An empirical investigation of entrepreneurial orientation, internationalization, and performance of small and medium-sized enterprises (SMEs)

As the reduction in the barriers for global commerce continues and the integration of the world economy grows, there is an increase in the importance being placed on the internationalization of small and medium sized enterprises (SMEs). SMEs, defined as firms with less than 500 employees, must actively participate in this growth as their competitive environment becomes more complex. The key problem being addressed by this research is why some SMEs are successful in expanding their business internationally. How does the characteristic of management with a positive attitude towards internationalization impact the degree of internationalization of SMEs? Is there a relationship between an organization's degree of internationalization and entrepreneurial orientation? Is there a relationship between the attitude towards internationalization and entrepreneurial orientation? How does entrepreneurial orientation and attitude towards internationalization, in an uncertain environment, impact the firm's degree of internationalization? It is becoming increasingly important to address these questions as small and medium sized businesses develop survival strategies. The primary focus of this dissertation is to develop an integrated framework linking such constructs as entrepreneurial orientation, attitude towards internationalization and degree of internationalization.Based on the literature review, hypotheses were developed. Measurement tools were based on scales previously established in the literature for measuring entrepreneurial orientation, attitude towards internationalization, degree of internationalization, and environmental uncertainty. Reliability and validity for the scales have been previously established. The sample surveyed consisted of 1,400 American SMEs.Determining the impact of entrepreneurial orientation and the attitude towards internationalization on the market share of international business and international expansion is of interest not only to SME's management and owners, but is also of interest to stakeholders and possible host countries. Characteristics are identified that would add in predicting the probable success or failure of an SME considering growth through expanding into global markets. There are few studies that link the degree of internationalization, entrepreneurial orientation, and attitude towards internationalization.