Internationalization of Innovative SMEs, in Brazil: Challenges from the New Paradigm of Development

The paper discusses results from an exploratory research, conducted from 2012 to 2014, with 60 internationalized and innovative small and medium-size enterprises (SMEs), in Brazil, operating in different sectors,localized in the country most developed areas. The analysis, using quali-quanti techniques, followed a multidimensional perspective that considers multifaceted interests and different dimensions – economic, cultural, institutional and subjective/individual - which seemed to be appropriate to understand what is occurring in a country such as Brazil. A major limitation of the study is the use of a non probabilistic and small size sample, which may have impacted our results.

The main purpose was to know how the Brazilian SMEs face the challenges imposed by the new development paradigm, based on knowledge, innovation and internationalization – elements  Brazil badly lacks. The international literature, specially that which is formulated by scholars from high-income countries, tends to emphasize the role of institutionalism, highlighting the contribution of institutionalized interactions between entrepreneurs and business associations, law agencies, venture capital providers, consumer associations, scientific organizations and even competitors. This environment has little correspondence to the Brazilian society particularities. Considering the institutional perspective as a crucial factor to explain innovation and internationalization, could not be accepted to understand a positive performance in the case of the Brazilian SMEs, since the institutional context is not favorable. However, as shown by our research findings, the movement towards the new paradigm among the Brazilian SMEs, despite  its beginning and fragility, shows capacity for growing. These findings led us to look at other factors to understand the phenomenon. In this sense, the individual level – individuals’ strong motivation; the entrepreneurs’ technical and scientific skills; their previous international experiences (academic and/or professional); international mind-set orientation  and integration into national and international networks – seem to help to off-set the lack of an appropriate institutional basis.

Findings concerning emergent societies might contribute for better qualifying the findings of the international literature: for instance, the international literature tends to assert that entrepreneurs’ high levels of education and international experience have a positive impact on innovation and internationalization; this relation was not so evident among the surveyed SMEs of our research. There are many factors that intervene in this result: among others, the country absence of a culture of innovation, lack of qualified human resources, the unfavorable fiscal policy, the excess of bureaucracy, the country economic and cultural closeness, the large domestic market. In addition, it should be considered the kind of training offered by the Brazilian universities, which is still attached to the traditional conception that prioritizes the so-called basic research at the expense of the so-called "third mission". Hence, high level of education or international experiences, by themselves, may not be the crucial value for innovation; more important would be the kind of academic culture and training. 

To sum up, our findings tend to reinforce the arguments about the importance of economic and socio-cultural variables, without ignoring the strength of individual variables concerning entrepreneur’s motivation, personal career and life experiences.