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Who Should Export? A Study of Small- and
Medium-sized High-tech Enterprises
Lee Li*
School of Administrative Studies
Atkinson Faculty of Liberal & Professional Studies
York University, 4700 Keele Street, Toronto
Canada M3J 1P3
Email: leeli@yorku.ca
Gongming Qian
Department of Management
The Chinese University of Hong Kong
Hong Kong
Email: qian@baf.msmail.cuhk.edu.hk
* Corresponding author
Lee Li
School of Administrative Studies
Atkinson Faculty of Liberal & Professional Studies
York University
Canada
4700 Keele Street, Toronto
Canada
M3J 1P3
Tel: (416) 498 3355
Fax: (416) 499 2731
Leeli@yorku.ca
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Who Should Export? A Study of Small- and
Medium-sized High-tech Enterprises
Summary
This study aims to explore the factors influencing the performance of exporting
small- and medium-sized technology-based enterprises (SMTEs). Literature
review suggests that innovator position, market awareness, niche operations,
number of export markets, and distribution partnerships should all have positive
impacts on their performance. However, the findings partially agree with, and
partially dissent from, the above propositions.
Exporting has been an important strategy for small- and medium-sized enterprises
(SMEs), and particularly for those technology-based enterprises (SMTEs) (Karagozoglu
and Lindell, 1998; Lu and Beamish, 2001). The most obvious gains of this strategy are
related to scale and scope economics as achieved from larger volumes of sales and
production made possible by revenue growth in geographic extension of markets (Segers,
1993). In addition, a presence in multiple, diverse international markets can lead to
advantages related to increase of market power, product knowledge, and country-specific
knowledge (Acs et al., 2001; Preece et al., 1998; Qian, 2002). These advantages can serve
as the platform for future international expansion (Lu and Beamish, 2001). More
importantly, exporting is particularly applicable to SMTEs that suffer from resource
shortages. Exporting requires little capital investments, and thus provides a feasible entry
mode for SMTEs. However, few studies have been reported as to how exporting SMTEs
manage uncertainty, turbulence, and hostility in overseas markets and maximize their
performance. The purpose of this paper is to capture the factors that may affect the
performance of exporting SMTEs’ and assess the feasibility of strategies that are
available for exporting SMTEs to improve their performance.
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LITERATURE REVIEW
The Characteristics of SMTEs
SMTEs enjoy advantages but also suffer disadvantages in their competition against
large firms. Their major advantages include innovativeness (Segers, 1993). SMTEs’
innovativeness can be traced to two sources. First, SMTEs possess nimble and flexible
management system (Meredith, 1987). The organizational simplicity and functional
flexibility enable SMTEs to develop or shift to new technologies faster and at lower costs
than large firms can (Cohen and Klepper, 1996). Second, employees at SMTEs are
generally more innovative than those of large firms (Acs and Yeung, 1999). An innovator
in a large company has very limited property right protection as the innovation generally
belongs to the corporation and not to the employee who invent it. In contrast, employees
in SMTEs hold clear property rights and thus have every incentive to undertake radical
innovations.
SMTEs’ disadvantages are characterized mainly by size constraints and resource
shortages. Consequently, SMTEs can hardly compete in resources and cannot bear high
risks (Kobrin, 1991). Two strategies have been recommended for SMTEs to manage
resource shortages and high risks. First, they should concentrate their investments within
certain market niches (Porter, 1990). Resource concentration relaxes size constraints and
thus helps increase SMTEs’ competitiveness in those niches (Kohn, 1997). Second,
SMTEs can work closely with partners as strategic alliances. Alliances not only pool
different resources but also spread the risks (Stuart, 2000).
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The Characteristics of High-tech Industries
High-tech industries are different from traditional industries. The main characteristics
of high-tech industries include high initial costs in R&D, technological uncertainties,
short product life cycles and first time buyers (Kobrin, 1991; Porter, 1985). High initial
costs in R&D imply that SMTEs should devote and concentrate their limited resources on
R&D activities (Kohn, 1997). Technological uncertainties and short product life cycles
suggest that SMTEs should maximize sales and recover investments quickly before the
technologies become obsolete (D’Aveni, 1994). Consequently, SMTEs should enter
various markets swiftly and grab sales and profits when they invent technologies or
products (Saloner et al., 2001). First time buyers indicate the importance of customer
education (Porter, 1985). In high-tech industries, new technologies and new products
emerge frequently to replace existing ones. Customers may not develop intensive
knowledge about these new products and advertising is therefore necessary to create wide
market awareness and overcome customer objection towards new products.
