Capabilities and the internationalisation of smaller-sized, service-oriented firms in the southern hemisphere

Abstract

Underpinned by the threshold and dynamic capabilities perspectives as a sub-set of Resource-Based Theory, the objective of this study is to understand ways in which management teams build types of capabilities to facilitate their internationalisation activities. Thirty-one semi-structured interviews took place among smaller-sized, service-oriented internationalising firms located in three countries within the southern hemisphere: two emerging economies (Chile and Colombia) and one developed economy (New Zealand). The findings indicate that some management teams were able to develop threshold capabilities enabling them to operate outside their domestic market. In contrast, certain management teams appeared to possess dynamic capabilities, facilitating their evolving business models and sustainability. Particular capabilities allowed the respective firms, regardless of their national origin, to exhibit varying performance-enhancing internationalisation strategies. The study contributes to theory and practice in the domain of entrepreneurial marketing, offering new insights questioning whether certain capabilities are enough to sustain particular management teams' internationalisation behaviour.