Market orientation, guanxi, and business performance

The purpose of this research is to investigate the role of guanxi in the relation between market orientation (MO) and business performance (financial and strategic). In this study, based on prior findings, we have proposed that an interaction between MO and business guanxi is likely to be positively related to both financial and strategic performance. The interaction between MO and political guanxi is proposed to be negatively associated with financial and strategic performance. In this study we focus on the competitor orientation and interfunctional coordination of the MO components. Our findings advance the existing guanxi and MO-performance literature by revealing that; (a) business guanxi has both positive and negative effects on business performance (financial and strategic), (b) political guanxi has both positive and negative moderation effect on financial performance and a negative influence on strategic performance, (c) the alignment of guanxi and MO can be extended to the MO competitor and interfunctional coordination components, and (d) a proper match between guanxi and the MO elements is important. The outcomes of this study have implications for marketing managers and research concerning MO, guanxi, and business performance.     

Market orientation, interdepartmental integration, and product development performance

Various research studies have shown that a market orientation and interdepartmental integration can positively influence product development performance. Addressed in this article is whether market orientation and interdepartmental integration both equally influence product development performance, whether one of these constructs is more influential than the other, and whether such influence is dependent on the type of department being examined? Analyzing survey data from 156 marketing, manufacturing, and R&D managers, the tentative results suggest that a market orientation and interdepartmental integration correlate to improved product development and product management performance in varying degrees across these three manager sets. It appears that a positive relationship between market orientation and product development petformance is likely to be reflected by the marketing department, while marketing and manufacturing departments are likely to reflect a positive relationship between the general construct of market orientation and product management performance. Manufacturing managers also reflect a positive relationship between interdepartmental integration and product development and product management performance. Further analyses involving the elements of a market orientation and interdepartmental integration find that a customer orientation appears important to performance in the case of marketing managers, and that collaboration is important to performance in the case of manufacturing managers. R&D managers did not reflect any statistically significant relationships between market orientation, interdepartmental integration, their constructs, and performance. These results should not be taken as refuting the claim of an important relationship between market orientation and product development performance, however. The present results refine our understanding of market orientation to consider department‐specific effects, as well as temper the claims that implementing a market orientation will readily lead to improved product development performance across all departments in an organization. This may or may not be the case, depending on the focal department.     

Mental models,decision rules,and performance heterogeneity

This paper focuses on the role of managerial cognition as a source of heterogeneity in firm strategies and performance. We link differences in mental models to differences in decision rules and performance in a management simulation. Our results show more accurate mental models lead to better decision rules and higher performance. We also find that decision makers do not need accurate knowledge of the entire business environment; accurate mental models of the key principles are sufficient to achieve superior performance. A fundamental assumption in much of strategic management is that managers who have a richer understanding about organizational capabilities and the dynamics of industry structure can improve the performance of their firms. Our findings provide empirical evidence supporting this assumption and show that differences in mental models help explain ex ante why managers and firms adopt different strategies and achieve different levels of competitive success. Copyright © 2010 John Wiley & Sons, Ltd.     

Teams,Autonomy, and the Financial Performance of Firms

I estimate a structural model of teams, autonomy, and financial performance, using a cross section of British establishments. My findings suggest that team production improves financial performance for the typical establishment but that autonomous teams do no better than closely supervised or nonautonomous teams. I find that unobserved factors increasing the propensity to adopt teams are positively correlated with unobserved determinants of financial performance, and that unobserved factors increasing the propensity to grant teams autonomy are negatively correlated with unobserved determinants of financial performance when teams are adopted.     

Team Racial Composition, Member Attitudes, and Performance: A Field Study

Attitudinal, performance, and demographic data from 1200 workers on self-directed teams are examined to determine if racial composition affects team performance, if African-Americans and whites have different attitudes toward their teams and team performance, and whether any differences explain performance differences associated with different racial composition. Results indicate that racial composition affects team performance and racial differences in team and performance-related attitudes. Differences in attitudes reduce, but do not eliminate, racial composition effects on team performance.     

