New Reichman University Study: A Temporary International Market Exit May Lead to Future Global Expansion

A strategic withdrawal from international activity can free up resources, spur business growth and technological development — ​​and enable a stronger reentry onto the global stage

Might a temporary reduction in international presence today open the door to significant global success in the future?

A new study conducted by Prof. Niron Hashai, dean of the Arison School of Business at Reichman University, Prof. Christian Asmussen of Copenhagen Business School, and Netanel Drori of Northeastern University reveals an unexpected dynamic in global business strategy: companies that choose to scale back international operations in the short term may actually be laying the foundation for large-scale global expansion in the future. The researchers call this pattern “international contraction for the sake of international expansion,” and identify the key mechanisms that drive the effect: the freeing up of organizational capital and resources, renewed investment in emerging areas, the fueling of innovation, and the development of technological knowledge — all processes that lead to business growth and a powerful return to global markets.