Strangers in a strange land: strategy development for diminishing liabilities of newness and foreignness in transnational entrepreneurial companies
Item statusRestricted Access
Embargo end date31/12/2100
Stoyanov, Stoyan Petrov
Entrepreneurial migration has become increasingly common as a result of globalization and regional economic integration, and the economic contribution of immigrant entrepreneurs is increasingly appreciated. Many of these immigrant entrepreneurs become transnational entrepreneurs (TEs), in that their business activities link the markets of their home countries and their new host countries. Entrepreneurship, International Entrepreneurship and Internationalization Process research has emphasized the role of networks and of social capital for entrepreneurs for addressing the liabilities of foreignness or of outsidership when they address new markets. Research has not, however, addressed the role of networks for TEs, nor the role of networks in their strategies. This thesis asks how participation in Diaspora networks helps transnational entrepreneurs diminish liabilities of newness and foreignness, and how transnational entrepreneurs successfully realize and manage business embeddedness at an interorganizational level. A qualitative study is undertaken with 12 Bulgarian-owned service-consulting companies in London. Data came from semi-structured interviews of the entrepreneurs involved and their employees, which was combined with participant observations and oral life story narratives. Three overall contributions are developed from the findings of the study. First, the study makes a theoretical contribution to the field, by introducing the ‘resource orchestration’ framework in the study of entrepreneurs’ capabilities and resource configurations. Modifying this framework with the inclusion of a time dimension adapts it to the dynamism of process research. This helps the study to show how TEs typically undergo a sequence of processes in which they leverage their Diaspora networks in order to access, acquire, and adapt knowledge and capabilities. It is these processes that allow them to reduce the liabilities of foreignness that they face, and embed themselves in their new local environments. Second, the study illuminates heretofore unexplored processes of TE integration that reduce their liabilities of newness and foreignness and help to align with their new foreign country market environment. This involves preparation, paradigm shift, and initiation stages, each one being facilitated by embeddedness within a Diaspora community. It is through these integration processes that entrepreneurial resource orchestration is achieved, and the synchronization of resource structuring and bundling processes. Third, the findings challenge an assumption often encountered in entrepreneurial and international entrepreneurial network and social capital research that the co-existence of strong ties and bridging ties – referred to by Burt (1992) as an ideal configuration – is exceedingly rare. This study finds evidence of their frequent co-existence in the Diaspora network, and shows this configuration to underpin the operation and growth of the network. It shows how TEs have a particular opportunity to access, orchestrate and employ this valuable form of social capital, and doing this in the ways shown not only enables their own entrepreneurial success, but also their economic contribution to their host communities.