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.     

Leveraging Family‐Based Brand Identity to Enhance Firm Competitiveness and Performance in Family Businesses*

Drawing on the family‐embeddedness perspective on entrepreneurship and the resource‐based‐view of the firm, we investigate how the promotion of family‐based brand identity influences competitive orientation (customer versus product) and firm performance in family businesses. Applying structural equation modeling to survey data collected from leaders of 218 family businesses, we demonstrate that developing a family‐based brand identity positively contributes to firm performance (growth and profitability) indirectly, via a customer‐centric orientation. In contrast, attempts to leverage family‐based brand identity via a product‐centric orientation do not impact firm performance. Our results suggest that family‐based brand identity enhances the family business' ability to persuade customers to make purchasing decisions based on the perceived attributes of the seller. As a result, we contribute to the discussions centered on how to optimize the intricate synergy between family and business.     

A Cross‐Disciplinary Examination of Firm Orientations’ Performance Outcomes: The Role of Supply Chain Flexibility

Although market orientation (MO) has long been considered an important business philosophy, the examination of MO outside the firm's boundaries has been rather limited. To address this, this study explores how supply chain orientation and operational flexibility (FLX) facilitate the implementation of MO. Although the positive impact of MO on firm performance has been well established, this study highlights that such benefits are enhanced by the development of supply chain related capabilities. Results indicate that market‐oriented firms are more likely to realize the strategic importance of managing the supply chain when operating under conditions of high environmental munificence, dynamism, and complexity. This provides a better understanding of the complex relationship between the demand and supply sides of the firm. This study highlights the importance of marketing theory and concepts to supply chain management scholars, and vice versa. This further accentuates the importance of eliminating the disconnect between supply and demand‐management processes, also described as the “Great Divide” (Drucker 1973; Esper et al. 2010a,b). A number of key managerial implications are offered as well.     

Corporate Diversification and Firm Value: Evidence from Post‐1997 Data*

In 1997, SFAS 131 established a new segment‐reporting standard for US public companies. Using measures of diversification based on the diversity in segment‐industry characteristics and controlling for endogeneity of the diversification decision, we document a diversification premium in our post‐1997 period. We find significant positive effects of cash flow diversity, leverage diversity and profitability diversity on excess value, consistent with the efficient internal capital market hypothesis. We also find that the size of the diversification premium in the post‐1997 data is negatively correlated with the degree of diversification and positively correlated with firm size. In contrast, we find that the pre‐1998 data typically generates a diversification discount, but the effect is statistically less significant when endogeneity is controlled for. Thus, the diversification discount documented in earlier studies can be an artifact of the pre‐1998 data or a failure to control for endogeneity.     

A High‐Growth Firm Contingency Test of the Formalization‐Performance Relationship

The effect of formalization in high‐growth firms' performance is still unclear. We propose that formal commitment‐based human resource practices contribute positively to the financial performance of established high‐growth firms but have little effect on emergent ones. Using a sample of 101 Portuguese high‐growth firms (2006–2009 period), we tested the effect of formal HR practices during the high‐growth period in their financial results two years later (2011). Our results suggest that adopting a formal performance appraisal and a formal R&D function contributed positively for the performance of only established firms, while adopting a formal training activity negatively affected the performance of only emergent firms.     

Explaining the Strategic Groups–Firm Performance Relationship: A Multilevel Approach Applied to Small and Medium‐Sized Hotel Companies in Spain*

One of the main research questions in the field of strategic management is why firms obtain different performance levels. This paper answers this question from the strategic groups approach. This paper analyzes the linkage between strategic groups and firm performance offering a multilevel analysis about the relative importance of intergroup and intragroup performance differences based on the use of hierarchical linear models. The results show that intragroup differences explain firm performance better than intergroup differences.     

New Product Development Process Implementation in a Business-To-Business Firm: The Driving and Moderating Factors for Improved Program Performance and Time-To-Market

Purpose: The study aims to examine the critical factors affecting the implementation of a formalized new product development (NPD) process in a business-to-business (B-to-B) company with product-driven growth.

