Influential dynamic capabilities and small and medium enterprises' internationalization success: mediating role of international entrepreneurial orientation

Abstract

Purpose This study aims to analyze how international entrepreneurial orientation mediates the relationship between influential dynamic capabilities and the internationalization success of small and medium-sized enterprises (SMEs) in the context of the United Arab Emirates (UAE). Design/methodology/approach Adopting a quantitative approach, the researchers designed a questionnaire based on an extensive literature review and used structural equation modeling to ascertain the mediating role of international entrepreneurial orientation in the relationship between influential dynamic capabilities and SMEs' internationalization success. Findings The findings of this study indicate that international entrepreneurship orientation mediates the relationship between dynamic capabilities and internationalization success, as the indirect impact value is greater than the direct effect value for the relationship. Because the existence of the mediator in the model has no significant impact on the model's direct effects, full mediation is the most appropriate mediation type. Research limitations/implications This study has some limitations. One of the major limitations of this study relates to the limited finances of the incumbent, as the questionnaires were delivered to the respondents via email, but the incumbent had to follow up with phone calls and reminders. Second, this study mainly relied upon primary data and analysis based on the use of qualitative techniques; in future, researchers can incorporate qualitative aspects using interviews and other qualitative analysis tools and techniques. Third, limitation relates to sample size, as the sample size of research was above 500 but was limited to just UAE. Future researchers can conduct a cross-sectional analysis to determine the mediating role of different factors for the promotion of internationalization. Practical implications This study highlights the fundamental factors affecting the internationalization of SMEs in the UAE context, which has rarely been discussed. This study broadens the scope of internationalization by discussing its impact on SMEs' financial and non-financial performance. Social implications This study will contribute to the advancement of current information about the elements that impact the internationalization of SMEs and develop a new framework for analyzing SMEs' internationalization in the UAE. Originality/value This study contributes to the literature by developing and testing a framework based on a comprehensive literature review to include different factors and their constructs that impact the potential internationalization of SMEs in developing economies. This study identifies and addresses a research gap regarding the relationship between internationalization and company performance among UAE SMEs.