Zhejiang Sme Internationalization Research

In current management study circle, the research in internationalization of companies is very active and research scope is extremely broad, including transaction cost, institution, culture, social network, marketing, entrepreneurs and innovation, etc. Research achievements in these sectors or cross sectors provide certain degree of explanation of the phenomenon of internationalization of small and medium-sized enterprises (SMEs), but considerable limitations and insufficiencies also exist: western scholars mainly base their research on observations and evidences of multi-national companies in US and European developed countries; Chinese scholarshave got some meaningful results, while lacking of insights from SMEs; moreover, internationalization of companies in the past tended to focus on external environmental factors, including the political, economic, cultural and geographic factors of both native country and target country, but lacked consideration on internal factors of companies. Therefore, direct and mechanical application of western theory of enterprise internationalization or relevant research achievements of China can not well explain the internationalization of SMEs of Zhejiang Province. For this reason, this study considers exploring SME's internationalization from a new perspective, i.e. from the organization culture as internal factor of companies, the impact of organization culture on operation strategy, and the organization culture further influences on the performance of internationalization via operation strategy. The purpose is to provide reference to internationalization of SMEs in the future and boost the formation of analysis framework of new theory of internationalization of enterprises.The research content of this thesis covers three aspects as follows:①International organization culture theory and practical analysis. This study starts from theory of organization culture and practice of internationalization of SMEs in Zhejiang. Based on analysis of market orientation theory, entrepreneurship orientation theory and long-term relation orientation theory as well as observation of related phenomenon such as entering Chinese businessmen network, doing border trade, foreign cooperation and international entrepreneurship, etc., this study explores the common gene of organization culture behind from a deep level, creates a culture system of internationalization of SMEs in Zhejiang Province, and verifies it through practical experience.②International market operation theory and practical analysis. Mainly focus on product, quality, technology and international cooperation strategy of internationalization companies, analyze the quality, technologies and products that SMEs in Zhejiang adopt in initial stage of internationalization to cross the border of markets, as well as the channel they leverage to extend their products or services to broad overseas market, propose relevant assumptions, which are to be proved by practice.③Theory of relation between organization culture, operation strategy and company's performance of internationalization and practical analysis. Mainly review the mechanism of organization culture—operation strategy—company's performance of internationalization, form relevant theory model, and assess the reliability and validity of study and simulation effect of models via exploratory factor analysis and confirmatory factor analysis; verify assumptions of cause-effect relations of various variables and screen common variable influence effect.For studies above, after a series of document and material analysis, company interview, model construction, questionnaire and practical analysis, the main conclusions of this research are as follows:①Global vision, active innovation, concern of market, respond to market and international relation orientation are the major factors of international organization culture of SMEs in Zhejiang, whose mutual influence constitute an international organization culture system. Among these factors, global vision and active innovation are subject to international entrepreneurship orientation, while concern of market and respond to market international market orientation. These two orientation factors together with international relation orientation are the core content of internationalized organization culture of SMEs in Zhejiang; The major externally perceivable characteristics are the focus on transfer of concepts of international market to staff, taking preemptive measures in competition, accurately recognizing customers, close cooperation among departments and keeping promise to partners.②Advanced applicable technology, unique products, focus on quality, international marketing cooperation and international technical cooperation strategy are major common characteristics of operation strategy of SMEs in Zhejiang in initial stage of internationalization. The major externally perceivable characteristics of international operation strategy are pursuing advanced technology, adapting to market change rapidly, providing high quality products and expanding market and obtaining technical support via international cooperation, etc.③Organization culture is an important influence factor of international operation strategy. While international entrepreneurship orientation has negative impact on application of advanced technical strategy, international organization culture factors have positive impact on international operation strategy of SMEs in Zhejiang, but the mechanism and degree of influence vary considerably.④Internationalization performance includes financial performance and non-financial performance. The former are measured by growth and profit indicators, while the latter are measure by customer satisfaction, market share, product performance and knowledge learning effect. Non-financial performance is mainly influenced by unique product strategy, quality focus strategy and international partnership relation strategy, and financial performance is mainly influenced by advanced applicable technology, international technical cooperation and non-financial performance.⑤The higher the internationalization level of a company, the more obvious the impact of operation strategy on internationalization performance.The theoretical value and innovation of this article are mainly reflected in following aspects:①The article diversifies the organization culture perspective of study on internationalization of SMEs. In current study on internationalization of SMEs, it is very rare to see relevant research with organization culture as entry point. This study puts forward the common cultural factors behind internationalization of SMEs in Zhejiang, explores and analyzes its relation with operation strategy and internationalization performance, which is obviously innovative. It proposes the framework of international organization culture of SMEs in Zhejiang, which has obvious benefit to the framework of culture—strategy—performance analysis of internationalization.②It summarizes and proposes the common market strategy factors of SMEs in Zhejiang. This study analyzes the common strategy characteristics of SMEs in Zhejiang in four aspects, i.e. technology, product, quality and channel, studies relevant measuring issues and discovers two dimensions of international partnership strategy, i.e. marketing cooperation and technical cooperation.③It establishes and proves the model of organization culture—operation strategy—internationalization performance. The study analyzes the functional mechanism of organization culture to operation strategy and mode of impact of operation strategy on internationalization performance from a deep level, thus establishes a theory model; the model is then supported through practical evidence through specification measurement and model examination. The model links organization culture factors with regional development background, as well as links abstract organization culture factors and concrete practice of internationalization. It is a dynamic model with good explanation capability and ever-lasting vital force.In order to systematically demonstrate researches above, the article consists of seven chapters. Chapter 1: Introduction. Content: propose the questions to be studied and introduce the research purpose, significance, object, content, method and technical route as well as the structure of the article. Chapter 2: Review and comment on relevant literatures, make a systematic conclusion on relevant research in the past and base on this to form theory background and initial analysis framework of this study. Chapter 3: Regional culture and cross-border activity analysis with focus on regional culture factors influencing organization factors of SMEs in Zhejiang. The chapter summarizes the basic characteristics of typical cross-border activities of SMEs in Zhejiang, concludes the organization culture and strategy factors among such activities, form qualitative analysis and judgment, substantiates and enriches the initial analysis framework proposed in the last chapter, so as to provide necessary practical background knowledge for establishment of follow-up research assumptions and models. Chapter 4: Model establishment. This chapter establishes the relation theory model of organization culture—operation strategy—internationalization performance and proposes corresponding assumptions to be examined. Chapter 5: Questionnaire design and research data acquisition, which mainly covers questionnaire design, variable measurement, questionnaire revision, data collection and quality assessment. Chapter 6: Model demonstration and analysis. This chapter examines the reliability and validity of measurement and simulation effect of models via confirmatory factor analysis and structural equation model analysis and establishes final model via revision; and makes practical analysis on effect of common variable by means of variance analysis and structural equation model group comparison. Chapter 7: Conclusion and prospect, which is a summary of the research, including making main conclusions, analyzing the innovation and insufficiency of the research, proposing relevant suggestions for development of internationalization of SMEs and looking into the prospect of further research of the subject.