Enhancing foreign subsidiaries' performance through relational ties, market- and nonmarket-based capabilities

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Amonrat Thoumrungroje ◽  
Supara Kapasuwan
Keyword(s):  
Firm Performance ◽  
Multinational Enterprises ◽  
Social Capital Theory ◽  
Superior Performance ◽  
Foreign Subsidiaries ◽  
Capital Theory ◽  
Content Type ◽  
Mediating Role ◽  
Path Analyses ◽  
And Performance

PurposeGiven the inconclusive findings on relational ties–performance relationships, this study approaches this phenomenon through social capital theory and resource-based view (RBV) lenses to advocate the mediating role of nonmarket- and market-based capabilities.Design/methodology/approachA survey-based research methodology was employed. A list of 1,425 foreign subsidiaries was identified from the Thailand Board of Investment (BOI) website, and key informants were contacted. A final response rate of 11.8% was achieved. All hypotheses were tested via path analyses with the bootstrapping technique.FindingsThe results indicate that the relationships between business- and government-relational ties and performance are fully mediated by market- and nonmarket-based capabilities with the latter serving as essential but inadequate preconditions for achieving superior firm performance.Practical implicationsTo mitigate the liability of foreignness and to enhance performance of foreign subsidiaries operating in volatile emerging economies such as Thailand, government and business relational ties are crucial in developing nonmarket- and market-based capabilities. The nonmarket-based capabilities entail the ability to negotiate with and influence policy makers, which in turn helps augment the development of market-based capabilities, including the ability to be highly responsive to customers' needs.Originality/valueThis research illustrates the embedded roles of nonmarket and market-based capabilities developed through complex interactions among social actors, including the multinational enterprises’ (MNEs’) subsidiaries and government and nongovernment counterparts, in attaining superior performance. The results indicate how relational ties enable MNEs’ subsidiaries to develop various capabilities, and how these capabilities are related with each other and linked to firm performance. Findings from an emerging economy undergoing recent political and economic uncertainties also provide theoretical advancements for international business studies.

scholarly journals From social network to firm performance

2018 ◽  
Vol 41 (6) ◽  
pp. 680-700 ◽  
Author(s):  
Aluisius Hery Pratono
Keyword(s):  
Social Media ◽  
Social Network ◽  
Firm Performance ◽  
Social Capital Theory ◽  
Complex Relationship ◽  
Capital Theory ◽  
Content Type ◽  
Mediating Role ◽  
The Social

PurposeThe purpose of this study is to develop a structural equation model to explain the complex relationship between social network and firm performance by introducing the mediating role of trust, selling capability and pricing capability.Design/methodology/approachThe research model with hypothesis development was derived based on the literature. To provide empirical evidence, this study carried out a survey in which the data were equated with a list of questionnaires with a random survey of 380 small and medium enterprises (SMEs) in the Indonesian context.FindingsThis study indicates that the use of social media in management process will not affect the increasing firm performance, unless the firms build trust upon social networks. The social network with trust allows the firms to gain a pricing capability and a selling capability, which brings a positive impact on firm performance. The results also show that the selling and the pricing capabilities become essential following the utilizing the social media, which concerns on trust building.Research limitations/implicationsThis study focused on the small-to-medium context, which has conventionally provided an exemplary site for the development of social capital theory but raises issues of generalizability across different contexts.Practical implicationsTo the managers, it is advisable to encourage their employees to consciously exploit the selling capability by enhancing the business networks via social media to achieve the firm performance.Originality/valueThis paper contributes to the social capital theory by explaining the mediating role of trust in the complex relationship between social network and firm performance. This study provides evidence that trust plays a pivotal role in social networks, which enable the observed firms to achieve the performance.

scholarly journals tugas review artikel

2019 ◽  
Author(s):  
Arlika Anindya Putri
Keyword(s):  
Social Capital ◽  
Social Networks ◽  
Social Media ◽  
Social Network ◽  
Firm Performance ◽  
Positive Impact ◽  
Social Capital Theory ◽  
Capital Theory ◽  
Mediating Role ◽  
The Social