Contract,cooperation, and performance in international joint ventures

This study examines how contract, cooperation, and performance are associated with one another within international joint ventures (IJVs). We argue that contract and cooperation are not substitutes but complements in relation to IJV performance. An IJV contract provides an institutional framework guiding the course of cooperation, while cooperation overcomes the adaptive limits of contracts. Our analysis of 293 IJVs in a dynamic market demonstrates that previous cooperation bolsters contractual adaptability, which in turn nurtures current cooperation between the same partners. We find that contract completeness and cooperation drive IJV performance both independently and interactively. When contracts are more complete, cooperation contributes more to performance. Contract and cooperation differ in their quadratic effects such that the contribution of contract completeness to performance declines as completeness increases but the contribution of cooperation remains linear. Copyright © 2002 John Wiley & Sons, Ltd.     

CEO duality,organizational slack,and firm performance in China

CEO duality, organizational slack, and ownership types have been found to affect firm performance in China. However, existing work has largely focused on their direct relationships with firm performance. Advancing this research, we develop an integrative framework to address an important and previously underexplored question: How do CEO duality and organizational slack affect the performance of firms with different ownership types? Specifically, we compare the moderating effects of CEO duality on the relationship between organizational slack and firm performance in China’s state-owned enterprises (SOEs) and private-owned enterprises (POEs). Findings suggest that there is a positive relationship between organizational slack and firm performance, and that CEO duality negatively moderates this relationship in SOEs, but positively in POEs.     

Market orientation,job satisfaction,product quality,and firm performance: evidence from China

This article examines the processes by which market orientation (MO) affects performance using a cross‐level approach. The results of a survey of 2,754 employees from 180 firms in China show that organization‐level MO culture leads to unit‐level MO behavior, which improves employee‐level job satisfaction and then product quality, which in turn fosters organizational performance. In particular, MO behavior fully mediates the effects of MO culture on employee satisfaction, product quality, and organizational performance. Leadership quality strengthens the effect of MO culture on unit‐level MO behavior. Moreover, MO behavior enhances firm performance indirectly through employee job satisfaction and product quality. Copyright © 2008 John Wiley & Sons, Ltd.     

MNC strategies,exogenous shocks,and performance outcomes

This paper examines the effect of international diversification on multinational corporation (MNC) performance in the face of exogenous shocks in the global business environment, and the extent to which MNCs' internationalization aids or impedes post‐shock performance. We use the September 11, 2001 attacks as a research setting to investigate the relationship between international diversification and MNC performance after a sudden change in the environment. The empirical tests on a sample of 191 U.S. MNCs and a matched sample of non‐U.S. MNCs indicate that the level of pre‐September 11 international diversification is negatively correlated with immediate cumulative abnormal returns to shares, but positively correlated with longer‐term performance. Copyright © 2011 John Wiley & Sons, Ltd.     

Geographic scope,product diversification,and the corporate performance of Japanese firms

The study extends research on the geographic scope, product diversification, and performance relationship by exploring both the antecedents and consequences of geographic scope. In so doing, it addresses a fundamental criticism of the geographic scope–performance relationship; namely, that the observed positive relationship between geographic scope and performance is spurious because it is the possession of proprietary assets that is the foundation of superior performance, not expansion into international markets per se. We tested the research model with data on the corporate performance of 399 Japanese manufacturing firms. In the partial least squares analyses used to examine the study’s six main hypotheses, we demonstrate that geographic scope was positively associated with firm profitability, even when the competing effect of proprietary assets on firm performance was considered. Further, we find that performance was not related to the extent of product diversification, although investment levels in rent‐generating, proprietary assets were related to the extent of product diversification. Copyright © 1999 John Wiley & Sons, Ltd.     

