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2009-08-12

"Born Globals" – Today´s companies

The internationalization models Swedish Universities have produced through the years has changed tremendously due to the rapid technology development which particularly is relevant in communication.

The so-called Uppsala school's internationalization model that was developed during the 1970s described a company establishment process - internationalization through four different phases.

The first phase was the export of their product to the new market, then start selling through an agent which was the second phase. The third phase was that the company itself established a sales office and finally moved production to the country which was the fourth phase.

Such an establishment process was characterized by low risk
but also low priority on for example "Time to Market” for their product. Another factor which also ruled this type of establishment chain was geographical location, it was important that the new market would have a distance from the domestic market.

Surely there are companies today that use this establishment
chain, but for most it goes much faster when "Time To Market" in the company's business plan usually is of high priority.

Today, the choice of country of establishment includes factors other than geographical proximity. Due to the product or service access to high skills, modern infrastructure, minimal bureaucracy and acceptable cost levels are valued. Moreover, the country's political system and governance should are analyzed which should be democratic and reliable in the long term.

Studies published more recently consists of companies that fully makes use of today's communication possibilities. There are companies that already from the start are international, in the majority of studies the businesses are called "Born Globals"

The definition of "Born Globals" companies is that 25 percent
of sales come from customers outside the country within a period of maximum three years, and such sales shall be spread over several countries.

"Born global" companies are often associated with high-tech and knowledge industries. One example is the gambling industry which in Europe has been concentrated to the country of Malta which offers modern conditions by today's standards, and where customers are found in all countries with the existence of modern infrastructure.

Technological development in areas such as production,
transport and communication is the reason for the acceleration of globalization.

 
                                                                                         Cecilia Helland
Nopef
NCC