6.4 How do I implement my Internationalisation Strategy?

Strategy Formulation
The most important element to take into account before approaching international markets is strategy. Formulating an internationalisation strategy will not only help you realize your goals, but it will also clarify any doubts may be affecting your decision upon the mode of internationalisation. In short, keep in mind that internationalisation is most likely to prove fruitless without a strategic plan to follow and make sure your strategy is clear and based on realistic options, taking into account all factors which may shape the process.

Internationalisation involves risks that will play a very important part in the formation of your business strategy. In addition, a great number of obstacles must be dealt with and taken into consideration, owing to both exogenous (such as technical barriers and financing problems) and endogenous factors (such as poor knowledge of foreign markets, fear to take risks, lack of knowledge of foreign languages, etc.).1

The natural way of internationalising would normally involve firstly inward activities (i.e. imports) and then outward operations (i.e. exports).2

However, before getting involved into such activities, your strategy formulation should first focus on when, how and which markets you will enter and of course it is crucial to decide on the scale of your entry into the international market - if it is on a large scale you must act fast and invest plenty of resources, if it is on a small scale it will give you a chance to get to know the market as you will be less exposed to risk.3

The management team must therefore plan ahead. Factors that can aid this process are: market knowledge, business networks, past experience, management skills, financial resources, age and size of the company and information from government agencies.4

A very important factor that can affect this process is knowledge of foreign languages. Staff training is imperative in order to improve their language skills and as a manager or owner you must choose wisely the regions that you will expand your business to. The closer the link to your home country, the lesser the possible extra costs.5

EXERCISE: Think about which countries may be the best markets for you to expand your business, do some internet research and write down the benefits of each country of interest.

At this point it would be wise to consider in what order you should perform your actions. Below, we provide a useful model, which can be used as a guide to your further actions upon.

1 The process of Internationalization in Small and Medium Enterprises (SMEs), Kishore Kumar Bandi, Kamlesh Bhatt, Halmstad University, 2008, p. 9.
2 Global Marketing A Decision-Oriented Approach, 4th Edition, Svend Hollensen, 2007.
3 Internationalization Process of SMEs: Strategies and Methods, Mohibul Islam Masum Alejandra Fernandez, June 2008, p. 9.
4 Internationalization Process of SMEs: Strategies and Methods, Mohibul Islam Masum Alejandra Fernandez, June 2008, p. 9.
5 EU RESEARCH ON SOCIAL SCIENCES AND HUMANITIES, National Corporate Cultures and International Competitiveness Strategies ? The Challenge of Globalisation for European SMEs, p. 103.