Internationalisation Process of Russian IT-companies: Motivations, Entry Modes and Capabilities to Compete

Abstract

The aim of the paper is to reveal the motives and forms of Russian IT companies’ international expansion and to contribute in understanding of the competitiveness of Russian IT-companies abroad. The three most important stages of internationalisation have been studied: motivations – the intention to expand internationally; entry modes – the forms of international presence and the foreign market choice; and capabilities to compete – the extent to which Russian IT firms are competitive internationally. The research is based on multiple case study approach: the set of in-depth interviews was hold with middle and top-managers of Russian IT companies. The research has revealed both, proactive and reactive drivers of internationalisation among IT companies; the applicability of gradual internationalisation theory and CAGE-distance framework for the market choice to expand; and the fact, that Russian IT companies’ main competitive advantages are comparatively lower labor costs as in US and higher quality than in Asia. Also, the current government support of the IT industry in Russia is insufficient.