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International Journal of Economy, Management and Social Sciences, 2(10) October 2013, Pages: 864-875
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International Journal of Economy, Management and Social Sciences
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The Effect of Market Orientation and International
Experience on Performance with Regard to the
Mediating Role of Global Marketing Strategy
Ali Mokhtari 1, Mohammad Reza Hosseini Moghadam 2*, Masoud Monazzami Borhani 3,
Samira Sabaghian 4
1
Associate professor, Imam sadiq University, Tehran, Iran.
MA in Business Management, Ferdowsi University of Mashhad, Mashhad, Iran.
MA in Executive Administration, Ferdowsi University of Mashhad, Mashhad, Iran.
4
BA in Business Management, Binaloud University of Mashhad, Mashhad, Iran.
2
3
AR TIC LE INF O
AB STR AC T
Keywords:
Performance of companies with international experience is one of the significant subjects in current
situation. The aim of this research is to examine market orientation, international experience,
global marketing strategies, and the performance of manufacturing companies in Mashhad, Iran.
This research is a practical and descriptive- survey study. In order to collect data, we have used
questionnaire. The validity and reliability of questionnaire were confirmed using construct and
content validity and Cronbach's alpha respectively. The large and medium size manufacturing
companies of Mashhad industrial towns have been chosen for this purpose. Probability random
sampling has been used in this research. We have used PLS software in order to analyze the data.
The data analysis of 75 related companies show that there was a significant relationship between
market orientation and companies' performance. Moreover, there was a strong association between
international experience and companies' performance. Furthermore, the role of global marketing
strategies as an intermediate variable in related to market orientation and international experience
with company's performance did not confirm.
Market orientation
International experience
Global marketing strategies
Performance
© 2013 Int. j. econ. manag. soc. sci. All rights reserved for TI Journals.
1.
Introduction
A penetration view to the surrounding world reveals that: today's world is differing from the past." Globalization of economy, mass
production, existence of surplus capacity in most markets, time-based competition, mass of information, information efficiency, increasing
knowledge and power of markets and dynamic environment of manufacturing and service companies are some characteristics of the
modern world. Regarding this situation, what is the secret of companies' success and survival in today's competitive market? (Ibrahimi,
2003).
Regarding Literature review of organizational performance and success and strategic management theories, the answer is creating,
maintaining and sustaining competitive advantage. Pundits believe that organizations need to obtain and maintain sustainable competitive
advantage in order to comply with competitive necessities. It is obvious that, to serve this purpose a smart competitive approach is required,
which is ambiguous in terms of science and complex in terms of sociability and management. (Monavarian, 2000).
Previous studies have approved the positive effect of company's strategy on global market performance. (e.g., Birnik & Bowman, 2007;
Craig & Douglas, 2000; Kustin, 2010; Zou & Cavusgil, 2002). Marketing strategy is an approach in which companies react to the
competitive market situation. (Zou & Cavusgil, 1994). The absolute feature of marketing is to meet customer needs through representing
appropriate products and services (Dwairi, 2004). Because market orientation companies forecast and meet customer needs by appropriate
products and services, they could increase customer satisfaction and loyalty (Slater & Narver, 1998). Today's studies relating to these
relationships display that market orientation activities improved organization's competitiveness through motivating staff (Ahmed, Rafiq &
Saad, 2003) and then companies reach high performance. On the other hand, market orientation and attention to the environment are the
main marketing elements and significant factors in order to enable companies to comprehend the market and create appropriate product and
service strategies to meet customer needs and demands (Deshpande & Farley, 1998). The value of international experience for global
marketing has been considered in marketing literature (Qian & Delios, 2008). Many international companies follow social rationality in
* Corresponding author.
Email address: [email protected]
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their marketing functions; however, the low experienced companies are reversed (Douglas & Craig, 1992). In the end, in this research, we
are going to examine the impact of market orientation and international experience accompanied by intermediating role of global marketing
strategy on performance. The necessity and importance of this study is containing the most significant factors of global organizations'
success in all areas such as industry, service, and business. Since, there is not any similar study in Iran; this study can be a prominent
research.
2.
Literature review
2.1. Market orientation
Market orientation is a degree to which an organization perceives its customers' needs and uses this kind of information in order to forecast
the future of organization and also meet customers' needs. Consequently, organizations will be able to provide more value for customers
(Huseman, 2010).
