Introduction

A wealth of writing, researching, and debating the merits of Johanson and Vahlne’s “Uppsala Model” of firm internationalization has taken place since the model was first published some 43 years ago (Johanson & Vahlne, 1977). This is when the logic of a “gradual internationalization, rather than large foreign investments” was introduced to the international business professorate (e.g., Johanson & Wiedersheim-Paul, 1975, p. 305). The accolades for Johanson and Vahlne’s research are legendary in their own right, and the 1977 article itself has become a staple in international business scholarship that serves as a broad-based theoretical foundation for internationalization research. Remarkably, in this issue of the Journal of International Business Studies (JIBS), we are celebrating that the Johanson & Vahlne (2009) article received the JIBS Decade Award in 2019 (Johanson & Vahlne, 2020). This means that we are actually celebrating a derivative, updated version of an article that was published in 1977, an article’s premise that was already being rigorously defended in 1990 (Johanson & Vahlne, 1990), and that has been critiqued and defended numerous times over the years. This continual vetting of the Uppsala Model’s merits can certainly be viewed as staying power in the academic literature, in terms of the longevity of a research stream and the uniqueness of scholarly ideas, by any measure.

To put it in context, as formulated by the Academy of International Business (AIB), the JIBS Decade Award was inaugurated in 1996 to honor the most influential JIBS article of the volume ten years prior. In 2003, Palgrave Macmillan became the publisher of JIBS and also began to sponsor the award. In 2009, as part of the 40th anniversary celebrations of JIBS, the JIBS editorial team presented best-article awards for the inaugural volume in 1970 and for each year until 1985 to catch up and complete the selection of “decade articles” for each volume of the journal. Not only was the now Decade Award–winning article by Johanson and Vahlne (2009) part of the 40th anniversary celebrations, in many ways it became the lead article for the next decade of the evolution of internationalization process theory. Naturally, the Johanson and Vahlne (1977) article was also recognized as best-in-class for the articles published in JIBS in 1977 at that 2009 celebration. With more than 14,000 and 4,000 Google Scholar citations, respectively, for the 1977 and 2009 articles (and about 5500 for the 1990 article), at this time, the scholarly impact is clearly present in the research stream that Johanson and Vahlne started by studying primarily entrepreneurial Swedish firms.

Tracing the development of the theorizing inherent in the Uppsala Model is fascinating. Jan Johanson sketched out the history in a 72-minute interview with Lars Engwall (Professor Emeritus, Uppsala University) titled “Vägen Hit” (“The Road Here”) (Engwall & Johanson, 2008). In this Swedish-only interview, Johanson mentions the 2009 version of the Uppsala Model, prior to its publication, and says that he thinks it will become a well-received major update to the 1977 model some 22 years later (the 2009 article was an invited piece by then JIBS Editor-in-Chief, Lorraine Eden). Intriguingly, Johanson said that the invited 2009 article was tougher to get accepted than was the legendary, ground-breaking 1977 article. In parallel, as best he could recall, the Johanson and Wiedersheim-Paul (1975) and Johanson and Vahlne (1977) articles did not have any reviewers, seemingly allowing for greater scholarly flexibility and boundary-pushing theorizing. Finn Wiedersheim-Paul and Jan-Erik Vahlne are credited by Jan Johanson as being the early proponents of the idea of psychic distance being instrumental within the Uppsala Model, while much of the early thoughts of a gradual internationalization process emerged through Johanson’s own work. In particular, Johanson drew inspiration for the gradual internationalization process from essays written by his students for which he served as thesis advisor (students were asked to research internationalization efforts of a set of Swedish firms).

