Abstract
1- Introduction
2- Literature review and research hypotheses
3- Research methodology
4- Measurement
5- Reliability, validity and statistical analysis method
6- Findings
7- Robustness testing
8- Discussion
9- Research limitations
References
Abstract
Purpose – This study aims to present two new contingent frameworks that hypothesize the moderation role of managerial ties (MTs) in the international competitive strategy-export financial and strategic performance framework. The purposes of this study are to explore whether a common standardized or individual customized conceptualization consisting of MTs, international competitive strategy and performance can be used to achieve export financial and strategic performance; to offer contingent factors for the current international competitive strategy-export performance framework; and to generalize the roles of MTs in the developed vis-à-vis developing region. Design/methodology/approach – This study uses the experience of 114 exporting firms operating in the European Union region to test its theoretical frameworks. MTs include both business and political ties. Findings – Business and political ties have completely different moderation effects on the relation between international differentiation/low-cost strategy and export financial/strategic performance. Business ties have a positive influence on the international differentiation strategy-export strategic performance and international low-cost strategy-export financial performance dyads, but a negative effect in the international low-cost strategy-export strategic performance framework. In contrast, political ties are revealed to have a negative effect on the international differentiation/low-cost strategyexport financial performance framework. Originality/value – This research advances extant international competitive strategy-export performance literature by revealing the bright and dark sides of business ties and the down side of political ties in the framework. Performance should be investigated in terms of financial and strategic performance. The moderation effect of business ties is more complex than that reported in the developing region; thus, a cross-regional generalization on these ties’ effects is more difficult to establish. In contrast, the dark side effect of political ties is consistent across developed and developing regions; a cross-regional generalization on these ties is more viable. Collectively, the results show that a standardized process for achieving both export financial and export strategic performances is not feasible, while a customized process for each export performance is needed.
Introduction
A differentiation strategy denotes offering a product that customers perceive as unique in the market, where the product is specifically tailored to the needs of each customer, thereby creating high levels of customer loyalty and satisfaction (Porter, 1980; Knight and Cavusgil, 2005). A low-cost strategy occurs when a firm becomes the lowest cost producer competing in the industry in which it operates (Porter, 1985). Firms can achieve superior performance when their product sells at a lower price than rivals in the market (Li and Li, 2008). Though a significant amount of research has been dedicated to competitive business (differentiation and low-cost) strategy and performance in the past decades (Acquaah, 2007; Jusoh and Parnell, 2008), extant research primarily focuses on the direct relationship between international competitive strategy and export performance but fails to consider the contingent framework in the international competitive strategy-export performance dyad (Aulakh et al., 2000; Julien and Ramangalahy, 2003; Knight and Cavusgil, 2005; Namiki, 1988; Murray et al., 2011). The contingency theory suggests that the association between two variables is contingent upon internal and external factors (Zeithaml et al., 1988) and, thus, a firm’s performance is an outcome of the subject variables’ interactions (Chung et al., 2012). This theory provides guidance on what firms should do, and how they should do it, when the direct effect of an international competitive strategy on export performance is absent. In this study, we argue that the contingency approach can be used as an alternative technique for generating marketing theory in the dyad, especially when the direct effect of international competitive strategy on export performance is lacking (Zeithaml et al., 1988; Chung et al., 2012). Our study explores the contingent effect of managerial ties (MTs) (business and political ties) on the international competitive strategy-export performance framework.