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Oulun yliopiston väitöskirjat

FIRMS’ RESOURCE ALLOCATION BETWEEN R&D AND MARKETING IN THEIR INTERNATIONAL EXPANSION, ACTA UNIVERSITATIS OULUENSIS G Oeconomica 95

ISBN-10:	978-952-62-1698-0
Kieli:	englanti
Kustantaja:	Oulun yliopisto
Oppiaine:	Talous
Painos:	Osajulkaisuväitöskirjan yhteenveto-osa
Painosvuosi:	2017
Sijainti:	Print Tietotalo
Sivumäärä:	96
Tekijät:	HAAPANEN LAURI

15.00 €

For a small and medium size firm (SME), expansion into new foreign markets is a remarkable milestone, requiring specific resources and capabilities. The purpose of this study is to explore how management in internationalizing small and medium-size firms allocate their limited resources between key functions, in particular, between marketing and R&D. This thesis builds on a resource-based view of the firm, a dynamic capabilities perspective, and the SME internationalization literature, and therefore assumes that a firm’s success in foreign markets is closely related to its internal resource and capability configurations. The findings of this study suggest that SMEs need a capability portfolio in which the relative importance of key capabilities varies as international expansion proceeds. It appears that throughout the international expansion process, investments in developing R&D capabilities do not notably decrease, not even at the time when SMEs need to begin to develop other activities, such as marketing. Closer examination reveals that investments in the capabilities’ underlying microfoundations, rather than the resource allocation between the key functions per se, determine the nature of the resulting competitive advantage. Cross-border mergers are specific situations that reveal the strong influence of functionspecific microfoundations on functional capabilities and thus, on an SME’s dynamic capabilities. The results of this study show that in merger deals, each firm comes with distinctive crossfunctional structures, processes, routines, and skills. Synergies might not be capitalized if management is not able to effectively align merging firms’ underlying microfoundations. The results in this thesis underline the invaluable role of SMEs’ management. The findings show that even if the different phases of international expansion require diverse managerial capabilities, unanimity among the top management team executives is needed (surprisingly) only when these SMEs are making substantial resource commitments. Such adoption to changing conditions is an illustration of dynamic managerial capabilities that partly determines success in international markets.

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