As a precursor, the article by Sanden and Vahlne (1974) – coupled with thoughts in Vahlne and Wiedersheim-Paul (1973) – became the starting point of the research stream that led to the Uppsala Model. In many ways, the Uppsala Model, while authored by Johanson and Vahlne, fundamentally had intellectual thoughts assimilated from Uppsala University’s team of business researchers. Johanson talked about these intellectual discussions as give-and-take conversations among select Uppsala University team members (on an almost weekly basis). Across these theoretical and practical discussions, the conclusion was that, for example, Swedish firms were different from much larger American firms. Consequently, Johanson and Vahlne thought the (international) business literature needed a theory to explain this difference and, thus, the 1977 article was written. The 1977 article was followed by vigorous defenses of the theory (e.g., Johanson & Vahlne, 1990) and a couple of significant revisions (e.g., Johanson & Vahlne, 2009; Vahlne & Johanson, 2017). The 2009 award-winner, which is our core focus, is the most robust revision to the original published Uppsala Model, as we will discuss later, and, we think, the 2017 version still needs refinement and a test-of-the-time assessment.

Over these developmental time periods, the Uppsala Model has been the most criticized for not applying to rapidly internationalizing ventures (e.g., born globals, international new ventures). Johanson and Vahlne addressed some of these concerns regarding the perceived omission of rapidly internationalizing ventures in the 1977 model when they updated the Uppsala Model in the 2009 article. However, theoretically, the original modeling was partially intended to address just those firm scenarios when they studied them in the 1960s, 1970s, and 1980s (although the firms originated long before this time), several decades before the marketplace became heavily service-oriented and digitally driven (which has since also become a point of contention in the theoretical and empirical applicability of the Uppsala Model, in addition to rapidly internationalizing ventures). Vahlne and Wiedersheim-Paul (1973) and Sanden and Vahlne (1974) started the research stream, but the main theoretical impetus for Johanson and Vahlne (1977) was Johanson and Wiedersheim-Paul (1975), which was positioned as an interesting case study but lacked the theoretical foundation that Johanson and Vahlne (1977) achieved. In effect, we think the simple but broad and deep theorizing that was achieved by Johanson and Vahlne (1977), subsequently refined with a strong theoretical lens in 2009, resulted in the Uppsala Model’s longevity.

Johanson and Wiedersheim-Paul (1975, p. 305) effectively positioned the research stream that was subsequently captured by the Uppsala Model before it was even developed and introduced: “The widespread interest in multinational firms has given rise to many articles and books on various aspects of the international strategies of firms. Research has been concentrated on the large corporations, particularly the American. Many firms, however, start international operations when they are still comparatively small and gradually develop their operations abroad. From our studies of international business at the University of Uppsala [now Uppsala University or Uppsala Universitet] we have several observations indicating that this gradual internationalization, rather than large foreign investments, is characteristic of the internationalization process of most Swedish firms.” To capture the breadth and depth of this research stream, Table 1 summarizes 16 influential articles from research relating to the Uppsala Model that involve Johanson and/or Vahlne. The articles in Table 1 are included in chronological order to allow for an overview-read of the evolution of thought and theorizing.

Table 1 Core set of influential articles involving Jan Johanson and/or Jan-Erik Vahlne
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As it relates to the theory, some international business scholars who have been critical of the Uppsala Model have focused on its “gradual” (and sometimes also “sequential”) feature of internationalization. However, this gradual anchor was intentional in order to concentrate on manufacturing firms that start international operations when they are still comparatively small (compared with large American multinationals) and gradually develop their operations abroad. Consequently, if we assume “gradual” can be achieved faster (or slower) as a function of time and evolution of a firm, then practically all firms can fit into the Uppsala Model, as Johanson and Vahlne (2009) also make a case for in their 2009 Decade Award–winning article. At the same time, it is clear that deeper theorizing within the scope of, or as an extension to, the Uppsala Model needs to take place regarding service, technology, and internet-heavy ventures. In fact, the omnichannel environment that permeates most of international trade today demands integration of bricks-and-mortar and service-minded technology activities by virtually all multinational corporations. Meanwhile, many scholars consider the Uppsala Model to be a robust, time-tested depiction of internationalization, as long as “gradual” is adapted to the times, contexts, and environments in which world regions, countries, industries, and firms operate (e.g., Bamiatzi, Bozos, Cavusgil, and Hult, 2016).