Meta-analytic reviews of board composition,leadership structure,and financial performance

Careful review of extant research addressing the relationships between board composition, board leadership structure, and firm financial performance demonstrates little consistency in results. In general, neither board composition nor board leadership structure has been consistently linked to firm financial performance. In response to these findings, we provide meta-analyses of 54 empirical studies of board composition (159 samples, n = 40,160) and 31 empirical studies of board leadership structure (69 samples, n = 12,915) and their relationships to firm financial performance. These—and moderator analyses relying on firm size, the nature of the financial performance indicator, and various operationalizations of board composition—provide little evidence of systematic governance structure/financial performance relationships. © 1998 John Wiley & Sons, Ltd.     

Self‐selection,endogeneity, and the relationship between CEO duality and firm performance

This study focuses explicitly on the methodological implications of the endogenous theory of governance as applied to firm performance. In particular, if firms choose their governance structures as part of a constrained performance maximization process, then application of an appropriate empirical methodology should reveal statistical evidence of such behavior. In this study we take advantage of the endogenous switching regression model framework to determine whether such predicted optimizing behavior can be corroborated by the data. The model allows us to test explicitly for selection behavior in accordance with comparative advantage and, concomitantly, the presence of selectivity bias, in estimating the impact of CEO duality on firm performance. The selection and performance equations are modeled in accordance with the extant accounting, economics, and management literature on the impact of the dual governance structure on firm performance. Overall, we tested four performance measures for the entire sample of firm‐year observations as well as for the largest three industries in terms of sample sizes. The major finding, robust in all cases, is that there is no evidence to support a contention that CEO duality is a structure purposefully chosen for optimizing performance. If firms are indeed choosing the dual leadership structure, they are doing so for reasons other than improving performance from what it would be otherwise. In fact, for performance measured as market return and earnings per share, there is evidence of a significant selectivity bias that acts to lower performance below what it would have been under random assignment. For performance measured by Tobin's q and return on assets, we found neither evidence of selectivity bias, nor any significant marginal performance impacts of CEO duality. Such findings are inconsistent with an endogenous governance theory, at least when applied to firm performance. Copyright © 2009 John Wiley & Sons, Ltd.     

Corporate social performance,analyst stock recommendations,and firm future returns

This study posits that security analysts heed corporate social performance information and factor it into their recommendations to general investors. In particular, as corporate social performance is often uncertain and ambiguous to general investors, analysts may serve as the informational pathway connecting corporate social performance to firm stock returns. Thus, we argue that analyst recommendations mediate the relationship between corporate social performance and firm stock returns. On the basis of not only a qualitative study with literature searches and interviews of stock analysts but also a quantitative study with two longitudinal samples of large firms, we find support for these arguments. Our findings uncover an information‐based underlying mechanism for the link between corporate social performance and financial performance. Copyright © 2013 John Wiley & Sons, Ltd.     

Order, positioning, scope and outcomes of market entry

This research aims to analyze the relationships between three dimensions of the market entry strategy for new products - order, positioning and scope - and four dimensions of performance - customer satisfaction, competitive position, costs and profitability. The consideration of internal links between the entry dimensions, together with their effect on the different performance variables, will enable us to determine the existence of mediating effects, which up until now have barely been examined in the literature. We test our model on a cross-sectional sample of 136 manufacturing firms, applying structural equation modeling based on the Partial Least Squares (PLS) methodology. Our findings reveal that all the three strategic decisions included in our model of market entry do affect performance, although their influence changes according to the performance dimension being measured.     

Managerial ties,firm resources,and performance of cluster firms

Previous research has documented the relationship among managerial ties, firm resources, and performance in emerging economies such as China. While managerial ties may be embedded in a particular location, some of these ties may be non-location-bound. Therefore, for firms located within one geographically concentrated cluster, how do managerial ties and firm resources affect performance? Using data from 163 firms in two Chinese clusters, we demonstrate that managerial ties and firm resources—independently and in combination—help firms improve market performance. Results support the view that both network-centered strategies (utilizing managerial ties) and market-centered strategies (leveraging firm resources) are critical determinants of firm performance.     

