Download Export performance as an antecedent of export

The Emerald Research Register for this journal is available at
www.emeraldinsight.com/researchregister
EJM
38,9/10
1186
Received October 2002
Revised February 2003
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/0309-0566.htm
Export performance as an
antecedent of export commitment
and marketing strategy
adaptation
Evidence from small and medium-sized
exporters
Luis Filipe Lages
Faculdade de Economia, Universidade Nova de Lisboa, Lisbon, Portugal, and
Graduate School of Business, Stanford University, California, USA, and
David B. Montgomery
Graduate School of Business, Stanford University, California, USA, and
School of Business, Singapore Management University, Singapore
Keywords Organizational performance, Marketing strategy, Exports, Standardization,
Portugal
Abstract This paper argues that performance should be investigated as an independent variable.
Using survey data of over 400 managers responsible for the main export ventures of Portuguese
SMEs (small and medium exporters), this paper shows that past performance plays a crucial role
in building SMEs’ commitment to exporting and to the determination of their current marketing
strategy. Findings also show that marketing strategy adaptation to the foreign market is
particularly noted in firms exporting to the most developed markets, rather than in firms exporting
to the most competitive environments. Future international marketing research is encouraged to
focus on understanding both the direct and indirect relationships among past performance, firm’s
commitment to exporting, and current marketing strategy under the influence of external forces.
Such a focus has the potential to enrich the theory and generate relevant managerial and public
policy implications.
Introduction
Exporting activity is of extreme importance from the point of view of nations and
firms. From the point of view of national governments, exporting activity is crucial
because it contributes to the economic development of nations. It influences the amount
of foreign exchange reserves as well as the level of imports a country can afford, while
European Journal of Marketing
Vol. 38 No. 9/10, 2004
pp. 1186-1214
q Emerald Group Publishing Limited
0309-0566
DOI 10.1108/03090560410548933
This research was funded by research grants from “NOVA EGIDE” and “Fundação para a
Ciência e Tecnologia” (Portugal/European Union) to the first author. The authors also
acknowledge the support of Warwick University Business School (UK) in conducting the survey.
They wish to express their thanks for comments on the original work that led to this paper,
namely the anonymous reviewers of the EJM, Tim Ambler, Pedro P. Barros, Miguel P. Cunha,
Sandy D. Jap, Carmen Lages and Aviv Shoham, as well as the reviewers and participants of the
following conferences: European Marketing Academy, Academy of International Business,
European International Business Academy, and Portuguese Society for Economics Research.
shaping public perceptions of national competitiveness. Additionally, exports enhance
societal prosperity and help national industries to develop, improve productivity and
create new jobs. Abroad, exports enlarge consumers’ accessibility to a diversity of
goods and services, and improve the standard of living and quality of life.
At the firm level, through market diversification, exporting provides an opportunity
for firms to become less dependent on the domestic market. By serving new customers
abroad, the firm may also explore economies of scale and achieve lower production costs
while producing more efficiently. The firm may also use the international experience to
become a stronger competitor at home. Additionally, by operating abroad, the firms may
learn from international competition to eventually explore new foreign markets and get
involved in other international activities such as licensing, franchising, joint ventures or
direct investment abroad. In sum, exporting may assume an important role within the
firm as a means of reducing production costs, stabilizing cyclical demand, reaching new
markets and gaining experience for other forms of internationalization (Czinkota, 1994;
2002 (see www.house.gov/smbiz/hearings/107th/2002/020424/czinkota.html)).
Nevertheless, while exporting is now one of the fastest growing economic activities
essential for both nations and firms, there is still no strong theoretical framework for
researching the export activity phenomenon (Leonidou et al., 2002). A possible
explanation for this is that researchers live in a world that desires and rewards theories
that look for factors to improve export performance. Consequently, they focus on the
determinants of performance and tend to ignore firms’ reactive behavior (March and
Sutton, 1997). In this research we suggest that performance levels can also have an
immediate impact on marketing strategy decisions, similarly to what is observed in the
real world (see Lages, 1999). It is not uncommon to hear in the business press of firms’
reactive behavior to past results. For example, after its 1999 commercial financial
disaster, British Airways publicly announced a rethinking of its branding,
communication, and relationship marketing strategies. Similarly, immediately
following the disclosure of poor results, Marks & Spencer decided to redefine its
strategy and appoint a new board-level marketing director (Marketing Week,
August 19 1999). Many other examples may be cited to exemplify this type of
short-term reactive behavior to past performance. In line with recent work (Ashmos
et al., 1998), we feel that satisfaction with the most recent past performance is more
salient to managers and more likely to represent financial data that would affect
managers’ subsequent behavior and actions. If the exporting activities of small and
medium-sized firms have not been satisfactory in the previous year, it will be
extremely difficult for managers to focus on the future, as they will be under constant
pressure. Export managers will have (dis)incentives according to their short-term
results, and in some cases their own position may came into risk if they have not
achieved a satisfactory performance (Lages and Lages, 2004).
There are several objectives of this research. First, we expect to develop a better
understanding of performance as an independent variable. Historically, strategy
formulation is viewed as an antecedent to performance outcomes. A recent review of
the top journals in strategy and organizational behavior (March and Sutton, 1997)
indicates that performance appeared in 71 percent of the articles as a dependent
variable only, in 12 percent as an independent variable only, and in 11 percent of the
studies as both a dependent and independent variable[1]. Similarly, in the marketing
field, strategy formulation is traditionally viewed as an antecedent to performance
Export
performance
1187
EJM
38,9/10
1188
outcomes (Lages, 2000a). Moreover, in the specific field of international marketing, to
the best of our knowledge, no empirical research has examined performance as an
antecedent of managers’ behavior and marketing strategy definition. Instead,
international marketing researchers prefer to regard performance as causally
dependent even when the variables relate to the same period of time and it is
unclear which particular variables should be treated as causally dependent.
Nevertheless, some recent studies in other fields found that past performance is
strongly associated with a manager’s strategic orientation (Lant and Hurley, 1999; Lant
et al., 1992; Lant and Montgomery, 1987). Their findings are consistent with a central
assumption of the organizational behavior literature that suggests that organizations
and individuals set goals and adjust their behavior in response to favorable and
unfavorable feedback (Cyert and March, 1963; March and Simon, 1958). Hence, in this
paper we argue that the basis of both current commitment to exporting and current
export marketing strategy lies in past accomplishments and any inability to achieve
what was initially proposed.
In this research, by discussing past export performance and its implications for
strategy (i.e. by studying export performance as an independent variable only) we
expect to contribute toward bridging the gap between historical and current export
operations. It is also our aim to open a door for further international marketing
research that will explore a much more complex relationship: the relationship among
past performance, current export marketing strategy, and future performance (i.e. the
analysis of performance as both dependent and independent variable).
Furthermore, we advance earlier work by developing a model that accounts for
intervening (indirect) effects among variables. Most empirical studies focus
exclusively on the direct effects of different contingent forces on marketing strategy.
However, as the understanding of the export-marketing phenomenon has grown in
the last few years, it has become clear that we need to look for more complex
predictive models that allow for the analysis and testing of complex
inter-relationships (Katsikeas et al., 1998). The strategy and organizational
behavior literature suggests that satisfaction with preceding performance is likely
to be positively related to commitment in the next period. This occurs because when
the firm performs well, internal publics (e.g. top managers, employees, union
representatives) and external publics (e.g. clients/customers, suppliers, investors,
and credit institutions) are more likely to react favorably (Isen and Baron, 1991) to
the exporting activity. Additionally, the export marketing literature also suggests
that when firms’ commitment to the exporting venture increases, more resources are
allocated to the exporting activity, and consequently the firm will be able to
improve its planning procedures and implement more adaptive strategies (Lages
and Jap, 2002). This suggests that as past performance improves, commitment
increases, and this ultimately leads to marketing mix adaptation. Hence, past
performance will indirectly and positively influence marketing strategy adaptation
through commitment. However, the strategy and organizational behavior literature
suggests a conflicting rationale. If performance improves, there will be a decline in
adaptive behavior (Greve, 1998). The firms may experience the “fat cat syndrome”
(Dutton and Duncan, 1987, 290) and consequently will opt for much simpler
strategies, such as a standardized approach. This approach is much simpler than an
adapted approach, involving less effort and consideration of environmental and
internal forces. Based on this rationale, one might suggest that past performance
will lead to a lower degree of marketing mix adaptation. This conflicting issue
motivates the second purpose of this paper: to contribute to a better understanding
of the direct, indirect and total effects among variables. Does past performance have
a negative or positive impact on the degree of marketing mix adaptation? In another
words, how does past performance directly influence management commitment to
exporting, and indirectly influence the degree of marketing strategy adaptation
through commitment?
This paper is also influenced by the contingent approach to the standardization
versus adaptation debate. Within the exporting context, the contingency perspective
looks for a balance between marketing strategy adaptation and standardization of
domestic strategies to the foreign markets. It asserts that no strategy is superior to the
other. Adaptation or standardization is a matter of degree because marketing
strategies are contingent upon internal and external forces. This is an area of growing
interest for both academics and practitioners (Rosenbloom et al., 1997), widely seen as
one of the most vital marketing topics for the twenty-first century (Kahn, 1998). This
leads us to the final objective of our paper: to extend the understanding of the
contingent forces influencing standardization/adaptation in an exporting context.
Though prior studies tend to look at the various aspects of the marketing mix in
isolation and focus mostly on product and promotion strategies (Jain, 1989; Lages and
Jap, 2002), this research will take a more comprehensive approach to this debate by
including the adaptation of product, promotion, pricing and distribution strategies in
the same model.
