The significance of ethnic ties and entrepreneurial networks in the internationalization of the firm : case study : the internationalization of UK Indian enterprises
This thesis explores the significance of ethnic ties and entrepreneurial social networks in the internationalization processes of small and medium-sized enterprises. It explores whether such networks can be leveraged in order to enhance the business performance of individual firms, whilst simultaneously enhancing the international competitiveness and performance of the UK at an aggregate level. The above dimension was explored by focusing the study on UK Indian Enterprise. The reason for this focus was because the UK Indian community constitutes the single largest ethnic minority community in the UK. The qualitative study was devised by synthesising and integrating a number of pertinent literature streams, i. e. internationalization, SMEs, Asian Enterprise, Culture, and Networks. The study revealed that the nature and dynamics of the sample frame support the findings of past studies relating to Asian Enterprise and Asian Entrepreneurship. The findings highlight that deficiencies in formalised planning processes, financing, and professional management practices exist amongst the firms; and similarities can be drawn with the deficiencies and problems recognised to exist for family owned SMEs, and SMEs per se, regardless of ethnicity. A key issue facing the bulk of firms was that of 'diversification'and 'breakout', especially for firms operating in declining industrial sectors such as Textiles. It emerged that the internationalization process pursued by firms was in line with the internationalization literature relating to 'export development models', which suggests that firms develop and grow their international activities in phases/stages, i. e. Pre-engagement, Initial and Advanced. With regard to 'Ethnic Ties'and 'Entrepreneurial Social Networks', the study's findings revealed that such networks do play an important role in the dynamics of UK Indian Enterprise. It was also identified that: Indian social netw national settings; the importance attached to Indian Networks over the three (3) internationalization phases diminishes; and the international networks of UK Indians do not necessarily provide them with a significant advantage for internationalization, primarily because of issues relating to the competency, capabilities, and the synergy potential which exists with their international network contacts. The study's findings suggest that changes in UK Indian cultural norms, which will influence the business practices of future generations, will be increasingly influenced by Western business practices and ideology, which may well influence the internationalization practices of UK Indian enterprises in the future as shifts in management paradigms surface. It also materialised that mainstream business support services were ineffective and lacking in both engaging and facilitating the internationalization activities of the participating firms. This supports the findings of past studies i n this area. From a international policy perspective, the study reveals that although government advice and guidance services may be of assistance to SMEs per se (in the main firms which are already engaged in international activity), they do not address the needs of many firms which are at the 'preinternationalization' stage, seeking to address questions orientated around 'whether', 'where' and 'how' to Internationalize. In addition, this non take-up of services would appear to be more acute for ethnic minority enterprises.