Business model innovation and internationalization success: A study of SMEs in three European countries

Objectives: With our empirical paper, we test whether business model innovation (BMI) activ-ities of SMEs affect their success on international markets. We also use a BMI perspective to explain how differences in the resource and capabilities base can have an impact on the suc-cess of SMEsʼ internationalization endeavors. Approach/Method: Using databases of exporting companies in selected regions of three Eu-ropean countries (Austria, Italy, and Slovenia), we identified the managing directors of 1,867 internationally active firms. With our survey instrument (based on existing validated scales), we analyzed the most important internationalization steps of the firms. 286 SMEs were in-cluded in the statistical analyses. Multiple hierarchical regression models and mediator anal-yses were conducted to test the link between informational resources and international mar-keting capabilities, different dimensions of BMI, and internationalization success. Results/Findings: In our sample of SMEs, we found a highly significant relationship between the dimensions of BMI (value creation innovation, value proposition innovation, and value capture innovation) and internationalization success. Additional mediator analyses revealed that value proposition innovation fully mediates the relationship between informational re-sources/international marketing capabilities and internationalization success. Other dimensions of BMI showed a partially mediating effect. Value & Implications: We extend the emerging research stream on the link between business models and firm performance on international markets by showing that making the right changes in a business model during a major internationalization step can considerably raise the chances of SMEs’ internationalization success. Our results further suggest that it is not neces-sarily the resource and capabilities base as such that leads to a variation of success in an SME’s internationalization endeavors, but rather how these resources and capabilities are used to adapt the firm’s business model to the specific requirements of the international market environment.