In the following section, based on a review of the literature, a set of research
hypotheses are summarized in an operational model. This model is tested through a
cross-sectional international survey of more than 400 Portuguese managers
responsible for the exporting activity of small and medium-sized exporters (SMEs).
The results and their implications for theory are then discussed. After presenting
implications for export business practice and public policy making, the paper ends
with limitations of this research and suggestions for further research.
Theoretical perspectives
A contingency approach to the adaptation versus standardization controversy
The contingency approach to marketing mix adaptation/standardization traces its
roots to general systems theory (Boulding, 1956; Von Bertalanffy, 1951) and the
behavioral theory of the firm (Cyert and March, 1963; March and Simon, 1958; Simon,
1957). The main strength of the contingency theory when applied to the
standardization controversy is based on the fact that it recognizes both advantages
and disadvantages associated with each of the two extremes (adaptation and
standardization). This explains why this theory is also known as the “middle of the
road approach”.
The first steps of the contingency approach in the international marketing
context were taken in the late 1960s (Buzzell, 1968; Bartels, 1968; Britt, 1974). These
early works argued that the key question should not be whether or not one should
adapt or standardize; rather, it should involve an examination of the potential for
adaptation or standardization, taking into consideration the influencing forces.
Apparently, this question no longer exists. The most recent international marketing
Export
performance
1189
EJM
38,9/10
1190
literature, particularly that which is concerned with the degree of marketing
program adaptation/standardization, is based on this perspective (Shoham, 1999;
Zou et al., 1997). The underlying thought of today’s approach to this debate is based
on the idea of degree rather than absolute standardization or adaptation.
Researchers view marketing strategy along a continuum varying from pure
standardization to pure adaptation. There is no right strategy; either can be the
better in a particular situation. Hence, it is more important to consider the degree of
adaptation and the forces that influence it than to determine whether or not a
company should adapt its marketing strategies (Cavusgil and Zou, 1994; Samiee and
Roth, 1992).
Most studies covering the adaptation/standardization topic tend to compare the
marketing strategies used by firms across various exporting markets. However, a
much richer understanding of the phenomenon may be obtained by considering the
extent to which domestic marketing strategies may be transferred to a particular
foreign market (Cavusgil and Kirpalani, 1993; Cavusgil and Zou, 1994). This type of
approach is used in this research as it allows a more precise understanding of the
antecedents of marketing strategy. Therefore, we define the adaptation of product
strategy as the degree to which the product (brand name, design, labeling, variety of
main exporting product line, and quality) differs between the domestic and export
market. Similarly, the adaptation of promotion strategy is defined as the adjustment
of the domestic promotion program (advertising idea/theme, media channels for
advertising, promotion objectives, budget for promotion, public relations emphasis,
and direct marketing/mailing) to the main export market. Pricing strategy
adaptation refers to the degree to which the pricing strategies (determination of
pricing strategy, concession of credit, price discount policy, and margins) for a
product differ across national boundaries. Finally, the adaptation of distribution
strategy reflects the readjustment of distribution (criteria to select the distribution
system, transportation strategy, budget for distribution, and distribution network) to
the export market.
Satisfaction with export performance
In today’s complex business world, performance is an indispensable guide for any
company analyzing its level of success, in both the domestic and international arenas.
Assessing export performance is quite a complex task, as export performance can be
conceptualized and operationalized in many ways (Diamantopoulos and Schlegelmilch,
1994). Broadly speaking, the literature considers three aspects of export performance:
financial, strategic, and that of performance satisfaction (Zou et al., 1998). In particular,
one approach that is increasingly relied upon is the aggregation of satisfaction with
various performance measures into a single measure of export performance (cf.
Diamantopoulos and Winklhofer, 2001; Katsikeas et al., 2000). This is the approach
incorporated here, whereby satisfaction is defined as a compound psychological
variable (an affective state) assessing the effectiveness of a marketing program in
terms of its sales revenue, sales volume, profitability, market share, and overall
performance (cf. Bonoma and Clark, 1988).
Satisfaction is the most studied outcome variable in the marketing literature on
interorganizational relationships (see Geyskens et al., 1999 for a review). One reason for
this trend is the fact that performance itself is a complex construct in the view of the
firm (Greve, 1998). It is often idiosyncratic to the firm and setting; success for one
company may constitute failure for another. Furthermore, for research purposes it is
often impossible to establish common definitions or fixed reference points across firms.
The use of satisfaction with performance allows us to compare performance across the
wide range of groups presented in our sample because managers will be able to
evaluate export performance while taking into consideration their own firm’s reference
groups (e.g., a firm’s particular circumstance in terms of industry, stage of export
involvement, and technology intensity) (Katsikeas et al., 1996). Hence, by measuring
satisfaction with performance, instead of performance per se, we are able to capture the
degree to which performance has matched the aspiration levels of the firm, and
compare it across a variety of exporting firms. In this manner, a boundary line is
incorporated and used as a reference point for perceived success and failure.
The importance of research on SMEs
This paper focuses on the study of SMEs, as they play an important role in many
economies (Zou and Stan, 1998). Exporting is now the preferred mode of
internationalization of these firms. As SMEs are not able to compete on price with
multinationals and large firms, they have to explore their strengths in other ways.
A key strength is related to their lighter structure. While larger firms often
suggest that adjustments to the market are not allowed because of “corporate
policy”, smaller firms use this lighter structure to export and rapidly adapt their
strategies to the special needs of the foreign market. The other strength of SMEs
is that once they get involved in exporting they present high corporate
commitment (often with the full commitment of the owner and top management),
which will be essential for building good relationships with the importer and
achieving competitive advantage in relation to larger corporations (Czinkota, 2002,
see www.house.gov/smbiz/hearings/107th/2002/020424/czinkota.html).
Previous research on SMEs has tended to focus on the effects of marketing
strategy on performance. However, exploratory interviews revealed that SMEs are
particularly reactive – rather than proactive – because they have limited financial
resources and are much more dependent on short-term results for survival (see
Lages and Melewar, 2000). SMEs are particularly vulnerable to previous export
performance results because export operations require more capital and represent a
larger portion of the firm’s resources than do domestic transactions. Additionally,
smaller firms have to rely heavily on their own resources because it is much harder
for them to gain access to credit than it is for larger firms. As a result, it is much
harder for managers of SMEs to cope with lower performance levels than it is for
managers of larger corporations.
SMEs also play a crucial role in the economic security of different nations, a role
that becomes even more vital in times of recession and limited domestic growth. There
is a particular research need to pay more attention to European SMEs, as most research
has been developed with firms based outside the European Union (EU); particularly
North American companies (Walters and Samiee, 1990; Winer, 1998). However, the EU
is the world’s largest exporter of goods. It has maintained a stable share of around one
fifth of total world exports (intra-EU trade excluded) since 1990 (European
Commission, 2000). The extensive saturation of the smaller European markets, such
Export
performance
1191
EJM
38,9/10
1192
as the Portuguese market, has placed added pressure on firms of those countries to
start selling their products abroad.
Within the European context, the Portuguese case is particularly interesting, as the
external commerce has contributed significantly to the economic development of the
country, representing 55 percent-70 percent of the total gross domestic product (GDP)
during the last decade. The export activity was particularly important in increasing the
national GDP. According to the National Statistics Institute, over the six-year period
preceding our survey (1993-1998), Portuguese exports increased 60 percent, from
US$15,930 million to US$24,158 million. Hence, like those of other small European
countries, Portuguese SMEs are a vital ingredient in the country’s growth.
Research hypotheses
In this paper we propose that the adaptation of marketing strategy to the foreign
market is directly affected by the firm’s prior performance, its commitment to
exporting, and two foreign market forces (degree of export market competition and
export market development). Moreover, it is proposed that marketing strategy
adaptation is indirectly affected by preceding export performance and the same two
external forces, through their influence on the firm’s commitment to exporting. An
overview of the conceptual framework is presented in Figure 1. In this section we begin
by developing hypotheses regarding the antecedents of marketing mix adaptation.
Then, the antecedents of the firm’s commitment to exporting are discussed.
Antecedents of marketing strategy adaptation
The effects of prior performance on marketing strategy adaptation
During the last four decades, quite a number of empirical studies have been developed
concerning the impact of marketing strategy adaptation on export performance.
According to a recent meta-analysis (Leonidou et al., 2002), in aggregate these studies
indicate that the adaptation of product, promotion, pricing and distribution strategies
have a positive impact on export performance. Surprisingly, and despite the extensive
research into this topic, no single empirical study has analyzed the reverse relationship,
Figure 1.
A conceptual framework
of the effects of prior
export performance on
firm’s current commitment
to exporting and
marketing strategy
adaptation
i.e. the impact of performance on the degree of marketing strategy adaptation (Lages
and Melewar, 2000). In this research we suggest that past performance is also
associated with current marketing strategy definition.
