Social capital and internationalization of family SMEs in Campeche, Mexico: a qualitative comparative analysis.
| Autor | Camara, Selina Salazar |
1 Introduction
Although there are several contributions of interest on the internationalization of family businesses from the 1990s, the knowledge about the internationalization of family businesses (hereinafter FBs) from emerging economies remains limited (Carney, Essen, Gedajlovic, & Huegens, 2015; Essen, Carney, & Gedajlovic, 2015; Sabah, Carsrud, & Kocak, 2014; Tasavori, Zaefarian, & Eng, 2018).
The processes of family-owned small and medium enterprises (SMEs) are different from in other types of enterprises (Abdellatif, Amann, & Jaussaud, 2010; Hennart, Majocchi, & Forlani, 2019). In addition to the main differences due to their family nature, size, and resources, this type of firm is more prone to social capital issues (Kontinen & Ojala, 2011a). This is of particular interest in emerging economies, where there are often unstable institutional environments, frequent changes in the legal system, and a large black economy (Smallbone & Welter, 2001). These increase the uncertainty associated with the internationalization process.
We find a gap in the literature on the internationalization of family SMEs in emerging economies based on the relational approach. Some studies have shown that networks are a decisive element in FBs seeking out and taking advantage of international opportunities (Coviello, 2006; Kontinen & Ojala, 2011b; Musteen, Francis, & Datta, 2010). However, there is insufficient knowledge about the different types of social capital and how they influence the internationalization of FBs (Gittins, Lang, & Sass, 2015). Their roles may vary depending on the family firm's identity (Uhlaner, Matser, Berent, & Floren, 2015).
This research seeks to fill this gap in the literature, by focusing on family SMEs, specifically in the fishing sector in the state of Campeche, Mexico, and their internationalization process. Our main objective is to identify the existing relationships between the different types of social capital (bonding, bridging, and linking), international entrepreneurship, and market orientation, and how these variables influence the promotion or cessation of internationalization by SMEs.
The contributions of this study are the following. First, we contribute to understanding the different types of social capital in family firms. Second, we introduce new variables--such as market orientation, international entrepreneurship, bonding, linking, and bridging--to examine how they influence the promotion or cessation of internationalization. By investigating these different organizational configurations, we show more than one optimal way for FBs to achieve successful internationalization results.
In addition, this study focuses on the dynamics of networks and international entrepreneurship in relation to the process of internationalization at an advanced stage. Thus, it complements prior works on new ventures (Ibeh & Kasem, 2011; Paul & Rosado-Serrano, 2019) and completing the whole internationalization process (Johanson & Vahlne, 2009; Vahlne & Johanson, 2013).
Most of the existing studies have examined the internationalization of family SMEs and their networks in the context of developed markets (Kontinen & Ojala, 2011a, 2011b). But there have been few studies on emerging countries, where companies use it as a growth and development strategy. Our research focuses on Mexico, where like in most developing countries the majority of firms are SMEs and FBs (Reyna, Vazquez, & Valdes, 2012). Research is scarce in this context, so we respond to calls for more in-depth studies on internationalization in emerging economies (Kiss, Danis, & Cavusgil, 2012; Rienda, Claver, Quer, & Andreu, 2019).
SMEs are characterized by limited financial resources, a focus on their home country, and limited geographical coverage. They lack the resources required to expand operations beyond their domestic markets (Dar & Mishra, 2020). Most academic studies on FBs in Mexico have focused on describing the characteristics that increase the longevity to this type of business. Despite there being many examples of the internationalization of FBs in different areas, little has been written about the internationalization of Mexican FBs (Maciel, 2013).
Mexican family SMEs require a high level of knowledge and communication. Among their primary values are honesty, trust, efficiency, and a great sense of belonging (Ramos, Qintero, & Figueroa, 2008). Regarding their social capital, some findings indicate that this results from relationships between the family and other business members, which are strengthened when they commit to new projects (Ramirez & Fonseca, 2010).
