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Most of the research studies on entry mode have been done through the lens of manufacturing firms in developed economies entering developing economies, and most of the related frameworks and theories have been developed to explain this perspective. This paper presents an understanding of entry mode strategies of services firms in developing economies entering into developed economies by considering several software services firms in India entering developed economies. The study develops a framework that incorporates multiple theories - both from an emerging economy perspective as well as a services perspective - and presents the findings based on six case study analyses of services firms in India. Results identify addressable market size, cultural aspects, firm size, resource and service characteristics as dominating factors that influenced choice of entry modes. From a theoretical perspective, the authors find that theories such as transaction cost theory, eclectic paradigm, the gradual approach to internationalization, institutional theory do not successfully explain the entry mode strategies for firms in developing economies. Strategic theory, including resource based view, motivation of a firm, network theory have some application but do not explain, in isolation, all aspects of the entry mode choices. The paper also addresses future areas of investigation in this space.

Entry Mode, Strategy, International Business