The organizational and strategy literature suggests that managers of firms
performing poorly are under considerable pressure (Fredrickson, 1985). They are
expected to do a better job, which naturally encourages them to develop more
comprehensive and rational strategic decisions than managers faced with a better
performance (Mintzberg et al., 1976). Poor performance puts pressure on managers to
take comprehensive, accurate and discriminating decisions (Cyert and March, 1963)
and will make them much more likely to search widely for information and conduct an
in-depth analysis of the surrounding environments (Audia et al., 2000). The need to
implement specific and distinct strategies, marked by the need to analyze the fine
distinctions between the domestic and foreign markets, will naturally lead the
managers of less successful organizations to develop an adapted strategy. In contrast,
the literature suggests that a good performance will promote more relaxed (Cyert and
March, 1963) and effortless strategic decisions (Bourgeois, 1981; March and Simon,
1958; Litschert and Bonham, 1978). These managers will become narrowly focused and
overly preoccupied with the factors that have contributed to their firms’ good
performance, so that they will tend to exploit the existing opportunities without
searching for information and conducting an in-depth analysis of the environment
(Cyert and March, 1963). Hence, managers of firms performing better will lose their
ability to react to the various contingent forces (Miller, 1993). The consequence of this
behavior is that the firm may begin to allocate its resources in a simpler way, reflecting
a singular focus that does not correspond adequately to the complex environment that
the firm is actually facing. Hence, we expect that the firm may be more likely to use a
less adapted marketing strategy in an export context when its satisfaction with past
performance has been particularly strong and when managers are satisfied with it.
Based on this rationale, the following is proposed:
H1. The greater the performance in the prior year, the lower the adaptation of
product (H1a), promotion (H1b), price (H1c) and distribution (H1d) strategies
in the current year.
The effects of firm’s commitment to exporting on marketing strategy adaptation
There are many forces within the firm that may affect export strategy success, such as
organizational culture, the firm’s capabilities and competencies, internal status of the
export management, location, and product differentiation. While it would be
impossible to discuss all of them here, we consider one that is particularly important:
the firm’s commitment to exporting. The firm’s commitment to exporting refers to the
degree to which organizational and managerial resources are allocated to exporting
ventures. A firm’s commitment to exporting is offered in this paper as a construct that
incorporates the amount of planning, financial and human resources that the firm
allocates to the exporting activity (Cavusgil and Zou, 1994), and the extent to which the
manager is attached to the organization (Morris and Sherman, 1981) and exercises
considerable efforts (Porter et al., 1974) to support the firm’s exporting activity.
We have selected the firm’s commitment to exporting because it is a strategic
decision that guides resource allocation to export strategies. The firm’s commitment to
a particular direction may enhance employees’ feelings of loyalty and duty to the
Export
performance
1193
EJM
38,9/10
1194
organization (Wiener and Vardi, 1980). Because of their devotion to the organization,
highly committed managers are more willing to accept the organization’s solicitations
for extra work as well as more demanding activities (Etzioni, 1975; Randall, 1987).
Consequently, when the firm demonstrates a strong commitment to exporting,
managers may be more apt to work harder on demanding tasks such as marketing
strategy adaptation. On the other hand, the less committed managers tend to be less
participative (Angle and Perry, 1981), and thus prefer to implement standardized
strategies which are much simpler to implement and require much less work.
International marketing research suggests that the more committed firms allocate
more resources to the exporting activity (Aaby and Slater, 1989; Christensen et al.,
1987). These extra human and financial resources enable companies to improve the
depth of planning procedures (e.g. in terms of market research and market analysis)
that will allow managers to implement marketing strategies that are more adapted to
the needs of different markets (Cavusgil and Zou, 1994). In sum, as increasing levels of
resources are committed to the exporting venture, the firm is in better position to
improve its planning procedures and to implement more adaptive strategies. By
applying this rationale to our study, we propose the following:
H2. The greater a firm’s commitment to exporting, the more likely will be the
adaptation of product (H2a), promotion (H2b), price (H2c) and distribution
(H2d) strategies to the foreign market.
The effects of export market forces on marketing strategy adaptation
Many export market forces might influence the degree of marketing adaptation to the
foreign market. Some possibilities include local government influence, the exporting
country’s image, technological and cost factors, as well as export market differences in
terms of product life-cycle, culture, infrastructures, and government regulations.
Among these possibilities, we focus on two aspects of particular importance (degree of
export market competition and export market development) that are frequently
examined by literature focused on the adaptation/standardization debate (e.g. Cavusgil
and Zou, 1994; Johnson and Arunthanes, 1995; Seifert and Ford, 1989).
Export market competition is the extent to which businesses must strive to outdo
each other to gain the economic rents of that industry. Competition may vary along
multiple dimensions, such as the number of competitors, price competitiveness, and
service/delivery. Any manager who is committed to developing a suitable marketing
strategy must initially identify the key competitors (Clark and Montgomery, 1999; Day
and Wensley, 1988). In addition, it is necessary to make an analysis of the prices
(Cavusgil and Zou, 1994) and delivery times (Czinkota et al., 1996) of competitors in the
different markets.
Marketing managers have to pay a good deal of attention to the impact of
competition on marketing decisions (Weitz, 1985). A direct comparison with other
competitors will allow managers to assess their own firm’s competitive advantage
(Day, 1984; Day and Wensley, 1988) and to use a reference for developing competitive
marketing strategies to the different export markets. Previous empirical research in the
international marketing field has shown that the level of competition in the export
market is positively associated with product and promotion adaptation (Cavusgil and
Zou, 1994; Cavusgil et al., 1993). If a company opts for a standardized strategy,
although it may be able to achieve lower production costs, there will always be some
competitors who are willing to offer what the consumer wants (Kotler, 1996).
Consequently, as the level of competition within an export market rises, firms are
pressured to adapt their strategies in order to differentiate their offerings and gain
competitive advantage over local challenges (Hill and Still, 1984). Hence, as competition
increases, we expect that the exporting firm tends to adapt its product, promotion,
pricing, and distribution strategies to the export market.
In this paper we refer to the degree of export market development as the overall
standard of living in the export market, as evidenced by the level of economic
development and education levels in the foreign market. As with export market
competition, the literature suggests that the degree of export market development
enhances marketing mix adaptation. This occurs because in the more developed
markets the demands are such that adaptation of marketing has to address the
cultural, economic and existing legislative rules if companies wish to operate. The
more developed markets tend to be more competitive (Sriram and Manu, 1995) and
firms exporting to these markets have less power over exports than do firms exporting
to the less developed countries (Lages and Jap, 2002). Furthermore, in the most
developed markets firms are under pressure to adapt the marketing strategy to
shopping patterns, where consumers tend to be more educated and more sophisticated
(Buzzell, 1968). Hence, similar to what takes place with competition, we expect that the
adaptation of the marketing mix elements will be enhanced by the degree of market
development. Collectively, we hypothesize that:
H3. The degree of export market competition is positively related with the degree
of adaptation of product (H3a), promotion (H3b), price (H3c) and distribution
(H3d) strategies.
H4. The degree of export market development is positively related with the degree
of adaptation of product (H4a), promotion (H4b), price (H4c) and distribution
(H4d) strategies.
There might be, however, cases in which the opposite effect occurs. This is the case of
competitive and developed markets where the question is of selling efficiently through
practices that take advantage of economies of scale. In addition, if the degree of foreign
market competition/development is similar to the domestic market, we may see little
adaptation because the same marketing mix may be applicable in both export and
domestic contexts. Nevertheless, as revealed by previous empirical research, we expect
that overall the degree of foreign market competition and development is associated
with marketing strategy adaptation.
Antecedents of firm’s commitment to exporting
The effects of prior performance on firm’s commitment to exporting
Previous research in international marketing indicates that the firm’s commitment to
exporting directly impacts performance because this commitment is associated with
the allocation of greater resources to the task, better enabling the organization to
achieve its exporting goals. In general, the more committed the firms, the more
successful their performance, as they are more engaged in planning, and therefore
allocate greater financial and human resources to the export activity (for extensive
reviews regarding this relationship see Bilkey, 1978, Aaby and Slater, 1989; Zou and
Stan, 1998).
Export
performance
1195
EJM
38,9/10
1196
In this study we suggest that performance should also directly impact on the firm’s
commitment to exporting. To the best of our knowledge, no study in international
marketing has empirically tested this relationship. Nevertheless, as suggested by
previous studies (Fenwick and Amine, 1979; Madsen, 1987; Stump et al., 1998), past
performance is very likely to shape the degree of commitment to exporting and should
be considered a research priority.
The international marketing literature suggests that export commitment is a
function of resource availability (Cavusgil and Nevin, 1981). When export operations
perform well, the various internal publics and external publics are more likely to
support the exporting activity within the firm. On the other hand, the reputations of the
exporting operations and export managers are diminished by poor performance and,
consequently, they will likely have fewer resources available. This situation becomes
even more evident in SMEs having a short strategic cycle. Nevertheless, the literature
suggests that overall, the perception of success on the part of the different entities
interacting with the company, enhanced by the firm’s internal stability, will lead the
managers to increase their motivation to exporting. This leads to the following
hypothesis:
H5. The better the performance in the previous year, the greater the firm’s
commitment to exporting.
Nevertheless, one should also note some exceptions. For example, in certain situations
SMEs might be prepared to accept consistent losses in order to learn and establish
market share, and during this phase commitment might increase. It is also worth
noting that while in performing firms the opportunities to increase performance may
be viewed as discretionary possibilities, in low performing firms managers will have to
be more committed because the opportunities are seen as vital (Cyert and March, 1963).
When the firm is not performing well, managers will have to be committed to
implementing precise and discriminant decisions and to expending the effort to make
proper choices (Fredrickson, 1985). Nonetheless, based on the hints previously
discussed that emerge from the international marketing literature, we will test to see if
the firm’s commitment to exporting increases when managers have achieved past
performance goals.
The effects of export market forces on firm’s commitment to exporting
Foreign markets present both opportunities and threats for exporters (Cavusgil and
Zou, 1994). Managers of firms operating in less competitive environments tend to feel
less threatened and more confident about the existing opportunities (Dutton, 1993).
