Country institutional profiles: evidence from Colombian software exporters

Abstract

Purpose The purpose of this paper is to illustrate how the perceived institutional environment of Colombian internationally operating small- and medium-sized enterprises (SMEs) in the software industry comes to determine their performance. Design/methodology/approach The research applies regression modelling to a sample of 43 internationally operating Colombian SMEs in the software development industry, collected via an online survey. Findings The results indicate that the normative dimension of the institutional environment comes to determine the export performance of the SMEs. Conversely, the cognitive and regulatory dimensions of the institutional forces do not have a significant effect. Research limitations/implications The cross-sectional nature of the survey tool, the single industry and the single country context place limitations on the generalisability of the results across different industry and country contexts. Practical implications The results highlight the need for entrepreneurship-friendly norms and values in the context of internationalising SMEs in Latin America. Governments should focus on the development and promotion of international entrepreneurs that inspire and serve as role models for other entrepreneurs rather than concentrate on the creation of regulatory frameworks and the provision of knowledge of how to start and manage risk for the internationalising SME. Originality/value The study is one of the first to apply the Busenitz et al. (2000) scale on the institutional country profile to real entrepreneurs. Previous studies have mainly applied the framework to a sample of students or officers assigned to US embassies. Besides Renko et al.’s (2009) conference paper, ours is the first one that links the country institutional profile to the performance of internationalising software firms and, especially, in the context of a Latin American country. The study, therefore, attempts to contribute to a better understanding of how a country’s institutional environment impacts the performance of internationalising SMEs.