Purpose – The purpose of this study is to develop a structural equation model to explain the complexrelationship between social network and firm performance by introducing the mediating role of trust, sellingcapability and pricing capability.Design/methodology/approach – The research model with hypothesis development was derived basedon the literature. To provide empirical evidence, this study carried out a survey in which the data wereequated with a list of questionnaires with a random survey of 380 small and medium enterprises (SMEs) inthe Indonesian context.Findings – This study indicates that the use of social media in management process will not affect theincreasing firm performance, unless the firms build trust upon social networks. The social network with trustallows the firms to gain a pricing capability and a selling capability, which brings a positive impact on firmperformance. The results also show that the selling and the pricing capabilities become essential following theutilizing the social media, which concerns on trust building.Research limitations/implications – This study focused on the small-to-medium context, which hasconventionally provided an exemplary site for the development of social capital theory but raises issues ofgeneralizability across different contexts.Practical implications – To the managers, it is advisable to encourage their employees to consciouslyexploit the selling capability by enhancing the business networks via social media to achieve the firmperformance.Originality/value – This paper contributes to the social capital theory by explaining the mediating role oftrust in the complex relationship between social network and firm performance. This study provides evidencethat trust plays a pivotal role in social networks, which enable the observed firms to achieve the performance.

Exploring the family effect on firm performance

2015 ◽  
Vol 21 (6) ◽  
pp. 898-917 ◽  
Author(s):  
Yosra Mani ◽  
Lassaad Lakhal
Keyword(s):  
Social Capital ◽  
Firm Performance ◽  
Family Firms ◽  
Family Firm ◽  
Social Capital Theory ◽  
Three Dimensions ◽  
Capital Theory ◽  
Cognitive Dimension ◽  
Content Type ◽  
The Impact

Purpose – The purpose of this paper is to investigate how internal social capital – as a part of the familiness resources– affects family firm performance. The social capital theory states that internal social capital within family businesses is composed of three dimensions: the structural dimension, the relational dimension, and the cognitive dimension. The aim of the paper is to study the relationship between each dimension of internal social capital and family firm performance. Design/methodology/approach – The paper employs an empirical investigation which is based on a sample of 114 Tunisian family firms. Findings – Results demonstrate that the structural and relational dimensions are positively associated with financial and non-financial family firm’s performance. However, the cognitive dimension has a significant positive effect on financial performance but not on non-financial family firm performance. Originality/value – The proposed model aims to test the direct effect of internal social capital dimensions on financial and non-financial family firm’s performance. Besides, there is a lack of empirical evidence aiming at understanding the impact of structural, cognitive and relational social capital on the performance of family firms.

The role of internationalization in entrepreneurial orientation-performance link: empirical study of SMEs in a developing nation perspective

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Zaynab Dadzie ◽  
Ahmed Agyapong ◽  
Abdulai Suglo
Keyword(s):  
Firm Performance ◽  
Empirical Study ◽  
Entrepreneurial Orientation ◽  
Developing Nation ◽  
Content Type ◽  
Mediating Role ◽  
And Performance ◽  
The Impact ◽  
The Relationship

Purpose This study aims to examine the mediating role of internationalization in the relationship between the dimensions of entrepreneurial orientation (EO) and performance, empirical study of small and medium scale enterprises (SMEs) in a developing nation. Design/methodology/approach The study uses a sample of 158 exporting SMEs based in the sub-Saharan developing economy, Ghana. The use of hierarchical regression (ordinary least square analysis) was used by the researcher to assess the suggested model of the study. Findings Largely supporting the conjectural predictions, the study indicates that EO positively and significantly influences performance; internationalization fully mediates the relationship between innovativeness and performance of export firms; internationalization fully mediates the relationship between risk-taking and performance of export firms; and finally, internationalization partially mediates the relationship between competitive aggressiveness and performance of export firms. Managers are, therefore, encouraged to strategically develop both their EO and internationalization, as the study has confirmed that EO has both a direct and indirect relationship with performance. Originality/value This study integrated a resource-based view of the firm and international entrepreneurship theory as a theoretical foundation. Theoretically, internationalization’s mediating role reveals the relevance of this construct in the linkage between entrepreneurial orientation and firm performance. Furthermore, the study extends the entrepreneurial orientation concept to the international business literature by estimating and testing models of the mediating link between entrepreneurial orientation and performance. Moreover, the study seeks to broaden the knowledge of entrepreneurial orientation and its relationship with performance in small and medium businesses. The study further extends the limited studies on performance, driven by entrepreneurial orientation and internationalization in a developing nation (Ghanaian) context. This paper besides seeks to highlight the impact of entrepreneurial orientation on performance when channeled through internationalization. The study also reveals the dimensions of entrepreneurial orientation to be important antecedents of internationalization, in attempts at unearthing the critical predictors of firm performance, especially those of international characteristics.