This situation is likely to make managers less committed because the firm operates in a
closed system and loses its ability to identify and react to the various issues that may
arise from the environment. On the other hand, the intensity of export market
competition is likely to force managers to take strategic decisions in order to gain
competitive advantage over rivals (Cavusgil et al., 1993; Jain, 1989). While managers of
firms operating in low competitive environments have the luxury of taking effortless
strategic decisions, managers of firms operating in highly competitive environments
are under constant pressure to be committed to exporting activity. The need to
constantly monitor the environment, avoid potential threats and differentiate the
offerings across markets, forces firms that export to more competitive environments to
be more committed to their export operations.
Similar to what occurs with the degree of export market competition, we also expect
that the degree of foreign market development is associated with a higher degree of the
firm’s commitment to exporting. SMEs exporting to less developed countries (LDCs)
are expected to be less committed because consumers in these countries are not very
demanding and frequently prefer products from developed countries to those from
their own country (Bilkey and Nes, 1982). Furthermore, as suggested by a Portuguese
manager during a preliminary interview, SMEs may impose more convenient decisions
on some of the less developed markets because “if the markets are easy, companies
tend to accommodate themselves.” While Portuguese companies have no power in the
relationship with importers based in developed markets, they have considerable power
over importers based in the less developed markets. In contrast, when exporting to the
most developed markets, firms are under pressure to be committed and satisfy as much
as possible the more educated and sophisticated consumers in those countries (Buzzell,
1968). Hence, similar to what happens with firms operating in the more competitive
environments, firms operating in the most developed markets will have to be
committed to the exporting activity and try to maximize satisfaction to the importers in
those markets. Collectively, the above rationales can be expressed in the following
hypotheses:
H6. The degree of export market competition is positively related with the firm’s
commitment to exporting.
H7. The degree of export market development is positively related with the firm’s
commitment to exporting.
Method
Data collection procedure
A questionnaire was developed that incorporates a variety of multi-item measures and
indicators of the conceptual framework. Additional indicators derived from
exploratory interviews in the research context were also included. Both adaptation
of product and promotion strategies were adapted from Zou et al. (1997); both
adaptation of pricing and distribution strategies were adapted from Shoham (1999).
With regard to the export market forces, the firm’s commitment to exporting was
adapted from Cavusgil and Zou (1994) and the degree of foreign market development
was specifically developed for this research. The scale for satisfaction with prior year’s
export performance was influenced by Shoham’s (1996) work.
In line with the OECD’s 1994 definition, we use 500 employees as the dividing line
between an SME and a large firm. A sample of 2,100 small and medium-sized exporters
was randomly generated from the government agency database of Icep-Portugal
(available at: www.portugal.org/information/index.html) (ICEP, 1997). After analyzing
the results of the preliminary interviews and pre-testing the questionnaire[2], data
collection was conducted in the first quarter of 1999. Questionnaires with an
international postage-paid business reply envelope were sent to the person responsible
for exporting operations. This was followed by a reminder letter that included a reply
envelope. Out of 2,100 questionnaires, 29 managers replied that they no longer
exported and 104 questionnaires were returned by the postal service. These firms had
Export
performance
1197
EJM
38,9/10
1198
either closed down or moved without leaving a forwarding address. Thus the sample
size was reduced to 1,967. By the cut-off date, 459 questionnaires had been returned
(413 valid), which was equivalent to a 23.3 percent return rate (21 percent net response
rate). This result is quite satisfactory, considering that high-level executives are much
less likely to respond than people in the general population (Hunt and Chonko, 1987).
Furthermore, because of the numerous obstacles that have to be overcome, the
collection of data from a foreign country is usually more difficult (Douglas and Craig,
1983), making the response rates much lower for international surveys (Zou et al.,
1997).
The existence of a good response rate provides some confidence that response bias
is not a significant problem (Weiss and Heide, 1993). Nevertheless, non-response bias
was tested by assessing the differences between the early and late respondents with
regard to the means of the 36 items exhibited in the Appendix (Armstrong and
Overton, 1977). No significant differences between the early and late respondents were
found, suggesting that response bias was not a significant problem in the study.
Data and respondents’ profile
Nearly 90 percent of the respondents reported on ventures with other European Union
countries, while the remainder occurred with non-EU countries. Exporters from all of
the Portuguese regions participated in the survey. While 22 percent of SMEs have
annual sales exceeding e5m, only a small number (8 percent) have sales revenues of
total exports above that figure. Even lesser (2 percent) is the number of SMEs with
sales revenues of the main export venture above the e5m limit. The average sales
revenues of the main export venture ranged from e400,000-e750,000.
The survey was directed to individuals who were primarily responsible for
exporting operations and activities. The job title of these individuals ranged from
president to marketing director, managing director, and exporting director. Of the
respondents, 39.7 percent indicated that they had been responsible for the exporting
operations of their firm for eight to 15 years, while 83.3 percent ranged from three to 30
years. Respondents were also asked to indicate their degree of experience in exporting
on a scale where 1 ¼ none and 5 ¼ substantial. The mean response was 3.5
(SD ¼ 0.85, range 1 to 5). Collectively, this indicates that although the title of the
respondents’ positions may be wide-ranging, the individuals appear to have significant
knowledge in the specific exporting activities of the firm and are experienced with
exporting in general.
The unit of analysis
In line with the most recent export marketing research (Styles, 1996, 1998; Lages,
2000b), the firm’s main export market venture (MEV) is analyzed in this study. There
are problems involved in analyzing more than one export venture from the same firm
because, as revealed during the exploratory study, in many firms managers develop a
marketing strategy only for the MEV. Many of the secondary export ventures have no
defined strategy or are just a consequence of the strategy defined for the MEV.
Additionally, the MEV is used because it is believed that analyzing a single product or
product line exported to a single foreign market makes it possible to associate past
performance more precisely with its outcomes.
Data analysis
Confirmatory factor analysis
In order to assess the validity of the measures, the items are subjected to a
confirmatory factor analysis (CFA), using full-information maximum likelihood (FIML)
estimation procedures in LISREL 8.3 (Jöreskog and Sörbom, 1993). In this model, each
item is restricted to load on its pre-specified factor, with the eight factors allowed to
correlate freely. Despite the significant chi-square for this model (x2 ¼ 861.48, 467df,
p , 0.00), the fit indices – the comparative fit index (CFI ¼ 0.95), the Incremental fit
index (IFI ¼ 0.95), and the Tucker-Lewis fit index (TLI ¼ 0.94) – are indicative of a
good fit. Since fit indices can be improved by allowing more terms to be freely
estimated, we also assess the root mean square error of approximation (RMSEA),
which assesses fit and incorporates a penalty for lack of parsimony. A RMSEA of 0.05
or less indicates a close fit to the population, while 0.08 to 0.10 indicates a satisfactory
fit, with any score over 0.10 indicating an unacceptable fit. The RMSEA of this
measurement model is 0.045.
The Appendix (Figure A1) provides an overview of the standardized estimates and
t-values of each item on its intended construct. Convergent validity is evidenced by the
large and significant standardized loadings (average loading size was 0.77). As shown
in the Appendix, all eight constructs present the desirable levels of composite
reliability (Bagozzi, 1980). Discriminant validity among the constructs was also
stringently assessed using the Fornell and Larcker (1981) test; all possible pairs of
constructs passed this test. Discriminant validity was also evidenced by the correlation
estimates between any two constructs (Jöreskog and Sörbom, 1993). No correlation
includes a value of 1 (Anderson and Gerbing, 1988) and the highest correlation is 0.47
for promotion strategy adaptation and distribution strategy adaptation. Table I
provides an overview of the construct means, standard deviations, and the correlation
matrix among the constructs.
Path model parameter estimates
The conceptual framework of Figure 1 is simultaneously estimated in a structural
equation model using FIML estimation procedures in LISREL 8.3. Specifically, this
model contains eight constructs, 33 observable indicators, measurement and latent
variable errors, and inter-correlations between the latent factors. This model also has a
significant chi-square of 1144.02 (df ¼ 473, p , 0.00), but again, the fit indices suggest
a good fit of the model to the data (CFI ¼ 0.92, IFI ¼ 0.92, TFI ¼ 0.91,
RMSEA ¼ 0.059). Table II provides the maximum likelihood estimates for all the
direct, indirect and total effects associated with the structural paths. The estimates are
standardized and thus may be treated as an indication of the relative importance of
each variable relative to each endogenous variable (Goldberger, 1964).
When testing H1a and H1b, the results suggest that the direct association of prior
export performance with product and promotion adaptation is not significant.
However, performance has a significant and positive indirect impact on product
strategy adaptation (0.04, p , 0.05). Consistent with hypotheses H1c and H1d, the
results suggest that the prior year’s export performance has a significant and negative
direct impact on the degree of adaptation of both pricing (g ¼ 2 0.13, p , 0.05) and
distribution (g ¼ 2 0.15, p , 0.005) strategies. Table II also shows that the significant
Export
performance
1199
Table I.
