The Role of Cultural Competence in the Internationalization of SMEs Using E-Commerce

Document Type

Conference Proceeding

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This study is exploratory and aims at examining the effect of cultural competence on the relationship between organizational culture and the international orientation of Small and Medium Enterprises (SMEs). Egyptian SMEs with an e-business platform are the target population of the research. It uses the international entrepreneurship theory and the theory of planned behaviour to conceptualize the framework of the study. The methodology used includes the use of primary data obtained through a self-administered questionnaire. It assesses the organizational culture based on the Competing Values Framework (CVF), identifies the cultural competence based on the International Profiler (TIP) survey that aims to assess the cultural competence of the managers of the SMEs and the international orientation of the SMEs in the sample. A total of 110 SME managers completed the self-administered questionnaire. The data collected is analysed through the SPSS statistical package using correlation, logistic regression, and structural equation modelling. The results are timely with the pandemic and the lock down imposed on many businesses; many will have to depend more and more on e-commerce in their operations. SMEs are specifically vulnerable, because of their limited financial resources. The findings show that the adhocracy organizational culture and the market organizational culture are antecedents of the cultural competence of the managers. The adhocracy culture is always developing and seeking to create new resources, the market culture is pursuing new market penetration and achieving more success. The cultural competence has a positive and significant effect on the international orientation of SMEs using e-commerce platforms and is proven to be mediating the relationship between organizational culture and international orientation. Therefore, the study emphasizes the importance of having an adequate organizational culture that nurtures and develops international orientation. This is the role of the owners and managers of the SMEs, to create and develop such a culture.