Exporting and Entrepreneurship
Exporting is one of the most important paths for SMTEs’ growth (Lu and Beamish,
2001). Exporting provides SMTEs with fast access to foreign markets and the consequent
market opportunities for their innovations (Root, 1994). Such fast business growth helps
SMTEs spread the high R&D costs over large businesses across countries and thus
achieve larger economies of scale (Porter, 1985).
However, exporting strategy involves many unique challenges for SMTEs. Expansion
into foreign markets exposes SMTEs to higher market uncertainties, turbulence, hostility
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than their home markets, and thus lead to higher risks for SMTEs such as fluctuations of
exchange rates (Zoubir, 1999). In addition, liabilities of foreignness require high
managerial demands (Zahra and Garvis, 2000). Due to their size constraints, SMTEs may
not have sufficient resources to manage the challenges. Niche operations and partnerships
with resident partners can help SMTEs relax these demands (Keegan and Seringhaus,
1999). Niche operations across different countries offer SMTEs the opportunities to
operate in the same market segments across countries and thus makes it possible for them
to standardize their products (Carson and Gilmore, 2000). Product standardization
reduces production costs and coordination costs (Porter, 1990). Partnerships with resident
partners help SMTEs spread the risks across partners and get fast access to external
country-specific knowledge (Stuart, 2000).
HYPOTHESIS DEVELOPMENT
Innovator Position
When an SMTE exports into a foreign country, it faces entry barriers set by both
resident competitors and host governments (Zoubir, 1999). The SMTE can break through
the barriers only if it possesses either cost advantages or product advantages over the
resident competitors (Porter, 1990). It is difficult for an exporting SMTE to develop and
maintain cost advantages over resident competitors. Cost advantages are based mainly on
larger volume (Porter, 1985). With resource constraints, SMTEs can hardly achieve large
volumes in individual export markets (Lu and Beamish, 2001). Moreover, lack of
country-specific knowledge, lack of local promotion resources, and lack of local
distribution networks all restrict SMTEs’ competencies to compete in costs in foreign
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markets against resident competitors (Root, 1994). In addition, coordination of promotion,
distribution, and sales across countries incurs high administration costs for exporting
SMTEs (Hitt et al., 1997). Tariff and other trade barriers by host country governments
and transportation between countries add to the resident competitors’ cost advantages
over exporting SMTEs (Keegan and Seringhaus, 1999).
In order to break through the entry barriers, exporting SMTEs’ chances then rest
principally on their competencies to develop and maintain product advantages. Product
advantages are based on innovations which have not been duplicated by competitors
(Porter, 1990). In high-tech industries, frequent innovations and short product life cycles
provide SMTEs with great opportunities to innovate and achieve first-mover advantages
over resident competitors. Innovations facilitate SMTEs’ market entry as customers in
overseas markets are willing to pay higher prices for better products. Moreover,
governments of both developing and developed countries do not restrict imports of new
technologies (Buckley and Mirza, 1997).
Exporting SMTEs enjoy great opportunities to nurture innovations (Acs and Yeung,
1999). With organizational simplicity, exporting SMTEs can shift to new technologies or
new products fast and at low switching costs. More importantly, exporting SMTEs are
exposed to diversity of needs, culture, and competition across countries and thus have
greater chances to learn and innovate. Moreover, employees of SMTEs are highly
innovative as they benefit directly from innovations. The logic above suggests that
exporting SMTEs should invest considerably in R&D and achieve first-mover advantages.
Therefore, we propose:
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Hypothesis 1: The performance of an exporting SMTE is positively associated with
its innovator position.
Market Awareness
Innovator strategy is usually accomplished with wide market awareness (Lambkin and
Day, 1989). As an innovator, the exporting SMTE is the sole supplier in the export market.
It has to inform potential customers about the merits of its new products and convince
consumers of the value of new products over the existing ones (Porter, 1985). Market
awareness can be more important in high-tech industries than in traditional industries, as
new products offered in high-tech industries can be dramatically different from existing
products and not widely familiar to potential consumers (Moriarty and Kosnik, 1989).
Creating market awareness can be more important for exporters than domestic suppliers.