Means, standard
deviations, and
correlations among latent
constructs
3.2
2.2
2.5
2.8
3.2
2.8
3.8
3.7
Y2. Current adaptation of product strategy to the
foreign market
Y3. Current adaptation of promotion strategy to the
foreign market
Y4. Current adaptation of pricing strategy to the
foreign market
Y5. Current adaptation of distribution strategy to the
foreign market
X1. Satisfaction with prior year’s export performance
X2. Export market competition
X3. Export market development
Mean
Y1. Firm’s current commitment to exporting
Construct
0.95
0.80
1.0
1.0
1.0
1.0
1.0
1.0
1.0
1.0
Min
5.0
5.0
5.0
5.0
5.0
5.0
5.0
5.0
Max
0.285
0.173
0.282
0.101
0.019
0.060
0.145
1
1
0.141
0.082
0.012
0.179
0.379
0.272
1
2
0.107
0.051
0.011
0.470
0.422
1
3
0.441
1
2 0.044
0.034
2 0.094
4
1
0.139
0.056
2 0.024
5
1200
0.79
1.21
1.05
1.16
1.09
0.89
SD
0.202
0.029
1
6
0.236
1
7
1
8
EJM
38,9/10
0.16*
(2.24)
H2a
0.16*
(2.24)
0.06
(0.88)
H2b
0.06
(0.88)
0.09
(1.35)
H2c
0.09
(1.35)
0.15*
(2.23)
H2d
0.14*
(1.98)
H4d
2 0.07
(2 1.12)
H3d
0.17***
(2.61)
0.04*
(1.96)
0.15*
(2.23)
2 0.05
(2 0.76)
0.02*
(1.66)
2 0.12****
(2 2.10)
Notes: Values in upper rows are completely standardized estimates. Values in lower rows are t-values. *p , 0.05; **p , 0.01; ***p , 0.005 (one-tailed test)/****p , 0.05
(two-tailed test). Because of rounding, sometimes the “total effect” is the not the same as “the direct effect plus the indirect effect”. The signs for the expected indirect and total
effects were established by implication. We assume that if all the direct relationships involved in an indrect relationship are positive, the final indirect relationship is also
expected to be positive. The same principle applies to the total effects. If both direct and indirect effects are expected to be positive, then the sign for the total effect is also
expected to be positive
Y1 Firm’s current
commitment to
exporting
0.02
(1.27)
0.05
(0.72)
0.16*
(2.30)
0.01
(0.87)
0.03
0.18*** (0.36)
H4c
(2.72)
0.12*
0.25***
(3.66)
0.25*** (1.69)
H4a
H7
(3.66)
0.04*
(1.96)
0.16**
(2.40)
H4b
X3: Export market
development
2 0.02
(2 0.34)
2 0.04
2 0.09 (2 0.56) 0.01
(1.19)
(2 1.57) H3c
2 0.10
(2 1.69) 0.01
H3b
(0.82)
0.02
(0.34)
0.00
(2 0.04) 0.02*
H3a
(1.67)
0.15**
X2: Export market (2.49)
H6
competition
0.15**
(2.49)
2 0.13*
2 0.04 (2 2.26) 0.02
(1.29)
(2 0.80) H1c
2 0.15***
0.04*
2 0.11**** (2.66)
H1d
(1.98)
(2 1.96)
Y5
Current adaptation of
Y4
distribution strategy to the
Current adaptation of pricing
foreign market
strategy to the foreign market
Direct Indirect Total
Direct
Indirect Total
2 0.06
2 0.02 (2 1.02) 0.01
(0.86)
(2 0.40) H1b
Y3
Current adaptation of
promotion strategy to the
foreign market
Direct Indirect Total
0.24*** 2 0.06
(4.19)
(2 1.02) 0.04*
H1a
(2.00)
Y2
Current adaptation of
product strategy to the
foreign market
Direct Indirect Total
0.24***
(4.19)
H5
X1: Satisfaction
with prior year’s
export
performance
Effect of/on
Y1
Firm’s current
commitment to exporting
Direct Indirect Total
Export
performance
1201
Table II.
Effects of exogenous and
prior endogenous
constructs (aximum
likelihood
estimation, n ¼ 413)
EJM
38,9/10
1202
positive indirect impact of performance on the adaptation of distribution strategy leads
to a weakening of the total effects, which, however, remain negatively significant.
As predicted by hypotheses H2a and H2d, the results indicate that a firm’s
commitment to exporting significantly influences the degree of adaptation of product
(b ¼ 0.16, p , 0.05) and distribution (b ¼ 0.15, p , 0.05) strategies. The firm’s
commitment to exporting is not significantly associated with adaptation of promotion
(H2b) and pricing (H2c) strategies.
Table II shows that although there is not a significant direct impact of export market
competition on product (H3a), promotion (H3b), pricing (H3c) and distribution (H3d)
strategies, there is a significant positive indirect impact of competition on the degree of
adaptation of both product and distribution strategies. However, the total effects
remain non-significant.
In contrast, consistent with H4a, H4b and H4d, export market development has a
significant positive impact on the degree of adaptation of product (g ¼ 0.12, p , 0.05),
promotion (g ¼ 0.16, p , 0.01) and distribution (g ¼ 0.14, p , 0.05) strategies. The
three indirect effects strengthen the total effects for all three relationships because they
are also positive. Surprisingly, export market development is not significantly
associated with pricing adaptation (H4c).
The last three hypotheses (H5, H6 and H7) are confirmed. The results show that
commitment to exporting is highly significantly influenced by the three exogenous
variables: prior export performance (g ¼ 0.24, p , 0.005), export market competition
(g ¼ 0.15, p , 0.01), and export market development (g ¼ 0.25, p , 0.005).
In sum, ten out of the 19 predicted direct relationships are statistically significant at
p , 0.05 level or better. Table II also shows that six out of the 12 possible indirect
effects, and ten out of the 19 possible total effects, are statistically significant at
p , 0.05 and beyond.
Relative importance of predictor variables
The above discussion has focused upon the rows of Table II. The following discussion
will consider the relative explanatory power of the predictor variables with respect to
each of the five endogenous variables in the model, thus examining the columns of
Table II.
For Y1, the current year’s commitment to exporting, the first columns show that X3,
export market development (0.25, p , 0.005) and X1, satisfaction with prior year’s
export performance (0.24, p , 0.005), are equally important and both are more so than
X2, export market competition (0.15, p , 0.01), although all three variables are
significant at p , 0.01 and beyond. Thus, the three exogenous variables have the
expected positive impact on export commitment, not just significantly, but of a
reasonable magnitude, as well.
For Y2, product strategy adaptation, only Y1 (0.16, p , 0.05), the firm’s current year
commitment to exporting, and X3 (0.16, p , 0.05), export market development, have a
significant and virtually equal importance. However, for Y3, promotion strategy
adaptation, only X3 (0.18, p , 0.005), export market development, has a statistically
significant and sizeable impact.
In contrast, for Y4, price strategy adaptation, only X1 (2 0.11, p , 0.05), satisfaction
with the prior year’s export performance, has any significant association and that at
the smallest magnitude of total effects among those in Table II that are statistically
significant.
Finally, for Y5, distribution strategy adaptation, three of the four predictor variables
are significant at p , 0.05 or better and are fairly equal in impact: X3 (0.17, p , 0.005),
export market development, Y1 (0.15, p , 0.05), firm’s current year export
commitment, and X1 (2 0.12, p , 0.05), satisfaction with prior years’ export
performance. Thus, the decision to adapt distribution strategy appears to be the
most multifaceted of all four adaptation decisions.
The above results suggest that the three exogenous variables (X1, X2, and X3) and
Y1 have markedly different impacts on strategy adaptation across marketing’s 4Ps.
This suggests that using a more aggregated variable, such as overall marketing
strategy adaptation, could lead to misleading results or even mask significant
relationships. It should also be noted that our results suggest that X2, export market
competition, does not appear to have much impact on strategy adaptation to the
foreign market, in stark contrast to export market development, which had a
substantial impact on all except price adaptation.
Discussion
The major contribution of the study stems from the empirical findings. First, our
findings support the argument that export performance is an antecedent of the firm’s
commitment to exporting. Second, export performance affects the way managers
define their exporting strategies. Specifically, it affects the degree of adaptation of
product (significant indirect effects), pricing (significant direct and total effects) and
distribution (significant direct, indirect and total effects). This leads us to conclude that
international marketing researchers are overlooking a potentially significant part of
the export-marketing phenomenon.
We expect that the empirical findings presented in this paper will lead international
marketing academics to reflect on the importance of prior performance to a firm’s
commitment to exporting. By better understanding this relationship and the different
forces influencing it, international marketing researchers will be able to help firms
enhance their export commitment when performing poorly (suggestions are presented
under “Implications for practice and public policy making”).
The impact of performance on marketing strategy is particularly relevant in the
context of SMEs. As suggested by the export manager of a clothing firm, “strategy is
defined every day as a result of past results.” Following the view of the manager of a
metal-exporting company, we might also conjecture that many SMEs are being led into
a vicious circle, where they are not able to improve their performance in the long term
because they are reacting too quickly in the short term, without expecting to observe
the effects of their strategy in the long term.
The interviewees also offered different explanations for the negative impact of
performance on marketing strategy adaptation. The general manager of a
stone-exporting firm suggested that SMEs tend to have limited resources and
“Portuguese managers are usually reluctant to invest”. Hence, if companies achieve a
good performance they will tend to relax and use more standardized strategies that
require many fewer resources than do more adapted strategies. Another exporting
manager suggested that, since the companies which perform better are not under
pressure, they might prefer to standardize their strategies in order to “become more
Export
performance
1203
EJM
38,9/10
1204
homogeneous across markets and reduce the disorder” which normally results from
having different strategies for different markets.