Methodology/approach: Case study using a combination of survey, artifacts, and long interviews

Findings: The findings suggest that (1) the initial phase proficiency can improve NPD effectiveness (NPD program performance) and NPD efficiency (i.e., time-to-market), but this relationship is moderated by the effective communication of the new NPD process throughout the entire firm; (2) the process formalization enhances time-to-market and NPD program performance, but its effects are asymmetric and contingent upon the decision concerning the inclusion of ad hoc and extended NPD team members; and (3) the product approval (executive) committee’s (PAC) ineffective communication could alienate team members from NPD efforts while resource availability moderates the influence of PAC’s decision making quality on time-to-market.

Research implications: Future research could examine the PAC decision-making quality as a multidimensional construct, composed of rigor and timeliness dimensions. That way, a more granular understanding of the effect of PAC decisions could be achieved. Future studies could make a clear distinction of the NPD process type in the study context when NPD decisions are examined.

Practical implications: Managers should acknowledge that decision-making processes and their comprehension by worker bees affect an NPD program’s success. It is interesting to note that removing go-no go decisions by the product approval committees at each phase may not lead to faster product development as these executive committee meetings have double entendre: they are not only to get the executives informed and get their signoff, but also is a facilitator to capital approvals. Hence, appropriate measures must be taken to remove or ease all bottlenecks in the NPD process.

Originality/value/contribution: This study uncovers several crucial factors that can improve the effectiveness and time-to-market of an NPD program in B-to-B companies, especially when firms implement a new formalized NPD process.     

Role of Family Resources in Firm Performance: Evidence from Tanzania

The main purpose of this article is to examine the role of intangible family resources in the performance of family enterprises in Tanzania. In particular, the article examines the role of information sharing, family patient capital and family labor in firm performance. Using a sample of 163 family firms and the structural equation model of analysis, the findings indicate that family patient capital and information sharing contribute significantly to the performance of firms. With regard to the cost of labor, the study does not show any evidence that lower labor costs improve family firms' performance, most probably because these businesses incur additional labor costs which are not directly linked to the business. Based on the results, it is concluded that the family has an influence on the strategic level of family businesses, thereby contributing to their success.     

Product Differentiation and Process R&D: The Trade-off Between Quality and Productivity in the Spanish Firm

This paper proposes a theoretical model in which the incentives that product differentiation exercises on process innovation are established. The resulting quadratic relationship determines a point beyond which a trade-off between these two variables exists. The estimations based on a panel data of Spanish manufacturing firms confirm this result. Moreover, firm size seems to play a important role on process innovation only for those firms with a certain degree of product differentiation. For the rest, the degree of differentiation of rival firms is the relevant variable.     

Linking Entrepreneurial Orientation and Firm Performance: The Role of Organizational Learning Capability and Innovation Performance

This research contributes to the entrepreneurial orientation (EO)–performance literature by offering a wider picture that includes two intermediate steps: organizational learning capability (OLC) and innovation performance. This study also provides an explanation of intra‐industry firm performance differences by focusing on EO. We use structural equation modeling to test the hypotheses on a data set from Italian and Spanish ceramic tile producers. The results support our conceptual model and demonstrate its usefulness in explaining differences in intra‐industry firm performance. Findings suggest that OLC and innovation performance should be enhanced by managers in order to boost the positive EO–performance link.     

Technology Synergy,Product Characteristics,and New Product Performance: A Meta‐Analytic Review

The associations of technology synergy, product characteristics, and new product performance are widely spread in the marketing and innovation management literatures. However, little research integrates these associations. This study adopts a meta‐analytic approach to aggregate prior findings across studies published before 2010 to review the relationships between technology synergy, product characteristics, and new product performance. Structural equation analysis reveals that technology synergy has: (a) a positive medium effect on new product performance; (b) a positive and strong impact on product advantage, which then affects new product performance; and (c) an indirect effect on new product performance through product innovativeness and product advantage. These findings suggest that product innovation and advantage are important intermediaries between technology synergy and new product performance—as yet unrevealed in extant literature. Copyright © 2012 ASAC. Published by John Wiley & Sons, Ltd.     

