The role of multi-ethnic workforces in the internationalisation of SMEs

Purpose – The purpose of this paper is to highlight the importance of ethnic workforce diversity for the internationalisation of small- to medium-sized enterprises (SMEs). Using the resource-based view, it is argued that an ethnically diverse workforce can help SMEs in overcoming barriers to internationalisation and increase the degree to which they benefit from globalisation.

Design/methodology/approach – This is a conceptual paper using the resource-based view (RBV) of the firm to investigate the importance of work force diversity.

Findings – The paper identifies a series of mechanisms that link ethnic workforce diversity to increased internationalisation of SMEs as well as a range of contingencies of this relationship. It calls for a stronger appreciation of individual employees' external, co-ethnic networks and knowledge as a hitherto largely ignored resource in the initiation, management and expansion of SMEs' international operations.

Research limitations/implications – The findings of the paper have implications for research and practice by shedding light on the importance of this so far largely neglected phenomenon. The findings are limited in as far as they are yet to be tested empirically.

Practical implications – The paper provides a framework of mechanisms that can sensitise practitioners with regard to the importance of workforce diversity for internationalisation activities as well as human resource management practices.

Originality/value – The paper addresses an issue that is shown to be of increasing importance to SMEs, but has so far been largely neglected in research on SMEs.