One of the key advantages of using a path model is the possibility of estimating not
only the direct effects, but also the indirect and total effects among latent variables
(Bollen, 1989). Indeed, interesting insights are raised when using this type of approach
to analyze our data. A surprising finding is that while performance has a negative
direct impact on all the marketing strategy elements (the impact is significant for
pricing and distribution), the indirect effects of performance on the four marketing
strategy elements through firm’s commitment to exporting are positive (significant for
product and distribution), which naturally leads to a weakening of the total effects[3]
(significant for pricing and distribution). Accordingly, we conclude that although the
firms that perform better tend to relax, and consequently implement simpler strategies
(particularly with regard to the standardization of both pricing and distribution
strategies), this situation is less likely to occur when firms are committed to exporting
activity (in which case they will tend to adapt more the product and distribution
strategies).
When comparing the total effects of the three exogenous variables on the firm’s
commitment to exporting, both prior performance and export market development are
found to have a similar highly significant positive impact on that commitment.
Although the impact of export market competition on a firm’s commitment to
exporting is also significant, this impact is slightly lower than the impact of the other
two exogenous constructs[4]. When analyzing the key antecedents of the marketing
mix strategy, it is found that export market development and a firm’s commitment to
exporting are the most important determinants of product strategy adaptation to the
main foreign market. The degree of export market development is also found to be the
most important determinant of both promotion and distribution strategies adaptation.
Prior performance is the key determinant of pricing strategy adaptation. Finally, the
structural model presented here also adds significantly to previous research by
showing that a firm’s marketing strategy (namely the degree of adaptation of product
and distribution strategies) is affected by the degree of export market competition and
development, through the indirect effects of management commitment to exporting.
Implications for practice and public policy making
Exporting activity may be very attractive from the point of view of both managers and
public policy makers. From the point of view of managers, exporting to foreign
markets can be very rewarding and is sometimes the only way for SMEs to survive.
Through exporting activity, SMEs may extend the life cycle of their products, reduce
their overall operating costs (e.g. costs associated with marketing, production, R&D
and technology) and use the foreign market to absorb their excess capacity.
The model presented in this paper helps managers to systematize the complex
export-marketing phenomenon and, simultaneously, might help to improve their
marketing expertise and enhance their ability to protect and perform better in the
domestic market. Our research findings indicate that firms with higher performance
levels are more inclined to standardize their pricing and distribution strategies in the
following year (except when the firms are more committed to the exporting activity; if
this situation occurs there is a tendency to increase the adaptation of the product and
distribution strategies). SMEs’ managers are particularly encouraged to reflect on the
fact that quite often it will not be possible to see the effects of preceding strategies in
the long run because strategies are determined every year as a reaction to the previous
year’s results. By better understanding how prior performance, and the degree of
export market competition and development affect marketing strategy definition,
SMEs’ managers should be able to improve their exporting strategies in the long term.
Finally, the findings might also be of vital importance when the firm is assessing its
propensity to export, because at this stage the firm may have to take into account the
degree of competition and market development in making the decision.
Research into SMEs is also of relevance for governments from both developed
countries and LDCs. While in the more developed countries SMEs represent a growing
percentage of national exporting activity (Dichtl et al., 1984), in the LDCs they have been
used as a way to achieve economic growth (Jaffe and Pasternak, 1994). By better
understanding exporting firms, public policy makers will be able to help these firms
compete more effectively in global markets (Lages and Montgomery, 2003). In particular,
our findings reveal that SMEs performing poorly will be less committed to exporting
activity. Both national and international public policy makers could use part of their
limited resources to help overcome this tendency[5]. The most obvious option would be
to provide training assistance on export strategy to the managers of the less committed
firms. Another possibility would be to play an active role in exposing these managers to
potential opportunities in foreign markets (e.g. by sponsoring their participation in
international trade fairs and visits to potential foreign clients). Moreover, since
international market studies are extremely expensive (and are often inaccessible to
SMEs), public policy makers could also grant the managers of these firms free access to
the existing EU databases that contain contact details for foreign firms.
Research limitations
The results presented in this paper should be interpreted with caution in the light of
some significant limitations. A first limitation relates to the omission of certain
relevant variables. For example, future research might include other possible
determinants of marketing strategy and management commitment[6]. As Pedhazur
and Schmelkin (1991) explain, such an omission may lead to a degree of bias in the
parameter estimates associated with the independent variables. However, it must be
stressed that the goal of this research is not to present a holistic approach to the export
marketing phenomenon. The focus is on the relationship among prior performance,
commitment and marketing strategy under the influence of key market forces.
This research has focused on SMEs operating in Portugal. Portugal is particularly
interesting to study as it is an emergent EU economy that is strongly dependent on the
exporting activity of its firms. Furthermore, the small size of Portugal’s domestic
market leads to a strong export orientation of Portuguese firms. Nevertheless, a sample
based on export ventures from only SMEs or from firms based in a single country is
bound to be limited. The results cannot be automatically generalized to larger firms or
firms based in other countries without further evidence.
In terms of causality, two initial concerns were that the use of techniques such as
LISREL could not prove the direction of causality; and due to the lack of time and
financial resources, it would not be possible to develop a longitudinal research design.
As suggested by Madsen (1987), in order to overcome these obstacles we introduced
time lags in our survey instrument. For example, in the relationship between 1997
Export
performance
1205
EJM
38,9/10
1206
performance and 1998 pricing strategy adaptation, the direction of causality became
clear. In terms of a logical progression, 1997 performance affects 1998 pricing strategy,
but the opposite relationship is ruled out. Nevertheless, in the future it is recommended
to replicate our research through the use of a longitudinal approach.
Despite the study’s evident limitations, it is believed that a solid survey instrument
has been produced both at the measurement and causality levels. All the measures
presented in this study are reliable and valid, and the final structural model presents a
good fit.
Directions for further research
Strategic decisions are motivated by reactive behaviors in which the firm responds to
past results (Lindblom, 1959). Most research (including that in marketing) tends to
ignore the firm’s reactive behavior, despite the fact that it may play an equal, if not
greater, role as proactive behavior in the determination of current strategy. Hence, it is
essential for international marketing researchers to start investigating the reactive
behavior, and consequently using export performance as a variable on the right side of
the equation (i.e. as an independent variable). It is believed that the two relationships
proposed in this paper (i.e. “performance ¼ . firm’s commitment” and
“performance ¼ . marketing strategy”) suggest potentially fruitful avenues of
research. It is particularly important to investigate the conditions under which past
performance affects a firm’s commitment to exporting and exporting marketing
strategy. Although neglected by previous international marketing research, managers
consider past performance and its effects as a top priority issue. If performance has
been satisfactory, firms will be in a better position to develop long-term results. The
internal and external publics are more likely to react positively and export managers
will be in a better position to request from top managers and public policy makers
more human and financial support for the development of exporting marketing
strategy. Additionally, past performance is vital because it relates to managers’
personal interests, as a positive performance might have an immediate effect in terms
of personal income (e.g. salary bonus).
In this study we use the 4Ps adaptation as the dependent variables. There is a need
to develop international marketing frameworks that examine the marketing mix as a
whole, rather than concentrating on just one of the “Ps”. Instead of discussing whether
a company should standardize its marketing strategies or not, a fruitful direction for
future research is to try to understand the interaction between the existing forces and
the degree of adaptation to the main foreign market (Jain, 1989). Furthermore, in this
study we focus on the rate of change of marketing strategy (export versus domestic
adjustments) as a consequence of previous performance. Future international
marketing research is also encouraged to analyze whether a strategy has been
changed from one year to the following in response to past performance, and the
reasons behind this change.
Most studies tend to concentrate exclusively on the analysis of the direct
relationships among the elements involved in the export-marketing phenomenon.
Much more empirical research is needed to focus on the analysis and understanding of
the indirect relationships (Zou and Stan, 1998). The use of an advanced multivariate
technique, such as SEM, is recommended to model such complex relationships (Hair
et al., 1998). Our results indicate that satisfaction with prior year’s export performance
has a direct impact on a firm’s commitment to exporting, an indirect impact on product
strategy adaptation, a direct impact on pricing strategy adaptation, and both a direct
and indirect impact on the adaptation of distribution strategy. However, there is a
non-significant impact of prior year’s export performance on promotion adaptation. It
might be true that it takes longer than a single year to observe the impact of the
previous year’s performance on the decision of adapting promotion strategies –
particularly if a promotion campaign is a long-term, multi-year effort. Future research
is needed to further examine this possibility.
This particular study shows that marketing strategy is a function of the fit between
preceding performance, management commitment and export market forces. Although
the occurrence of these effects might be observed in SMEs, their occurrence might be
unusual in larger firms. For example, since large companies have more resources to
train their managers, the latter will almost certainly be more committed to exporting
and in a better position to develop marketing strategies. Future research should test
this possibility.
In order to further test the relationships presented here, this study should be
replicated with firms based in different countries. Nevertheless, generalizations to
SMEs based in countries with characteristics similar to those of Portugal (i.e. small
European countries, emergent economies, or export-oriented countries) must be made
with caution. Two interesting possibilities would be to develop a similar survey across
different European countries, or to compare firms based in developed and less
developed countries. It would also be useful to test the hypotheses presented in this
paper according to the level of internationalization of the firms and when comparing
service industries and goods manufacturing. Finally, both the “performance ¼ .
firm’s commitment to exporting” and “performance ¼ . marketing strategy”
relationships proposed in this paper in an international business context should be
tested at the domestic level.
Notes
1. Percentages do not add up to 100 percent because in 6 percent of the reviewed studies,
performance appears in some other capacity.
2. Both the results of the preliminary interviews and an extensive list of the various steps used
to pretest the questionnaire may be obtained from the first author.
