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The Role of Market Orientation in Internationalization of SMEs
Abstract
A rapidly changing business environment generates a growing demand for enterprises to understand their markets. Knowledge about markets is a strategic resource and enterprises are advised to invest in understanding their markets, competitors, and customers. Market orientation is widely studied as a concept describing how enterprises generate and respond to market knowledge. Market orientation is a cultural factor which we analyze in the framework of organizational culture. We examine market orientation as a cultural factor, as adopting a new type of culture inside and outside an organization can be particularly challenging for Small- and Medium-Enterprises (SMEs). SMEs have not been considered as very active participants in global business, where market knowledge is of utmost importance. For example, Keskin (2006) finds that market orientation is an antecedent of learning orientation in SMEs and market intelligence guides their learning processes. This chapter examines both theoretically and empirically how market orientation as a cultural factor is related to the internationalization processes of SMEs. This hopefully helps us to understand how SMEs can develop their businesses to a global level. We will present a qualitative study of four Finnish SMEs representing different phases of internationalization. Finally, discussion on the results and future research directions will be presented.
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