Kara et al (2005) express that market orientation is a significant source of sustainable competitive advantage. Since imitation is difficult,
the company should focus on finding opportunities for growth and reduce the procrastination in response to the opportunities. They assert,
"Market orientation is a fundamental aspect of organizational culture that creates competitive values, norms, artifacts, and behaviors which
provide an opportunity for organization to obtain competitive advantage".
Farrell (2000) draw a comparison between marketing and market orientation and states that marketing concept is the way in which an
organization thinks about products and customers, however market orientation undertakes essential activities to implement the marketing
concept. This comparison suggests that while organizations may assume that they are serving customers and seeking customer satisfaction,
their actions can be seen as a real proof of their market orientation.
2.1.1 Market intelligence generation
The first action of market orientation is generation of market intelligence that consists of four independent and interdependent steps.
1234-
Gathering and analyzing information about needs and preferences of current customers.
Analyzing the external factors of industry (such as government regulations, economic trends, technology and other environmental
forces) which may influence on customer needs and demands.
Monitoring, forecasting and analyzing competitors' action and the way in which they could effect on needs and preferences of
potential and current customers.
Gathering and monitoring market intelligence through formal or informal methods.
In order to be a real market –oriented company, organizations should maintain the dynamic nature of current and future needs of different
customers (Kotler, 1994).
Due to the dynamic nature of the environment, we need market intelligence to monitor the effect of external factors such as governmental
regulations, economic trends, technology and other environmental forces on customer needs and preferences (Kotler, 1994). These factors
influence on organizational performance. Furthermore, in order to analyze environmental changes and their effects on customer needs and
preferences, market intelligence is needed. Since a significant share of industrial exchanges includes international trade, market intelligence
requires continuous monitoring and evaluating of external environmental changes in the industry (Kohli & Jaworski, 1990).
2.1.2 Market orientation dissemination
Market orientation dissemination includes two dimensions:
12-
Dissemination of existing and anticipated information across the organization with regard to the needs and preferences of current
and potential customers, current and potential competitors and other external factors.
Effective use of published information through encouraging participants of all sectors and individuals to share information about
needs and preferences of current and potential customers, current and potential competitors and other external factors.
Market intelligence effectiveness requires the participation of all sectors of an organization. Variety of sectors and individuals that are
aware of market needs and changes and ways of responding to them is an important factor (Kohli & Jaworski, 1993).
Kohli & Jaworski (1990) state that a horizontal communication system is an effective way of disseminating information. Since the
generation of market intelligence increases through involving all sectors and individuals, the advantages of intelligence dissemination
spread for all sectors. Each sector or person of organization can share information with others.
2.1.3 Market intelligence responsiveness
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The third function of market orientation is market intelligence responsiveness, which consists of three steps:
1- Development, design, implementation and adaptation of products and services (tangible or intangible) to meet the needs and
preferences of current and potential customers.
2- Development, design, implementation and adaptation of systems for product and service promotion, distribution and pricing in
response to the current and potential customer needs and preferences.
3- Utilization of market segmentation, diversification of products and services, and other marketing instruments in order to develop,
design, implement and adapt products, services and systems which are related to promotion, distribution and pricing.
While the purpose of intelligence generation and dissemination is to develop market knowledge (Kohli & Jaworski, 1990), the main aim of
intelligence responsiveness is to use market knowledge towards strategy recognizing, understanding, creating, selecting, implementing and
modifying responsiveness in order to face market needs and changes (Hunt & Morgan, 1995).
2.2. International experience
Company experience is one of the influential factors on gaining international competitive advantage. A company with a history of more
than a year in business may gather experiences and develops some different aspects of market. A company may recruit people who have
worked in overseas markets and have international marketing experiences. With this action, this company took the first step in international
marketing.(Naeemi ghahroodi,1997)
The value of international experience in global marketing is so clear in marketing literature (Qian & Delios, 2008). Many international
companies are looking for social rationality in marketing operations, although less experienced companies are reversed (Douglas & Craig,
1992). Experienced international companies are more likely to identify strategic markets for entering in response to the market
environmental changes (Sambharya, 1996). As the primary emphasis is on intangible skills and firm resources, performance background is
one of the physical resources of organization. (Barney, 1991). International experience enables firms to choose better markets and suitable
strategy and implement it effectively (Douglas & Craig, 1989). Empirical evidences show a positive relationship between export
performance and international experience (Wu, 2011).
