Benchmarking strategic core competencies of performance across Chinese and South Korean manufacturing companies

Abstract

PurposeThis study empirically investigates the significance of the core competencies on various economic performance indices by utilizing accounting and market-based performance in Chinese and South Korean leading manufacturing companies.Design/methodology/approachThis research employs a series of hierarchical regression models to test the hypotheses concerning the significance of R&D and export strategy on firms' performance.FindingsThis study finds that R&D intensity and foreign trade activities through export are most likely to be significantly associated with firm performance, particularly market-based performance, across the Chinese and South Korea manufacturing companies. The significance of other core strategic factors such as capital intensity, leverage, inventory turnover, labor productivity, administrative cost efficiency, and collection policy on performance was also contemplated.Originality/valueThe relationship between R&D and firm performance has been an interesting issue concerning the performance measures employed across different country settings. Research issues addressed in this paper relate to how R&D, and foreign trade by export influence firm performance across two diverse economic environments inherent of Chinese and South Korean leading manufacturing firms. Particularly, this study explores the directions and magnitudes of the operational and strategic relationships between key strategic factors, such as R&D intensity, export by foreign trade, and the firm's economic and market-based performance.

Complex interplay of R&D, advertising and exports in USA manufacturing firms: differential effects of capabilities

“…Although there is some disagreement over the effect of the current ratio (Borhan et al, 2014;Jaworski and Czerwonka, 2022;Muhammad et al, 2014), firms with a higher current ratio are good at utilizing resources and sustaining supplier relationships when launching new product development and embarking on a market expansion, which affects their economic performance and market valuation (Bibi and Amjad, 2017;David et al, 2015;Kariv et al, 2017). Inventory turnover is used as one of the key operational factors and performance measures in manufacturing industries because it affects cash generation and the efficient utilization of financial assets, especially when firms are committed to developing innovative products and competing in the global market (Kwak, 2019;Pati and Lee, 2023;Shardeo, 2015). As a surrogate measure of lean operations, inventory turnover allows the firm to maintain sound asset capacity for better financial performance, which is linked to important decision areas across purchasing, production, marketing and exports (Ahmad and Mahmood, 2018;Boute et al, 2007;Demeter and Matyusz, 2011;Khan et al, 2016;Vidhyaprlya et al, 2020).…”

“…As such, along with selected control factors, this study explores the dynamic interplay of key inputs (i.e. advertising, R&D and exports) and their impacts on Tobin's Q as a forward-looking market performance, which is commonly adopted as a performance measure for manufacturing firms (Agarwal, 2016;Jacobs et al, 2016;Pati and Lee, 2023). In this study, the operationalization of all strategic factors can be summarized as follows:…”