Purpose
This study aims to examine the effects of international competitive strategies, i.e. cost leadership and differentiation, on export (market share and strategic) performance. This study further explores the roles of exploitative and exploratory organizational learning in the relationships between international competitive strategies and export performances. To fill research gaps, this study intends to provide guidance on how varied exploitative/exploratory organizational learning and cost leadership/differentiation strategy combinations would affect export performance. The outcomes of this study provide a new match and mis-match conceptualization to extant international competitive strategy and organizational learning literature.
Design/methodology/approach
This study selected New Zealand (NZ) exporting as the research setting because exporting plays such a vital role in NZ’s economy and NZ exporting firms have long been highly competitive in international markets (e.g. meat and dairy exporters), with the primary data collected through surveys conducted in 2010 and 2013. This study adopted a three-year lagged performance approach.
Findings
Cost leadership strategy has a positive effect on market share performance. This effect is enhanced by exploitative learning but dampened by exploratory learning. Cost leadership also has a positive effect on strategic performance, which is not affected by exploitative and exploratory learning. Differentiation strategy bears no relation to market share and strategic performance, even allowing for exploitative and exploratory learning. Collectively, the contingent role of organizational learning in the international competitive strategies and export performance framework is far more comprehensive than was expected.
Research limitations/implications
This study reveals that a match between cost leadership strategy and exploitative learning may result in a superior market share. The configuration of differentiation strategy and exploitative learning and the integration of cost leadership strategy and exploratory learning are suggested as mis-matches, as these combinations would not lead to any significant and positive market share and strategic performance. Unexpectedly, the co-alliance of differentiation strategy and explorative learning is not suggested as a match, as it does not result in a superior market share and strategic performance. This latter outcome suggests that the differentiation strategy-export performance link may be stimulated by other moderating factors (e.g. business managerial ties).
Practical implications
While choosing an appropriate international competitive strategy, managers may use cost leadership over differentiation strategy to achieve successful export performance in both the market share and strategic perspectives. Export managers focusing on cost leadership strategy may further implement exploitative learning instead of explorative learning, when market share is vital. Meanwhile, they may note that explorative learning may not have a moderating effect on enhancing strategic performance through cost leadership. These points signify that exploitation of existing knowledge may be more effective than exploration of new knowledge for market share expansion when cost leadership strategy is devoted to exporting activities. Differentiation strategy, however, does not influence market share and strategic performance in exporting, even with an alignment of exploitative/exploratory learning. Managers are urged to pay attention to the mis-match of differentiation strategy and organizational learning when market share and strategic performance are the priorities in export performance evaluation.
Originality/value
This study contributes to the organizational learning literature by providing a new match and mis-match conceptualization relating to international competitive strategy and export performance. The new framework provides directions on when firms should use organizational learning to enhance their competitive strategies (a match scenario) and when they should not use it (a mis-match scenario). This study broadens the existing research that has mainly focused on alignment combinations such as organizational learning-internationalization strategy and organizational learning-social network.
IS SMEs ABLE TO CONSTRUCT BUSINESS STRATEGY TO IMPROVE ITS PERFORMANCE USING ITS OWN ABILITY? (STUDY ON SMEs KARAWO HANDICRAFT IN CITY OF GORONTALO, INDONESIA)
