Industrial Clusters and Small Firm Internationalisation (Best paper)

Abstract

Trends towards the globalisation of finance, communication, technology and markets have resulted in unprecedented business competition, especially for small firms (Knight and Cavusgil, 1996). Firms are constantly reminded that this globalisation of economic and business activity will result in competition that occurs increasingly between networks of firms (Thorelli, 1986; Axels son and Easton, 1992; Welch et al., 1997). Morgan and Hunt (1994) have suggested that to be an effective competitor in the global economy will require one to be a trusted cooperator in some network. Firms are beginning to pay closer attention to their own connections with one another, to recognise the common problems they face and to look for relationships and alliances which provide collective solutions and enable their competitive advantage to be maintained. Moreover, in an increasingly globalised market, where production technology is widely diffused, they must seek out ways of differentiating themselves and their products to establish or maintain a marketing competitive advantage.