Small and medium-sized enterprises (SMEs) play a fundamental role in the economic development of Taiwan. Globalization and the continuous increase of internationally active SMEs are key worldwide trends. Due to the globalization of markets, improvements in transportation and communications technologies, as well as other facilitating factors, more and more SMEs are looking for opportunities in international markets.
This research investigates the relationships between cultural intelligence, market orientation, customer and competitor related responsiveness, guanxi networks, and the internationalization of SMEs, while taking into consideration the moderating effect of entrepreneurial orientation-risk taking. Based on the survey conducted involving 349 managers and owners of SMEs in Taiwan, the main findings indicate that cultural intelligence as an individual factor, and market orientation as a firm factor, help to describe the internationalization process of SMEs, while cultural intelligence contributes positively on SMEs capability to develop guanxi. The findings also demonstrate that cultural intelligence plays a prominent role on the internationalization process when the owners and managers are more risk averse.

REFERENCES
Acs, Z. J., & Preston, L. (1997). Small and medium-sized enterprises, technology, and globalization: Introduction to a special. Small Business Economics, 9(1), 1.
Adler, P. S., & Kwon, S. W. (2002). Social capital: prospects for a new concept. Academy of Management Review, 27(1), 17-40.
Ai, J. (2006). Guanxi networks in China: Its importance and future trends. China & World Economy, 14(5), 105-118.
Anderson, J. C., & Gerbing, D. W. (1988). Structural equation modeling in practice: A review and recommended two-step approach. Psychological Bulletin, Vol. 103(No. 3), p 411-423.
Ang, S., & Inkpen, A. C. (2008). Cultural intelligence and offshore outsourcing success: A framework of firm-level intercultural capability. Decision Sciences, 39(3), 337-358.
Bagozzi, R. P., & Youjae, Y. (1988). On the evaluation of structural equation models. Journal of the Academy of Marketing Science, 16(1), 74-94.
Baird, I. S., & Thomas, H. (1985). Toward a contingency model of strategic risk taking. Academy of Management Review, 10(2), 230-243.
Bandalos, D. L. (2008). Is parceling really necessary? A comparison of results from item parceling and categorical variable methodology. Structural Equation Modeling-a Multidisciplinary Journal, 15(2), 211-240.
Bosma, N., Jones, K., Autio, E., & Levie, J. (2007). Global entrepreneurship monitor 2007 Executive Report. Retrieved January 21, 2009, from http://www.gemconsortium.org/about.aspx?page=pub_gem_global_reports
Brislin, R., Worthley, R., & Macnab, B. (2006). Cultural intelligence - understanding behaviors that serve people's goals. Group & Organization Management, 31(1), 40-55.
Byrne, B. M. (Ed.). (2001). Structural Equation Modeling with AMOS: Basic Concepts, Aplications, and Programming. New Jersey: Lawrence Erlbaum Associates.
Cavusgil, S. T., & Zou, S. M. (1994). Marketing strategy-performance relationship - an investigation of the empirical link in export market ventures. Journal of Marketing, 58(1), 1-21.
Chang, S. C., Lin, R. J., Chang, F. J., & Chen, R. H. (2007). Achieving manufacturing flexibility through entrepreneurial orientation. Industrial Management & Data Systems, 107(7), 997-1017.
Cheng, H. L., & Yu, C. M. J. (2008). Institutional pressures and initiation of internationalization: Evidence from Taiwanese small- and medium-sized enterprises. International Business Review, 17(3), 331-348.
Chua, R. Y. J., Morris, M. W., & Ingram, P. (2009). Guanxi vs networking: Distinctive configurations of affect- and cognition-based trust in the networks of Chinese vs American managers. Journal of International Business Studies, 40(3), 490-508.
Dess, G. G., Lumpkin, G. T., & Covin, J. G. (1997). Entrepreneurial strategy making and firm performance: Tests of contingency and configurational models. Strategic Management Journal, 18(9), 677-695.
Earley, P. C. (2002). Redefining interactions across cultures and organizations: Moving forward with cultural intelligence. In Research in Organizational Behavior, Vol 24 (Vol. 24, pp. 271-299).
Earley, P. C., & Mosakowski, E. (2004). Cultural intelligence. Harvard Business Review, 82(10), 139-+.