In comparison with resident competitors, exporters’ brand recognition can be limited as
they have not operated in export markets for long. Cultural differences and psychic
distance may deter customers from purchase action. Wide market awareness can reduce
the negative impacts of cultural differences and psychic distance. More importantly, wide
market awareness can serve as an effective means to overcome entry barriers such as
high-price image and local consumers’ negative perception of imported products.
Therefore, we propose:
Hypothesis 2: The performance of an exporting SMTE is positively associated with
its market awareness.
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Niche Operations
Innovator strategy and wide market awareness require a large amount of financial
resources. Exporting strategy incurs high costs as well, such as information searching
costs, exporting administration costs, and exporting distribution costs (Root, 1994). With
the size constraints, exporting SMTEs can hardly afford to commit those investments in
various market segments. Thus they have to concentrate their resources in certain market
niches. Niche operations provide strategic benefits for exporting SMTEs. First, they can
carve out niches that few direct competitors serve (Porter, 1985). Thus, niche operations
relax direct competition from resident competitors who enjoy cost advantages in their
home markets. In addition, niche operations help exporting SMTEs to overcome trade
barriers as similar products may not be available in the export markets and host
governments can hardly restrict the imports of the products in question. Second, focus
orientation relaxes the constraints of resource shortages (Covin et al., 1990). With niche
operations, exporting SMTEs can concentrate most of their resources in certain niches
and thus increase the effectiveness of these investments. Third, niche operations across
different countries provide exporting SMTEs with the opportunities to standardize their
products across countries, as they cover the same market segments in these countries.
Product standardization across countries reduces production costs and coordination costs
(Hitt et al., 1997). Moreover, product standardization spreads high R&D costs over large
product volume achieved across countries and thus relaxes SMTEs’ cost pressure.
Therefore, we propose:
Hypothesis 3: The performance of an exporting SMTE is positively associated with
its niche operations.
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Overseas Market Involvement
Niche operations relax resource shortages, but they may not generate sufficient sales
to recover high R&D and advertising costs in high-tech industries (Preece et al., 1999).
Consequently, SMTEs have to export into various foreign countries. Exporting into
various foreign markets provide SMTEs with various gains. First, with substantial R&D
investments, SMTEs have to leverage their R&D costs across great sales volumes which
inevitably must be achieved across various countries (Pitts and Lei, 2000). Second,
technological uncertainties in high-tech industries often lead to high risks. Environmental
velocity associated with overseas operations adds to the risks (Root, 1994). SMTEs have
to spread high risks across different countries and thus reduce their failure rates. Third,
with short product life cycles in high-tech industries, SMTEs should export swiftly into
various markets and thus maximize their sales revenues and profits before their
innovations become obsolete. Fourth, a presence in multiple, diverse international
markets can lead to advantages related to increases in market power (Lu and Beamish,
2001). Such market power is manifested in brand name and market recognition (Porter,
1985). In high-tech industries, the market power can be essential. With high technological
uncertainties, customers usually purchase only from those who have established
reasonable brand equity in the markets. Last, operations in multiple and diverse countries
expose SMTEs to diverse needs, culture, and competition and thus speed up their learning
and innovating process (Hitt et al., 1997). Therefore, we propose:
Hypothesis 4: The performance of an exporting SMTE is positively associated with
the number of its export markets.
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Distribution Partnerships
Simultaneous exporting into various countries helps SMTEs build up swiftly their
competitive advantages but also creates problems. First, establishment of distribution and
marketing infrastructures in various countries requires huge investments. Second,
exporting into a particular country requires country-specific knowledge. Without countryspecific knowledge of clients, market and demand situation, a firm can hardly exploit
opportunities in that particular country (Lu and Beamish, 2001). Market-specific
knowledge is more important in high-tech industries than in traditional industries, as
market jolts are frequent in high-tech industries and a firm needs country-specific
knowledge to manage market jolts (Stuart, 2000). Consequently, SMTEs should develop
market-specific knowledge swiftly when they enter overseas markets. However, marketspecific knowledge is difficult and costly to develop, as it is accumulated through
learning-by-doing process (Eriksson et al., 1997).
Alliances with resident distributors provide an optimal solution to the above problems.
