Sweating the Assets: Asset Leanness and Financial Performance in the Motor Carrier Industry

Originally adopted by the automotive manufacturers, lean management practices have since been applied to many other manufacturing industries. This study reviews the different theoretical perspectives on the leanness‐performance relationship in the context of the motor carriage industry. Drawing on both the lean management in logistics and organizational slack literatures, we develop hypotheses addressing the link between asset leanness and financial performance. These hypotheses are empirically tested using a comprehensive panel data set of 1,172 firm‐quarter observations from the U.S. publicly traded truckload motor carriers. Initially expecting an inverted U‐shaped relationship between asset leanness and performance, findings indicated a U‐shaped relationship, both for carriers' total assets and the subset of trailer assets.     

The Impact of Firm Capabilities and Competitive Advantages on Import Intermediary Performance

ABSTRACT

Import intermediary firms, domestic firms that serve U.S. industries by linking domestic wholesalers/retailers and foreign distributors/manufacturers, handled a whopping U.S. $1.85 trillion of commodity good imports in 2006. This study focused on these important firms by assessing the role of capabilities and competitive advantages as key determinants of import intermediary performance. The empirical results showed that market interpretation, sourcing, and service capabilities, overall, positively affected cost, product, and service competitive advantages. These competitive advantages, in turn, positively affected their relationship performance with business partners. Results, however, also indicated some interesting negative associations among sourcing capabilities, service advantages, and relationship performance with foreign partners, raising questions about extant firm performance theory.     

Who Invests in the Least Developed Countries?

Abstract

Africa is a giant market with a population of Europe and Japan combined, and highly diversified with respect to culture, natural resources, economic development, and political regimes. Yet, the continent is largely ignored with respect to research on the multinational activities of U.S. firms. In this paper, we provide the first evidence regarding the operating characteristics of U.S. firms that operate in Africa. We find that firms with operations in Africa are larger, more diversified, and more profitable than a matched control sample of multinational firms. This paper also shows that technology firms, manufacturing firms, and mining firms dominate the rest of companies operating in Africa. Certain geographical regions in Africa also seem to attract more companies than others, with Southern Africa being the most preferred region, while Central Africa is the least preferred. Finally, when a multinational firm invests in a specific country in Africa, it tends to do so in several business sectors.     

A Global Analysis of Orientation,Coordination, and Flexibility in Supply Chains

Global supply chains are growing rapidly, and the ability to manage cross border logistics operations has become a necessity to maintain a competitive advantage in a dynamic environment. This research addresses current gaps in the literature by investigating the buyer–supplier integration dynamics in a global context with a focus on the antecedents and outcomes involved in the process. Empirical data from 320 U.S. based manufacturing companies that source from overseas was collected and used to test the framework. In addition to providing empirical evidence for the importance of orientation on collaboration, operational coordination, and integration this research explains how manufacturing companies can enhance the flexibility of their global suppliers and how that impact their logistics as well as overall firm performance. Managerial and research implications are provided as well as areas for future research.     

Brands in the Basque gun making industry: The case of ASTRA-Unceta y Cía

Abstract

Basque gun making was an exception in early twentieth-century Spanish industry due to its high proportion of exports. The intense growth of handgun production during those years resulted from several factors such as Spanish patent law, the revolution in transport and communications, the electrification of manufacturing and the organisation of the sector as an industrial district. This article aims to analyse the role that brands played in this success, employing not only quantitative information but also the correspondence of one of the most important manufacturers of that time. Beyond counterfeiting, Basque gun making showed extraordinary marketing performance in which branding strategies were decisive for its success.     

Bonding Ties,Bridging Ties,and Firm Performance: The Moderating Role of Dynamic Capabilities in Networks

ABSTRACT

Purpose: Building on the dynamic capabilities view and the configuration of network ties, this study investigates how dynamic capabilities moderate the relationships between bonding and bridging ties and firm performance, thus an area with potential to explain the divergent empirical results contained in the existing literature on the relationship between intra/extraorganizational ties and performance.