2.3. Global marketing strategy
This study shows the lack of agreement on what makes global marketing strategy. This study includes three orientations (Wu, 2011).
1.
2.
3.
Standardization strategy
Coordination Strategy (Adaptation)
Integration Strategy
In standardization strategy, a company follows global marketing strategy regarding its own products, price and structure (Fritz & Dees,
2009).
Coordination or adaptation strategy is a perspective in which global marketing strategy focus on specifications and Characteristics of value
chain activities (Zou & Cavusgil , 1996). Integration strategy includes fundamental principles of global marketing strategy in order to unite
competitive movements of different sections of company in global market (Ghoshal, 1987). Global marketing strategy plays an important
role in company performance in global market. Thus, the inconsistent findings in previous studies by many scientists on various aspects of
global marketing strategy have been described (Schike et al, 2009).
Managers face two challenges of entering the global market: first, identification and definition of global strategy. Second, after knowing
what they are going to do in global market, they have to direct their efforts towards that strategy. Two groups of factors determine the type
and quality of global strategy and company’s capability to enter global markets: firstly, external factors of industry, which displays industry
capacity for globalization, and secondly, organization Internal factors that would facilitate the achievement of global strategy.
External factors refers to four factors which contains: market factors (Homogeneous market needs, global customers and
internationalization of distribution ways), economic factors ( economies of scale in global production and distribution, increased product
development costs), environmental factors ( reduction of transformation costs, communication improvement, government policies and
technology changes) and competitive factors ( global competitors, Competitive interdependence among countries and the opportunity to
benefit from a global competitor activity (Yip, Loewe & Yoshino, 1988). Organization internal factors for determination global marketing
strategy Includes structure (to centralize global authority and no gaps between different parts of a company), people (using foreign people
and frequent trips, managerial processes of global planning, global budgeting and international groups) and culture (Zou, Shaoming, 1995).
2.4. Performance
Kara et al (2005) organized market orientation consequences into four groups: organizational performance, customer accomplishments,
innovation accomplishments and staff accomplishments. Marketing strategy literature state, that market orientation provides capabilities
that lead to the best organizational performance through market sensitivity and communication with customer. Organizational performance
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consists of cost-oriented performance scales, which reflect performance after calculating the components of a strategy, and incomeoriented performance scales, which do not calculate strategy implementation costs.
Performance is one of the important concepts in managerial studies. Undoubtedly, it is the best criteria for measuring success in business
corporations. In international marketing, rate of return on investment (ROI), sales, sales growth and total performance are used as the
measures of firm performance. (Zou, cavugel, 2002). Marketers are very interested in using different strategies and directions to effect on
company performance in terms of high technology product. Success in new products and innovations may consider as a dimension of
corporate performance (Baker & Sinkula, 2005).
3.
Hypothesis development and conceptual model
There is a great interest in market orientation as an influential intangible factor on organizational performance in marketing concepts
(Homburg et al, 2003). Market orientation is a business culture that leads to performance generation with creation of superior value for
customers (Slater and Narver 2000).
Some experiential studies examined the impact of market orientation on performance. Some researchers found that market orientation
increase business performance (e.g., Chang and Chen). While others did not find any significant direct effects of market orientation on
performance (e.g., Han et al 1998; Siguaw et al., 1998). Anyway, new attitudes about market orientation process and performance indicate
that when a company reaches its values completely, market orientation requires complementary organizational competencies, then it is
recognized that how market orientation and organizational competencies represent their market orientation through established companies,
which are important resources for competitive advantage (Morgan et al, 2009). Therefore, the first and second hypotheses are as follows:
H1: Market orientation has a positive effect on company's performance.
H2: Global marketing strategy of a company comes under the influence of market orientation.
Katsikeas (2006) asserts that we can clarify some marketing strategies as a liaison for better performance through an appropriate method.
The more clarification could be obtained by standardizing and adaptation analyses at different levels of marketing (e.g., Zuo & Cavusgil,
1994). Moreover, it is possible to understand the significant relationship between global marketing strategy and performance beneath the
level of marketing mix elements (Griffith et al, 2003; Harvey, 1993; Okazaki et al, 2007; Ryans et al, 2008; and Wind, 1986).
