to navigate in new market. Mort (2006) explains that global firms need to develop a good network inorder to overcome the being global issues which is similar to author argument.
In summary it shows the characteristics of born global products in which it has shown that its evidenced that born global products develop in a different way from technology entrepreneurs. It can be concluded that for technology firms that start global have more changes to survive compared to local firms. They should also focus on strategies and this article clearly indicates that companies born global are more successful. This is a broad area in which has not yet been covered fully thus it’s far from being concluded. For this more study must be done on what barriers that face technology firms go global, what some of things that make these born global company succeed apart from finances, advantages of going global in early stages, what the role of eco systems in launching the products global and how are born global companies owned.
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