Methodology: This study employed a mail survey to senior executives. A total of 169 firms operating in an industrial district were collected. Regression analysis was employed to test the proposed model.

Findings: This study found that the combination of dynamic capabilities and bonding/bridging ties helps improve firm performance. Furthermore, this study found a positive relationship between bonding ties and firm performance, but no equivalent relationship for bridging ties.

Research Implications: Research results indicate that firm performance is significantly enhanced by bonding ties, which provide opportunities for sharing information and exchanging resources. Moreover, the empirical results reaffirm the proposition that dynamic capabilities are important transformational mechanisms for managing resources.

Practical Implications: The findings reveal that managers can improve firm performance by simultaneously building social ties and developing and implementing dynamic capabilities.

Originality/Value: This study demonstrates that the components of dynamic capabilities (i.e., sensemaking and reconfiguration) are transformational mechanisms and can moderate the positive relationship between bonding and bridging ties and firm performance, empirically supporting recent perspectives from the literature on dynamic capabilities and social networks.     

Strategies of Developing Country Exporters: Empirical Evidence from Zimbabwe's Manufacturers

Abstract

This study uses data from a 1999 survey of manufacturing exporters in Zimbabwe. The paper focuses on export strategies of the manufacturers. It uses correlation and regression analysis to find which export strategy variables significantly account for performance. Results show three strategies positively impacting on performance. These are standardisation vis-ä-vis customisation, finish status of the export product, and promotion by agents and distributors. Two variables are significantly but negatively impacting on performance. These are current organisational structure and visits to clients as part of promotion. Strategy variables outlined above explain more than 50% of variation in export performance of Zimbabwe's manufacturers.     

Logistics Information System Evaluation: Assessing External Technology Integration and Supporting Organizational Learning

Firms often outsource the development and acquisition of logistics information systems (LIS) needed to improve logistics processes. Managers tasked with such outsourcing decisions often struggle to understand and balance the external technology's impact on existing logistics processes, individual stakeholders, firm strategies, and the financial and operational performance of the firm. Unfortunately, research is limited on (1) methods for evaluating the performance capabilities of systems from external sources prior to full implementation, and (2) the impact of external technology integration (ETI) on organizational behavior and learning related to a firm's logistics processes. Through the lens of organizational learning (OL) theory, this research uses a case study approach to examine the transportation division of a major U.S.‐based fuel retailer to gain insights on the management control of ETI efforts. The study builds theory to fill important literature gaps then develops a conceptual framework and supporting propositions to inform future research on logistics ETI. The findings highlight important OL implications for firms involved in ETI efforts and also provide a practically relevant management control tool that can be used by logistics practitioners.     

The Power of Innovativeness in Manufacturer–Retailer Relationships

ABSTRACT

Purpose: Retailers often challenge manufacturers through aggressive store brand policies and severe listing constraints. This study investigates manufacturer innovativeness as a managerial lever to shift the power balance between manufacturers and retailers.

Methodology/approach: Using data from 277 senior managers of Swiss and German consumer goods manufacturers and analyzing these data with structural equation modelling, the authors test hypotheses about the impact of manufacturer innovativeness on manufacturer–retailer relationship characteristics (i.e., retailer dependency, store brand aggressiveness, and listing constraints).

Findings: The study demonstrates that manufacturer innovativeness enhances retailer dependency, which in turn positively affects overall manufacturer performance. This relationship can be explained further: By increasing retailer dependency, manufacturers suppress retailers’ store brand aggressiveness and attenuate retailers’ listing constraints. Store brand aggressiveness affects overall manufacturer performance through listing constraints.

Research implications: Identifying levers such as innovativeness that assist manufacturers in fostering their power over retailers provides a new mode for understanding how manufacturers can influence the balance of power between manufacturers and retailers. The study provides support for the approach/inhibition theory of power on the inter-organizational level. Organizations with increased power are assumed to have approach-related tendencies and act in goal-consistent manner, whereas organizations with reduced power are assumed to develop the tendency to pursue inhibition-related actions, e.g., attending to threats. Furthermore, this study identifies channel relationship characteristics such as retailer dependency as a mediating path between manufacturer innovativeness and performance.