First, when firms work together and pool their resources, they relax their resource
shortages. By working with resident distributors, exporting SMTEs can get access to
established marketing and distribution facilities swiftly and at low costs (Lu and Beamish,
2001). With a better country-specific knowledge, resident distributors usually manage
distribution functions better and at lower costs than exporting SMTEs (Acs and Yeung,
1999). Second, high uncertainties in high-tech industries expose firms to greater risks and
SMTEs of shallow pocket may not be able to absorb the full risks associated with
innovation and internationalization (Stuart, 2000). By teaming up with partners, SMTEs
can spread and reduce the risks. Third, because resident distributors operate at their home
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markets, they have accumulated high levels of customers’ trust and confidence. By
working with resident distributors, exporting SMTEs can benefit from such market trust
and confidence. Last, alliances increase flexibility and reduce switching costs should
undesirable events occur (Kohn, 1997). Therefore, we propose:
Hypothesis 5: The performance of an exporting SMTE is positively associated with
its partnerships with resident distributors.
METHOD
Sample Selection
We chose the biotechnology industry as our research field. This industry has shown
important characteristics of high-tech industries (Zahra and George, 2000) and has
become an important industry of the future (Shan and Song, 1997). According to Burrill
and Lee (1992), a biotechnology firm is defined as a company that was established
primarily to engage in the development, production and marketing of biotech products.
The criterion for our sample selection was strictly based on the above firm characteristics.
The company name was gathered from Bioscan and Ernst and Young’s Industry Annual
Report.
The sample in this study includes only biotechnology companies that were engaged in
exports. Three other criteria were also employed to select sample. First, the firm had to be
established for at least five years. As failure rates in high-tech industries are extremely
high, this is to ensure that the firm has ‘come through’ the early turbulent years
(McDougall et al., 1994). Second, it had to employ at least ten people. This is to ensure
that they are not deemed to be ‘self-employed’ enterprises (Carson and Gilmore, 2000).
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Third, only independent firms, as opposed to corporate-sponsored counterparts, were
considered since research has revealed that substantial differences exist between the two
(Zahra and George, 2000).
The study uses company-level data including annual reports, 10-k filings and other
documentation produced by the firms. These provide company information on R&D,
advertising, number of employees, age of the company, history of co-operation with other
parties (including the name of partners), international activities and company segment
sales. To smooth out temporal fluctuations in company data, a three-year average 1995 to
1997 is used for the variables in the study. The final sample comprised 63 firms.
Measures
Dependent Variable
Firm performance. We defined export performance using both accounting and
operating-based measures: (1) return on assets (ROA), (2) return on equity (ROE), (3)
return on sales (ROS), and (4) sales growth (SG). For each firm, we compiled data for
four performance measures over a three-year period (1995-97) by the average annual. We
used averages to reduce variability in the data.
Independent Variables
Innovator position was measured by R&D intensity. R&D is the key factor that leads
firms to build and maintain their innovative position (Franko, 1989; Hitt et al., 1997;
Mutinell and Piscitello, 1998). It is the average of the reporting business’s annual
expenditures on R&D expenses, divided by revenues. Market awareness was measured
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by advertising intensity, which captures brand name, reputation and consumer goodwill
(Ettlie, 1998; Lu and Beamish, 2001; Morck and Yeung, 1991). As such, it creates market
awareness (Porter, 1985). Like previous studies (e.g. Deliois and Beamish, 1999; Lu and
Beamish, 2001; Morck and Yeung, 1991), we measured the variable by the average of the
reporting business’s annual expenditures on advertising expenses, divided by revenues.
Product scope was determined using the entropy measure to gauge the extent of
relatedness of a firm’s activities based on SIC classification. Products within the same
four-digit SIC industry group are treated as related. Products from different two-digit SIC
industry groups are taken as unrelated. We treat the former as being proxy of operations
in narrow niches. In contrast, we regard the latter as being equal to operations in broad
product segments. Overseas market involvement was determined by the number of
countries/markets to which a firm exported. Partnerships were a continuous count
variable measured by the actual number of formal agreements (e.g. contracting and
licensing agreements) in the functional area of marketing and distribution.
Control Variables
Following prior research (e.g. Geringer et al., 2000; Grant et al., 1988; Hitt et al.,
1997; Markides, 1995; Tallman and Li, 1996), we also control for several firm-specific
variables to capture other factors that might influence firm performance. These are: firm
age, size, and leverage, risk and past performance.