However, there is great difficulty in accessing information on Mexican family SMEs at a public and institutional as well as at a business level, since there are no established databases and there is distrust on the part of businesspeople (Martin-Reyna, & Duran-Encalada, 2012). Likewise, the companies generally lack a relevant organizational structure and strategic planning at a structural level because they often do not look beyond the short term horizon. Therefore, improvisation prevails in these companies (Hernandez, Mendoza, & Salazar, 2015). Among their financial disadvantages, there is a low level of reinvestment and they usually refuse to open up to external capital. Among their cultural disadvantages, they are reluctant to change for fear of the unknown. Both are reflected in the process of generational succession, which is usually not planned.
This study also applies a configurational approach by conducting a fuzzy-set qualitative comparative analysis (hereinafter fsQCA). fsQCA has been widely used as a tool for categorizing antecedents into causal recipes (Cheng, Chang, & Chu, 2013). Complex phenomena--such as internationalization--are often more accurately described as following on from combinations of antecedent conditions. Moreover, fsQCA is an approach that considers asymmetric relationships between the antecedents and the outcome, offering a useful method to address the research . In this case, we acknowledge that the factors leading to internationalization may be different from the factors leading to non-internationalization. The fsQCA approach has already been used to investigate this topic (Kraus, Mensching, Calabro, Cheng, & Filser, 2016).
Finally, from the managerial point of view, we provide a number of practical contributions for family entrepreneurs in the fishing sector to understand the factors that intervene in driving or preventing their internationalization. Given the industry's importance and low competitiveness, this study fills a knowledge gap by adopting a practical approach to the region and the industry.
2 theoretical Foundations
2.1 Addressing internationalization in FBs
Studies of the internationalization process present different approaches. For instance, the resource-based view sees FBs as unusual, complex, dynamic, and rich in intangible resources. This theory states that many of the competitive advantages of FBs are rooted in the family and the organizational processes that take place within it. This approach also provides a theoretical model that analyzes relationships at different levels within and outside the company and its assets, strategies, and sustainable competitive advantages.
According to the, RBV, competitive advantages arise when a company implements a strategy that generates more value than its competitors and cannot be replicated. In the case of FBs, the differentiating resource may be their three different levels of social capital. The relational aspect is considered an intangible asset and can be even more important than physical capital and inventory (Steier, 2001).
However, it is interesting to observe how other approaches have evolved towards a network perspective (Vahlne & Johanson, 2013, 2019). In this process, firms need to identify opportunities, deploy resources, and acquire knowledge to advance in their international commitment. Recent literature shows that internationalization is an essential strategic element in pursuing growth (Arregle, Duran, Hitt, & Essen, 2017). However, most studies assume that family firm internationalization follows the Uppsala model of internationalization (Johanson & Vahlne, 1977). This perception of the internationalization process is in line with family firms' long-term orientation (Stieg, Cesinger, Apfelthaler, Kraus, & Cheng, 2018). According to the general tendency, social capital approaches may be of particular interest in a FB because of the unification of ownership and management (Kontinen & Ojala, 2011a; Salvato & Melin 2008), as well as contributing to diminishing the risk of this type of decision (Stieg et al., 2018).
Thus, we assume that networks influence family firms' strategic decisions, allowing the exchange of resources between diverse members and serving as bridges into foreign markets, providing new opportunities and the motivation to become international (Johanson & Vahlne, 2009). Awareness of this issue has led to entrepreneurs identifying and exploiting new global opportunities. There are works on international entrepreneurship and its promotion through relational networks (Coviello, 2006). These use the network internationalization model (Crick & Spence, 2005), explaining how business networks act as a bridge into foreign markets. Therefore, we assume that networks are crucial for identifying innovative and creative opportunities that will translate into superior financial performance regardless of size or time pursuing internationalization (Kraus et al., 2016; McDougall & Oviatt, 2000).
In the case of FBs, entrepreneurial attitudes can be motivated by various factors, including: (i) the long-term nature of ownership, which allows them to dedicate the resources needed for innovation and risk-taking, thus fostering their entrepreneurial spirit (Zahra, Hayton, & Salvato, 2004); (ii) the kinship ties that are unique to FBs and that can have a...
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