Practical implications: Managers need to strengthen the firm’s innovative capacity to enhance the performance of their companies. By developing the capability to provide radical innovations, manufacturers are able to enhance their performance not only directly but also indirectly by strengthening the manufacturer’s position with regard to retailers. This study underscores the relevance of innovativeness for strengthening the manufacturer’s position in its relationship with retailers that avoids problems with aggressive store brands and constrained listing conditions.

Originality/value/contribution: This study proposes manufacturer innovativeness as a managerial lever to shift the power balance between manufacturers and retailers.     

We Have Never Been Secular: Religious Identities,Duties, and Ethics in Audit Practice

Contemporary research highlights multiple societal and environmental benefits in addition to potential economic advantages associated with renewable energy (RE) utilization. As federal and state incentives for investments in RE technologies become more prevalent, RE sources represent increasingly viable alternatives to established fossil fuel energy. RE utilization is recognized as a key component of “green” product innovation that helps firms reduce the environmental impact of production processes and diminish their ecological footprints and energy consumption. Yet, despite consistent evidence that corporate sustainability initiatives are favorably associated with firm performance, the limited research that examines associations between RE initiatives and firm performance yields mixed results and an explicit link has yet to be established. Drawing on the natural resource-based view of the firm, we examine the association between RE utilization and firm financial performance over time. Annual ROI, Tobin’s Q, and operating margin for large U.S. firms identified as exceptional users of RE in the EPA’s Fortune 500 Top Green Power Partners list are compared with their respective industry medians over a 7-year period (2007–2013) and post hoc bootstrapping and sensitivity analyses are performed to further validate the study findings. Our research advances current knowledge about the influence of RE utilization by demonstrating that top RE user firms consistently generated superior financial performance compared to their industry competitors. As such, the study findings lend credence to the existence of a business case that complements the societal and environmental benefits of RE utilization.     

Manufacturing servitisation and duration of exports in China

In recent years, manufacturing servitisation has become a growing characteristic of global firms. Firms develop their service factors, to realise more values and increase their international competitiveness. China, as an important manufacturing centre of the world, has abundant manufacturers seeking for getting more involved in the international market. This paper makes use of detailed customs data and firm‐level data from China, to find how the servitisation in China affects the export durations of Chinese manufacturers. The results demonstrate that manufacturing servitisation input in China contributes to export performance. The service factors have become the important production factors in Chinese manufacturing enterprises. However, China is still at the primary stage of manufacturing servitisation, and Chinese manufacturing enterprises should pay more attention to the whole value chain and seek the transformation from a pure manufacturing enterprise to a service manufacturing enterprise.     

Global competitive conditions driving the manufacturing location decision

Given today's rapidly shifting global competitive conditions—including customer location, natural disasters, currency valuation, labor and transportation costs and availability—many U.S. companies are revisiting decisions about their preferred manufacturing location(s). The purpose of this research is to understand some of the trends that affect whether U.S.-based companies bring their production back to the United States or relocate it to different geographical locations (reshore). The focus is on the key factors that affect companies’ manufacturing location decisions, the importance of these factors, and how the importance has changed over time. Because of the complexity involved in the manufacturing location decision, key risk factors inherent in the manufacturing decision are also assessed. Survey responses from 319 companies that currently manage offshore manufacturing plants are analyzed. Among other insights, this study found that 40% of these companies perceived a trend toward reshoring to the U.S. in their industries. The companies involved in this study also place an increasing importance on where their customers want them to locate, as well as how the location could help expand into new customer markets. These and further results and implications for U.S. manufacturing companies are presented herein.     