Mergers,acquisitions, and the pruning of managerial deadwood

This research investigates the role that mergers and acquisitions may play in the disciplining of entrenched and inefficient managers. The relationship between a company's performance history and its subsequent top management turnover is assessed for a sample of target companies, their parents, and a control group of companies not involved in merger and acquisition activity. The results reveal that target company top management turnover is higher than ‘normal’ in the 2 years immediately following a merger or acquisition, but there is no relationship between previous target company performance and its subsequent top management turnover. Further analyses indicate that first-year target company turnover rates are associated with a history of relatively poor parent company performance, while second-year turnover rates are associated with a history of relatively good parent company performance.     

Relationships between innovation stimulus, innovation capacity, and innovation performance

This paper examines the integration of the human and technological aspects of innovation management by modelling the innovation stimulus – innovation capacity relationship in determining innovation performance. The research framework developed in this study was tested amongst 194 managers of Australian firms. The survey responses indicate that both the relationships between innovation stimulus and innovation capacity and between innovation capacity and innovation performance are significant and strong. However, innovation stimulus does not show any direct effect on innovation performance, suggesting that its effect is mediated through innovation capacity. The overall practical implication that can be drawn from the findings is that to achieve high innovation performance, organizations first need to develop the behavioural and cultural context and practices for innovation (i.e. stimulus), and only within such conducive environments is it possible for organizations to develop innovative capacity in research and development and technology so as to more effectively deliver innovation outcomes and performance.     

Export intensity,scope, and destinations: Evidence from Brazil

How do the three dimensions of geographic export diversification—namely, (1) export intensity, (2) export scope, and (3) export destinations—interact in determining firm performance? How does the export intensity–performance relationship change considering export scope and destinations? Drawing on institution-based and resource-based lenses, we argue that differences between home and destination country institutional environments are amplified by the scope or variety of export destinations. As firm resources nurtured in the home country may not fit an increasing number of different foreign institutional environments, the export intensity–firm performance relationship turns negative. Conversely, our panel data analysis suggests a positive relationship between export intensity and performance when exporters from an emerging economy increase their exports to a limited number of other emerging economies. Thus, our findings extend conventional wisdom on the export intensity–firm performance relationship and suggest that the international marketing strategy literature needs to simultaneously incorporate three dimensions (including export destinations) into the geographic export diversification construct.     

Synergy,environmental context,and new product performance: A review based on manufacturing firms

This study adopts a meta-analytic approach to review the effects of technology synergy, marketing synergy and environmental context on new product performance by aggregating the empirical evidence documented in studies published from 1979 to 2011. Based on this aggregation, the results from a structural equation analysis show that (a) increasing technology and marketing synergies improves new product performance and the performance effect of marketing synergy is stronger than that of technology synergy; (b) increasing technology synergy enhances product advantage, which increases new product performance, whereas increasing marketing synergy does not; (c) increasing technology and marketing synergies may hinder product innovativeness; and (d) improving product innovativeness increases new product performance through product advantage. These findings suggest that ignoring the intermediary roles of product advantage and innovativeness may lead to an incomplete understanding of the relationships among technology and marketing synergies, environmental context, and new product performance. The results also demonstrate that technological turbulence affects new product performance through product innovativeness and advantage; in contrast, market intensity has a direct effect on new product performance. Future studies can examine the relationships among synergy, product effectiveness, and new product performance by constructing a mediated moderation or moderated mediation framework based on the environmental context.     

Uncertainties, resources, and supplier selection in an emerging economy

Focusing on supplier selection, this article addresses two questions: (1) What are the antecedents that lead to the adoption of various types of selection strategies? (2) What impact do these strategies have on supplier performance? We build a research model showing how both the uncertainty-based and resource-based views drive market-focused and relationship-focused supply selection strategies. Further, we argue that market-focused and relationship-focused selection strategies may have different effects on supplier performance. Specifically, market-focused selection has a positive influence, whereas relationship-focused selection has an inverted U-shaped effect on supplier performance. In addition, the interaction between these two strategies exerts a significant positive influence on supplier performance. Survey data collected from 208 Chinese manufacturers are used to test our hypotheses.