Another aspect of the original Uppsala Model (Johanson and Vahlne, 1977) that was somewhat lost for many years was that business relationships and networks permeated a significant portion of the development of the internationalization process, mainly via the research focus adopted by the Industrial Marketing and Purchasing (IMP) group (e.g., Johanson & Vahlne, 2011).1 This internationalization–network dynamic inherent in the Uppsala Model is illustrated by several of the influential articles in Table 1 (e.g., Anderson, Håkansson, & Johanson, 1994; Hallén, Johanson, & Seyed-Mohamed, 1991; Holm, Eriksson, & Johanson, 1996, 1999; Johanson & Vahlne, 2011). The connection between the Uppsala Model and the IMP theorizing is natural. Uppsala University was instrumental in helping to start the IMP group worldwide under the leadership of Håkan Håkansson, with several Uppsala researchers involved on the team (e.g., Lars-Gunnar Mattsson, Mats Forsgren). Importantly, there was critical cross-collaboration across the IMP and IB researchers at Uppsala University that motivated cross-fertilization of intellectual thoughts. In this context, Jan Johanson describes his career-long research focus in the interview with Lars Engwall (Engwall & Johanson, 2008): In the 15 years prior to the 1977 article, he said his focus was mainly on the internationalization process of firms, followed by 15 years on business networks (1977–1992), and subsequently 15 years (1993–2008) on merging internationalization and business networks. This internationalization–network theorizing is also reflected in the revised versions of the Uppsala Model, including the 2009 Decade Award–winning article (Johanson & Vahlne, 2011), in which “market commitment” is theoretically expanded and replaced by “network position.”

To properly celebrate that the Johanson and Vahlne (2009) article has been recognized with the Decade Award, the best place to start is to trace the theoretical evolution of the Uppsala Model. Our theoretical, empirical, and practical lens in this endeavor is to focus on the Uppsala Model’s linkage to the field of marketing. Not lost on international marketing researchers, or those involved in the IMP group, the Uppsala Model traces a heavy dosage of its conceptualization to scholarly marketing thought. This is not to say that the Uppsala Model is theoretically more rooted in marketing than, say, management, economics, or international business, per se, but our focus is entrenched in marketing scholarship to make a unique contribution. Importantly, through various revisions and defenses, the Uppsala Model has maintained a strong link to marketing thought (e.g., in 1977, 1990, 2009, and 2017).

Theoretical evolution and linkage to marketing

In general, there have been relatively minimal theoretical revisions to the original Uppsala Model from 1977, but the most robust modifications came in 2009. Figure 1 traces the evolution at the construct level, with market knowledge, commitment decisions, current activities, and market commitment as the four pillars (sequential stages) of the dynamic Johanson and Vahlne (1977) model. Table 2 provides descriptions of the constructs in the Uppsala Model, as they evolved in 1977, 2009, and 2017. As can be seen in both Fig. 1 and Table 2, the award-winning article in 2009 incorporated revisions of these pillars to a new but related set of knowledge opportunities, relationship commitment decisions, learning, creating and trust building, and network position.

Figure 1
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Evolution of the Uppsala Model, 1977, 2009, and 2017.

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Table 2 Descriptions of the constructs in the Uppsala Model, 1977, 2009, and 2017
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In both versions (1977 and 2009) as well as in the most recent revision (2017), the Uppsala Model consists of two sets of variables, namely state variables (shown on the left-hand side of Fig. 1) and change variables (shown on the right-hand side of Fig. 1). These variables affect each other, the current state having an impact on change, and vice versa. Johanson and Vahlne (2009: 1423) argue that the “model thus depicts dynamic, cumulative processes of learning, as well as trust and commitment building.” “The change variables are the crucial elements of the model: they are where the action takes place” (Vahlne & Johanson, 2017: 1092).

