The internationalization performance of Indonesian SMEs during COVID-19 pandemic: exploring a mediation model
Review of International Business and Strategy
ISSN: 2059-6014
Article publication date: 23 June 2023
Issue publication date: 7 November 2023
Abstract
Purpose
Small and medium enterprises (SMEs) in emerging economies face significant challenges in formulating effective strategies to enter international markets, particularly amid uncertain conditions such as the COVID-19 pandemic. Consequently, there is a pressing need to examine the performance of these SMEs and evaluate their internationalization process. This study aims to examine the effects of international entrepreneurial orientation on the internationalization performance of SMEs and the mediating effects of organizational dynamic capability and organizational culture in Indonesia.
Design/methodology/approach
This study used a quantitative method with a survey approach by distributing questionnaires to 206 SMEs in Indonesia that have implemented internationalization practices. Partial least squares-structural equation modeling (PLS-SEM) was used to predict and estimate relationships.
Findings
This study finds that one of the SMEs’ strategies to encounter the new normal era of COVID-19 is to improve their internationalization performance, especially by actively participating in international markets. The empirical results show that organizational dynamic capabilities and organizational culture are proven to fully mediate the relationship between international entrepreneurial orientation and the internationalization performance of SMEs. Meanwhile, international entrepreneurial orientation does not directly affect SMEs’ internationalization performance. This study confirms the mediating role of organizational dynamic capabilities and organizational culture in dynamic capabilities theory and their relevance to internationalization.
Originality/value
This study provides valuable insights and encourages owner-managers and policy-makers in emerging economies, particularly Indonesia, to develop organizational dynamic capabilities and organizational culture that align with the demands of internationalization.
Keywords
Acknowledgements
The authors thank to the reviewers for their useful suggestions. A research grant [Penelitian Unggulan Departemen Manajemen] from Faculty of Economics and Business, Universitas Gadjah Mada, are gratefully acknowledged. The authors declare no conflict of interest.
Citation
Anggadwita, G., Indarti, N., Sinha, P. and Manik, H.F.G.G. (2023), "The internationalization performance of Indonesian SMEs during COVID-19 pandemic: exploring a mediation model", Review of International Business and Strategy, Vol. 33 No. 5, pp. 763-785. https://doi.org/10.1108/RIBS-04-2023-0030
Publisher
:Emerald Publishing Limited
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