Thus, the third hypothesis is as follow:
H3: Global marketing strategy influences the positive performance of the company.
It is expected that international experience of company will have a direct impact on marketing strategy. However, this effect could be
different among various companies. Naturally, small and medium size companies have lower global experience and resources in
comparison with large companies and their global experience is under the impact of future global strategy limitations (Prater & Ghoh,
2006). On the other hand, global marketing strategy has a great effect on performance.
Hence, the fourth and fifth hypotheses are as follows:
H4: International experience exerts an influence over global marketing strategy of the company.
H5: International experience of the company has a positive impact on performance.
There is a lack of study in the field of relationships between market orientation and international experience with global marketing strategy,
particularly in domestic industries of Iran and the existent studies show indirect and weak relationships between variables. Furthermore,
there is no comprehensive model that contains these competencies and each of these studies introduced a factor as an intermediate variable
separately. However, the relationship between international experiences and company's strategic capability to enter global markets could be
summed up in following paragraph (based on previous studies):
Each activity beyond the international boundaries such as establishing an agency, participation in other industries, exporting and
international cooperation increase our knowledge of international interactions and leads to increase in capability of global marketing
strategy and provide the company with a competitive advantage for entering a global market. Therefore, the two last hypotheses are as
follows:
H6: Global marketing strategy mediates the relationship between market orientation and performance.
H7: Global marketing strategy mediates the relationship between international experience and performance.
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Market
Orientation
Global Marketing
Strategy
Performance
International
Experience
Figure 1. Conceptual model of research
4.
Methodology
This study is an applied research in terms of purpose and a descriptive-survey research in terms of the methods used to collect and analyze
data. The research variables are market orientation, international experience, global marketing strategy and performance.
4.1. Data collection
Questionnaire is one of the best ways of collecting information in survey studies. As it is clear how to measure variables of this research,
the best method of collecting data is questionnaire. The questionnaire consisted of 23 items, with five-point Likert scales in which 19 items
are ranged from totally disagree to totally agree and also 4 items in the end of the spectrum are ranged from much weaker than competitors
to so much better than competitors. The 23 items have divided into 4 parts: market orientation with 6 items, international experience with 3
items, global marketing strategy with 10 items and performance with 4 items. Items related to market orientation consisted of three
sections: market intelligence generation, market intelligence dissemination and market intelligence responsiveness that are derived from
Kohli & Jaworski (1993). The second part items which related to international experience are derived from Cavusgil, Zou & Naidu's,
(1993) and third parts items( global marketing strategies) included 3 parts: global marketing standardization, global marketing coordination
and global marketing integration that are derived from (Zou & Cavusgil's, 2002 and finally items related to the performance are derived
from Baker & Sinkula, 2005) .
4.2. population and sample
The population of this study contains of all medium and large manufacturing firms of industrial town of Mashhad that export goods.
According to statistics of Industries and Mines Organization of Khorasan Razavi, the total number of these companies is 90.
Given that senior managers of company are the most knowledgeable people in the company, they have selected for responding to the
questionnaire. We have used probability sampling in this study. As generalization of results is very critical, simple random sampling was
used and sample size was determined by Morgan table. 75 of 90 firms were selected randomly using Morgan and Jersy table. Regarding the
researcher presence during responding process, all 75 questionnaires were returned.
4.3. Validity and reliability of instrument
All procedures relating to the validity and reliability of measuring instrument were completed. In order to examine questionnaire reliability,
all questions were obtained from reliable sources. Then pre-test was conducted to evaluate the potential problems. Besides, measurement
instrument has examined by some experts. Finally, exploratory factor analysis was used to examine structural validity. Table 1 displays the
results of exploratory factor analysis for these four variables respectively: market orientation, international experience, global marketing
strategy and performance.
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Table 1. Results of Exploratory Factor Analysis
Market orientation (MO)
International experience (IE)
Global marketing standardization (GMS)
Coordination of marketing activities (CMA)
Integration of competitive action (ICA)
Performance (P)
MO1
MO2
MO3
MO4
MO5
MO6
0.602
0.408
0.558
0.365
0.342
0.332
IE1
IE2
IE3
0.933
0.912
0.097
GMS1
GMS2
GMS3
GMS4
0.001
0.243
0.895
0.925
CMA1
CMA2
CMA3
CMA4
0.572
0.685
0.381
0.438
ICA1
ICA2
0.720
0.720
P1
P2
P3
P4
0.476
0.611
0.568
0.483
Based on the data that is shown in table 1 and with regard to Pallant's (2009), opinion items with loading factor less than o.3 should be
removed. Thus, IE3, GMS1 and GMS2 were excluded in the first stage of factor analysis. Table 2 shows the results of the second stage of
factor analysis.
