Internationalization of Malaysian Service Smes: The Leveraging Role of Network Capital and the Internet-Enabled Business Environment

Yeoh Khar Kheng*, Mohamad Yusop B. Mohd Jani and Mohd Sufli B. Yusof
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Yeoh Khar Kheng*: School of Business Management, Universiti Utara Malaysia
Mohamad Yusop B. Mohd Jani: School of Business Management, Universiti Utara Malaysia
Mohd Sufli B. Yusof: School of Business Management, Universiti Utara Malaysia

The Journal of Social Sciences Research, 2018, 718-728 Special Issue: 6

Abstract: Realizing the economic importance of SMEs in the context of service-related industry, Malaysian government’s commitment for service SMEs were reinforced especially in the internationalization of service SME in Malaysia; post GATS (General Agreement on Trade in Services) & AFAS (Asean Framework Agreement on Services Agreement). One of the liberalization preparation is to explore market access opportunities abroad through partnerships. Generally, this research is to establish the relationship of network capital determinants namely access to resources and knowledge, access to market opportunites and collaboration that can accelerate the degree of internationalization of service SMEs in Malaysia. It also seeks to establish that the network capital moderated by the Internet-enabled environment will accelerate the internationalization of service SMEs. A cross-sectional design was deployed together with survey method of data collection and systematic random sampling technique were utilized. The population of this study is 1,500 export-ready SMEs in the Malaysia`s service sector and was obtained from the SME business directory. The study postulated and tested 7 hypotheses. Based on the outcome, all the direct hypotheses, namely; H1, H2, H3 and H4 were supported. Based on the results, all the independent variables have t-value ? 1.645, significant at 0.05. Specifically, access to resources and knowledge (? = 0.477, p? 0.01), access to market opportunities (? = 0.241, p? 0.01), business collaboration (? = 0.148, p? 0.01) and internet-enabled environment (? = 0.159, p? 0.01) have positive influence on the degree of internationalization. Thus, H1, H2, H3 and H4 are supported. Access to resources and knowledge has the largest effect in producing the R2 for the degree of internationalization. While, the effect of other 2 predicting variables namely; access to market opportunities and business collaboration, as well as the moderating variable, internet-enabled environment is small in producing the R2 for the degree of internationalization.

Keywords: Export-ready service small and medium enterprise; Network capital; The internet-enabled environment; Accelerate internationalization; General agreement on trade in services; Asean framework agreement on services. (search for similar items in EconPapers)
Date: 2018
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