A phenomenological study of sub-contracting small-and-medium-sized enterprises and their globalization strategies and responses

Abstract

Small and medium-sized enterprises (further SMEs) are the backbone of the economic development in all countries around the world (Story, 1994: Saee, 1995; 1997; Saee & Mouzytchenko, 1999). In the era of globalization, the well-being of any national economy depends on the export performance of local companies and their integration in the world economy. Therefore, in the past decade, issues of internationalization of SMEs have been attracting much attention from academic researchers and policymakers. However, there are still gaps in the knowledge regarding international behavior of SMEs involved in subcontracting. This exploratory research looks at the international activities of a number of SMEs involved in subcontracting. The research is of qualitative nature and is based on in-depth interviews with eight senior managers of four Scottish SMEs operating as subcontracting firms. Further, the following issues arising from the international behavior of the subcontracting SMEs, namely the motives for internationalization; the relationship between growth of the company and international expansion; the relationship between characteristics of management team and internationalization; the problems and the strategies of internationlization; and the use of government support programs/initiatives to promote their international operations relating to subcontracting SMEs are analyzed and discussed.