The Role of Networks in Internationalization of Operations at Africa Heritage Design Company in Kenya

Abstract

The level of awareness in this information age that we are living in has made people acquire preferences and tastes for products from across the world. This has motivated more and more SMEs to venture into the world trade arena. This project looks at an important but often overlooked aspect of the international process; the business networks established by those capable of exacting influence on a given firm. Extensive studies have been carried out in the past to document this process. However, most of these have been carried out in developed economies and in tech savvy industries. This project is therefore aimed at carrying out similar research in a developing economy set-up and in an industry dealing with preferably indigenous African products. The research centered on African Heritage Design Company a Kenyan firm dealing with products that are viewed as indigenously Kenyan. The research paper aimed at answering two questions; the influence of networks on the choice of a particular foreign based market and the influence of networks in the mode of entry into the foreign market. The theory of internationalization is broad; however, for this project, the behavioral process theories of internationalization were used as the conceptual framework, key among them being the Uppsala theory of internationalization and the network approach to internationalization. This project was aimed at corroborating or contradicting existing literature. The research design was a case study and data was collected through the interview method and analyzed through content analysis. Empirical evidence showed that management having a previous history on international experience, were likely to set their firms on an internationalization path. It was also observed that networks had a significant influence on the choice of foreign market. Business networks showed a weak influence on the choice of entry mode utilized in the various foreign markets. However, personal and family relationships did seem to influence more investment than typical business networks. The study should be extended in the future to involve more firms in a longitudinal case study type of research.