Table 2. Results of Exploratory Factor Analysis
Market orientation (MO)
MO1
0.602
IE1
0.946
International experience (IE)
MO2
0.408
IE2
0.946
Global marketing standardization (GMS)
Coordination of marketing activities (CMA)
Integration of competitive action (ICA)
Performance (P)
CMA1
0.572
ICA1
0.720
P1
0.476
CMA2
0.685
ICA2
0.720
P2
0.611
MO3
0.558
MO4
0.365
GMS3
0.963
CMA3
0.381
GMS4
0.963
CMA4
0.438
P3
0.568
P4
0.483
MO5
0.342
MO6
0.332
Reliability of measurement instrument was evaluated using Cronbach's α coefficient, which is the most common test for internal
consistency of multifactor scales. Table 3display this coefficient for research variables. Table4 shows Cronbach's α coefficient after doing
factor analysis and eliminating the cases lower than quorum. The reliability coefficient alpha values above 0.6 are considered suitable for
instrument validity.
Table 3 . Results of the reliability study
P
0.709
ICA
0.612
CMA
0.688
GMS
0.602
IE
0.657
MO
0.734
Table 4. Results of the reliability study elimination measures
P
0.709
ICA
0.612
CMA
0.688
GMS
0.961
IE
0.943
MO
0.734
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5.
Data analysis
5.1. Demographic characteristic of respondents
The average age of respondents was 42 years. The average of their work experience and working in managerial posts were 17 and 12 years
respectively. The minimal amount of managerial experience is 1.5 years and the maximum amount of that is 45 years. 80% of respondents
were male and 20% were female. From the total 75 respondents, 14 people had diploma, 5 people had associated degree, 32 people had
license, 17 had master degree and 7 people had PhD. Food industry with 33.8% and agricultural industry with 1.4% of frequencies have the
most and the least frequencies among all industries respectively.
5.2. Hypotheses test
Table 6 indicates the average and standard deviation for research variables.
Table 5. Mean and Std
MO
IE
GMS
CMA
ICA
P
Mean
3.8267
2.5467
3.3333
3.8033
4.0533
3.7567
Standard deviation
0.59049
1.06280
1.09770
0.58888
0.76923
0.62327
Figure 2 shows structural equation modeling and research path diagram. As the model displays, path coefficient among variables, and their
significance level are specified. P-value is the probable value in which variable significance is examined. When the P-value is more than
0.05, indicating that path and path coefficients would not be significant, thus the related hypotheses would be rejected. Path coefficients and
P-values have been displayed on structural equation modeling.
5.3. Research hypotheses examination
Research hypotheses have been evaluated by using path coefficient and significance levels. P-value shows the significance of path
coefficient. If this value is lower than 0.05, the path and path coefficient will be approved. Otherwise, that path coefficient will not be
significant and the related hypothesis is rejected (Fornell & Larcker, 1981).
H1: Market orientation has a positive effect on company's performance.
As table 6 shows, the path coefficient between market orientation and performance is 0/39. Thus, according to the significance level
(P=0/012), which is lower than 0/05, the related hypothesis is approved.
Table 6. Path coefficient Market orientation on performance
Direct path
Market orientation→ performance
Path coefficient
0.394
S.E
0.172
Significant level
p=0.012
Hypotheses
H1
Results
Confirmed
H2: Global marketing strategy of a company comes under the influence of market orientation.
H2a : There is a significant relationship between market orientation and standardization.
H2b : There is a significant relationship between market orientation and Coordination.
H2c : There is a significant relationship between market orientation and Integration.
According to table 8, the path coefficient of the impact of market orientation on global marketing strategy elements is -0.111 for
standardization and the p-value is 0.314, which is more than 0.05, thus the related hypothesis is rejected. This hypothesis is confirmed for
coordination s (0.768), because p=value is 0.001 that is lower than 0.05. Since p-value is equal to 0.136 that is more than 0/05, this
hypothesis is rejected for the last element, which is integration (0.136).
