The purpose of this study is to contribute to managers’ understanding of the internationalization of born global (BG) firms from developed countries in emerging markets. Adapting the new institutional sociology approach, the authors provide insights into how BGs might strive to bridge the institutional distance.
An explorative, multiple case study is used focusing on two Swiss BG firms in Brazil.
The study shows that these two firms faced similar institutional challenges. However, they approached them in different ways and achieved different outcomes. The comparison of these two cases highlights key factors that may influence successful internationalization, namely, niche strategies, high commitment modes of entry and the liability of outsidership.
The main research implication is that the market mode of entry and high commitment entry modes are conductive to local market knowledge acquisition. Future research should investigate how western BGs might overcome the disadvantages of foreignness and effectively gain acceptance in emerging markets such as in Brazil, China or India. This could be done by looking at micro-processes, e.g. multiple identities in which BGs might strive to simultaneously fit in and stand out in the host market.
The findings, which uncover key factors that influence internationalization, shall contribute to managers’ understanding of how BG firms from developed economies enter emerging markets and overcome challenges.
Comparing these two cases highlights key factors that may shed light on the successful internationalization of BGs from developed countries in emerging markets. The authors first describe the institutional isomorphic pressures on the two Swiss BGs in Brazil. Second, the authors reveal how they engaged in isomorphic processes to bridge the institutional distance.
