The Concept of International New Ventures - 620 Words

Week 1 HIA Explain how the article builds on the seminal work of Oviatt and McDougall in their paper,. Describe and analyze the factors identified in the Zahra article as giving competitive advantage to new firms in the globalized economy. Do you agree that these are the key factors underlying success in the international business environment? Give reasons for your answer. International New Ventures (INV)are firms who target the international market while lunching their operations (Shenkar and Luo P 11) unlike the traditionally operating firms who target the domestic market before exporting to other countries. In their article, â€Å"Toward a Theory of International New Ventures†, published in 1994 Oviatt and McDougall defined the†¦show more content†¦The major factors overlooked by Oviatt and McDougall, and which build the competitive advantage are - according to Zahra- : 1- The Institutional environment 2- The economic Geography These factors consist in studying the country’s culture, assessing the market, hiring locals and establishing work contacts. In addition to that, Zahra considers that INV’s managers should demonstrate a high degree of openness and flexibility thus allowing the firm to function in the foreign environment. The same critics that Zahra has addressed to Oviatt and McDougall’s analysis applies on his list of factors contributing to the INV’s competitive advantage. We should acknowledge that every country has some economic or cultural specificity; therefore there are some universal business rules which apply on the entire global market. The traditional firms, who possesses years of local market experience, ownership and abundance of their resources are more qualified to compete on the international level. Therefore I believe that the INV’s should considerShow MoreRelatedThe Key Term And Why You Are Interested924 Words   |  4 Pagesterm, joint ventures. This concept is of interest because in today’s business environment due to the economy downfall, many organizations recourse to this strategy in order to easily infiltrate in a foreign market. Companies are seeking more opportunities to expand their market share and a joint venture is an attractive option to do so. Getting involved with a foreign market come with several obstacles and challenges. 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