Internationalization of Small Family Firms: The Influence of Family from a Socioemotional Wealth Perspective. (17th June 2015) - Scholes, Louise
Abstract : We explore the factors influencing the internationalization of small family firms. Based on interviews with six family firms in Singapore, we highlight the importance of (1) family harmony, (2) trust in external relationships, (3) social and business networks, and (4) organizational resources and capabilities in the internationalization process. We show how the socioemotional wealth factors of trust and harmony affect networking and resources, which in turn affect internationalization. We find that initial internationalization through exports is enabled through trust in family networks, but the typical family characteristics of a desire to maintain family harmony and distrust of outsiders have a negative impact on network creation and resource development, which constrains the extent to which the firm internationalizes beyond exporting. In order to move from the first stage (exports/similar markets) to the second stage (joint ventures/different markets) of internationalization, less emphasis on trust and family harmony accompanied by more emphasis on building external networks and resources may be necessary. We propose a new model of internationalization of family firms based on our findings. © 2015 Wiley Periodicals, Inc.