The state-change focus and overall evolution of the Uppsala Model are very much aligned with the logic that Jan Johansson presented in his interview with Lars Engwall in 2008 (Engwall & Johanson, 2008). As we summarized earlier, Johanson said that he mainly studied internationalization of business activities in the 15 years prior to the Johanson and Vahlne (1977) article. As a consequence of this theorizing, the 1977 article served the international business field as the foundation of firms’ internationalization processes for decades, and it also became the platform for the research fabric at Uppsala University. After that, Johanson’s focus, and presumably much of the Uppsala University team’s focus, centered on business relationships and networks leading up to the publication of the 2009 article. The 2009 revision emphasizes this dual and reinforcing focus on internationalization and networks by delineating the logic that market commitment from 1977 should be viewed as where a firm is positioned in the larger ecosystem or “network” of the marketplace. (To provide clarity, the international business ecosystem is defined as the organisms of the business world – including stakeholders, organizations, and countries – involved in exchanges, production, business functions, and cross-border trade through both marketplace competition and cooperation.)

While the concept of networks still permeates the logic in the Uppsala Model’s newer iteration (along with the view that trade and cross-border business activities take place in an international business ecosystem), the 2017 version again alters the market commitment stage to commitment and performance (Vahlne & Johanson, 2017). That said, it is clear that market commitment is important to the internationalization modeling in the minds of Johanson and Vahlne but also that the position in the international business network or ecosystem is central to a firm’s performance within the marketplace. This aspect of the Uppsala Model becomes clearer in 2017 when the idea of commitment is portrayed as such (instead of as a network position) but also with the added focus on performance. Specifically, a firm being committed to the market (Johanson & Vahlne, 1977), or being able to identify the market position of the firm within the network (Johanson & Vahlne, 2009), is of limited value if performance associated with such commitment and network position is not superior to viable alternatives and competitors’ offerings (Vahlne & Johanson, 2017). There has to be a positive performance implication of the commitment undertaken and the network position achieved for the Uppsala Model’s internationalization process to be valuable in a broader context (cf. Katsikeas, Morgan, Leonidou, & Hult, 2016). Thus, we argue that competitiveness of the firm within the international business ecosystem is critical, not just within a network or based on commitment.

Figure 2 provides a clearer evolution of each of the four stages/constructs in the Uppsala Model, tracing the advances in the core developmental years of 1977, 2009, and 2017. In this context, the Johanson and Vahlne (1990) article – while immensely influential – largely served to defend the original 1977 version. The constructs stayed the same in 1990 as in 1977 and, consequently, we focus on the 1977, 2009, and 2017 iterations in Fig. 2. Beyond the “boxes” in the Uppsala Model signified by the market commitment → network position → commitment/performance evolution, which really serve as the end-point of the model (although the model is theoretically dynamic), there are three additional evolutionary linkages. The process starts with market knowledge (1977) which leads to knowledge opportunities (2009) and capabilities (2017) over time. The evolution of this “knowledge” construct appears to fall within the same general literature base, albeit with a broadening from “knowledge” in 1977 and 2009 to capabilities in 2017 (cf. Day, 1994). With the introduction of capabilities, the Uppsala Model theoretically adds resources, skills, and likely also the related phenomenon of strategic assets. Knowledge is a part of, but does not constitute the full scope of, capabilities. Capabilities generally refer to knowledge and skills, which are both related to, but also viewed by most scholars as theoretically different from, a firm’s strategic assets and resources.

Figure 2
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Marketing’s influence on the Uppsala Model, 1977, 2009, and 2017.