Horizontal and Vertical Firm Networks,Corporate Performance and Product Market Competition

This paper sheds new light on the assessment of firm networks via multiple directorships in terms of corporate firm performance. Using a large sample of European listed firms in the period from 2003 to 2011 and system GMM we find a significant compensation effect on corporate firm performance for the initial negative effect of horizontal multiple directorships by product market competition. In markets with effective competition, horizontal multiple directorships turn out to be an efficient mechanism to increase firm performance and thus assure competitive advantages. By contrast, linkages between up- and downstream firms have no significant influence on financial performance, irrespective of the level of competition intensity.     

The Relationship between Entrepreneurial Self‐Efficacy and Firm Performance: A Meta‐Analysis of Main and Moderator Effects

Entrepreneurial self‐efficacy (ESE) is an important construct in entrepreneurship research. It captures entrepreneurs’ specific self‐efficacy in accomplishing entrepreneurial tasks. Because various empirical results exist in past studies of the ESE‐firm performance relationship, we employed meta‐analysis to review and synthesize the current literature concerning this relationship and to address moderators that influence it. We meta‐analyzed 27 samples from 26 studies with a total sample size of 5,065 firms and found that the corrected ESE‐firm performance correlation is 0.309. We found that the firm performance measurement is a significant moderator and we suggest scholars to further identify moderators.     

The Effect of Brand Management and Product Quality on Firm Performance: The Italian Craft Brewing Sector

The article contributes to the limited literature on marketing strategies of microfirms operating in new niches within mature industries. The study explores the effect of brand management processes and product quality on performance of microfirms in the Italian brewing industry. Preliminary qualitative interviews with eight entrepreneurs were realized. Then 92 questionnaires were collected from the entire population of 335 microbreweries operating in Italy for quantitative analysis. Findings suggest intrinsic product quality being the most relevant determinants of firms’ performance, while the adoption of brand management processes exerts a significant, negative impact. The article takes into account the relationship between brand management, quality, and performance by focusing on a single industry. Future research may enhance the significance of our findings by including multiple sectors. Entrepreneurs and microbusiness leaders should carefully assess both external (industry life-cycle stage) and internal (resource availability) factors before engaging in any brand management activity. In mature firms, it may be more beneficial and effective focusing on enhancing product quality. The article addresses an important gap regarding the adoption of brand management practices in microfirms, adding to the emerging strategic marketing literature in the small business field.     

The Big Family: Informal Financing of Small‐ and Medium‐Sized Businesses by Guanxi

Guanxi facilitates interaction between companies and people in Confucian societies. Does this type of social construct still play the key role, when the entrepreneurs live in Western societies? The objective of this article is to verify the impact of Guanxi on the capacity of small and medium‐sized businesses accessing financial resources informally. To this end, data collected from small Chinese entrepreneurs active in the principal business center of Brazil were used. From nonparametric tests, the results suggest that: (1) different levels of Guanxi allow small and medium‐sized businesses to access informal financial resources; (2) different types of informal financing are mostly used, or judged to be more significant, depending on the level of Guanxi of the entrepreneur in terms of parental and nonfamily ties; and (3) unlike the Western literature on the financial cycles of start‐ups, this type of informal financing can extend beyond the initial stage of the business. © 2014 Wiley Periodicals, Inc.     

The Impact of Organizational Orientations on Medium and Small Firm Performance: A Resource‐Based Perspective

Recent studies suggest that market, entrepreneurial, and learning orientations individually improve firm performance. In this study, we suggest that each of the orientations can enhance company success, but the potential of each orientation should not be viewed in isolation. Instead, we draw on the resource‐based view of the firm, looking at these three orientations as capabilities of small and medium‐sized enterprises (SMEs). The analysis was carried out on a sample of 164 SMEs. The results indicate that market, entrepreneurial, and learning orientations jointly give rise to positional advantage, which, in turn, is positively related to the performance of the firm.     

