Mindsets and Internationalization Success: An Exploratory Study of the British Retail Grocery Industry

Despite the growing pressures of internationalization, failures in international efforts are becoming increasingly widespread. Previous literature has developed external environmental and internal firm-specific explanations of international success, but has ignored the role of mindsets in understanding international failures. This gap is especially important because recent studies contend that the mindsets or the way top managers make sense of their global environment is central to international decision making and outcomes. We propose that mindsets are important in explaining international success. We compare the mindsets of two matched firms in the British retail grocery industry—one successful (Tesco) and another unsuccessful (Sainsbury)—from 1988 to 2003. Our results suggest systematic differences between the successful (Tesco) and the unsuccessful (Sainsbury) firm in two specific facets of mindsets—complexity and reactivity. These results, although exploratory, do highlight the importance of mindsets in the process of internationalization and raise interesting questions for future empirical examination