Service advantage built on service capabilities: An empirical inquiry of international new ventures

Journal of Business Research 88 (2018) 371–381

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Service advantage built on service capabilities: An empirical inquiry of international new ventures

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Silvia L. Martina, , Rajshekhar (Raj) G. Javalgib, Luciano Ciravegnac,d a

California State University Los Angeles, 5151 State University Drive, Los Angeles, CA 90032-8121, United States Cleveland State University, 2121 Euclid Ave., Cleveland, OH 44115, United States c Kings College London, UK d INCAE, Costa Rica b

A R T I C L E I N F O

A B S T R A C T

Keywords: International new ventures Service advantage Informational resources Service capabilities Entrepreneurial orientation Export venture performance

The literature on high-tech international new ventures (INVs) has failed to consider the precursors of service advantage within the strategy interplay for approaching new markets overseas. Services account for an increasingly crucial component, especially in high-tech manufacturing sector. Attaining competitive advantage in international markets is contingent upon the level of service the firm offers to its customers. Building on the resource-based view, this study advances the literature by analyzing an integrative model of service advantage based on INVs' service capabilities. The findings show that service capabilities, leveraged from entrepreneurial orientation and informational resources, are central to attaining superior performance when developing a service advantage. Due to the high-velocity environment in which high-tech INVs compete, new strategies are needed for attaining service advantage. This study's findings have influential implications for research on new-venture decision making and international marketing.

1. Introduction Services have become predominant in the manufacturing sector—especially in high-velocity industries—and account for a rising relevant component of gross domestic product globally. In these high-velocity industries, such as high-tech, significant structural competitive changes are found due to the rapid diffusion and unprecedented use of information and communications technologies (World Resources Institute, 2008). High-velocity industries emphasize the brisk and discontinuous changes in demand, competition, and technological innovations (Wirtz, Mathieu, & Schilke, 2007). Such industries require fast decisions by firms (Eisenhardt, 1989; Judge & Miller, 1991). To achieve competitive advantage, firms operating in high-velocity environments must respond quickly to market changes or anticipate them by being aggressive and innovative and by implementing a clear strategy (Boudreau, Loch, Robey, & Straud, 1998; Riel, Allard, & Lievens, 2004). Competition in these environments requires faster differentiation, particularly in firms with international offerings (Xiaoyun, Xin, & Zheng, 2014). In theory, firms can respond by complementing the product offering with service components (Porter, 1980). However, little is known about how firms implement these service components to create a favored market position based on the provision of superior customer value due to service.

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Within this context, many international new ventures (INVs) have come into being, sharing entrepreneurial orientation (EO) attitudes as risk-taking, pro-activeness, innovativeness, and aggressiveness (Coviello & Cox, 2006). INVs are firms that, from inception, seek to gain substantial competitive advantage from the use of capabilities for the international sale of outputs (Oviatt & McDougall, 1994). EO is a firm's strategic orientation toward its decision-making actions, processes, and practices that lead to new market entry or a new value creation (Lumpkin & Dess, 1996). Research on international entrepreneurship (IE) has shown that EO is an important performance driver in approaching international markets (Cavusgil & Knight, 2015). Entrepreneurial firms create opportunities through their actions. The IE literature addresses the relevance of international opportunities recognized by entrepreneurial firms with foreign operations (Angelsberger, Kraus, Mas-Tur, & Roig-Tierno, 2017). To take advantage of these opportunities, such firms will often need to reconfigure their resource bases, using certain capabilities as the mechanisms for doing so (Covin & Lumpkin, 2011). Operating under resource-constrained conditions, INVs appear to overcome such deficiencies by leveraging unique capabilities that help them to recognize opportunities and adapt to changes in the international markets (Martin, Javalgi, & Cavusgil, 2017).

Corresponding author. E-mail addresses: [email protected] (S.L. Martin), [email protected] (R.R.G. Javalgi), [email protected] (L. Ciravegna).

https://doi.org/10.1016/j.jbusres.2018.01.024 Received 20 June 2017; Received in revised form 8 January 2018; Accepted 11 January 2018 0148-2963/ © 2018 Elsevier Inc. All rights reserved.

