Managing Internationalization
Y53000
Filip de Beule Academicyear 2025-2026
Topic 0. Introduction
Topic 1. Theories of internationalization
1. Internationalization: process model
2. Internationalization: internation entrepreneurship
3. Internationalization model
4. Market selection and management
Topic 2. Internationalization of social enterprises
Topic 3. Integrated models of internationalization and multinational activity
1. Integrated model of internationalization process
2. Integrated theory of MNE governance
3. Example: industry 4.0
Glossary (begrippenlijst) at the end
Cases: used in class to show course materials and understand. Not in
summary, watch video cases on Youtube
- Lutosa
- Amica
- NV-Holders
- IPEE
Articles: 34 articles, summary available on my profile
Volledige restructuratie van de powerpoints in een veel logischere en
makkelijkere te volgen volgorde. Volgens de 5 management vragen (why-
what-how-when-where). Bevat al de elementen om een grotere samenhang
te zien van de lesseninhoud. Deze structuur overlopen met de PowerPoints
voor een nog betere kennis.
A complete restructuring of the PowerPoint slides into a much more logical
and easier-to-follow sequence, based on the five management questions
(why–what–how–when–where). Contains all the elements to be able to see
the bigger picture of the coursematerials. Reviewing this structure together
with the PowerPoint slides to achieve an even better understanding.
1
,Why do firms
internationalize? (motives)
What problem is internationalization solving for the firm?
Market seeking motives: goal = sell more, find new customers
Have a look at the foreign operation modes
Seek markets
- Literature on internationalization often assumes that sales-oriented
objectives are the most relevant.
- The primary motive for starting activities in a foreign country is
frequently the access to new markets and the sales potential offered
by foreign markets.
o But
more firms import than export, on average
(but not in all countries, regions, industries? See further)
Efficiency seeking motives: goal = reduce costs or improve productivity
Lob cost labor
Resource seeking motives: goal = access what you don’t have at home
Foreign activities can also be taken up with the objective of giving the firm
access to relevant resources (resource seeking)
- such as natural resources (like agricultural produce, raw materials, …),
- but also to parts and components from foreign suppliers,
- low cost labor
=> Efficiency seeking
- and high skilled labor and knowledge
=> Strategic asset seeking for R&D and innovation
Strategic asset seeking motives: goal = strengthen the firm for the future
High skilled labor and knowledge
Triggers versus barriers
These feed in to certain motives to do internationalization
- Motives explain WHY firms want to internationalize
- Triggers explain WHY internationalization starts at a specific moment
2
, - Barriers explain WHY internationalization is delayed, limited, or
avoided
All these questions are interrelated
Theoretical perspective on internationalization
- Neoclassical perspective on firms
- Economic approaches
o Market imperfections
o Internalization theory
o Eclectic OLI paradigm
- Behavioral approaches
o Internationalization process perspective
Luostarinen
Uppsala
o International entrepreneurship
o Network theories
From liability of foreignness to liability of outsidership
Effectuation theory
Neoclassical perspective
Neoclassical theory
- Assuming perfect markets, perfectly competitive markets (costless
exchange)
o Many buyers and sellers
o Perfect information
o Known technology
These result in the perfect coordination of supply and demand and lead
to the correct price.
- No focus on existence, boundaries, internal organization of companies
- Certainly not on multinational companies
Theory of capital movements (Mundell)
Study of international investment: investment flows from countries with low
financial cost/returns to countries with high financial cost/returns. FDI as a
financial flow.
Economic approaches
3
, Monopolistic advantages (Hymer-Kindleberger)
Oligopoly theory of FDI based on monopolistic advantages
- Need of advantage by firm to overcome liability of foreign countries
- Need for higher return abroad due to higher costs abroad
Critique on Mundell: several reasons for increasing involvement of
multinationals in global economy
- Cross-border ownership: increasing concentration
- Imperfect competition: monopolistic profits
- Ownership advantages across countries at low marginal cost (economy
of scale)
- International activities provide gains from international diversification
of risks (portfolio effects)
Product cycle theory of international trade and investment (Vernon)
Product life cycle: approach to explain foreign production was essentially an
extension of the neoclassical theory of the spatial distribution of factor
endowments to embrace intermediate products. Argues that the investment
decision was a decision between exporting and investing. Products move
through a life cycle divided into three stages, giving a cost-based rationale
for the switching from exporting to foreign-based production.