Table 7. Path coefficient Market orientation on elements of the global marketing strategy
Direct path
Market orientation→ standardization
Market orientation→ Coordination
Market orientation→ Integration
Path coefficient
S.E
-0.111
0.768
0.136
0.229
0.075
0.235
Significant
level
0.314p=
0.001p=
p=0.281
Hypotheses
Results
H2a
H2b
H2c
Rejected
Confirmed
Rejected
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Q1
Q2
Q3
Market
Orientation
Q4
Q5
Q6
Q10
Q11
Q12
Q13
β=-0.11
P=0.31
β=0.77
P<0.01
β=0.14
P=0.28
β=0.39
P=0.01
standardization
β=-.0.00
P=0.50
Q14
Q15
β=0.45
P=0.03
Coordination
Q16
Q17
Q18
Q19
β=-0.30
P=0.01
β=0.11
P=0.14
β=-0.24
P=0.03
Q20
Q21
Performance
Q22
β=-0.02
P=0.38
Integration
Q23
β=0.16
P=0.05
Q7
International
Experience
Q8
Q9
Figure 2 . Diagram structural equation modeling and path
H3: Global marketing strategy influences the positive performance of the company.
H3a : There is a significant relationship between standardization and performance.
H3b : There is a significant relationship between Coordination and performance.
H3c : There is a significant relationship between Integration and performance.
As table 8 indicates, path coefficient of global marketing strategy elements and performance is -.001with 0.496 of p-value that is more than
0.05 for standardization, so the related hypothesis is rejected. The related hypothesis for coordination and performance with 0.450 and pvalue=0.031 that is lower than 0.05 is approved. These coefficients for integration elements are -0.017 and p=0.382, so the related
hypothesis is not confirmed.
Table 8. Path coefficient elements of the global marketing strategy on performance
Direct path
Path coefficient
S.E
Significant level
Hypotheses
Results
standardization → performance
-0.001
0.080
p=0.496
H3a
Rejected
Coordination → performance
0.450
0.237
p=0.031
H3b
Confirmed
Integration → performance
-0.017
0.056
p=0.382
H3c
Rejected
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H4: International experience exerts an influence over global marketing strategy of the company.
H4a : There is a significant relationship between international experience and standardization.
H4a : There is a significant relationship between international experience and Coordination.
H4a : There is a significant relationship between international experience and Integration.
Regarding table 9 that show coefficients of relationships between international experience and global marketing strategy elements, this
value for international experience and standardization is -.296 with the p-value of 0.011, which is lower than 0.05, the related hypothesis is
confirmed. This value for international experience and coordination is 0.106, p-value= 0.139 so the related hypothesis is not approved.
Finally, path coefficient for international experience and integration is -0.237 with significance level of 0.031 which is lower than 0.05.
Therefore, the related hypothesis is approved.
Table 9. Path coefficient international experience on elements of the global marketing strategy
Indirect path
International Experience→ standardization
International Experience→ Coordination
International Experience→ Integration
Path
coefficient
-0.296
0.127
Significant
level
p=0.011
0.106
-0.237
0.097
0.125
p=0.139
P=0.031
S.E
Hypotheses
Results
H4a
Confirmed
H4b
H4c
Rejected
Confirmed
H5: International experience of the company has a positive impact on performance.
According to table 10, path coefficient for the impact of international experience on performance is 0/15. As p=0/04 that is lower than 0/05,
the related hypothesis is approved.
Table 10. Path coefficient international experience on performance
Direct path
International Experience → performance
Path coefficient
0.159
S.E
0.095
Significant level
p=0.049
Hypotheses
H5
Results
Confirmed
H6: Global marketing strategy mediates the relationship between market orientation and performance.
H6a : Standardization intermediate the relationship between market orientation and performance.
H6b : Coordination intermediate the relationship between market orientation and performance.
H6c : Integration intermediate the relationship between market orientation and performance.
In this hypothesis, the elements of global marketing strategy are considered as intermediate variables between market orientation and
performance. As table 11 shows, not all relations between market orientation and performance with the intermediated role of global
marketing strategy were significant. Thus, it is concluded that none of the global marketing strategy elements have significant role between
market orientation and performance.
