Making better foreign friendships: the effects of increased cultural diversity in alliance portfolios and portfolio configuration decisions on firm performance

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ning Li ◽  
William Hoggan Murphy
Keyword(s):  
Firm Performance ◽  
Cultural Diversity ◽  
Culturally Diverse ◽  
Generalized Method Of Moments ◽  
Partner Choice ◽  
Moderating Effects ◽  
Alliance Portfolio ◽  
Content Type ◽  
Data Limitations ◽  
Marketing Alliances

Purpose This paper aims to examine the effect of increases in alliance portfolio cultural diversity (IAPCD) on a firm’s performance and how portfolio configuration characteristics moderate this effect, aiming to enable managers to make better partner choice and portfolio configuration decisions to improve performance. Design/methodology/approach The sample includes 2,326 focal firms from 93 countries that formed 7,616 alliances between the years 1992 and 2006. This study uses generalized method of moments estimation to examine the effects of portfolio changes on next year’s firm sales performance. Findings Results reveal an inverted-U relationship between IAPCD and firm performance. Data limitations led to examining moderating effects only on the upslope portion of the inverted-U, indicating that an increasing percentage of joint ventures in a firm’s alliance portfolio strengthens IAPCD’s contribution to performance. Further, increased numbers of marketing alliances or research and development alliances and increased percentage of horizontal alliances in an alliance portfolio have a negative moderating effect. Research limitations/implications The sample mostly covers large companies. The data indicate that nearly all firms are on the upslope of an inverted-U IAPCD–to–performance relationship, allowing testing of moderating effects pre-inflection point only. Practical implications Firms can leverage the additions of culturally diverse partners toward improved performance through astute configuration decisions in alliance portfolio composition. Originality/value This paper uses the knowledge-based view to contribute to the alliance portfolio literature. This study asserts that capacity constraints affect firms’ ability to realize performance gains when taking on culturally diverse partners, an effect moderated by portfolio configurations. This paper tests hypothesis with longitudinal data.

Internationalization of exploitation alliance portfolios and firm performance

2019 ◽  
Vol 57 (1) ◽  
pp. 86-99 ◽  
Author(s):  
Oliver Rossmannek ◽  
Olaf Rank
Keyword(s):  
Firm Performance ◽  
Design Methodology ◽  
Panel Regression ◽  
Alliance Portfolio ◽  
Content Type ◽  
Marketing Alliances ◽  
High Degree ◽  
The Impact ◽  
Practical Implications ◽  
Alliance Portfolios

Purpose The purpose of this paper is to analyze the impact of alliance portfolio internationalization (API) on firm performance in the context of exploitation alliances. Design/methodology/approach The hypothesis is tested by applying a panel regression using a sample of 64 airlines over a nine years period. Findings As a result, the study finds a U-shaped relationship between API and firm performance. Research limitations/implications The results are particularly relevant for firms using many exploitation (e.g. marketing) alliances. Practical implications In the context of exploitation alliances, managers should focus either on local partners or to take advantage of partners with a high degree of foreignness. Stuck in the middle seems to be not advantageous. Originality/value Previous work found an S-shaped relationship between portfolio internationalization and firm performance while concentrating on exploration alliances. In contrast, this study shows that exploitation alliance portfolios do not experience a decline of firm performance at high levels of portfolio internationalization.

The impact of intellectual capital on firm performance: a study of Indian firms listed in COSPI

2018 ◽  
Vol 19 (5) ◽  
pp. 935-964 ◽  
Author(s):  
Neha Smriti ◽  
Niladri Das
Keyword(s):  
Firm Performance ◽  
Intellectual Capital ◽  
Value Creation ◽  
Generalized Method Of Moments ◽  
Value Added ◽  
Secondary Data ◽  
Share Price ◽  
Content Type ◽  
Listed Firms ◽  
The Impact

Purpose The purpose of this paper is to examine the effect of intellectual capital (IC) on financial performance (FP) for Indian companies listed on the Centre for Monitoring Indian Economy Overall Share Price Index (COSPI). Design/methodology/approach Hypotheses were developed according to theories and literature review. Secondary data were collected from Indian companies listed on the COSPI between 2001 and 2016, and the value-added intellectual coefficient (VAIC) of Pulic (2000) was used to measure IC and its components. A dynamic system generalized method of moments (SGMM) estimator was employed to identify the variables that significantly contribute to firm performance. Findings Indian listed firms appear to be performing well and efficiently utilizing their IC. Overall, human capital had a major impact on firm productivity during the study period. Furthermore, the empirical analysis showed that structural capital efficiency and capital employed efficiency were equally important contributors to firm’s sales growth and market value. The growing importance of the contribution of IC to value creation was consistently reflected in the FP of these Indian companies. Practical implications This study has robust theoretical grounds and employs a validated methodology. The present study extends knowledge of IC among academicians and managers and highlights its contribution to value creation. The findings may help stakeholders and policymakers in developing countries properly reallocate intellectual resources. Originality/value This study is the first study to evaluate IC and its relationship with traditional measures of firm performance among Indian listed firms using dynamic SGMM and VAIC models.