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The commitment decisions (1977) – relationship commitment decisions (2009) – commitment processes (2017) link has been shown to incorporate perhaps the least evolutionary revisions over the last four decades. That is, the Uppsala Model has generally been described theoretically as a “stages model” or “process model” and not necessarily a “decision model” (although the algebra in the 1977 version conveys a decision schema). As such, “commitment processes” resonate better theoretically than “commitment decisions” within the scope of the model corollaries. This theorizing is best described in the 2009 article in which Johanson and Vahlne, perhaps purposefully, move away even more from economics, a process that started with the 1977 article where the authors consciously wanted to elevate micro-oriented firm-level explanations over macro-oriented economics in internationalization. Consequently, it can be said that the decision-making aspect was positioned as a core component in the Uppsala Model but probably should always have been secondary to the “process” aspect of the model and subsequent empirical testing. In fact, an argument can be made that the Uppsala Model is much broader and deeper in its theorizing than the empirical testing that has been conducted to validate it. This process focus – if assumed a process can be completed anywhere from slow to fast – would also help make the argument that the model is applicable to newer contexts and contemporary firms (e.g., born global firms, new internationalized ventures). Thus, revising the commitment decision to a process focus – by stressing relationships as a way of embedding business relationships and networks even deeper into the theorizing – is theoretically advantageous and logical. Such process focus also applies more soundly to service firms, digital ventures, and technology-intensive settings.

The most extensive revisions to the Uppsala Model appear to be in the current activities (1977) – learning, creating, and trust building (2009) – knowledge development processes (2017) link. In fact, an argument can be made, at the coarse-grained level, that the 2017 focus on knowledge development processes instead of current activities (1977) or learning, creating, and trust building (2009) has blurred the theoretical refinement of the Uppsala Model. Basically, there has been lots of development and re-thinking of the constructs in this link, but not necessarily to a more refined version that is verifiable and applicable. Such blurred refinement is perhaps a function of the changing world within which we now operate (e.g., Verbeke & Fariborzi, 2019), a world that is both continuing globalizing in many ways but is also retracting its global efficiencies in others (e.g., tariffs, nationalism). For example, we now have knowledge at multiple levels, or at least at various stages in a stage-model view, that detracts from the core activities of internationalization. Interestingly, we also have commitment at two stages in the latest model in 2017; albeit here we can reasonable assume that commitment is a two-pronged phenomenon centered on market commitment and firm commitment. Ultimately, though, any modeling becomes time-tested. The award-winning 2009 version (like the original 1977 version) has theoretical soundness and credibility in the marketplace. The 2017 version likely needs more refinement and/or thoughts linked to the 1977 and/or 2009 versions to be theoretically sound and practically viable, but at the very least it needs more empirical testing.

The 2017 version should motivate and entice the international business professorate (and perhaps in particular marketing scholars), especially since both the 1977 and 2009 versions have been recognized with the JIBS Decade Award. What strikes us in the 2017 version of the model is that all constructs have become embedded even more in the international marketing and marketing strategy literatures. Figure 2 identifies core constructs from the field of marketing in italicized bold font, whereas the normal text captures other elements (mainly from the management and international business literatures). As a broad take, what Fig. 2 tells us is that the Uppsala Model started out as being strongly based in industrial and international marketing (and economics), evolved somewhat in the 2009 award-winning article to a broader take on the business literature, and returned in 2017 to a heavy marketing theory foundation. This is not to say that these italicized bold-font constructs are only applicable and used in the field of marketing – many fields incorporate these constructs – but rather that the theoretical anchoring in marketing is very strong. At the same time, these “marketing” constructs are natural in the sense that the Uppsala Model rests very much on business network research (e.g., Hallén, Johanson, & Seyed-Mohamed, 1991), international marketing (e.g., Hult, 2012), purchasing and supply chain management (e.g., Kozlenkova, Hult, Lund, Mena, & Kekec, 2015), trust and commitment (e.g., Morgan & Hunt, 1994), and markets and networks (e.g., Johanson & Vahlne, 2011).

