The Effect of Intangible Resources and Competitive Strategies on the Export Performance of Small and Medium Sized Enterprises

Ömer Kumlu / Procedia - Social and Behavioral Sciences 150 ( 2014 ) 24 – 34

capabilities are not tangible it is again kind of intangible resource to firm. So we use name intangible resources to cover also capabilities, and our first hypothesis is that:

H1: Intangible resources are positively related to company’s export performance.

2.3. Types of Intangible Resources (IR)

In this paper we subdivide intangible resources into three categories, which are intellectual property assets, managerial assets and network assets.

2.3.1 Intellectual Property Assets (IPA)

Intellectual Property Assets refer to resources like intellectual property such as trademarks, patents, reputable brand names, quality systems, company reputation, and etc, (Chatterjee and Wernerfelt, 1991; Hall 1992; Williams 1992). In this research we select Legally Protected Rights (patents, trademarks and etc), Quality Focus and Brands as Intellectual Property Assets. Montobbio and Rampa (2005) tabulated annual growth rate of patents and export shares to world total and found that export growth increases with number of patents. Yang and Maskus (2009) and Yang and Huang (2009) found that stronger intellectual property rights would have positive impact on export performance in Taiwan. Quality Focus implies a system which induces firms for creating superior offerings, prompting enhanced customer satisfaction and leading to increased customer loyalty and improved performance (Buzzell and Gale, 1987). To attain quality focus companies establish quality systems like ISO, TQM and etc to assure standard quality level in their products and services, through these systems they follow up the minimum quality standards required for their products and improve their quality accordingly. Emprical researches also support the adoption of quality focus to have better export performance; Figueiredo and Almeida (1988) and Cardoso (1980) bring proofs from Brazil that; poor quality control techniques affect export performance negatively. Czubala, Shepherdb and Wilson (2009) find robust evidence that non-harmonised standards with international standards reduce African exports of these products. Brands are also very important company resources. Exporters who face the poor reputation of their brand may end up with poor export performance (Cardoso, 1980; Gereffi 1992). Mohy-ud-Din et al. (1997) reported that the Pakistan yarn manufacturers have lost market share in virtually all their major markets due to image problems. Gereffi (1992) found that, lack of own internationally recognised brand names affect export performance negatively. Based on the above discussions regarding to Intellectual Property Assets, it may be proposed that:

H1: Company’s intellectual property assets are positively related to company’s export performance.

2.3.2. Managerial Assets

Managerial Resources are widely accepted as the main variables in SMEs’ exporting (Miesenbock, 1988). Adams and Hall (1993) studied 1132 SMEs across Europe and they find out that personal factors were to be most important factors in export performance. In this research Managers’ International Experience, Managers’ Export Commitment, Managers’ Risk Handling and Innovativeness of the Manager are selected as managerial resources. Filatotchev, Liu, Buck and Wright (2009) proved that export performance depend very much on managers' international experience. Eusebio, Andreu and Belbeze (2007) found that international experience is the main factor in the export performance of the Italian businesses. Wolff and Pett (2000) agree that management experience is a critical resource in the exporting of small firms. With the word managers' export commitment we mean the priority given to export. Aaby and Slater, (1989) found that export performance tends to be higher where management is committed firmly to exporting. Mohammed, Ali and Ramayah (2009) found that export commitment have significant impact on export performance. For Innovativeness of the Manager; Guan and Ma (2002) found that; export growth is closely related to innovation capability. Lages, Silva and Styles (2009) ‘s findings reveal that product innovation play a greater role in enhancing export performance. Nguyen, Pham, Nguyen and Nguyen (2008) found that innovativeness of Vietnamese SMEs enhances their likelihood of exporting. Some researchers have supported the positive effect of R&D intensity on export performance (Gemunden 1991; McGuinness and Little 1981; Eusebio, Andreu and Belbeze 2007). Finally in this research it is assumed that Managers’ Risk Handling chracteristics have positive impact on export performance. Aaby, and Slater (1989) found that export performance tends to be higher where management has the willingness to take risks. Based on the above discussions about managerial resources lead us to propose that: