Comparing Developed and Emerging Countries Exporting Performance: Does Strategic Choice or Environmental Pressure Matter?

• Published in: Global journal of flexible systems management Vol. 23; no. 3; pp. 421 - 430
• Main Authors: Gunawan, Janti, Fraser, Kym
• Format: Journal Article
• Language: English
• Published: New Delhi Springer India 01.09.2022
• Subjects: Business and Management; Original Research; Emerging and developed countries; Strategic choice; International strategy; Exporting performance; Environmental determinism
• ISSN: 0972-2696; 0974-0198
• DOI: 10.1007/s40171-022-00308-x

Exporting is the most common mode of entry when firms want to expand their operations via internationalisation. In this study, a comparison of the exporting performance between firms in a developed country, New Zealand, and an emerging country, Indonesia, is undertaken. The study aims to better understand the relationship between firm performance and exporting decisions, and whether performance is a result of the firms’ strategic choice or environmental pressure. Exporting firms from both New Zealand and Indonesia were targeted with a self-administered survey, and the companies involved ranged from low to high internationalised industries. Eighty-seven useable questionnaires were received from company owners and export managers, with 52 coming from New Zealand exporters and 35 from Indonesia. Regression analysis was conducted with the focus on two iterations, with the first being a test of the overall model, and the second iteration comparing the model to New Zealand and Indonesia data separately. With respect to the overall model, the study found that strategic choice is the significant factor when being compared to environmental pressure. When comparing differences between Indonesian and New Zealand exporters, the study found that the export performance of Indonesian firms was significantly linked between strategic choice and the age of the firm. The study indicates that as Indonesian firms mature, they improve the flexibility of their management systems to allow better strategic responses to international business opportunities. For New Zealand companies, the situation changes somewhat, with environmental uncertainty and the length of time to internationalise, being negatively associated with export performance. The less uncertainty of the environment and the less experience of the firm in the international market, the higher the export performance of New Zealand firms. With respect to different industries, firms that operate in highly internationalised industries can be pulled by the size and strength of industry networks, such as support from the association representing the industry.