Exploring the Language Choice Dilemma of International Small Firms: A Social Exchange Perspective on English-only Versus Multilingualism

In international business, firm-level language choices are important questions that require scarce organizational resources to deal with external stakeholders’ diverse preferences. While language choices have a major impact on the success and survival of SMEs, current knowledge of these choices is mainly based on data from MNEs, which constitutes a research gap. We help address this gap by exploring from a social exchange perspective why and how decision-makers in international small firms choose between “English-only” and “multilingual” approaches to language. We find that when evaluating the cost and benefits of these alternatives, decision-makers aim for high levels of both external and internal resource sharing. However, external language diversity and limited internal availability of relevant language competencies force them into difficult trade-offs.