A jack-of-all-trades or a master of none: the performance effects of balancing exploration and exploitation within vs across alliance portfolio domains

2018 ◽  
Vol 24 (3) ◽  
pp. 569-587 ◽  
Author(s):  
Christopher R. Penney ◽  
James G. Combs ◽  
Nolan Gaffney ◽  
Jennifer C. Sexton
Keyword(s):  
Firm Performance ◽  
Value Chain ◽  
Fixed Effects ◽  
Empirical Work ◽  
Generalized Least Squares ◽  
Exploration And Exploitation ◽  
Specific Domain ◽  
Alliance Portfolio ◽  
Content Type ◽  
Alliance Portfolios

Purpose Theory predicts that balancing exploratory and exploitative learning (i.e., ambidexterity) across alliance portfolio domains (e.g. value chain function, governance modes) increases firm performance, whereas balance within domains decreases performance. Prior empirical work, however, only assessed balance/imbalance within and across two domains. The purpose of this study is to determine if theory generalizes beyond specific domain combinations. The authors investigated across multiple domains to determine whether alliance portfolios should be imbalanced toward exploration or exploitation within domains or balanced across domains. The authors also extended prior research by exploring whether the direction of imbalance matters. Current theory only advises managers to accept imbalance without helping with the choice between exploration and exploitation. Design/methodology/approach Hypotheses are tested using fixed-effects generalized least squares (GLS) regression analysis of a large 13-year panel sample of Fortune 500 firms from 1996 to 2008. Findings With respect to the balance between exploration and exploitation within each of the five domains investigated, imbalanced alliance portfolios had higher firm performance. No evidence was found that balance across domains relates to performance. Instead, for four of the five domains, imbalance toward exploration related positively to firm performance. Originality/value An alliance portfolio that allows for exploration in some domains and exploitation in other domains appears more difficult to implement than prior theory suggests. Firms benefit mostly from using the alliance portfolio for exploratory learning.

The role of national culture in the impact of board gender diversity on firm performance: evidence from a multi-country study

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Navaz Naghavi ◽  
Saeed Pahlevan Sharif ◽  
Hafezali Bin Iqbal Hussain
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Generalized Method Of Moments ◽  
Gender Diversity ◽  
Governance Structure ◽  
Corporate Governance Structure ◽  
Data Set ◽  
Content Type ◽  
Board Gender Diversity ◽  
The Impact

PurposeThis study seeks to add more insights to the debate on “whether”, “how”, and “under which condition” women representation on the board contributes to firm performance. More specifically, the current study aims to investigate if the effect of board gender diversity on firm performance is dependent on macro factors of national cultures.Design/methodology/approachThe authors used the generalized method of moments regression and a data set consists of 2,550 company year observations over 10 years.FindingsThe results indicated that cultural variables interact with board diversity to influence firm performance. Having women on the board in countries with high power distance, individualist, masculine and low-uncertainty avoidance culture influences the firm performance negatively.Originality/valueThe findings indicate that the effects of corporate governance structure on firm performance depends on culture-specific factors, providing support for the argument that institutional norms that are governed by cultural norms affect the effectiveness of corporate governance structure.

Corporate social responsibility, firm performance and the moderating effect of earnings management in Chinese firms

2018 ◽  
Vol 10 (2/3) ◽  
pp. 184-199 ◽  
Author(s):  
Muhammad Safdar Sial ◽  
Zheng Chunmei ◽  
Tehmina Khan ◽  
Vinh Khuong Nguyen
Keyword(s):  
Corporate Social Responsibility ◽  
Firm Performance ◽  
Social Responsibility ◽  
Earnings Management ◽  
Generalized Method Of Moments ◽  
Chinese Firms ◽  
Content Type ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship

