Social capital as a key criteria of partner selection and focal firm’s network expansion in Russia.

• Main Authors: Artem Abramov, 阿蒂姆
• Other Authors: 林正寶
• Format: Others
• Language: en_US
• Published: 2012
• Online Access: http://ndltd.ncl.edu.tw/handle/09092349767928544907

碩士 === 國立中興大學 === 企業管理學系所 === 100 === The process of internationalization of small medium enterprises is a risky and tough path that is hard to pass alone, especially if the entry market is Russia. Due to significant institutional barriers, such as weak legislation and law enforcement system, corruption in all branches of power, economical instability, administrative obstacles and extensive bureaucracy, existence of shadow economy and criminal gangs, cultural and geographical distance, more and more SMEs choose partnership as an entry mode to the Russian market. The assistance of Russian counterparty can make it possible to overcome all these barriers and helps to acquire local market expertise, necessary for business network expansion. However in academic literature there is no deterministic answer to the question about how to select an appropriate partner in emerging market and which partner evaluation criteria should be taken into account. This study attempts to shed light on partner selection criteria in context of Russia. The research framework was designed by merging three different theoretical concepts, such as network approach, partner selection and social capital. In this study, as a methodology the case study of one Taiwanese small –sized firm, which has accumulated more than 10 years internationalization experience in the Russian market is analyzed. Through the semi structural, in depth interview with co-owner of this company I have found there exist strong relationships among firm’s social capital, partner selection and network expansion in this case study. The results of my research suggest that Russian counterparty’s connections in local market and their strength, position inside the industry close to the main central actors, partner’s reputation and professionalism play the critical role in the process of partner selection in context of Russia. Despite the fact that partner’s insufficient language congruency and experience in international business can significantly increase the transaction costs, these problems, from our respondent’s perspective, did not affect the quality of partnership. The extensive partner’s social capital positively influence on the processes of trust building, joint-problem solving and knowledge transfer. However long-term dyadic relationships in foreign market could become constraint of business network expansion and should be replaced by multilateral links with local actors.