Beyond categorization: New directions for theory development about entrepreneurial internationalization

Journal of International Business Studies (2017) ª 2017 Academy of International Business All rights reserved 0047-2506/17 www.jibs.net EDITORIAL Beyond categorization: New directions for theory development about entrepreneurial internationalization A Rebecca Reuber1, Pavlos Dimitratos2 and Olli Kuivalainen3,4 1 Rotman School of Management, University of Toronto, 105 St. George St., Toronto, ON M5S 3E6, Canada; 2 Adam Smith Business School, University of Glasgow, Glasgow, Scotland, UK; 3 School of Business and Management, Lappeenranta University of Technology, Lappeenranta, Finland; 4 Alliance Manchester Business School, University of Manchester, Manchester, UK Correspondence: AR Reuber, Rotman School of Management, University of Toronto, 105 St. George St., Toronto, ON M5S 3E6, Canada. Tel: 416-978-5705; e-mail: Received: 8 February 2017 Revised: 8 February 2017 Accepted: 10 February 2017 Abstract Categorizations emphasizing the earliness of internationalization have long been a cornerstone of international entrepreneurship research. Here we contend that the prominence of categories has not been commensurate with theory development associated with them. We draw on categorization theory to explain why earliness-based categories are persistent, and argue that a greater focus on notions related to opportunity can open new avenues of research about the entrepreneurial internationalization of business. We propose and discuss three directions for opportunity-based research on entrepreneurial internationalization, involving context, dynamics and variety. Journal of International Business Studies (2017). doi:10.1057/s41267-017-0070-3 Keywords: internationalization theories foreign market entry; context analysis; business dynamics; categorization theory; international new venture; born global; opportunity INTRODUCTION Categories have long been a cornerstone of international entrepreneurship scholarship. A general contention is that this research domain started with the observation that some firms were able to internationalize earlier and faster than existing theory would predict (Oviatt & McDougall, 1994; McDougall, Shane, & Oviatt, 1994). The identification of, and explanation for, this new category of firm – labelled ‘‘international new venture’’ – has sparked countless research studies, and Oviatt and McDougall were awarded the JIBS Decade Award in 2004. A decade later, Knight and Cavusgil (2004) examined the capabilities of early internationalizing firms – which they labelled ‘‘born globals’’ – and this also inspired a large body of research and a JIBS Decade Award, in 2014. Since then, a number of narrower firm-level classifications reflecting internationalization patterns have been described in the research literature, including born-again globals (Bell, McNaughton, & Young, 2001), born regionals (Baum, Schwens, & Kabst, 2015; Lopez, Kundu, & Ciravegna, 2009) and geographically focused born-internationals (Kuivalainen, Saarenketo, & Puumalainen, 2012). These categories have been important in providing labels to delineate different temporal and spatial dimensions of the Beyond categorization initiation of internationalization. Their pervasive presence in academic journals, teaching material and policy reports attests to their value in this regard, as does their prominence in recent reviews of the domain (e.g., Jones, Coviello, & Tang, 2011; Knight & Liesch, 2016). However, we believe that theory development in this area has not grown commensurately. We think that it may have been constrained by the persistence of existing categories that emphasize the earliness of internationalization, and that new possibilities for theory development will emerge when scholars look beyond this dimension. Our objective here is to outline three such possibilities. To begin with, however, we first draw on categorization theory to explain why existing categories are persistent and constrain new kinds of sensemaking about international entrepreneurship phenomena. CATEGORIES IN INTERNATIONAL ENTREPRENEURSHIP RESEARCH Categorizing things with respect to their similarities and differences is an inherent part of the human condition. It is a basic mechanism that people use to make sense of a messy world and communicate it to others. Indeed, category-based processing is the dominant way to learn about new entities (Fiske & Neuberg, 1990). For example, when someone goes to a new film, that person is likely to make sense of it by categorizing it into a familiar genre (Hsu, Hannan, & Koçak, 2009). In the same way, categorization is a basic building block of theory generation. As scholars observe phenomena in their research domain, they automatically compare them to known categories. When an anomaly is encountered – something that does not fit known categories – there is an opportunity to create a new category and develop theory to explain the new phenomenon (Christensen, 2006). This recognition of anomalies is consistent with Oviatt and McDougall’s description of how they became interested in theorizing about international new ventures, which occurred when they found it hard to integrate into their existing frameworks the growing number of such firms they observed or read about in the business press (Oviatt & McDougall, 2005, pp. 3–4). In order to understand the role of categories in extant international entrepreneurship research, it is important to understand why our existing timingbased categorical schemes are persistent. Categorization theory provides a three-fold explanation. Journal of International Business Studies A Rebecca Reuber et al The first reason has to do with category labels. Since category labels serve to aid in collective sensemaking about the category, successful labels convey both the novelty of a category and its differences with existing categories (Grodal, Gotsopoulos, & Suarez, 2015). For example, the labels ‘‘international new venture’’ and ‘‘born global firm’’ both emphasize the earliness of internationalization of these firms compared with other types of firms, through the words ‘‘new’’ and ‘‘born.’’ Successful category labels introduced after a dominant category has emerged tend to highlight the novelty of the new category, but in a manner that links it with existing categories. This is normally done through a process of linguistic recombination: the reformulation of one or more pre-existing words or phonemes to create a new category label (Grodal et al., 2015, p. 426). Again, this practice has been common in the international entrepreneurship literature; for instance, the category labels ‘‘born again global’’ and ‘‘born regional’’ are both linguistic reformulations of ‘‘born global.’’ The advantage of such reformulated categories is that they are easy to remember and communicate. However, the drawback is that categorical variations highlight one aspect of an entity while ignoring others. In this case, initial category labels were based on the relationship be (...truncated)