IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v17y2025i15p6943-d1713899.html
   My bibliography  Save this article

Managerial Capabilities and the Internationalization Process of Small and Medium Enterprises: The Sustainable Role of Risk and Resource Management

Author

Listed:
  • Tengfei Shen

    (International College, Shinhan University, Seoul 11644, Republic of Korea)

  • Alina Badulescu

    (Department of Economics and Business, University of Oradea, 410087 Oradea, Romania)

Abstract

This study explores the internationalization of small and medium enterprises (SMEs), emphasizing the critical role of competent managerial abilities. Specifically, it investigates the sustainable role of managerial capabilities in directly facilitating SMEs’ entry into international markets, or whether these capabilities first assist in risk management and resource utilization, supporting international expansion. We propose that SMEs with skilled and capable managers are better equipped to manage internal risks and leverage available resources, thereby enhancing their internationalization efforts. Drawing on empirical data from 191 Chinese SMEs, our findings support the proposed model, revealing that managerial capabilities contribute to internationalization indirectly—this relationship is fully mediated by risk management and resource utilization. This study recommends that SMEs prioritize building a sustainable management team capable of navigating internal challenges to successfully pursue international growth. Our research contributes to the resource-based view and the Uppsala model of internationalization by contextualizing the role of managerial capabilities, risk management, and resource utilization in the internationalization processes of SMEs.

