Learning strategies for international growth : On knowledge acquisition and opportunity realization

Abstract: Literature on firm internationalization has pointed out knowledge and learning as central components in the internationalization process. While much research has emphasized the development of experience in the firm as the main source of new knowledge, this notion has also been challenged. Furthermore, in internationalization literature, most attention has been paid to market entry and far less to growth in the market thereafter. This research addresses how internationalizing firms capture growth opportunities by acquiring new knowledge in foreign markets. The purpose is to describe and explain how internationalizing firms learn about foreign markets by combining various knowledge sources in order to realize growth opportunities in these markets.To address this purpose, data from two steps of data collection is analyzed. The first step contains qualitative focus-group data from seven Swedish firms and aims to describe learning from a combination of knowledge sources, which leads to the development of a typology of learning strategies. The tentative results from the first step are established in the second step, which contains survey data from 144 internationalizing Swedish firms. In addition to validating the typology, data from the second step explains heterogeneous knowledge outcomes based on differences in learning strategies, suggesting that a diversified strategy has the greatest potential for learning. These results indicate that external knowledge matters more than what has been previously recognized. Furthermore, the results show curvilinear effects of knowledge of the local network and international spread on the realization of international growth opportunities.By integrating components from international entrepreneurship, this research may contribute to internationalization-process literature by (1) describing the typology of how internationalizing firms learn in foreign markets, (2) establishing the described types and explaining the knowledge consequences for internationalizing firms, and (3) explaining how this knowledge impacts the ability to realize international opportunities. This chain of components provides the links between learning and growth of the internationalizing firm beyond the initial market entry.