Governance mechanisms of small and medium enterprise international partner management

Pavlos Dimitratos, S. Lioukas, Kevin Ibeh, Colin Wheeler

Research output: Contribution to journalArticle

19 Citations (Scopus)

Abstract

We examine how small and medium enterprises manage their international partners across different market servicing modes, namely exporting, joint ventures and wholly owned subsidiaries. The international business literature has placed emphasis on soft issues of international partner management (such as trust, cultural sensitivity etc.) in each mode category independently. Since network arrangements and knowledge sharing are involved in all these modes, we contribute to the literature by providing evidence on the mechanisms of international partner management across market modes. Specifically, based on agency and knowledge-based theories, we seek to understand the extent to which small and medium enterprises assign rights to make decisions to partners abroad, and the types of incentives and performance monitoring schemes they use. These mechanisms are drawn from agency theory. In-depth case studies were carried out in 14 Greek small firms that employed different modes to collaborate with their partners abroad. Seven of these firms had high levels of international performance while the other seven had low levels. We identify two distinguishable combinations of governance mechanisms being implemented by these two sets of firms: high performers pursue situational decision-making with outcome-oriented incentives/performance monitoring schemes, whereas low performers pursue centralized decision-making with behaviour-oriented incentives/performance monitoring schemes.
LanguageEnglish
Pages754-771
Number of pages18
JournalBritish Journal of Management
Volume21
Issue number3
Early online date20 Jun 2008
DOIs
Publication statusPublished - Sep 2009

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Monitoring
Decision making
Industry
Small and medium-sized enterprises
Governance mechanisms
Performance monitoring
Incentives
Wholly owned subsidiary
Knowledge-based
International business
Cultural sensitivity
International performance
Knowledge sharing
Small firms
Agency theory
Servicing
Joint ventures
Exporting

Keywords

  • governance
  • partner relationships
  • market servicing
  • business partnerships

Cite this

Dimitratos, Pavlos ; Lioukas, S. ; Ibeh, Kevin ; Wheeler, Colin. / Governance mechanisms of small and medium enterprise international partner management. In: British Journal of Management. 2009 ; Vol. 21, No. 3. pp. 754-771.
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Governance mechanisms of small and medium enterprise international partner management. / Dimitratos, Pavlos; Lioukas, S.; Ibeh, Kevin; Wheeler, Colin.

In: British Journal of Management, Vol. 21, No. 3, 09.2009, p. 754-771.

Research output: Contribution to journalArticle

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