Ellis, P., & Pecotich, A. (2001). Social factors influencing export initiation in small and medium-sized enterprises. Journal of Marketing Research, 38(1), 119-130.
Fornell, C., & Larcker, D. F. (1981). Evaluating structural equation models with unobservable variables and measurement error. Journal of Marketing Research, 18(1), 39-50.
Gartner, W. B. (1989). "Who is an entrepreneur?" is the wrong question. Entrepreneurship: Theory & Practice, 13(4), 47-68.
Gartner, W. B. (2008). Variations in entrepreneurship. Small Business Economics, 31(4), 351-361.
George, G., Wiklund, J., & Zahra, S. A. (2005). Ownership and the internationalization of small firms. Journal of Management, 31(2), 210-233.
Granovetter, M. (1985). Economic sction and social structure: the problem of embeddedness. The American Journal of Sociology, 91(3), 481-510.
Gu, F. F., Hung, K., & Tse, D. K. (2008). When does guanxi matter? Issues of capitalization and its dark sides. Journal of Marketing, 72(4), 12-28.
Hair, J. F., Black, W. C., Babin, B. J., Anderson, R. E., & Tatham, R. L. (Eds.). (1988). Multivariate data analysis (6th ed.).
Harvie, C., & Lee, B.-C. (2002). Globalization and SMEs in East Asia. Cheltenham, UK.: Edward Elgar Publishing Limited.
Henley, A. B., Shook, C. L., & Peterson, M. (2006). The Presence of Equivalent Models in Strategic Management Research Using Structural Equation Modeling. Organizational Research Methods, 9(4), 516-535.
Homburg, C., Grozdanovic, M., & Klarmann, M. (2007). Responsiveness to customers and competitors:The role of affective and cognitive organizational systems. Journal of Marketing, 71(3), 18-38.
Hsu, J. Y., & Saxenian, A. (2000). The limits of guanxi capitalism: transnational collaboration between Taiwan and the USA. Environment and Planning A, 32(11), 1991-2005.
Jaworski, B. J., & Kohli, A. K. (1993). Market orientation - antecedents and consequences. Journal of Marketing, 57(3), 53-70.
Jayachandran, S., Hewett, K., & Kaufman, P. (2004). Customer response capability in a sense-and-respond era: The role of customer knowledge process. Journal of the Academy of Marketing Science, 32(3), 219-233.
Karlsen, T., Silseth, P. R., Benito, G. R. G., & Welch, L. S. (2003). Knowledge, internationalization of the firm, and inward-outward connections.
Khatri, N., Tsang, E. W., & Begley, T. M. (2006). Cronyism: a cross-cultural analysis. Journal of International Business Studies, 37, 61-75.
Knight, G. (2000). Entrepreneurship and marketing strategy: The SME under globalization. Journal of International Marketing, 8(2), 12-32.
Knight, G., & Cavusgil, S. T. (2004). Innovation organizational capabilities and the born-global firm. Journal of International Business Studies, 35(2), 124-141.
Kohli, A. K., & Jaworski, B. J. (1990). Market Orientation - The construct, research propositions, and managerial implications. Journal of Marketing, 54(2), 1-18.
Kohli, A. K., Jaworski, B. J., & Kumar, A. (1993). Markor - A measure of market orientation. Journal of Marketing Research, 30(4), 467-477.
Lin, C. Y. Y., & Zhang, J. (2005). Changing structures of SME networks: Lessons from the publishing industry in Taiwan. Long Range Planning, 38(2), 145-162.
Lloyd-Reason, L., & Sear, L. (2007). Trading places - SMEs in the global economy. Cheltenham, UK: Edward Elgar Publishing Limited.
Lumpkin, G. T., & Dess, G. G. (1996). Clarifying the entrepreneurial orientation construct and linking it to performance. Academy of Management Review, 21(1), 135-172.
Lumpkin, G. T., & Dess, G. G. (2001). Linking two dimensions of Entrepreneurial Orientation to firm performance: the moderating role of environment and industry life cycle. Journal of Business Venturing, 16(5), 429.
McDougall, P. P., & Oviatt, B. M. (2000). International entrepreneurship: The intersection of two research paths. The Academy of Management Journal, 43(5), 902-906.
Miller, D. (1983). The Correlates of entrepreneurship in three types of firms. Management Science, 29(7), 770-791.