3. This includes both the significant and non-significant indirect effects.
4. The standardized coefficients indicate how a typical variation in the independent variable
leads to, or is associated with, a typical change or variation in the dependent variable
(Goldberger, 1964). They give an indication of relative importance to the dependent variable.
5. By saying this, we do not mean that public policy support to exporting should not be
provided to managers of successful firms.
6. Possibilities include the use of alternative ways of assessing export market characteristics
(e.g. the extent to which the foreign market is profitable or has potential for growth) and the
use of other export performance measures (e.g. export intensity). Future may also include the
type and availability of existing resources (e.g. financial and human resources) as well as
other strategic factors (e.g. degree to which the venture is related to other complementary
export operations, and the extent of information collection about main competitors and
markets).
Export
performance
1207
EJM
38,9/10
1208
References
Aaby, N.-E. and Slater, S.F. (1989), “Management influences on export performance: a review of
the empirical literature 1978-1988”, International Marketing Review, Vol. 6 No. 4, pp. 7-26.
Anderson, J.C. and Gerbing, D.W. (1988), “Structural equation modeling in practice: a review and
recommended two-step approach”, Psychological Bulletin, Vol. 103, pp. 411-23.
Angle, H. and Perry, J. (1981), “An empirical assessment of organizational commitment and
organizational effectiveness”, Administrative Science Quarterly, Vol. 26, pp. 1-14.
Armstrong, J.S. and Overton, T.S. (1977), “Estimating nonresponse bias in mail surveys”, Journal
of Marketing Research, Vol. 16 August, pp. 396-400.
Ashmos, D.P., Duchon, D. and McDaniel, R.R. Jr (1998), “Participation in strategic decision
making: the role of organizational predisposition and issue interpretation”, Decision
Sciences, Vol. 29 No. 1, pp. 25-51.
Audia, P.G., Locke, E.A. and Smith, K.G. (2000), “The paradox of success: an archival and a
laboratory study of strategic persistence following radical environmental change”,
Academy of Management Journal, Vol. 43 No. 5, pp. 837-53.
Bagozzi, R.P. (1980), Causal Models in Marketing., John Wiley, New York, NY.
Bartels, R. (1968), “Are domestic and international marketing dissimilar?”, Journal of Marketing,
Vol. 32 July, pp. 56-61.
Bilkey, W.J. (1978), “An attempted integration of the literature on the export behavior of firms”,
Journal of International Business Studies, Vol. 9 No. 1, pp. 33-46.
Bilkey, W.J. and Nes, E. (1982), “Country-of-origin effects on product evaluations”, Journal of
International Business Studies, Vol. 13 No. Spring/Summer, pp. 89-100.
Bollen, K.A. (1989), Structural Equations With Latent Variables, John Wiley, New York, NY.
Bonoma, T.V. and Clark, B.H. (1988), Clark Marketing Performance Assessment, Harvard
Business School Press, Boston, MA.
Boulding, K. (1956), “General systems theory – the skeleton of science”, Management Science,
Vol. 2, pp. 197-208.
Bourgeois, L.J. (1981), “On the measurement of organization slack”, Academy of Management
Review, Vol. 6 No. 1, pp. 29-39.
Britt, S.H. (1974), “Standardizing marketing for the international market”, Columbia Journal of
World Business, Vol. 9 No. 4, pp. 39-45.
Buzzell, R. (1968), “Can you standardize multinational marketing”, Harvard Business Review,
Vol. 46 November-December, pp. 102-13.
Cavusgil, S.T. and Kirpalani, V.H. (1993), “Introducing products into export markets: success
factors”, Journal of Business Research, Vol. 27 No. 1, pp. 1-14.
Cavusgil, S.T. and Nevin, J.R. (1981), “Internal determinants of export marketing behavior:
an empirical investigation”, Journal of Marketing Research, Vol. 18 February, pp. 114-9.
Cavusgil, S.T. and Zou, S. (1994), “Marketing strategy-performance relationship: an investigation
of the empirical link in export market ventures”, Journal of Marketing, Vol. 58 January,
pp. 1-21.
Cavusgil, S.T., Zou, S. and Naidu, G.M. (1993), “Product and promotion adaptation in export
ventures: an empirical investigation”, Journal of International Business Studies, Vol. 24
No. 3, pp. 479-506.
Christensen, C.H., Da Rocha, A. and Gertner, R.K. (1987), “An empirical investigation of the
factors influencing exporting success of Brazilian firms”, Journal of International Business
Studies, Vol. 18, Fall, pp. 61-77.
Clark, B.H. and Montgomery, D.B. (1999), “Managerial identification of competitors”, Journal of
Marketing, Vol. 63 July, pp. 67-83.
Cronbach, L.J. (1951), “Coefficient alpha and the internal structure of tests”, Psychometrika,
Vol. 16 September, pp. 297-334.
Cyert, R.M. and March, J.G. (1963), A Behavioral Theory of the Firm, Prentice-Hall, Englewood
Cliffs, NJ.
Czinkota, M., Ronkainen, I. and Moffett, M. (1996), International Business, 4th ed., Dryden Press,
London.
Czinkota, M.R. (1994), “A national export assistance policy for new and growing businesses”,
Journal of International Marketing, Vol. 2 No. 1, pp. 91-101.
Day, G.S. (1984), Strategic Market Planning: The Pursuit of Competitive Advantage, West
Publishing, St Paul, MN.
Day, G.S. and Wensley, R. (1988), “Assessing advantage: a framework for diagnosing
competitive superiority”, Journal of Marketing, Vol. 52 No. 2, pp. 1-20.
Diamantopoulos, A. and Schlegelmilch, B.B. (1994), “Linking exporting manpower to export
performance: a canonical regression analysis of European and US data”, in Cavusgil, S.T.
and Axinn, C. (Eds), Advances in International Marketing, 6, JAI Press, Greenwich, CT.
Diamantopoulos, A. and Winklhofer, H.M. (2001), “Index construction with formative
indicators”, Journal of Marketing Research, Vol. 38 May, pp. 269-77.
Dichtl, E., Leibold, M., Koeglamyr, G. and Mueller, S. (1984), “The export decision of small and
medium-sized firms. a review”, Management International Review, Vol. 24 No. 2, pp. 49-60.
Douglas, S.P. and Craig, S.C. (1983), International Marketing Research, Prentice-Hall, Englewood
Cliffs, NJ.
Dutton, J. (1993), “Interpretations on automatic: a different view of strategic issue diagnosis”,
Journal of Management Studies, Vol. 30, pp. 339-57.
Dutton, J. and Duncan, R.B. (1987), “The creation of momentum for change through the process of
strategic issue diagnosis”, Srategic Management Journal, Vol. 8, pp. 279-95.
Etzioni, A. (1975), A Comparative Analysis of Complex Organizations: On Power, Involvement
and Their Correlates, Free Press, New York, NY.
European Commission (2000), DGI Report, available at: http://europa.eu.int/comm/trade/
index_en.htm.
Fenwick, I. and Amine, L. (1979), “Export performance and export policy”, Journal of the
Operational Research Society, Vol. 30 No. 8, pp. 747-54.
Fornell, C. and Larcker, D. (1981), “Evaluating structural equation models with unobservable
variables and measurement error”, Journal of Marketing Research, Vol. 18 February,
pp. 39-50.
Fredrickson, J.W. (1985), “Effects of decision motive and organizational performance level on
strategic decision processes”, Academy of Management Journal, Vol. 28 No. 4, pp. 821-43.
Geyskens, I., Steenkamp, J.-B. and Kumar, N. (1999), “A meta-analysis of satisfaction in
marketing channel relationships”, Journal of Marketing Research, Vol. 36 May, pp. 223-38.
Goldberger, A.S. (1964), Econometric Theory, Wiley, New York, NY.
Greve, H.R. (1998), “Performance, aspirations, and risky organizational change”, Administrative
Science Quarterly, Vol. 43, pp. 58-86.
Hair, J. Jr, Anderson, R., Tatham, R. and Black, W. (1998), Multivariate Data Analysis, 5th ed.,
Prentice-Hall International, Upper Saddle River, NJ.
Export
performance
1209
EJM
38,9/10
1210
Hill, J.S. and Still, R.R. (1984), “Adapting products to LDC tastes”, Harvard Business Review,
Vol. 62 March-April, pp. 92-101.
Hunt, S.D. and Chonko, L.B. (1987), “Ethical problems of advertising agency executives”, Journal
of Advertising, Vol. 16, pp. 16-24.
ICEP (1997), CD-Export Database: Disk 1., European Union: Dataware Technologies.
Isen, A.M. and Baron, R.A. (1991), “Positive affect as a factor of organizational behavior”, in
Cummings, L.L. and Staw, B.M. (Eds), Research in Organizational Behavior, JAI Press,
Greenwich, CT.
Jaffe, E. and Pasternak, H. (1994), “An attitudinal model to determine the export intention of
non-exporting, small manufacturers”, International Marketing Review, Vol. 11 No. 3,
pp. 17-32.
Jain, S.C. (1989), “Standardization of international marketing strategy: some research
hypotheses”, Journal of Marketing, Vol. 53 January, pp. 70-9.
Johnson, J.L. and Arunthanes, W. (1995), “Ideal and actual product adaptation in US exporting
firms: market-related determinants and impact on export performance”, International
Marketing Review, Vol. 12 No. 3, pp. 31-46.
Jöreskog, K.G. and Sörbom, D. (1993), LISREL 8: Structural Equation Modeling with the
SIMPLIS Command Language., Scientific Software International, Inc., Chicago, IL.
