How technology-based firms from India deal with legitimacy challenges in international markets

Abstract

Technology based firms from India, an emerging market, seek legitimacy in international markets in order to get access to mission-critical capabilities and resources for growth. Cooperation with internationally established firms and the resulting legitimacy enables emerging market firms to get access to development activities that they can use to substitute for expensive R&D efforts. Technology-based emerging market multinational enterprises do not possess great brands or technologies. They have agility and flexibility based on working with different technologies and their vendors. Developing interoperability between technologies and products and being able to do so is a distinct set of capabilities that enables them to support foreign expansion. As they enhance their expertise by working with diverse set of customers in different stages of the product life cycle, they develop unique skills in systems integration. Some of these companies have acquired firms in developed markets to strengthen their capabilities in product development and to move up the value chain. The dynamics results in the evolution of emerging market firms.