Purpose The purpose of this paper is to examine the relationship between corporate social responsibility (CSR) and firm performance and the moderating role of earnings management on the relationship between CSR and firm performance. Design/methodology/approach The empirical study used the updated data set (3,481 unbalanced observations for period 2009–2015) from Chinese listed companies on Shenzhen and Shanghai stock exchanges. The generalized method of moments (GMM) statistical approach has been used for the analysis. The authors utilized STATA to test GMM on a sample of Chinese listed firms data over the period 2009–2015. The unbalanced sample obtained 3,481 observations from China stock market and accounting research database and CSR ratings provided by Rankins (RKS). Findings The results demonstrated that CSR has a positive and significant relationship with firm’s performance; also, earnings management has a negatively moderate relationship between CSR and firm performance. These results imply that a high value of earnings management, which results in high level of symbolic CSR, converts to low firm performance of the Chinese firms. CSR actions (only as symbolic measures) promoted by managers as a means to cover their profit management incite an adverse effect on the company’s performance. This study has highlighted the impact of two different corporate social responsibilities: substantive and symbolic (genuine CSR vs greenwashing) on firm performance. Research limitations/implications The results of this investigation will be of distinct interest to company owners who wish to ascertain the effectiveness of the sustainability decisions of directors and managers, and also to investors and public authorities to estimate the positive relationship between CSR and company’s reputation and image, and thus, the positive influence on firm performance. Originality/value Previous studies have generally focused on the relationship between CSR and firm performance. This study provides the impact of earnings management (measurement of both aspects of accrual-based earnings management and real earnings management) on this relationship. Furthermore, this study examines the state of CSR in the Chinese market and provides empirical evidence of this relationship in emerging markets.

Impacts of social insurance on firm performance: evidence from Vietnamese small- and medium-sized enterprises

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
The Nguyen Huynh
Keyword(s):  
Firm Performance ◽  
Labor Productivity ◽  
Social Insurance ◽  
Generalized Method Of Moments ◽  
Three Dimensions ◽  
Content Type ◽  
Return On Equity ◽  
Social Insurance Contribution ◽  
Insurance Costs ◽  
The Impact

PurposeThis article analyzes the impact of social insurance on firm performance by obtaining evidence from Vietnamese small- and medium-sized enterprises.Design/methodology/approachThe method employed in the research is the generalized method of moments for testing hypotheses of data collected from the General Statistics Office of Vietnam.FindingsThe results show that social insurance contributions can enhance firm performance in three dimensions: return on equity (ROE), labor productivity and total factor productivity (TFP). In addition, financial leverage, firm size, the average wage of workers and fixed assets have an impact on the social insurance costs of these companies.Originality/valueThis article provides a novel explanation of the contribution of social insurance to firm performance. In particular, social insurance contribution not only increases labor productivity but also boosts the growth of the TFP of companies. In addition, the article points out that taking care of the benefits of employees is a valuable investment of companies. These are the unique contributions of the paper to the literature on the economic impact of social insurance.

Dynamic study of corporate governance structure and firm performance in China

2019 ◽  
Vol 13 (2) ◽  
pp. 299-317 ◽  
Author(s):  
Lin Shao
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Generalized Method Of Moments ◽  
Supervisory Board ◽  
Governance Structure ◽  
State Ownership ◽  
Content Type ◽  
Listed Firms ◽  
The Impact ◽  
The Relationship

Purpose The paper aims to provide a comprehensive investigation of the relationship between corporate governance (CG) structure and firm performance in Chinese listed firms from 2001 to 2015. The authors’ motivation derives from the fact that the CG system in China is different from those in the US, the UK, Germany, Japan and other countries. Design/methodology/approach A large unbalanced sample, covering more than 22,700 observations in Chinese listed firms, was used to explore, by means of a system-generalized method-of-moments (GMM) estimator, the relationship between CG structure and firm performance to remove potential sources of endogeneity. Findings Results show that Chinese CG structure is endogenously determined by the CG mechanisms investigated: there is no relationship between board size (including independent directors) and firm performance; CEO duality has a significantly negative effect on firm performance; concentration of ownership has a significantly positive influence on firm performance; managerial ownership is negatively correlated with firm performance; state ownership has a significantly positive effect on firm performance; and a supervisory board is positively correlated with firm performance. Practical implications The findings provide policymakers and firm managers with useful empirical guidance concerning CG in China. Originality/value Few integrative studies have examined the impact of CG structure on firm performance in China. This study adds new empirical evidence that the relation between CG structure and performance in China is endogenous and dynamic when controlling for unobserved heterogeneity, simultaneity, and dynamic endogeneity.

The impacts of IT capability on internet-enabled supply and demand process integration, and firm performance in manufacturing and services

2015 ◽  
Vol 26 (1) ◽  
pp. 172-194 ◽  
Author(s):  
Hefu Liu ◽  
Qian Huang ◽  
Shaobo Wei ◽  
Liqiang Huang
Keyword(s):  
Firm Performance ◽  
Structural Equation ◽  
Process Integration ◽  
Supply And Demand ◽  
Equation Modeling ◽  
Moderating Effects ◽  
Resource Based View ◽  
Content Type ◽  
It Capability ◽  
Industry Type

Purpose – The purpose of this paper is to derive a model to examine how Information Technology (IT) capability affects internet-enabled supply and demand process integration, which will eventually improve firm performance. In addition, the moderating effects of industry type in the research framework are explored. Design/methodology/approach – Data were obtained from a survey administered to 261 firms in the manufacturing and services industry in China. The structural equation modeling approach is used to test the hypotheses. The study further applied the t-test to compare the path coefficiencies between manufacturing and service. Findings – Results from the survey indicate that internet-enabled supply and demand process integration is affected by IT capability, and can directly impact firm performance. The results further indicate that manufacturing and services firms may benefit from IT capability in different ways. Originality/value – The current paper contributes knowledge on the value-realizing mechanism of internet-enabled supply chain integration (SCI) from a resource-based view. It presents a multidimensional explanation of the relationships among IT capability, internet-enabled SCI, and firm performance.

