The Influence of Domestic Interfirm Networks on the Firm's Initial Internationalization Performance: A Study on Taiwanese SMEs

摘要

The purpose of this study is to investigate how domestic interfirm network relationships affect the firm's performance. More specifically, this study argues that the domestic interfirm networks can help the firms achieve better performance, including financial and non-financial indicators. In this study, a firms' performance was measured using four dimensions, i. e. financial performance, operational performance, market growth and business relationship satisfaction. This study compared the performance between the firm groups that internationalised with their domestic interfirm networks and those with other approaches, in an attempt to reveal the influence of the domestic interfirm networks. The result indicates an overall positive effect that the domestic interfinn networks have on the firms' performance, particularly in the non-financial measures. Prior studies that examine the effect of networks on the firm's performance tend to focus on only financial measures. This study revealed the positive influences of the domestic interfirm networks on the firm's performance in the non-financial aspects. The possible limitations of network relationships on the firm's performance proposed by literature review, such as lock-in effect on the firm's market and entry mode selection and unavailability of local information, are not evident in this study.