Innovating, Learning and Internationalizing: a Mutual Causality Model

The literature on organizational learning, innovation and internationalization usually views these three processes as building upon each other. In this paper, however, we aim to clarify these relationships and propose a theoretical model that has mutual causality at its core and is based on ideas originating in complexity theory. Our model results from case study research into two clothing sector firms. We view innovation in knowledge, products and processes as well as expanding into new markets, as processes that reinforce each other, and which as a whole constitute a system. Furthermore, we propose two distinct paradigms or stages for understanding these relationships: the incremental and the global. The former views adaptive learning, incremental innovation and low-level internationalization as being interlinked. The latter considers generative learning, radical innovation and global internationalization as supporting one another. The paper ends in an exploration of the academic and management implications of our model.