Strategic alliances on performance of retail firms in Nairobi County, Kenya

2015 ◽  
Vol 27 (6) ◽  
pp. 732-740 ◽  
Author(s):  
Rosemary Muange ◽  
Loice C. Maru
Keyword(s):  
Firm Performance ◽  
Strategic Alliances ◽  
Production Efficiency ◽  
Strategic Alliance ◽  
Technology Development ◽  
Practical Implication ◽  
Capital City ◽  
Top Management ◽  
Content Type ◽  
Marketing Alliances

Purpose – The purpose of this paper is to determine the effect of strategic alliances on firm performance and the moderating effect of firm size in retail firms in Nairobi County in Kenya. Design/methodology/approach – Resource Dependency Theory was used to guide the study. The study adopted explanatory research design. Questionnaires were used to collect data from sample of 216 respondents through stratified and simple random sampling technique. The study used inferential statistics to test hypotheses. Findings – Study findings indicated that joint marketing alliances, procurement-supplier alliances, joint manufacturing alliances and technology development alliances have significant and positive effect on firm performance. Based on the findings, creating a joint marketing, procurement-supplier, joint manufacturing and technology development alliances mostly enhance firm performance. Research limitations/implications – The study considered only one county out of 47, although this county hosts the capital city, where most of the firms considered are located. It therefore is representative of all counties and firms considered in this study. It also considered top management staff and thus may have an effect since the lower cadre staff were not considered. However, most of the required information was expected from top management since these are the ones who make decisions, and hence most affected by strategic alliances. Practical implications – This study has practical implication on firm performance because it has established that strategic alliance improves on overall firm performance. This manifests itself in terms of improve productivity, production efficiency and profitability. It also helps in the availability of products to the end users. Social implications – Through improved productivity, efficiency and profitability, this translates to improved terms of payment of staff and hence improved quality of lives of their families and communities within which they live. It also enables the firms to participate more in corporate social responsibility projects which in turn improves the standard of living of the communities around them. Originality/value – The study has provided an empirical insight on the importance of strategic alliance on firm performance. This is the first study done in the Kenyan context concerning strategic alliances formed by firms to improve on their performance especially on retail firms.

scholarly journals Facilitating culturally diverse groups with visual templates in collaborative systems

2017 ◽  
Vol 24 (1) ◽  
pp. 78-98 ◽  
Author(s):  
Sabrina Bresciani ◽  
Alice Comi
Keyword(s):  
Cultural Diversity ◽  
Culturally Diverse ◽  
Structuration Theory ◽  
Collaborative Systems ◽  
Adaptive Structuration Theory ◽  
Content Type ◽  
Face To Face ◽  
Positive Effects ◽  
Collaborative System ◽  
Diverse Groups

Purpose The use of visual templates has proven instrumental in supporting group meetings. The purpose of this paper is to explore whether visual templates enable culturally diverse groups to achieve greater task precision in face-to-face meetings. Design/methodology/approach Building on Adaptive Structuration Theory, it is argued that visual templates provide structuration for face-to-face meetings, even more so when they are embedded in computer-supported collaborative systems. In particular, it is hypothesized that the higher the degree of structuration imposed by visual templates, the higher the degree of task precision will be. It is also hypothesized that this relationship is positively moderated by group cultural diversity: higher cultural diversity will further sustain the positive effects of visual templates that provide higher structuration. Findings Results of an experiment with 229 managers from 49 countries confirm that facilitating groups with visual templates embedded in a computer-supported collaborative system significantly increases task precision at high levels of cultural diversity. Research limitations/implications This study contributes to Positive Organizational Scholarship (POS) by investigating the use of visual templates as a contingency factor that increases performance – specifically task precision – of co-located, culturally diverse groups. Practical implications Results indicate that visual templates embedded in a computer-supported collaborative system are an effective method for increasing task precision in face-to-face meetings of culturally diverse groups. Originality/value Theories from information systems and visualization are integrated into cross-cultural management with a view to sustaining the effectiveness of culturally diverse groups. The study sample is characterized by highly culturally diverse groups interacting in face-to-face meetings.

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