Competitive advantage and the transformation of value chains over time: The example of a South Korean diversified business group, 1953–2013

We examine the historical evolution of different elements in value chains that create value-added and competitive advantage. This is achieved by using the conceptual model of the ‘smile curve’ with a longitudinal case study of a diversified business group, CJ Group, a former affiliated firm of Samsung Group. We found that the value-added structure graph in the industrialisation period displayed an ‘upside-down U shape’, indicating that production and manufacturing were the most value-adding sectors. However, in the more recent knowledge-based economy period, the graph shows a quite different shape, indicating R&D, firm infrastructure, manufacturing, logistics, service, and marketing as sources of value-added. This shows that competitive advantage diversified into other fields to fit with the changed economy. We also investigate what type of organisational structure, strategy, and capabilities were adopted for organisational change. We found an evolution, with an unrelated diversification strategy by altering capabilities from contacts and generic to organisational and technological capabilities.     

The Impact of U.S.-Sponsored Foreign Trade Office Activities

ABSTRACT

Foreign trade offices (FTOs) are an important, little-understood element in the export promotion portfolio of U.S. state export promotion organizations. The value of these organizations is in dispute. In recent years California closed its FTOs in response to budgetary pressures, claiming that these organizations exist primarily to enhance the political standing of politicians rather than to act as effective export development tools. During the same period Washington State opened several new FTOs. Clearly the value of these organizations is in dispute. Another consideration in the effectiveness of U.S. exporters is the subnational contour of the American economic system. State business climates vary considerably, thereby influencing exporter success as well as those programs (such as FTOs) intended to improve firm performance. We hypothesize and find that (a) state entrepreneurial climate is positively related to state exports and (b) FTO network entry activities amplify the impact of state entrepreneurial climate on state exports. Implications for firms and policy makers are explored.     

The effect of technology management capability on new product development in China’s service-oriented manufacturing firms: a social capital perspective

Abstract

Technology management capability (TMC) and new product development (NPD) are important for China’s service-oriented manufacturers to achieve competitive advantage. In this study, TMC is conceptualized as comprising of four sub-level capabilities: searching, selecting, implementation and learning capabilities. Drawing from the theory of social capital, we hypothesize that social capital plays a role in the relationship between TMC and NPD performance. Our findings indicate that NPD performance and social capital are influenced by all the four sub-capabilities of TMC but the effect of each capability of TMC varies. Selecting capability is more significantly and positively related with NPD performance, while learning capability exerts the most significant positive effect on social capital. Moreover, our empirical findings indicate the partial mediating role of social capital in the process of TMC influencing NPD performance. This study makes a particular contribution to the literature by providing a more complete understanding of how social capital plays a role in the relationship between TMC and NPD performance. In terms of managerial implications, our results indicate that improving TMC is essential in enhancing a service-oriented manufacturing firm’s NPD performance. Managers should also pay particular attention to nurturing social capital as a pathway to realize the true value of TMC.     

Exploring the Role of Product Development Capability for Transforming Marketing Intelligence into Firm Performance

ABSTRACT

Purpose: This study examines the role of product development capability for transforming marketing intelligence activities into firm performance on industrial markets.

Methodology/Approach: The authors apply structural equation modeling to analyze survey data from 342 industrial manufacturing companies.

Findings: Results reveal that sales integration and holistic macroeconomic view are particularly important features of the marketing intelligence capability on industrial markets to gain additional insights in order to develop products successfully. Results also reveal that product development capability transforms the marketing intelligence activities into firm performance on industrial markets.

Research Implications: This study offers new insights on marketing theory by extending and concretizing the concept of market orientation to a broader concept of the marketing intelligence capability for industrial markets. Further, this research reveals that the product development capability serves as a mediator to business performance.

Practical Implications: This study’s systematic and tangible outline of the dimensions of marketing intelligence and its link to the product development capability helps firms to better understand how to capitalize on market orientation’s potential values.

Originality/Value/Contribution: This research (a) reveals the relevant dimensions of marketing intelligence on industrial markets and (b) shows how the product development capability tranforms marketing intelligence activities into firm performance on industrial markets.     