Miller, D., & Friesen, P. H. (1983). Strategy-making and environment: The third link: Summary. Strategic Management Journal, 4(3), 221–235.
Narver, J. C., & Slater, S. F. (1990). The efffect of market orientation on business profitability. Journal of Marketing, 54(4), 20-35.
Narver, J. C., Slater, S. F., & MacLachlan, D. L. (2004). Responsive and proactive market orientation and new-product success. Journal of Product Innovation Management, 21(5), 334-347.
Ng, K. Y., & Earley, P. C. (2006). Culture plus intelligence - old constructs, new frontiers. Group & Organization Management, 31(1), 4-19.
Nohria, N., & Gulati, R. (1997). What is the optimum amount of organizational slack? A study of the relationship between slack and innovation in multinational firm. European Management Journal, 15(6), 603-611.
Pelham, A. M. (2000). Market orientation and other potential influences on performance in small and medium-sized manufacturing firms. Journal of Small Business Management, 38(1), 48-67.
Robinson, J. P., & Shaver, P. R. (1973). Measures of psychological attitudes: University of Michigan.
Sapienza, H. J., De Clercq, D., & Sandberg, W. R. (2005). Antecedents of international and domestic learning effort. Journal of Business Venturing, 20(4), 437-457.
Shook, C. L., Ketchen, D. J. J., Hult, G. T. M., & Kacmar, K. M. (2004). An assessment of the use of structural equation modeling in strategic management research. Strategic Management Journal, 25, 397-404.
SMEA. (2007). White Paper on Small and Medium Enterprises in Taiwan, 2007. Taipei, Taiwan: Small and Medium Enterprise Administration, Ministry of Economic Affairs.
TAITRA. (2009). Leading Taiwan Exporters 2009-2010: Taiwan External Trade Development Council.
Teece, D. J. (2007). Explicating dynamic capabilities: The nature and microfoundations of (sustainable) enterprise performance. Strategic Management Journal, 28(13), 1319-1350.
Thomas, D. C., Elron, E., Stahl, G., Ekelund, B. Z., Ravlin, E. C., Cerdin, J.-L., et al. (2008). Cultural intelligence: Domain and assessment. International Journal of Cross Cultural Management, 8, 123-143.
Verhees, F. J. H. M., & Meulenberg, M. T. G. (2004). Market orientation, innovativeness, product innovation, and performance in small firms. Journal of Small Business Management, 42(2), 134-154.
Weerawardena, J., & O'Cass, A. (2004). Exploring the characteristics of the market-driven firms and antecedents to sustained competitive advantage. Industrial Marketing Management, 33(5), 419-428.
Welch, D. E., & Welch, L. S. (1996). The internationalization process and networks: A strategic management perspective. Journal of International Marketing, 4(3), 11-28.
White, J. C., Varadarajan, P. R., & Dacin, P. A. (2003). Market situation interpretation and response: The role of cognitive style, organizational culture, and information use. Journal of Marketing, 67(3), 63-79.
Wiklund, J. (1999). The sustainability of the entrepreneurial orientation--performance relationship. Entrepreneurship: Theory & Practice, 24(1), 39-50.
Wiklund, J., & Shepherd, D. (2005). Entrepreneurial orientation and small business performance: a configurational approach. Journal of Business Venturing, 20(1), 71-91.
Wolff, J. A., & Pett, T. L. (2006). Small-firm performance: Modeling the role of product and process improvements. Journal of Small Business Management, 44(2), 268-284.
Wright, M., Westhead, P., & Ucbasaran, D. (2007). Internationalization of small and medium-sized enterprises (SMEs) and international entrepreneurship: A critique and policy implications. Regional Studies, 41(7), 1013-1029.
Zahra, S. A. (1991). Predictors and financial outcomes of corporate entrepreneurship - an exploratory study. Journal of Business Venturing, 6(4), 259-285.
Zahra, S. A. (2005). A theory of international new ventures: a decade of research. Journal of International Business Studies, 36(1), 20-28.
Zahra, S. A., & Covin, J. G. (1995). Contextual influences on the corporate entrepreneurship performance relationship - a longitudinal analysis. Journal of Business Venturing, 10(1), 43-58.
Zhou, L. X., Wu, W. P., & Luo, X. M. (2007). Internationalization and the performance of born-global SMEs: the mediating role of social networks. Journal of International Business Studies, 38(4), 673-690.