The internationalisation of service-sector SMEs in an emerging market

Abstract

PurposeThis paper aims to explore the internationalisation of service-sector small- and medium-sized enterprises (SMEs) from an emerging market, focussing on the entry modes, psychic distance, business network, internationalisation challenges and capabilities of business training and consultancy firms from Malaysia.Design/methodology/approachA multiple-case study approach is adopted, and 31 in-depth interviews were conducted with the top management and executives from eight business training and consultation (BT&C) firms in Malaysia. The Uppsala model is used for theoretical guidance to analyse the internationalisation of the firms.FindingsThe results suggest that psychic distance, business network and business capabilities influence the internationalisation of BT&C firms from Malaysia. However, the discussion of entry modes in the framework of service internationalisation does not accurately explain the internationalisation of the studied firms.Research limitations/implicationsThis study is a qualitative research based on the experiences of eight firms. The basis of this study is inadequate for scientific generalisation. Quantitative research should be conducted in the future to provide a statistical test and empirical results. This study is concerned with the emerging-market context. The study could be expanded to include more industries and other emerging markets in the future.Practical implicationsThis study explored the application of internationalisation theories to the BT&C industry in an emerging market, with particular emphasis on firms’ entry modes, psychic distance, business networks, international challenges and capabilities. This study also highlighted some of the key internationalisation challenges facing emerging market small- and medium-sized enterprises (EMSMEs), underlining the importance of business networks and capabilities.Social implicationsNevertheless, this study shares useful and practical discoveries concerning the internationalisation process of BT&C firms from the emerging market, focussing on entry modes, psychic distance, business network, the challenges faced and the required capabilities.Originality/valueThe study provides new insights into service internationalisation in SMEs from an emerging market. The application of internationalisation theories to the BT&C industry in an emerging market is analysed.