Organizational Routines Development and the Timing and Pace of Early Stage Internationalization

Abstract

This research investigates the process in which smaller, younger internationalizing firms explore and exploit the required knowledge and capabilities. This research adopted an exploratory, case-based theorising approach, and conducted a longitudinal empirical case study of four firms, each of which took a different internationalization path. The analysis focuses on how the four firms developed the firm-level organizational routines for exploring and exploiting external knowledge and capabilities, by investigating and comparing the level of routines development at the time of initial internationalization and these two years after this. As a result, this research finds that the level of the development of the firm-level organizational routines for internationalization is low, regardless of the timing and pace of internationalization, at the time of internationalization. Further, by analyzing the complete list of knowledge sources and knowledge types, this research argues the advantages of grafting for developing a wider variety of firm-level organizational routines to accelerate the pace of internationalization. Moreover, the distinction between ordinal and change routines has enabled this study to investigate the exploitation aspect of capabilities, and discusses the value of analyzing the higher-level routines that foster the exploitation, which distinguish rapidly internationalizing firms from slowly internationalizing firms.