Conclusion

The combined picture that is formed across Tables 1 and 2, and Figs. 1 and 2, and the thoughts we presented in this paper, presents a unique international marketplace. This is a marketplace that shows evolution, drastic changes in market dynamics, and new opportunities to leverage the Uppsala Model for even better understanding and predictive abilities. However, it is clear that the Uppsala Model has to evolve as a function of time and context. For example, the award-winning Johanson and Vahlne (2009) article was published at a time when international markets were in upheaval in the midst of the global financial crisis in 2008–2009. The model incorporated nuanced revisions and logical changes relative to what was needed at the time. The question for the future is if the Uppsala Model (Johanson & Vahlne, 1977, 2009; Vahlne & Johanson 2017) can provide explanatory and predictive power in the trade and production era of tomorrow, an era in which firms face a backlash against globalization, increasing protectionism and nationalisms as well as a surge in populism against consumption and international travel. How does this affect firms’ quest for increasing international presence in new and distant countries, and what does it mean for the Uppsala Model?

As just one example of new market dynamics, can the Uppsala Model integrate strategically important themes such as the United Nations’ Sustainable Development Goals while offering a prosperous outlook for small, medium, and large firms in the international marketplace (Hult, Mena, Gonzalez-Perez, Lagerström, & Hult 2018)? Myriad other examples exist of elements that connect with global efficiency that can affect the Uppsala Model’s viability, e.g., service-focus, digital footprint, and technology enhancements. (Global efficiency is defined as the value of total world trade relative to countries’ total GDP production; a higher number means the world operates more globally efficiently; Hult, 2018.) Such refined understanding also needs to be relevant to preferably all, or at least most, world regions, countries, firms, and industries, among a plethora of driving forces (cf. Aguilera, Ciravegna, Cuervo-Cazurra, & Gonzalez-Perez, 2017).

Another theme for future consideration is opportunity recognition in relation to the Uppsala Model, as networks are likely to pose boundaries for new opportunity discovery of exploration character while being fundamental for opportunity development of exploitation character. Consequently, opportunity recognition might be contingent on the commitment and network position with boundaries that place undue constraints. And, related to another boundary constraint, Johanson and Vahlne (1977, 2009) emphasized gradual or incremental internationalization in the Uppsala Model. This incremental internationalization has also been one of the reasons for criticizing the model, leading to theoretical and practical emphasis on time and speed in internationalization as a result (e.g., born globals). However, a focus on time and speed has led to other aspects of incrementality in theorizing and applicability as it relates to the Uppsala Model. Thus, one area with potential for increased explanatory and predictive power of the model is to deconstruct the gradual aspect of internationalization into different aspects of distance, commitment, knowledge, and time. This deconstruction should also be carried out from both inter-country (cross-border trade) and intra-country bases (Chabowski, Hult, Kiyak, & Mena, 2010).

Many more examples exist of market dynamics and theoretical boundary conditions and constraints that likely relate to the continued viability of the Uppsala Model (e.g., see the point-counterpoint discussion in the Journal of International Business Studies, volume 48, number 9, 2017 – Coviello, Kano & Liesch, 2017; Hutzschenreuter & Matt, 2017; Håkansson & Kappen, 2017; Santangelo & Meyer, 2017; Vahlne & Johanson, 2017). Perspectives on this changing world view have been captured in various ways in the literature, most recently in the 50th anniversary issue of Journal of International Business Studies (volume 50, number 9, 2019). International business scholars continually working on and attending to the Uppsala Model’s viability – via carefully crafted revisions, critiques, and testing – is a way to make sure that internationally operating firms can constantly become more efficient. At the macro-level, regions and countries strive for global efficiencies; firms have a massive stake in the implementation of such global efficiencies.

NOTES

  1. 1

    As a reference, the Industrial Marketing and Purchasing (IMP) group was in the early days also sometimes referred to as the International Marketing and Purchasing Group (Engwall & Johanson, 2008).