Abstract
This chapter aims to explore the roles of entrepreneurship and internationalization in global business, thus illustrating the theoretical and practical overviews of entrepreneurship, corporate entrepreneurship, and internationalization; the relationship between entrepreneurship and internationalization and their impact on the global economy; and the importance of entrepreneurship and internationalization in global business. The accomplishment of entrepreneurship and internationalization is vital for modern organizations that seek to serve suppliers and customers, increase business performance, and attain regular success in global business. Thus, it is necessary for modern organizations to investigate their entrepreneurship and internationalization applications, create a strategic plan to explore their functional advancements, and immediately respond to the entrepreneurship and internationalization needs of customers. Applying entrepreneurship and internationalization has the potential to increase organizational performance and achieve strategic goals in global business.
TopBackground
Cantillion (1755) considered entrepreneurship as self-employment of any sort involved in a process of bearing the risk to organize factors of production to deliver a product or service demanded by the market. Marshall (1890) defined entrepreneurship as an important factor of production together with land, capital and labor. Knight (1921) who underlined the risk-bearing dimension of entrepreneurship. Drucker (1985) developed the innovation dimension of the entrepreneurship which implies the exploitation of existing resources through its ability to produce something new. The term entrepreneurship appears to be hard to define in a precise and unambiguous manner (Sorenson & Stuart, 2008).
Internationalization theory was built concerning the intellectual foundations of transaction cost established by Coase (1960) and first applied to multinational enterprises (MNEs) by Buckley and Casson (1976) and Hennart (1982). These latter two works suggest that firm-specific advantages determine a firm’s domestic and international success, with the environment acting as a constraining or facilitating force. MNEs increasingly need top managers who understand global markets and diverse business practices and who are aware of opportunities to compete on an international level (Finkelstein, Hambrick, & Cannella, 2009; Luo, 2005). Regarding transaction cost arguments, more reports in the literature of internationalization have considered the role of firms’ capabilities (Madhok, 1998), the effects of foreign exchange rate and the volatility of the corporate choice of foreign entry mode (Baek & Kwok, 2002), the impact of uncertainty on the timing and dimensioning of investment (Fisch, 2008), and the impact of corporate and national cultures on decentralization decisions (Williams & van Triest, 2009).
Key Terms in this Chapter
Internationalization: The growing tendency of corporations to operate across national boundaries.
Entrepreneurship: The capacity and willingness to organize and manage a business venture along with any of its risks in order to make a profit.
Business: An organizational or economic system where goods and services are exchanged for one another or for money.
Business Venture: A business enterprise in which the expectation of gain is accompanied by the risk of loss or failure.
Entrepreneurial Resource: The assets, both tangible and intangible, that are mobilized by entrepreneurs in the process of building a business, organization, or other initiative.
Entrepreneurial Organization: The group of business owners who meet on a regular basis to share information, experiences, and tools for improving businesses.