The Pricing Processes of Exporters

Abstract

Within the realm of research regarding the successful implementation of exporting strategies lies the often neglected topic area of export pricing. This subject has received relatively little attention over the years for a number of reasons, including a lack of formal export pricing theory and a reluctance among international managers to discuss their pricing practices. Concurrently, what research that has been conducted on this issue has been largely undertaken from the single country perspective. Future research, both exploratory and empirical, is called for.

This study attempts to define what export pricing strategies and processes are currently being utilized by exporting firms, what influences the adoption of these strategies, and how these strategies differ across cultures. Through a series of interviews with export managers from U.S. and Mexican manufacturing firms, an exploratory case study analysis was conducted to address four major issues, namely (1) what are the export pricing processes of the firm, (2) how do stated export objectives relate to these strategies, (3) what are the perceived barriers to the successful implementation of pricing practices, and (4) how do these factors differ between Mexican and U.S. exporters.     

International Catalog Mix Adaptation

Abstract

Striking the right balance of adaptation of the international catalog mix may be the key to profitability. U.S. catalog firms, new to international markets, have less experience in adapting than firms in more globalized industries. The literature on international marketing strategy adaptation reveals that this decision depends on the environment, industry, market, product, and characteristics of the firm. This paper examines the influence of market similarity, type of business and the firm's international experience on international catalog adaptation, and explores the effects of catalog adaptation on a firm's performance. We hypothesize that the greater the market similarity, the less likely it is that firms will adjust their catalog. We also argue than adaptation is greater for consumer catalogs than for business-to-business catalogs. A third hypothesis is that more internationally experienced firms will adapt more and a final hypothesis is that a greater degree of adaptation will increase the international catalog performance. The results did not support the association of international catalog adjustment and market similarity, experience, and type of catalog. Findings are mixed both on catalog adaptations and firm performance. We found that some but not all adaptations in the catalog lead to improved performance. We speculate that U.S. catalog firms are making adaptations to reduce the costs of international marketing operations. This cost reduction strategy may not necessarily lead to profitability, thereby discouraging other firms from entering international markets.     

Firm heterogeneity and location choice of Taiwanese multinationals

This paper examines the extent to which production location decisions of Taiwanese multinationals reflect underlying patterns of firm productivity. In our theoretical model, heterogeneous firms in a middle-income country decide on the optimal production locations for serving three geographically separate markets: domestic, foreign high-income and foreign low-income. The model shows that the equilibrium decision of a firm depends on the fixed investment costs of establishing foreign subsidiaries, production costs, transportation costs, market size and its own productivity level.Using firm-level data in 2000, Taiwanese electronics firms are divided into four different categories: non-FDI, investors in China only, investors in the U.S. only, investors in both China and the U.S. We use a multinomial logit model to link firms' location choices with their productivity, controlling for country, industry and other firm characteristics. Our empirical results are consistent with the predictions of the theoretical model. We show that more productive firms engage in outward FDI, with the most productive ones investing in both China and the U.S. We also provide evidence indicating that Taiwanese multinationals investing only in the U.S. are more productive than those investing exclusively in China due to smaller fixed investment costs in China relative to the U.S.     

The impact of internal,external, and competitor factors on marketing strategy performance

ABSTRACT

Strategy formulation is commonly understood as the match between a firm’s internal resources and skills and its external environment. Marketing strategy performance is the function of a dynamic, interactive process incorporating internal firm resources, external environmental factors, and competitive actions. The study aims to assess the impact of competitor actions on marketing strategy performance. We develop a model that accommodates the effects of 29 variables (comprising internal marketing strategy variables, external environmental factors and competitors’ marketing mix variables) on business performance. We empirically test the model using simultaneous equation modelling of time-series data on UK car manufacturers collected from publically available resources and annual reports. The results show that external factors, in particular competitors’ marketing mix elements, have a greater influence on a company’s business performance than internal (marketing and non-marketing) strategy variables. Implications for marketing theory and management are discussed.