Strategic capabilities in exporting: an examination of the performance of Mexican firms

Abstract

Purpose -This study aims to examine in the context of high involvement exporting Mexican firms a model which suggests that a blend of absorptive and dynamic capabilities is necessary to build and sustain their competitiveness in international markets. Design/methodology/approach -Data were collected from 119 high involvement Mexican exporting firms through informants. Formative and reflective constructs were validated through MIMIC models and confirmatory factor analysis using LISREL. The theoretical model was tested using partial least squares (PLS). Findings -Results suggest that high involvement Mexican exporting firms' capacity to adapt through product design, technology management, manufacturing processes, and cooperative relationships impacts their innovation and market expansion-adaptation capabilities. Nurturing an entrepreneurship orientation is critical to build flexibility, transfer innovation to markets, and drive export performance. Ultimately, performance is determined by the firms' ability to design and develop products through the adoption of improved technologies, a deep understanding of international demands, and an ability to refocus exporting strategies as changes in competitive contexts require.Research limitations/implications -The design of exporting capabilities in this study only applies to high involvement exporting firms. Practical implications -High involvement exporting firms sustain growth through the development of exploration (learning), exploitation (expansion-adaptation), and dynamic (innovation, entrepreneurship) capabilities as determinant of performance. Originality/value -This is the first model that tests relationships among learning, manufacturing flexibility, and market expansion-adaptation and dynamic capabilities such as innovation and entrepreneurship and their impact on performance in high involvement Mexican exporting firms.

Determinants of Enterprises Radical Innovation and Performance: Insights into Strategic Orientation of Cultural and Creative Enterprises

“…Market orientation (clients' orientation, competitors' orientation, and inter-functional coordination) [43] and corporate culture (willingness to cannibalize, future market orientation, and risk tolerance) [21] positively determine radical innovation levels [44]. An entrepreneurial orientation provides a key avenue for an enterprise in transferring innovation to the markets [45] and positively driving its performance [46]. Firms with an entrepreneurial orientation (proactiveness, risk taking, autonomy, competitive aggressiveness, see Salavou and Lioukas [8]) have enhanced radical innovation capability [20].…”

Evolving Absorptive Capacity: The Mediating Role of Systematic Knowledge Management

“…Subsequently, the concept of absorptive capacity has been used at different levels of organisational analysis. These include the inter-organisational level (e.g., joint ventures) [13], [14], [15]; organisational level [16], [17], [18], [ 1 9 ] , [20]; team absorptive capacity [15], and in the technology management arena [21], [22], [23].…”

What do we know about internationalization strategies implementation and what are we missing?

“…Chiesa (1996) points out that the degree of dispersion of external sources of knowledge, and the degree of dispersion of the key internal R&D resources influence the structural outcome. Rodriguez, Wise and Martinez (2013) and Fisch and Zschoche (2011) agree that the flexibility to shift production among subsidiaries, adapting manufacturing processes, and cooperative relationships impacts the firm's innovation and market expansion-adaptation capabilities, increasing profitability of international production networks. In addition, Miozzo and Mo (2012) and Sanna-Randaccio and Veugelers (2007) researches bring evidences that decentralization on the headquarters-subsidiary relationships can provide flexibility and help to take advantages of favorable external factors.…”