Empirical approach to the sequential relationships between generation, relational capital and performance in family wineries in Spain

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Marta Fernandez-Olmos ◽  
Isabel Diaz-Vial ◽  
Giulio Malorgio
Keyword(s):  
Social Capital ◽  
Cross Sectional Study ◽  
Social Capital Theory ◽  
Wine Industry ◽  
Cross Sectional ◽  
Capital Theory ◽  
Content Type ◽  
Final Sample ◽  
The Family ◽  
And Performance

Purpose This study aims to focus on relational social capital in family wineries. Relational social capital is influenced by the family nature of the business and is at the same time a key antecedent of winery performance. The aim is to analyse these relationships in the qualified denomination of origin (DOC) Rioja wine industry (Spain). Design/methodology/approach Using a final sample of 110 family wineries, a Baron and Kenny approach was performed to investigate the causal and mediating relationships between the generation in control, relational social capital and family winery performance. Findings Using a final sample of 110 family wineries, the study demonstrates that later generations show a higher level of relational social capital, that the positive relationship between relational social capital and performance is maintained in a family firm sample and that the generation in control sequentially influence on performance through its influence on relational social capital. Research limitations/implications The main limitations are that empirical data were obtained only from DOC Rioja wine family businesses and a cross-sectional study was conducted. Social implications This study provides policymakers and family managers responsible for succession with a better understanding of the effects of transferring the business to the next generations in terms of relational social capital and performance. Originality/value To the best of the knowledge, this is the first study to examine the sequential relationships between generation, relational social capital and performance in DOC Rioja family wineries. The context of the DOC Rioja wine industry is particularly noteworthy for two reasons. First, in this industry, family-controlled firms predominate. Second, the DOC Rioja wine industry is focussed on the small-to-medium context, which has conventionally provided a very good area for the development of social capital theory.

Theorizing coordination, collaboration and integration in multi-sourcing triads (B3B triads)

2020 ◽  
Vol 25 (3) ◽  
pp. 285-300
Author(s):  
Ilias Vlachos ◽  
Selvie Carolin Dyra
Keyword(s):  
Supply Chain ◽  
Empirical Research ◽  
Transaction Cost Economics ◽  
Social Capital Theory ◽  
Third Party ◽  
Capital Theory ◽  
Content Type ◽  
Structural Embeddedness ◽  
And Performance ◽  
Research Propositions

Purpose Supply chains are becoming more complex and uncertain, yet existing theories are predominately based on empirical research of dyads overlooking triadic settings. This study aims to bridge the gap between supply chain theories and praxis, this study examined multi-sourcing triads in terms of coordination, collaboration and integration. Design/methodology/approach Transaction cost economics, resource-based view in conjunction with social capital theory and agency theory were used to develop a research framework. Abductive, comparative research examined four triads. The triads comprised four retailers (EU, USA, Japan and one with a global presence), one third-party logistics provider (3PL) and 103 suppliers in textiles and the clothing industry. Findings All multi-sourcing triads achieved efficient coordination via network configuration showing varying degrees of collaboration and integration. Three research propositions were developed as follows: transaction complexity and dynamics necessitate triad coordination and control by the 3PL; relational and structural embeddedness emerge when actors invest in triad-specific resources and capabilities; information, relational and structural asymmetries may trigger bridge transfer and affect triad integration and performance. Research limitations/implications Empirical research on multi-sourcing triads complements existing research on logistics and service, transitive triads to uncover how triad coordination, embeddedness and power asymmetries affect supply chain performance. Future studies should examine the interrelationships between triad embeddedness, asymmetries and relational capital. Practical implications Compared to logistics or service triads, B3B triads excel in relational and structural embeddedness and offer unique production-distribution solutions that create value to end-consumers and triad actors. Originality/value B3B triads are a unique conceptualization in supply chain management that extends the concepts of logistics triads and service triads.