Suggested Citation

  • Tengfei Shen & Alina Badulescu, 2025. "Managerial Capabilities and the Internationalization Process of Small and Medium Enterprises: The Sustainable Role of Risk and Resource Management," Sustainability, MDPI, vol. 17(15), pages 1-22, July.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:15:p:6943-:d:1713899
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/17/15/6943/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/17/15/6943/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Ahmad Raza Bilal & Muhammad Naveed & Farooq Anwar, 2017. "Linking distinctive management competencies to SMEs’ growth decisions," Studies in Economics and Finance, Emerald Group Publishing Limited, vol. 34(3), pages 302-330, August.
    2. Yevgen Bogodistov & Veit Wohlgemuth, 2017. "Enterprise risk management: a capability-based perspective," Journal of Risk Finance, Emerald Group Publishing Limited, vol. 18(3), pages 234-251, May.
    3. Alayo, Mikel & Maseda, Amaia & Iturralde, Txomin & Arzubiaga, Unai, 2019. "Internationalization and entrepreneurial orientation of family SMEs: The influence of the family character," International Business Review, Elsevier, vol. 28(1), pages 48-59.
    4. Nathaniel Boso & Pejvak Oghazi & Magnus Hultman, 2017. "International entrepreneurial orientation and regional expansion," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 29(1-2), pages 4-26, January.
    5. Xiangsheng Dou & Fizza Ishaq, 2025. "Enterprise’s Strategic Agility and Resource Allocation Choice: A Case of SMEs in China," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 16(1), pages 2229-2248, March.
    6. Muhammad Anwar, 2018. "BUSINESS MODEL INNOVATION AND SMEs PERFORMANCE — DOES COMPETITIVE ADVANTAGE MEDIATE?," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 22(07), pages 1-31, October.
    7. Popli, Manish & Ahsan, Faisal M. & Mukherjee, Debmalya, 2022. "Upper echelons and firm internationalization: A critical review and future directions," Journal of Business Research, Elsevier, vol. 152(C), pages 505-521.
    8. Ferreira de Araújo Lima, Priscila & Crema, Maria & Verbano, Chiara, 2020. "Risk management in SMEs: A systematic literature review and future directions," European Management Journal, Elsevier, vol. 38(1), pages 78-94.
    9. Arturs Kalnins, 2018. "Multicollinearity: How common factors cause Type 1 errors in multivariate regression," Strategic Management Journal, Wiley Blackwell, vol. 39(8), pages 2362-2385, August.
    10. repec:eme:sef000:sef-10-2015-0236 is not listed on IDEAS
    11. Ron Adner & Constance E. Helfat, 2003. "Corporate effects and dynamic managerial capabilities," Strategic Management Journal, Wiley Blackwell, vol. 24(10), pages 1011-1025, October.
    12. Meinen, Philipp & Parrotta, Pierpaolo & Sala, Davide & Yalcin, Erdal, 2022. "Managers as knowledge carriers – Explaining firms’ internationalization success with manager mobility," Journal of International Economics, Elsevier, vol. 138(C).
    13. Waleed Omri & Audrey Becuwe, 2014. "Managerial characteristics and entrepreneurial internationalization: A study of Tunisian SMEs," Journal of International Entrepreneurship, Springer, vol. 12(1), pages 8-42, March.
    14. Oliva, Fábio Lotti & Teberga, Pedro Marins Freire & Testi, Lucas Israel Oliveira & Kotabe, Masaaki & Giudice, Manlio Del & Kelle, Peter & Cunha, Miguel Pina, 2022. "Risks and critical success factors in the internationalization of born global startups of industry 4.0: A social, environmental, economic, and institutional analysis," Technological Forecasting and Social Change, Elsevier, vol. 175(C).
    15. Abraham Carmeli & Asher Tishler, 2006. "The relative importance of the top management team's managerial skills," International Journal of Manpower, Emerald Group Publishing Limited, vol. 27(1), pages 9-36, January.
    16. Muhammad Anwar & Shaungjie Li & Ahmed Al-Omush & Munther Al-Nimer, 2023. "SMEs’ Internationalization: Mapping the Field through Finance, ITC, and Social Ties," Sustainability, MDPI, vol. 15(4), pages 1-21, February.
    17. Jane W. Lu & Paul W. Beamish, 2001. "The internationalization and performance of SMEs," Strategic Management Journal, Wiley Blackwell, vol. 22(6‐7), pages 565-586, June.
    18. Aven, Terje, 2016. "Risk assessment and risk management: Review of recent advances on their foundation," European Journal of Operational Research, Elsevier, vol. 253(1), pages 1-13.
    19. Barringer, Bruce R. & Greening, Daniel W., 1998. "Small business growth through geographic expansion: A comparative case study," Journal of Business Venturing, Elsevier, vol. 13(6), pages 467-492, November.
    20. Zulfiqar Ali & Hongyi Sun & Murad Ali, 2017. "The Impact of Managerial and Adaptive Capabilities to Stimulate Organizational Innovation in SMEs: A Complementary PLS–SEM Approach," Sustainability, MDPI, vol. 9(12), pages 1-23, November.
    21. Muhammad Sualeh Khattak & Qiang Wu & Maqsood Ahmad & Rizwan Ullah, 2024. "The role of managerial competencies in managing resources for sustainable development strategy in SMEs," Social Responsibility Journal, Emerald Group Publishing Limited, vol. 20(7), pages 1317-1344, May.
    22. Aynaz Monazzam & Jason Crawford, 2024. "The role of enterprise risk management in enabling organisational resilience: a case study of the Swedish mining industry," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 35(1), pages 59-108, March.