Small‐time,large‐time,and asymptotics for the Rough Heston model

We characterize the behavior of the Rough Heston model introduced by Jaisson and Rosenbaum (2016, Ann. Appl. Probab., 26, 2860–2882) in the small‐time, large‐time, and (i.e., ) limits. We show that the short‐maturity smile scales in qualitatively the same way as a general rough stochastic volatility model , and the rate function is equal to the Fenchel–Legendre transform of a simple transformation of the solution to the same Volterra integral equation (VIE) that appears in El Euch and Rosenbaum (2019, Math. Financ., 29, 3–38), but with the drift and mean reversion terms removed. The solution to this VIE satisfies a space–time scaling property which means we only need to solve this equation for the moment values of and so the rate function can be efficiently computed using an Adams scheme or a power series, and we compute a power series in the log‐moneyness variable for the asymptotic implied volatility which yields tractable expressions for the implied vol skew and convexity which is useful for calibration purposes. We later derive a formal saddle point approximation for call options in the Forde and Zhang (2017) large deviations regime which goes to higher order than previous works for rough models. Our higher‐order expansion captures the effect of both drift terms, and at leading order is of qualitatively the same form as the higher‐order expansion for a general model which appears in Friz et al. (2018, Math. Financ., 28, 962–988). The limiting asymptotic smile in the large‐maturity regime is obtained via a stability analysis of the fixed points of the VIE, and is the same as for the standard Heston model in Forde and Jacquier (2011, Finance Stoch., 15, 755–780). Finally, using Lévy's convergence theorem, we show that the log stock price tends weakly to a nonsymmetric random variable as (i.e., ) whose moment generating function (MGF) is also the solution to the Rough Heston VIE with , and we show that tends weakly to a nonsymmetric random variable as , which leads to a nonflat nonsymmetric asymptotic smile in the Edgeworth regime, where the log‐moneyness as , and we compute this asymptotic smile numerically. We also show that the third moment of the log stock price tends to a finite constant as (in contrast to the Rough Bergomi model discussed in Forde et al. (2020, Preprint) where the skew flattens or blows up) and the process converges on pathspace to a random tempered distribution which has the same law as the hyper‐rough Heston model, discussed in Jusselin and Rosenbaum (2020, Math. Finance, 30, 1309–1336) and Abi Jaber (2019, Ann. Appl. Probab., 29, 3155–3200).     

风险投资机构知识多样化与退出绩效:投资阶段的调节作用

本文利用CV Source数据库2005年1月1日至2013年12月31日的风险投资机构投资数据,运用多元回归分析模型,检验风险投资机构知识多样化对其退出绩效的影响以及投资阶段对二者之间关系的调节作用.结果表明:(1)风险投资机构知识多样化与其退出绩效之间呈U型关系;(2)投资阶段调节风险投资机构知识多样化与其退出绩效之间的U型关系,即与晚期阶段投资相比,在早期阶段投资的条件下,这种U型关系更显著.     

Socioemotional Wealth and Innovativeness in Small‐ and Medium‐Sized Family Enterprises: A Configuration Approach

What makes small‐ and medium‐sized family firms (family SMEs) innovative? Some family firm dynamics promote, yet others hinder innovation. It remains unclear whether combinations of family firm dynamics increase innovativeness. Our configurational perspective of socioemotional wealth (SEW) unravels determinants of family SMEs' innovativeness. We conduct a fuzzy set qualitative comparative analysis with 452 Swiss family SMEs. We categorize SEW dimensions into configurations of necessary and sufficient conditions. We contribute to theory on family SMEs' innovativeness because we reveal that the interplay of SEW dimensions leads to innovativeness. This offers practitioners a better framework to choose between SEW configurations.