- New products
- Maturing products
- Standardized products
International product life cycle: firms undertake FDI at particular stages in
the life cycle of a product
- Invest in other advanced countries when local demand in those
countries grows large enough to support local production
- Then shift production to low-cost developing countries when product
standardization and market saturation give rise to price competition
and cost pressures
Product life cycles extension strategies through internationalization
- E.g. life cycle of VW Santana
4
Y53000
Filip de Beule Academicyear 2025-2026
Topic 0. Introduction
Topic 1. Theories of internationalization
1. Internationalization: process model
2. Internationalization: internation entrepreneurship
3. Internationalization model
4. Market selection and management
Topic 2. Internationalization of social enterprises
Topic 3. Integrated models of internationalization and multinational activity
1. Integrated model of internationalization process
2. Integrated theory of MNE governance
3. Example: industry 4.0
Glossary (begrippenlijst) at the end
Cases: used in class to show course materials and understand. Not in
summary, watch video cases on Youtube
- Lutosa
- Amica
- NV-Holders
- IPEE
Articles: 34 articles, summary available on my profile
Volledige restructuratie van de powerpoints in een veel logischere en
makkelijkere te volgen volgorde. Volgens de 5 management vragen (why-
what-how-when-where). Bevat al de elementen om een grotere samenhang
te zien van de lesseninhoud. Deze structuur overlopen met de PowerPoints
voor een nog betere kennis.
A complete restructuring of the PowerPoint slides into a much more logical
and easier-to-follow sequence, based on the five management questions
(why–what–how–when–where). Contains all the elements to be able to see
the bigger picture of the coursematerials. Reviewing this structure together
with the PowerPoint slides to achieve an even better understanding.
1
,Why do firms
internationalize? (motives)
What problem is internationalization solving for the firm?
Market seeking motives: goal = sell more, find new customers
Have a look at the foreign operation modes
Seek markets
- Literature on internationalization often assumes that sales-oriented
objectives are the most relevant.
- The primary motive for starting activities in a foreign country is
frequently the access to new markets and the sales potential offered
by foreign markets.
o But
more firms import than export, on average
(but not in all countries, regions, industries? See further)
Efficiency seeking motives: goal = reduce costs or improve productivity
Lob cost labor
Resource seeking motives: goal = access what you don’t have at home
Foreign activities can also be taken up with the objective of giving the firm
access to relevant resources (resource seeking)
- such as natural resources (like agricultural produce, raw materials, …),
- but also to parts and components from foreign suppliers,
- low cost labor
=> Efficiency seeking
- and high skilled labor and knowledge
=> Strategic asset seeking for R&D and innovation
Strategic asset seeking motives: goal = strengthen the firm for the future
High skilled labor and knowledge
Triggers versus barriers
These feed in to certain motives to do internationalization
- Motives explain WHY firms want to internationalize
- Triggers explain WHY internationalization starts at a specific moment
2
, - Barriers explain WHY internationalization is delayed, limited, or
avoided
All these questions are interrelated
Theoretical perspective on internationalization
- Neoclassical perspective on firms
- Economic approaches
o Market imperfections
o Internalization theory
o Eclectic OLI paradigm
- Behavioral approaches
o Internationalization process perspective
Luostarinen
Uppsala
o International entrepreneurship
o Network theories
From liability of foreignness to liability of outsidership
Effectuation theory
Neoclassical perspective
Neoclassical theory
- Assuming perfect markets, perfectly competitive markets (costless
exchange)
o Many buyers and sellers
o Perfect information
o Known technology
These result in the perfect coordination of supply and demand and lead
to the correct price.
- No focus on existence, boundaries, internal organization of companies
- Certainly not on multinational companies
Theory of capital movements (Mundell)
Study of international investment: investment flows from countries with low
financial cost/returns to countries with high financial cost/returns. FDI as a
financial flow.
Economic approaches
3
, Monopolistic advantages (Hymer-Kindleberger)
Oligopoly theory of FDI based on monopolistic advantages
- Need of advantage by firm to overcome liability of foreign countries
- Need for higher return abroad due to higher costs abroad
Critique on Mundell: several reasons for increasing involvement of
multinationals in global economy
- Cross-border ownership: increasing concentration
- Imperfect competition: monopolistic profits
- Ownership advantages across countries at low marginal cost (economy
of scale)
- International activities provide gains from international diversification
of risks (portfolio effects)
Product cycle theory of international trade and investment (Vernon)
Product life cycle: approach to explain foreign production was essentially an
extension of the neoclassical theory of the spatial distribution of factor
endowments to embrace intermediate products. Argues that the investment
decision was a decision between exporting and investing. Products move
through a life cycle divided into three stages, giving a cost-based rationale
for the switching from exporting to foreign-based production.
- New products
- Maturing products
- Standardized products
International product life cycle: firms undertake FDI at particular stages in
the life cycle of a product
- Invest in other advanced countries when local demand in those
countries grows large enough to support local production
- Then shift production to low-cost developing countries when product
standardization and market saturation give rise to price competition
and cost pressures
Product life cycles extension strategies through internationalization
- E.g. life cycle of VW Santana
4