    23. Carl Arthur Solberg & François Durrieu, 2006. "Access to networks and commitment to internationalisation as precursors to marketing strategies in international markets," Management International Review, Springer, vol. 46(1), pages 57-83, February.
    24. Elizabeth E. Bailey & Constance E. Helfat, 2003. "External management succession, human capital, and firm performance: an integrative analysis," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 24(4), pages 347-369.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Coviello, Nicole E. & Jones, Marian V., 2004. "Methodological issues in international entrepreneurship research," Journal of Business Venturing, Elsevier, vol. 19(4), pages 485-508, July.
    2. Zohreh Molamohamadi & Mahmoud Asad Samani & Marjan Karimi, 2024. "Reviewing the historical milestones of risk management," SN Business & Economics, Springer, vol. 4(12), pages 1-20, December.
    3. Songling Yang & Muhammad Ishtiaq & Muhammad Anwar, 2018. "Enterprise Risk Management Practices and Firm Performance, the Mediating Role of Competitive Advantage and the Moderating Role of Financial Literacy," JRFM, MDPI, vol. 11(3), pages 1-17, June.
    4. Adomako, Samuel & Amankwah-Amoah, Joseph & Tarba, Shlomo Y. & Khan, Zaheer, 2021. "Perceived corruption, business process digitization, and SMEs’ degree of internationalization in sub-Saharan Africa," Journal of Business Research, Elsevier, vol. 123(C), pages 196-207.
    5. Dr Jason Mwanza & Nothando Tshuma, 2023. "Mitigating Business Risk in Manufacturing SMEs: A nexus between informal and formal business risk management: A case of Bulawayo, Zimbabwe," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 7(1), pages 1107-1138, January.
    6. Ciravegna, Luciano & Majano, Sara B. & Zhan, Ge, 2014. "The inception of internationalization of small and medium enterprises: The role of activeness and networks," Journal of Business Research, Elsevier, vol. 67(6), pages 1081-1089.
    7. Hezron Mogaka Osano, 2019. "Global expansion of SMEs: role of global market strategy for Kenyan SMEs," Journal of Innovation and Entrepreneurship, Springer, vol. 8(1), pages 1-31, December.
    8. Nathan R. Furr, 2019. "Product Adaptation During New Industry Emergence: The Role of Start-Up Team Preentry Experience," Organization Science, INFORMS, vol. 30(5), pages 1076-1096, September.
    9. Nave, Edgar & Ferreira, João J. & Carneiro, Jorge, 2024. "International entrepreneurial orientation and early internationalisation of SMEs: Does international networking orientation with competitors and non-competitors make a difference?," Journal of International Management, Elsevier, vol. 30(4).
    10. Sergio Ochoa Jiménez & Alma Rocío García García & Beatriz Alicia Leyva Osuna & Sacnicté Valdez del Río, 2021. "Entrepreneurial Behavior of SMEs and Characteristics of the Managers of Northwest Mexico," Social Sciences, MDPI, vol. 10(1), pages 1-15, January.
    11. Keith D. Brouthers & George Nakos, 2004. "SME Entry Mode Choice and Performance: A Transaction Cost Perspective," Entrepreneurship Theory and Practice, , vol. 28(3), pages 229-247, May.
    12. Niina Nummela & Tiia Vissak & Barbara Francioni, 2022. "The interplay of entrepreneurial and non-entrepreneurial internationalization: an illustrative case of an Italian SME," International Entrepreneurship and Management Journal, Springer, vol. 18(1), pages 295-325, March.
    13. Hultman, Magnus & Iveson, Abbie & Oghazi, Pejvak, 2021. "The Information Paradox in Internationalization: Can ignorance ever be bliss? Evidence from emerging market SME managers," Journal of Business Research, Elsevier, vol. 131(C), pages 268-277.
    14. Ripoll-Zarraga, Ane Elixabete & Huderek-Glapska, Sonia, 2021. "Airports’ managerial human capital, ownership, and efficiency," Journal of Air Transport Management, Elsevier, vol. 92(C).
    15. Yannis Caloghirou & Ioannis Giotopoulos & Alexandra Kontolaimou & Aggelos Tsakanikas, 2022. "Inside the black box of high-growth firms in a crisis-hit economy: corporate strategy, employee human capital and R&D capabilities," International Entrepreneurship and Management Journal, Springer, vol. 18(3), pages 1319-1345, September.
    16. Martin Johanson & Luis Oliveira, 2024. "The Performance of Decision-Making Strategies in SME Internationalization: The Role of Host Market’s Institutional Development," Management International Review, Springer, vol. 64(2), pages 303-335, April.
    17. Tomasz Ingram & Katarzyna Bratnicka-Myśliwiec & Teresa Kraśnicka & Izabella Steinerowska-Streb, 2022. "Entrepreneurial Orientation as a Determinant of Sustainable Performance in Polish Family and Non-Family Organizations," Sustainability, MDPI, vol. 14(24), pages 1-25, December.
    18. Marco Galvagno & Vincenzo Pisano, 2021. "Building the genealogy of family business internationalization: a bibliometric mixed-method approach," Scientometrics, Springer;Akadémiai Kiadó, vol. 126(1), pages 757-783, January.
    19. Wang, Rui & Saboo, Alok R. & Grewal, Rajdeep, 2015. "A managerial capital perspective on chief marketing officer succession," International Journal of Research in Marketing, Elsevier, vol. 32(2), pages 164-178.
    20. Xin, Yongrong & Khan, Rizwan Ullah & Dagar, Vishal & Qian, Fang, 2023. "Do international resources configure SMEs' sustainable performance in the digital era? Evidence from Pakistan," Resources Policy, Elsevier, vol. 80(C).

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:17:y:2025:i:15:p:6943-:d:1713899. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.