gy and joint ventures basis, where Driscoll quoted some reference from Kogut and Singh (1988). 4.2 Characteristics of different entry modes Driscoll proposed that the key characteristics of the entry modes methods are level of control, dissemination risk, resource commitment, flexibility and ownership. These characteristics are also supported by many authors such as Agarwal and Ramaswami 1992; Anderson and Gatignon 1986; Douglas and Craig 1989; and etc. As Driscoll argues that control is the key functionality for a firm to maximize its economic efficiency and return of investment in international markets. This was also supported by Hill et al. (1990) where control allows firm to directly manage its operation and decision making which would ensures desired level of achievement in its whole operation and target market. The next method relates to the risk of disseminating the firm’s knowledge asset to its contractual partner. Driscoll explains that protecting the firm’s know-how asset is critical to avoid unnecessary threats of survival for the firm. She quoted Williamson (1985) where risk can be minimized through comprehensive contingent contracts and continuous improvement of technology in products or services would gain a long term competitive advantage. The following entry mode method is resource commitment. Driscoll pointed out that there is a high tendency for firms to commit more business resources as the international business progress. This was supported by Johanson and Vahne (1977) in the Uppsala Internationalization Model as a firm needs to increase its resources commitment when it becomes more experienced and knowledgeable about the foreign markets. The commitment involves financial and physical cost, opportunity cost, and unforeseen risks and threats; for instance, threat of employee abduction and hostile occurrence. Flexibility is another substantial method that has inverse relation to the former method. According...