Linking organizational trust and performance through ambidexterity

2019 ◽  
Vol 49 (4) ◽  
pp. 956-973 ◽  
Author(s):  
Odette Chams-Anturi ◽  
Maria D. Moreno-Luzon ◽  
Juan P. Escorcia-Caballero
Keyword(s):  
Firm Performance ◽  
Empirical Evidence ◽  
Structural Equation ◽  
Organizational Trust ◽  
Future Research ◽  
Organizational Ambidexterity ◽  
Content Type ◽  
Food Industries ◽  
Mediating Role ◽  
And Performance

Purpose The literature provides mixed empirical evidence on the trust–performance relationship. The purpose of this paper is to shed additional light on this relationship, using organizational ambidexterity as an explanatory variable. Design/methodology/approach A structural equation technique was used to examine survey data obtained from 377 Spanish organic agro-food industries. Findings The results obtained provide support to show that organizational ambidexterity has a mediating role in the relationship between organizational trust and firm performance, in the organic agro-food industry. Research limitations/implications This study used a sample taken from only one industry and country. Future research could expand the model to other countries and industries. Practical implications This study suggests that managers could use tools to enhance organizational trust that would help to improve firm performance, given that trust can cause employees to adopt behaviors related to ambidexterity. Therefore, managers can use trust as a mechanism to encourage more stable relationships, increase the transfer of existing knowledge, facilitate experimentation and express ideas to promote organizational ambidexterity, thus benefiting firm performance. Originality/value This research paper offers a new insight into how ambidexterity affects the organizational trust-firm performance relationship. Even though there is growing theoretical importance given to the concepts of trust and ambidexterity, the empirical evidence that demonstrates how both variables are related to firm performance, especially in emerging sectors, is scarce.

Multinationality and performance effects: an integrated theory of new patterns of multinationality and home political influence

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
I-Fan Yen ◽  
Hsin-Mei Lin
Keyword(s):  
Multinational Enterprises ◽  
Positive Relationship ◽  
Political Influence ◽  
Superior Performance ◽  
Foreign Investments ◽  
Content Type ◽  
Performance Effect ◽  
Performance Effects ◽  
And Performance ◽  
The Relationship

Purpose This paper aims to develop an integrated perspective on the relationship between multinationality and performance in the outward foreign direct investment (OFDI) of Chinese firms. The study not only represents contrasting OFDI patterns – namely, born global-natured multiple synchronous foreign investments versus conventional internationalization process (IP)-natured steady increasing foreign investments – but also contributes to understanding the extent to which explanations of home political influence need to be rooted within the general theory of multinationality. Design/methodology/approach By testing a comprehensive panel observation of 8,635 OFDI projects from 1991-2016 in China, this study found that multinationality with the new pattern of multiple synchronous OFDIs has a superior performance effect compared with the conventional pattern of steady increasing OFDIs. Findings This study also finds a positive relationship between multinationality (international diversification and home political influence) and the performance effect with the new pattern of multiple synchronous OFDIs, as well as a partial positive relationship between multinationality and the performance effect with the conventional pattern of steady increasing OFDIs. Research limitations/implications The study extends the understanding of the performance effects of Chinese multinational enterprises, which may benefit more from the new pattern of multiple synchronous OFDIs than from the conventional pattern of steady increasing OFDIs when the home-country institution is strongly positioned. Originality/value This paper concludes that multinationality needs an integrated framework that accounts for the new pattern of OFDI and the influence of diversification and home politics, particularly for the emerging country, China.

