Title: Decision-making during small and medium-sized enterprises' internationalisation - effectuation vs. causation

Authors: Roger Schweizer

Addresses: Department of Business Administration, School of Business, Economics and Law, University of Gothenburg, P.O. Box 610, S-405 30 Göteborg, Sweden

Abstract: Although research on decision-making in small and medium-sized enterprises' (SMEs) international ventures has emphasised various attributes of the decision-maker when trying to explain decisions, few studies have examined the underlying overall mental models used. Exploring the explanatory power of effectuation, this paper discusses how and why SMEs change decision logic related to internationalisation over time. Using decisions made during a Swedish medical technology firm's internationalisation process as the unit of analysis, this paper employs an embedded case study approach. The paper concludes that a decision-maker makes decisions by following the logic of both effectuation and causation independent of the internationalisation stage of a firm. The chosen approach is influenced by the nature of the perceived problem space, existing decision-making routines and heuristics and the inability of decision-makers to learn from previous internationalisation decisions due to the idiosyncratic nature of each foreign expansion.

Keywords: small and medium-sized enterprises; SMEs; internationalisation; decision making; rationality; effectuation; causation; international ventures; mental models; Sweden; medical technology; case study; foreign expansion.

DOI: 10.1504/JIBED.2015.066744

Journal for International Business and Entrepreneurship Development, 2015 Vol.8 No.1, pp.22 - 41

Received: 22 Feb 2014
Accepted: 25 Feb 2014
Published online: 04 Jan 2015 *

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