Table 11. Results of the relationship between market orientation and performance with Mediating Role of global marketing strategy
Indirect path
By variable
Hypotheses
Results
Market orientation→ performance
Market orientation→ performance
Market orientation→ performance
standardization
Coordination
Integration
H6a
H6b
H6c
Rejected
Rejected
Rejected
H7: Global marketing strategy mediates the relationship between international experience and performance.
H7a : Standardization intermediate the relationship between international experience and performance.
H7b : Coordination intermediate the relationship between international experience and performance.
H7c : Integration intermediate the relationship between international experience and performance.
In this hypothesis, global marketing strategy dimensions are considered as intermediate variables between international experience and
performance. According to the table 12, since no relations between international experience and performance accompanied by the
intermediate role of global marketing strategy were significant, none of the dimensions of global marketing strategy has effects on
international experience and performance relations.
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Table 12 . Results of the relationship between International Experience and performance with Mediating Role of global marketing strategy
Indirect path
By variable
Hypotheses
Results
International Experience → performance
International Experience → performance
International Experience → performance
standardization
Coordination
Integration
H7a
H7b
H7c
Rejected
Rejected
Rejected
Regarding approved and disapproved hypotheses, final model of this study is represented. As it is displayed in figure 3, approved
relationships are shown with a straight line and disapproved relations are shown with a dotted line.
Market
Orientation
standardization
Coordination
Performance
Integration
International
Experience
Significant relationship
Non-significant relationship
Figure 3.The final result of the research model
6.
Discussion, conclusion and suggestions
In this study, various statistical technics have been used in order to examine the intermediate role of global marketing strategy on the
relations between market orientation and international experience in industrial towns of Mashhad- Iran. Research hypotheses have
examined using PLS software. Examination of final model, which is extracted from hypotheses results, indicates that market orientation has
a positive and significant effect on performance. This result is concurred with the studies of Narver and Slater (1990), Farly, and Webster
(1993). Moreover, the relationship between international experience and performance is approved, which is in agreement with studies of
(Wu, 2011), (Barney, 1991) and (Douglas and Craig, 1989). Although the relationship between market orientation and coordinating of
marketing functions and the impact of coordinating of marketing functions on performance were significant, the impact of global marketing
strategy as an intermediate variable on the relationship between market orientation and performance has not been confirmed. Furthermore,
the intermediate role of global marketing strategy on the relationship between international experience and performance has not been
approved although the relationship between internatial experience and global marketing standardization, coordination and integration on
performance has been approved.
According to the obtained results, six following advices are recommended:
Ali Mokhtari et al.
874
Int ernational Journal of Economy, Mana ge ment and Soci al Sci ences, 2(10) October 2013
The first and most important suggestion is organizational restructuring with regard to development of internal organizational factors those
impacts on organizational strategic capability to enter a global market.
The second advice for performance increase is to transfer technology and management knowledge through management contracts,
international manager employment, educational cooperation with foreign institutes and participants by sending managerial and technical
recruits.
The third suggestion is to develop international knowledge and experience through establishing and developing an international research
and studies institute in factories and industrial towns in order to teach instructions and principles for entering global village.
Although global marketing strategy intermediate the impact of market orientation and international experience on performance, this effect
is not significant. Thus, the fourth suggestion is that industries should pay more attention to global marketing strategy. To this end,
companies need advertising to increase their popularity and decision makers have to develop their knowledge about different countries and
foreign markets environments through global market research.
Finally, according to jent and Hensi(1995) international marketing success requires various skills. One of these most important skills is
strategic skills in international marketing (Karkkainen, 2005). Therefore, it is suggested that companies that export engineering and
technical service should hold international marketing strategy courses with emphasis on strategic coordination in order to increase strategy
skills of their managers and experts.
Our research limitations consist of:
12-
3-
The time of doing this research was coincident with boycotts and price raise, which had influenced on most companies functions,
thus managers of the companies were reluctant to answer the questions.
Another limitation of this study is related to the period. The period of this study was limited. Sampling period should be broad
enough to involve all the factors that affect respondents' behavior. For example, political and economic revolutions could affect
people's behavior and decision-making.
Market orientation comes under the influence of internal and external factors. These factors are called antecedents, which include
macro and micro environmental factors and organizational internal factors. It is recommended that these factors to be considered
in future researches.
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