Comparative Country Studies 2023: Week 3 articles
Article #1
The Uppsala internationalization process model revisited:
From liability of foreignness to liability of outsidership
Jan Johanson and Jan-Erik Vahlne
Published: 2009
Key points:
1. The Uppsala internationalization process model proposes that firms gradually
increase their internationalization through experiential learning.
2. The original model included the concept of liability of foreignness, which suggests
that firms face disadvantages in international markets due to their lack of
familiarity with local conditions.
3. The authors argue that the original model needs to be updated to account for
changes in the global business environment, including the increasing complexity
and uncertainty of international markets and the rise of new competitors from
emerging markets.
4. The authors propose replacing the concept of liability of foreignness with the
concept of liability of outsidership, which suggests that firms face disadvantages in
international markets due to their lack of access to local knowledge networks.
5. The authors also introduce the concept of strategic flexibility, which refers to a
firm's ability to adapt its internationalization strategy in response to changing
market conditions, as an important element of the updated Uppsala model.
Summary:
"The Uppsala internationalization process model revisited: From liability of foreignness to
liability of outsidership" by Jan Johanson and Jan-Erik Vahlne.
The article revisits the Uppsala internationalization process model, which was first
proposed by Johanson and Vahlne in the late 1970s. The model has been widely used in
international business research to explain how firms gradually increase their
internationalization through a process of experiential learning.
In this article, the authors argue that the original model needs to be updated to account
for changes in the global business environment, including the increasing complexity and
uncertainty of international markets, the rise of new competitors from emerging markets,
and the growing importance of knowledge and innovation in international business.
The authors propose a new version of the Uppsala model that includes two key changes.
First, they replace the concept of liability of foreignness (which suggests that firms face
disadvantages in international markets due to their lack of familiarity with local
conditions) with the concept of liability of outsidership (which suggests that firms face
, disadvantages in international markets due to their lack of access to local knowledge
networks).
Second, they introduce the concept of strategic flexibility, which refers to a firm's ability to
adapt its internationalization strategy in response to changing market conditions. The
authors argue that strategic flexibility is becoming increasingly important in the current
business environment, as firms need to be able to adjust their strategies quickly in
response to rapid changes in technology, regulation, and consumer preferences.
Overall, the article offers a valuable update to the Uppsala internationalization process
model, highlighting the need for firms to develop strategic flexibility and emphasizing the
importance of knowledge and network-based advantages in international markets. The
article is well-researched and provides a useful framework for understanding the evolving
nature of international business.
Overall conclusion:
The authors provide a convincing argument for the need to update the model to account
for changes in the global business environment and propose replacing the concept of
liability of foreignness with the concept of liability of outsidership, as well as introducing
the concept of strategic flexibility as a key element of the updated model. The article
offers valuable insights into the evolving nature of international business and provides a
useful framework for researchers and practitioners to better understand the process of
internationalization.
Article #1
The Uppsala internationalization process model revisited:
From liability of foreignness to liability of outsidership
Jan Johanson and Jan-Erik Vahlne
Published: 2009
Key points:
1. The Uppsala internationalization process model proposes that firms gradually
increase their internationalization through experiential learning.
2. The original model included the concept of liability of foreignness, which suggests
that firms face disadvantages in international markets due to their lack of
familiarity with local conditions.
3. The authors argue that the original model needs to be updated to account for
changes in the global business environment, including the increasing complexity
and uncertainty of international markets and the rise of new competitors from
emerging markets.
4. The authors propose replacing the concept of liability of foreignness with the
concept of liability of outsidership, which suggests that firms face disadvantages in
international markets due to their lack of access to local knowledge networks.
5. The authors also introduce the concept of strategic flexibility, which refers to a
firm's ability to adapt its internationalization strategy in response to changing
market conditions, as an important element of the updated Uppsala model.
Summary:
"The Uppsala internationalization process model revisited: From liability of foreignness to
liability of outsidership" by Jan Johanson and Jan-Erik Vahlne.
The article revisits the Uppsala internationalization process model, which was first
proposed by Johanson and Vahlne in the late 1970s. The model has been widely used in
international business research to explain how firms gradually increase their
internationalization through a process of experiential learning.
In this article, the authors argue that the original model needs to be updated to account
for changes in the global business environment, including the increasing complexity and
uncertainty of international markets, the rise of new competitors from emerging markets,
and the growing importance of knowledge and innovation in international business.
The authors propose a new version of the Uppsala model that includes two key changes.
First, they replace the concept of liability of foreignness (which suggests that firms face
disadvantages in international markets due to their lack of familiarity with local
conditions) with the concept of liability of outsidership (which suggests that firms face
, disadvantages in international markets due to their lack of access to local knowledge
networks).
Second, they introduce the concept of strategic flexibility, which refers to a firm's ability to
adapt its internationalization strategy in response to changing market conditions. The
authors argue that strategic flexibility is becoming increasingly important in the current
business environment, as firms need to be able to adjust their strategies quickly in
response to rapid changes in technology, regulation, and consumer preferences.
Overall, the article offers a valuable update to the Uppsala internationalization process
model, highlighting the need for firms to develop strategic flexibility and emphasizing the
importance of knowledge and network-based advantages in international markets. The
article is well-researched and provides a useful framework for understanding the evolving
nature of international business.
Overall conclusion:
The authors provide a convincing argument for the need to update the model to account
for changes in the global business environment and propose replacing the concept of
liability of foreignness with the concept of liability of outsidership, as well as introducing
the concept of strategic flexibility as a key element of the updated model. The article
offers valuable insights into the evolving nature of international business and provides a
useful framework for researchers and practitioners to better understand the process of
internationalization.