Firm size was measured by logarithm of total sales. Firm age was measured by the
actual existence of the firm since the starting year of its operations. The older the firm,
the more experienced its management will be. Firm leverage was measured by long-term
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debt as a proportion of total capital. Leverage is a two-edged sword (Levy and Sarnat,
1986). This is particularly so for smaller firms. On one hand, smaller firms are generally
constrained by financial resources in their internationalization process, and an effective
way of overcoming such constraints is to increase financial leverage (Qian and Wang,
1999). This enables them to maintain competitive advantages by securing existing
markets as well as entering new markets (Cooper et al., 1994). On the other hand, the
negative effects of leverage are also very likely to occur particularly for these smaller
firms (e.g. increased risk and declining performance). Firm risk was measured by the
standard deviation of accounting-based returns over the period from 1993 to 1995. Risk
increase may adversely affect profits because it denotes some degree of hazard (Bettis
and Hall, 1982). Past performance was measured by the average of all accounting-based
returns for the previous three years (1993-95). It may affect the availability of slack
resources and therefore the risk-taking ability (Zahra and Garvis, 2000).
RESULTS
Summary statistics for all variables are reported in Table 1. As shown in the table, the
low intercorrelations among these variables suggest no problems with multicollinearity.
We are therefore assured that the regression estimates were not degraded by the presence
of collinearity.
---Insert Table 1 about here---
We report the results of regressing each of the four profitability measurements on all
major explanatory variables after controlling for past performance, firm size, age,
leverage, and risk in Table 2. Results of regressing ROS, ROA, ROE and Sales Growth
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on the above-mentioned explanatory variables are reported in Models I, II, III and IV
respectively. As hypothesized, three explanatory variables (i.e. innovator position,
number of overseas markets, and partnerships) are highly significant with the appropriate
sign, though the level of significance was slightly different. The results were consistent
across all models. As the findings indicate, the innovator position and partnerships
variables in particular were most significantly related to SMTEs’ performance (all
performance measures being at the 0.01 level or higher). Thus the results lend strong
support to Hypotheses 1, 4 and 5.
---Insert Table 2 about here--In terms of the ‘product scope’ variable, we found that except for its effect on sales
growth (close to being significant at the 0.10 level), the coefficients of the variable on all
other performance measures were significant. Taken together, these findings still lend
partial support to Hypothesis 3. Hypothesis 2 predicted the positive and significant effects
of market awareness on SMTE’s performance. Contrary to the prediction, however, the
coefficient of the variable was not significant ever at the 0.10 level though positively
signed. The result was also consistent across all models. Therefore, Hypothesis 2 should
be rejected.
The findings indicate that all four models were highly significant and each had
reasonable explanatory power. They accounted for 24 to 29 percent of the variability in
the dependent variables respectively. Figure 1 summarizes the empirical findings.
---Insert Figure 1 about here---
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CONCLUSION
This study provides important managerial implications. Exporting SMTEs should
innovate continuously by concentrating their investments on R&D so as to achieve firstmover position. They should also work closely with resident distributing partners because
partnerships present a primary source of country-specific knowledge and permit a rapid
market penetration at relatively low costs. Meanwhile, SMTEs should export into various
countries so as to build up sales volumes, reduce sales variability, and quickly recoup
investments in R&D. Niche operations can be sensible for SMTEs of serious resource
shortages. Niche operations are important for these firms to develop and maintain
technological leadership. However, it should be noted that niche operations might hurt
sales growth because market scope is relatively narrow. Therefore, niche operations may
not be appropriate for exporting SMTEs that aim to achieve considerable sales growth.
However, we fail to observe a significant correlation between market awareness and
performance. This implies that exporting SMTEs should not spend much funding on
advertising to create market awareness. We offer three possible explanations. First, there
exists a low-level cost effectiveness threshold in high-tech industries. Over this threshold,
advertising spending may not be effective any more in creating market awareness.
Cultural differences and psychic distance between customers in different countries may
not have great negative impacts on their purchase in high-tech industries. In other words,
exporting SMTEs can standardize their advertising programs across different countries
and thus do not have to spend much funding on advertising. Second, wide market
awareness in high-tech industries may not necessarily lead to customers’ conviction and
their purchase action. In high-tech industries, technologies embodied in new products are
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likely to be imperfect. Therefore, customers do not fully trust advertising. They would
rather draw on their own or their friends’ experience with the products. Third, heavy
expenditures to create market awareness divert limited resources from R&D to
advertising and thus dilute the firm’s innovation focus. However, this study can hardly
determine which of the above explanations is tenable, and we will focus on the issue in
our future research.