Kahn, B.E. (1998), “Marketing in the 21st century – dynamic relationships with customers:
high-variety strategies”, Journal of the Academy of Marketing Science, Vol. 26 No. 1,
pp. 45-53.
Katsikeas, C.S., Bell, J. and Morgan, R.E. (1998), “Editorial: advances in export marketing theory
and practice”, International Marketing Review, Vol. 15 No. 5, pp. 322-32.
Katsikeas, C.S., Piercy, N.F. and Ionnidis, L.C. (1996), “Determinants of export performance in a
European context”, European Journal of Marketing, Vol. 30 No. 6, pp. 6-35.
Katsikeas, C.S., Leonidas, S., Leonidou, C. and Morgan, N.A. (2000), “Firm-level export
performance assessment: review, evaluation, and development”, Journal of the Academy of
Marketing Science, Vol. 28 No. 4, pp. 493-511.
Kotler, P. (1996), Marketing Management: Analysis, Planning, Implementation and Control,
9th ed., Prentice-Hall, Englewood Cliffs, NJ.
Lages, L.F. (1999), “Marketing lessons from Portuguese wine exporters: the development and
application of a conceptual framework”, Journal of Wine Research, Vol. 10 No. 2, pp. 123-32.
Lages, L.F. (2000a), “A conceptual framework of the determinants of export performance:
reorganizing key variables and shifting contingencies in export marketing”, Journal of
Global Marketing, Vol. 13 No. 3, pp. 29-51.
Lages, L.F. (2000b), “Export marketing standardization and its influence on performance: a
structural model examination”, unpublished PhD dissertation, Warwick Business School,
Warwick University, Warwick (for an abstract see www.jibs.net).
Lages, L.F. and Jap, S.D. (2002), “A contingency approach to marketing mix adaptation and
performance in international marketing relationships”, working paper no. 411, Faculdade
de Economia, Universidade Nova de Lisboa, Lisboa.
Lages, L.F. and Lages, C.R. (2004), “The STEP scale: a measure of short-term export performance
improvement”, Journal of International Marketing, Vol. 12 No. 1, pp. 36-56.
Lages, L.F. and Melewar, T.C. (2000), “An exploratory study of Portuguese exporters marketing
strategies”, in Wierenga, B., Smidts, A. and Antonides, G. (Eds), Marketing in the New
Millennium: 29th EMAC Proceedings (CD ROM), European Marketing Academy,
Rotterdam.
Lages, L.F. and Montgomery, D.B. (2003), “Analyzing the short term link between public policy
support and export performance improvement: the importance of the mediating effects of
price strategy”, in Henderson, G.R. and Moore, M.C. (Eds), What’s New? What’s Next? in
Marketing Theory, Education and Practice: Proceedings of the 2003 AMA Winter
Educators’ Conference, 14-17 February, Orlando, FL, American Marketing Association,
Chicago, IL, pp. 301-2.
Export
performance
Lant, T.K. and Hurley, A.E. (1999), “A contingency model of response to performance feedback:
escalation of commitment and incremental adaptation in resource investment decisions”,
Group and Organization Management, Vol. 24 December, pp. 421-37.
1211
Lant, T.K. and Montgomery, D.B. (1987), “Learning from strategic success and failure”, Journal
of Business Research, Vol. 15 No. 6, pp. 503-18.
Lant, T.K., Milliken, F.J. and Batra, B. (1992), “The role of managerial learning and interpretation
in strategic persistence and reorientation: an empirical exploration”, Strategic
Management Journal, Vol. 13 No. 8, pp. 585-608.
Leonidou, L.C., Katsikeas, C.S. and Samiee, S. (2002), “Marketing strategy determinants of export
performance: a meta-analysis”, Journal of Business Research, Vol. 55 No. 1, pp. 51-67.
Lindblom, C.E. (1959), “The science of muddling through”, Public Administration Review, Vol. 19
No. 2, pp. 79-88.
Litschert, R.J. and Bonham, T.W. (1978), “A conceptual model of strategy formulation”, Academy
of Management Review, Vol. 3 No. 2, pp. 211-9.
Madsen, T.K. (1987), “Empirical export performance studies: a review of conceptualizations and
findings”, in Cavusgil, S.T. (Ed.), Advances in International Marketing, Vol. 2, JAI Press,
Greenwich, CT, pp. 177-98.
March, J.G. and Simon, H.A. (1958), Organizations, John Wiley & Sons, New York, NY.
March, J.G. and Sutton, R.I. (1997), “Organizational performance as a dependent variable”,
Organization Science, Vol. 8 No. 6, pp. 698-706.
Miller, D. (1993), “The architecture of simplicity”, Academy of Management Review, Vol. 18 No. 1,
pp. 116-38.
Mintzberg, H., Raisinghani, D. and Theoret, A. (1976), “The structure of unstructured decision
processes”, Administrative Science Quarterly, Vol. 21 No. 2, pp. 246-75.
Morris, J.H. and Sherman, J.D. (1981), “Generalizability of an organizational commitment model”,
Academy of Management Journal, Vol. 24 No. 3, pp. 512-26.
Pedhazur, E.J. and Schmelkin, L.P. (1991), Measurement, Design and Analysis: An Integrated
Approach, Lawrence Erlbaum Associates, Hillsdale, NJ.
Porter, L., Steers, R., Mowday, R. and Boulian, P. (1974), “Organizational commitment, job
satisfaction and turnover among psychiatric technicians”, Journal of Applied Psychology,
Vol. 59 No. 5, pp. 603-9.
Randall, D.M. (1987), “Commitment and the organization: the organization man revisited”,
Academy of Management Review, Vol. 12 No. 3, pp. 460-71.
Rosenbloom, B., Larsen, T. and Mehta, R. (1997), “Global marketing channels and the
standardization controversy”, Journal of Global Marketing, Vol. 11 No. 1, pp. 49-64.
Samiee, S. and Roth, K. (1992), “The influence of global marketing standardization on
performance”, Journal of Marketing, Vol. 56 No. 2, pp. 1-17.
Seifert, B. and Ford, J. (1989), “Are exporting firms modifying their products, pricing and
promotion policies?”, International Marketing Review, Vol. 6 No. 6, pp. 53-68.
EJM
38,9/10
1212
Shoham, A. (1996), “Marketing-mix standardization: determinants of export performance”,
Journal of Global Marketing, Vol. 10 No. 2, pp. 53-73.
Shoham, A. (1999), “Bounded rationality, planning, standardization of international strategy, and
export performance: a structural model examination”, Journal of International Marketing,
Vol. 7 No. 2, pp. 24-50.
Simon, H. (1957), Administrative Behavior, Macmillan, New York, NY.
Sriram, V. and Manu, F.A. (1995), “Country-of-destination and export marketing strategy: a
study of US exporters”, Journal of Global Marketing, Vol. 8 No. 3/4, pp. 171-90.
Stump, R.L., Athaide, G.A. and Axinn, C.N. (1998), “The contingent effect of the dimensions of
export commitment on exporting financial performance: an empirical examination”,
Journal of Global Marketing, Vol. 12 No. 1, pp. 7-25.
Styles, C. (1996), “Determinants of export performance in small and medium sized enterprises: an
empirical investigation in the UK and Australia”, unpublished PhD dissertation, London
Business School, London University, London.
Styles, C. (1998), “Export performance measures in Australia and the United Kingdom”, Journal
of International Marketing, Vol. 6 No. 3, pp. 12-36.
Von Bertalanffy, L. (1951), “General system theory: a new approach to unity of science”, Human
Biology, Vol. 23, December, pp. 303-61.
Walters, P.G.P. and Samiee, S. (1990), “A model for assessing performance in small US exporting
firms”, Entrepreneurship Theory and Practice, Vol. 15 No. 2, pp. 33-50.
Weiss, A.M. and Heide, J.B. (1993), “The nature of organizational search in high-technology
markets”, Journal of Marketing Research, Vol. 30 May, pp. 220-33.
Weitz, B.A. (1985), “Introduction to the special issue on competition in marketing”, Journal of
Marketing Research, Vol. 22 No. 3, pp. 229-36.
Wiener, Y. and Vardi, Y. (1980), “Relationships between job, organization, and career
commitments and work outcomes – an integrative approach”, Organizational Behavior
and Human Performance, Vol. 26, pp. 81-96.
Winer, R.S. (1998), “From the Editor”, Journal of Marketing Research, Vol. 35, February, pp. iii-iiv.
Zou, S. and Stan, S. (1998), “The determinants of export performance: a review of the empirical
literature between 1987 and 1997”, International Marketing Review, Vol. 15 No. 5,
pp. 333-56.
Zou, S., Andrus, D. and Norvell, D. (1997), “Standardization of international marketing strategy
by firms from a developing country”, International Marketing Review, Vol. 14 No. 2,
pp. 107-23.
Zou, S., Taylor, C.R. and Osland, G.E. (1998), “The EXPERF scale: a cross-national export
performance measure”, Journal of International Marketing, Vol. 6 No. 3, pp. 37-58.
Further reading
Bourgeois, L.J. (1980), “Performance and consensus”, Strategic Management Journal, Vol. 1,
pp. 227-48.
OECD (1995), “Developments in individual countries: Portugal”, Economic Outlook, No. 58, p. 99.
Rosa, M.N. (1993), “Portugal: EC link brings benefits”, Euromoney, January, p. 90.
Appendix
Export
performance
1213
Figure A1.
Scale items, reliabilities,
variance extracted,
item-loadings and t-values
(n ¼ 411)
EJM
38,9/10
1214
Figure A1.