The Concept of International New Ventures

Topics: Globalization, International trade, Economic geography Pages: 3 (629 words) Published: October 24, 2012
Week 1 HIA

Explain how the article builds on the seminal work of Oviatt and McDougall in their paper,. Describe and analyze the factors identified in the Zahra article as giving competitive advantage to new firms in the globalized economy. Do you agree that these are the key factors underlying success in the international business environment? Give reasons for your answer.

International New Ventures (INV)are firms who target the international market while lunching their operations (Shenkar and Luo P 11) unlike the traditionally operating firms who target the domestic market before exporting to other countries. In their article, “Toward a Theory of International New Ventures”, published in 1994 Oviatt and McDougall defined the INV as a “business organization that, from inception seeks to derive significant competitive advantage from the use of resources and the sale of outputs in multiple countries. (Shenkar and Luo P 534). The Article of Zahra is a reexamination of Oviatt and McDougall’s article about the concept of INV’s which existed for many years but was snubbed by researchers. The author has emphasized the importance of the original document which is nowadays being studied on various academic levels. A brief Plan below explains the theory’s major points: I- General Introduction

A- The importance of the INV’s in the international Market B- The academic value of Oviatt and McDougall’s work
C- The aim of the article: Reexamination of the original paper. II- Introduction of INV’s
A- Definition
D- Characteristics of INV’s
1- Age at internationalization : Which has important implications on the firms performance 2- Entrepreneurial qualities: This is the way of how firms compete on the global market. E- The 4 Types of INV’s

1- Export/Import start-ups
2- Multinational trader
3- Geographically focused start-ups
4- Global Start –ups
F- INV’s Competitive Advantage
1- External Environment

References: * A theory of INV’s: A decade of Research – Shaker A Zahra.
* Hidden ties in international new venturing - Sara L. McGaughey
* International Business – Shankar and Luo
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