Opportunity novelty, improvisation and network adaptation in the internationalization of Swedish SMEs

• Date: 01 March 2021
• Author: Mikael Hilmersson,Stylianos Papaioannou,Heléne Lundberg,Martin Johanson
• DOI: http://doi.org/10.1002/tie.22182
• Published date: 01 March 2021

RESEARCH ARTICLE

Opportunity novelty, improvisation and network adaptation

in the internationalization of Swedish SMEs

Mikael Hilmersson

1

| Martin Johanson

2,3

| Heléne Lundberg

4

|

Stylianos Papaioannou

5

1

University of Gothenburg, School of Business,

Economics and Law, Gothenburg, Sweden

2

Department of Business Studies, Dalarna

University, School of Technology and Business

Studies, Uppsala University, Falun, Sweden

3

Department of Management, University of

Huddersfield, Huddersfield, UK

4

Department of Economics, Geography, Law

and Tourism, CER, Mid Sweden University,

Sundsvall, Sweden

5

Department of Business Studies, Uppsala

University, Uppsala, Sweden

Correspondence

Stylianos Papaioannou, Uppsala University,

Department of Business Studies, Box 513, SE-

75120 Uppsala, Sweden.

Email: stylianos.papaioannou@fek.uu.se

Abstract

By deviating from previous ways of working and improvising new solutions to prob-

lems in the internationalization process, small and medium-sized enterprises (SMEs)

will increase the likelihood of developing novel international opportunities. In this

way, for instance, unforeseen customer demand, rather than following a specific plan,

may govern market choice. Such novel opportunities, in turn, are likely to require net-

work adaptation in order for the firm to reach an insidership position in the interna-

tional business network. By integrating international opportunity theory with

theories on improvisational behavior, three hypotheses are developed between the

constructs of international opportunity novelty, improvisation, and network adapta-

tion. The hypotheses were tested with Structural Equation Modelling on 258 realized

international opportunities developed by Swedish SMEs (European Union definition:

number of employees 10–250) and were observed through on-site visits. It is rev-

ealed that improvisation increases the degree of international opportunity novelty as

well as the need for network adaptation. The degree of novelty of realized interna-

tional opportunities positively influences the need for adaptation to a foreign net-

work. Novelty can be seen as a proxy for opportunity's wealth-creating potential, and

developing improvisation capabilities seems to be a way to increase the novelty of

international opportunities developed. Managers that are risk averse and therefore

refrain from improvisation risk missing valuable novel opportunities.

KEYWORDS

improvisation, internationalization, network adaptation, novelty, opportunity, SME

1|INTRODUCTION

A central assumption in the internationalization literature is that unfa-

miliarity with political regulations, the economic environment, culture

and language in the host market causes a liability of foreignness for

the international growth-aspiring firm (e.g., Denk, Kaufmann, &

Roesch, 2012; Durand, Turkina, & Robson, 2016). This liability is likely

The article has not been previously published and it is not currently under consideration

elsewhere. The authors acknowledge the financial support they have received from

Leverhulme Trust.

DOI: 10.1002/tie.22182

This is an open access article under the terms of the Creative Commons Attribution-NonCommercial License, which permits use, distribution and reproduction in any

medium, provided the original work is properly cited and is not used for commercial purposes.

© 2020 The Authors. Thunderbird International Business Review published by Wiley Periodicals LLC.

Thunderbird Int. Bus. Rev. 2021;63:201–215. wileyonlinelibrary.com/journal/tie 201