Knowledge management processes and organizational performance: the mediating role of organizational learning

2020 ◽  
Vol 24 (8) ◽  
pp. 1859-1880 ◽  
Author(s):  
María Obeso ◽  
Remedios Hernández-Linares ◽  
María Concepción López-Fernández ◽  
Ana María Serrano-Bedia
Keyword(s):  
Knowledge Management ◽  
Organizational Learning ◽  
Firm Performance ◽  
Organizational Performance ◽  
Knowledge Generation ◽  
Future Research ◽  
Content Type ◽  
Mediating Role ◽  
And Performance

Purpose The purpose of this paper is twofold. First, it aims to analyze the individual influence of different knowledge management practises (KMP) on firm performance. Second, it aims to analyze the mediating role of organizational learning (OL) between each KMP and performance. Design/methodology/approach A telephone-survey was applied in 2018 to the managers of 400 Spanish firms. The data retrieved was analyzed by using multiple regression analysis. Findings Knowledge generation (KG) and knowledge flow (KF) promote firm performance, while there is not a direct association between knowledge storage and performance. OL mediates the relationship between KG and performance, as well as between KF and performance. Research limitations/implications First, this research confirms that not all the KMP have a direct effect on firm performance, thus, future research would need to differentiate between different KMP. Second, this paper is pioneering in providing empirical evidence that OL mediates the KMP – performance relationship. Third, the empirical study was performed in a context non-researched yet by the literature considering KMP individually: Spain. Practical implications First, besides the results managers should focus their efforts in practises related to KG and application. Second, OL mediating suggests that managers should invest in managerial commitment to promote a shared culture, shared vision, open-mind to new ideas and a lot of dialogue. Originality/value This is the first study that investigates how KMP contribute to firm performance by incorporating the mediating impact of OL. The results will help organizations to identify the KMP improving the performance.

Effectuation, innovation and performance in SMEs: an empirical study

2016 ◽  
Vol 19 (2) ◽  
pp. 214-238 ◽  
Author(s):  
David C. Roach ◽  
Joel A. Ryman ◽  
Joyline Makani
Keyword(s):  
Firm Performance ◽  
Structural Model ◽  
Empirical Relationship ◽  
Service Innovation ◽  
Firm Level ◽  
Content Type ◽  
Mediating Role ◽  
Product Service ◽  
And Performance ◽  
Practical Implications

Purpose – Ever since Sarasvathy’s (2001) seminal article, scholars have sought to test effectuation’s affect on firm performance. Although recent work has begun the arduous process of testing effectuation’s effect on entrepreneurial performance, there is still much to learn about its impact on firm performance. One such area is the relationship between effectuation and innovation. The purpose of this paper is to first, propose a scale suitable to the explication of the effectuation construct relative to innovation. Second, it proposes a more parsimonious scale for the measurement of innovation. Third, these scales are tested relative to firm performance. Design/methodology/approach – This paper develops and tests a structural model, which investigates aspects of effectuation as mediators between innovation orientation and product/service innovation. This is accomplished using a sample of 169 electronic product manufacturing-based small and medium-sized enterprises (SMEs). Subjective measures of performance are used as the dependent variable. Findings – The three most widely used measures of innovativeness were found to break cleanly into two sub-constructs, namely innovation orientation and product/service innovation. Effectuation measures included means (who I know), leverage contingencies (experimentation), pre-commitments and affordable loss. Means and leverage contingencies were found to positively mediate innovation orientation and product/service innovation leading to increased firm performance. Affordable loss did not show a mediating role, but had a direct effect on firm performance. Research limitations/implications – This study establishes two distinct sub-constructs of firm-level innovation; namely innovation orientation and product/service innovation. Second, by testing an innovation-centric effectuation model, this research establishes an empirical relationship between effectuation, innovation and firm performance. Practical implications – Practical implications include establishing a relationship between means, leverage contingencies and innovation-performance, indicating that the ways through which small and medium-sized enterprises use their innovation networks may affect innovation outcomes and ultimately firm performance. Originality/value – This research establishes an empirical relationship between effectuation, innovation and firm performance, extending effectuation theory from the entrepreneurship to the innovation literature.

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