Findings from this study suggest two theoretical contributions. First, transaction cost
theory indicates that international expansion incurs high coordination costs and
administration costs which are positively correlated with the number of overseas markets
(Hitt et al., 1997). This study indicates that the benefits of international expansion
overwhelm transaction costs and SMTEs should export to a large number of countries.
Perhaps, coordination costs and administration costs may not be substantial for exporting
first movers as they export standardized innovations across countries. Second, traditional
marketing theories emphasize 4 Ps, i.e. products, prices, promotion, and places
(distribution channels). Findings from this study suggest that exporting SMTEs should
focus on products and places. Their exporting performance is largely determined by their
innovations and efficient distribution channels.
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20
Table 1: Means, Standard Deviations and Correlations of Independent Variables
___________________________________________________________________________________________
Variables
Mean
s.d.
1
2
3
4
5
6
7
8
9
___________________________________________________________________________________________
1. Innovator position
2. Overseas market involvement
3. Market awareness
4. Product scope
5. Partnerships
6. Firm leverage
7. Firm size (log)
8. Firm age
9. Firm risk
10. Past performance
13.92
3.10
1.39
0.226
5.23
7.05
1.87
10.42
4.59
10.31
4.91
1.30
2.64
0.119
2.04
16.8
0.31
5.27
3.71
7.02
1.000
0.263***
0.078
0.085
0.153* 0.057
0.033
0.071
0.193** 0.041
0.063
0.046
0.025
0.052
0.034
0.044
0.066
0.049
0.031
0.039
0.019 -0.065
0.082
0.061 0.022
0.050
0.039 0.012
0.020 -0.155*
0.026 -0.147*
0.021 -0.162*
0.074 0.036
-0.027
0.016
0.124
0.008
0.114
0.040
0.019
0.028
0.022
-0.119
___________________________________________________________________________________________________
*p < .10 level; **p < .05 level; ***p < .01 level.
20
Table 2: Piecewise Linear Least-Squares
Regression of Profitability of U.S. Biotech Firms
______________________________________________________________________________________
Dependent Variable
_____________________________________________________________
Model
Model I
Model II
Model III
Model IV
(ROS)
(ROA)
(ROE)
(Sales Growth)
______________________________________________________________________________________
Constant
0.885***
(0.260)
0.157***
(0.052)
0.036
(0.026)
0.092*
(0.049)
0.123**
(0.056)
0.162***
(0.043)
0.029
(0.021)
0.017
(0.013)
0.032
(0.022)
-0.085*
(0.044)
0.111*
(0.055)
0.946***
(0.294)
0.176***
(0.058)
0.052
(0.036)
0.109**
(0.055)
0.119**
(0.051)
0.143***
(0.040)
0.026
(0.017)
0.021
(0.016)
0.029
(0.018)
-0.073*
(0.038)
0.104*
(0.053)
0.818***
(0.255)
0.139***
(0.046)
0.045
(0.030)
0.097*
(0.049)
0.112**
(0.050)
0.135***
(0.038)
0.019
(0.014)
0.018
(0.012)
0.026
(0.020)
-0.079*
(0.041)
0.108*
(0.057)
R2
0.305
0.285
0.291
0.334
Adjusted R2
0.261
0.242
0.250
0.291
F-Statistic
9.663
8.932
9.905
10.674
Innovator position
Market awareness
Product scope
Overseas market involvement
Partnerships
Firm size
Firm age
Firm leverage
Firm risk
Past performance
0.924***
(0.297)
0.184***
(0.061)
0.059
(0.041)
0.083
(0.041)
0.131**
(0.059)
0.149***
(0.046)
0.022
(0.016)
0.024
(0.017)
0.028
(0.013)
-0.088*
(0.047)
0.101*
(0.051)
______________________________________________________________________________________
Standard errors are in parentheses.
Probabilities of both F-statistics are less than .001
*p < .10 level; **p < .05 level; ***p < .01 level.
21
Innovator position
Market awareness
H1: significant (+)
H2: insignificant (+)
Niche operations
H3: significant (+)
Overseas market
involvement
H4: significant (+)
H5: significant (+)
Distribution
partnerships
operation
Figure 1. Empirical Results
22
Performance
(ROA, ROE,
ROS, SG)