Causation and Effectuation in the Foreign Market Entry and Selection of Software SMEs

Abstract

Current research emphasizes several factors impacting on SME internationalization. However, it remains unclear that how entrepreneurs in SMEs think and implement their internationalization and select target countries for foreign operations. In this qualitative case study, foreign market selection and entries of five Finnish software firms are analyzed by using the theory of causation and effectuation. The findings imply that software SMEs used more causation logic in their foreign market selection and effectuation logic in their foreign market entries. The case firms that followed causation logic in FMS entered more distant countries.