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resources—interact with other firm-level features to determine service advantage in high-velocity environments. Second, this study contributes to the INV literature by providing new insights into the role of service capabilities, showing that these capabilities mediate the relationship between informational resources and service advantage. Third, this study brings together entrepreneurship and early internationalization theory with marketing theory. Previous work on EO focused on its effects on internationalization and performance (Kuivalainen, Sundqvist, & Servais, 2007). This study, however, extends the literature by empirically analyzing an integrative model of EO, service capabilities, and informational resources, and by examining how the latter are interlinked and contribute to service advantages. Thus, this study links the IE literature with the international marketing literature on service advantage and service capabilities to inquiry hightech INVs. To the best of this study's knowledge, no previous research has attempted to examine the effects of EO on these marketing-anchored variables or to explore the relationship among service capabilities, informational resources, service advantage, and export venture performance. The novel model of this study recognizes INV managers concern that their investments will gain suitable service advantage rewards. However, based on the literature review in this study, INVs scholars are not certain of the context that will allow a firm to build considerable service advantage to increase export performance. This research is timely, offering the empirical grounding from which to advise INV managers on their decisions to build service advantage in high-tech industries. The remainder of the paper is organized as follows. Section 2 explains the study's theoretical background and states the hypotheses. Section 3 describes the methods chosen to provide evidence on the conceptual framework. Section 4, clarifies the analysis and reports the results of the hypotheses. Section 5 presents discussion, conclusions and the significance and contributions of the study. Finally, Section 6 explains the research limitations and suggests further research.

In high-velocity environments, product life cycles are frequently shortening; industry boundaries are continuously morphing; and competitive advantages are characteristically unsustainable. EO has proven a useful construct for understanding why and how some firms are able to regularly renew themselves via new growth trajectories, while others are not (Wirtz et al., 2007). However, the complexity of the EO-performance relationship challenges the understanding of how to best capture this connection. Lumpkin and Dess (2001) suggest that the relationship between an EO and performance varies according to the influence of internal and external factors on the firm and also depends on the type of environment. The impact of external factors on firm performance has been analyzed in the IE literature with contingency models that capture the interaction between EO and an aspect of the external environment (i.e., Martin & Javalgi, 2016; Wiklund & Shepherd, 2005). Conversely, the role of internal factors and their impact on the firm in relation to EO and performance have yet to be fully addressed in the IE literature (Knight, 2015). Concerning the influence of firms' internal factors, resources appear to be relevant to enacting an EO, especially in resourceconstrained INVs (Coviello & Cox, 2006). Thus, one might gain greater insight into performance by investigating the integrative mechanisms that ensure complementarity among the internal factors of the INV. Regarding the environment, the high-tech industry, in which INVs operate, has been enhanced by the widespread use of information technology and wireless communication. As services are prevalent in the high-tech manufacturing sector, and with firms experiencing constant pressure for product innovations and increasingly narrow profit margins, the ability to experiment with and capitalize on their service component has emerged as a promising avenue (Bitner, 1990). For firms to compete in this complex environment, they need distinctive information about customers, competitors, and the broader international market environment. This information becomes valuable and complex resources difficult to imitate (Morgan, Zou, Vorhies, & Katsikeas, 2003). Firms' challenge is to determine the mechanism that will allow them to use these informational resources to facilitate new product market introductions, easily delivered and serviced. Therefore, the firms pursue to achieve a preferred marketplace position that captures the provision of superior customer value. The way to achieve and sustain that position is through service—in other words, the service advantage (Kaleka, 2011). Although the marketing and IE literatures have devoted scant attention to the service advantage, customer satisfaction is emphasized through better service quality, albeit largely for service firms (Bitner, 1990; Bolton & Myers, 2003). The literature has not considered the physical fulfillment and logistics that complement the marketing component (Mentzer, Flint, & Hult, 2001) and should also offer insights into the nature of the service advantage. According to the logistics literature, service capabilities grant to launch new products into the market, to effortlessly deliver and service them (Yang, Marlow, & Chin-Shan, 2009). However, the marketing and IE literatures do not address this concept. Additionally, the literature on high-tech industry emphasizes the role of information and service; however, little is known about their relationship with the service advantage and the performance of INVs. Furthermore, the literature offers no insights into the empirical relation of information and service with EO (Rauch, Wiklund, Frese, & Lumpkin, 2004). This study attempts to address these gaps in the INVs' literature by examining the contribution of different firm factors to achieving a service advantage. Drawing from the resource-based view (RBV) of the firm, this study identifies a bundle of resources and capabilities as potential influencers of INVs' service advantage and performance. In sum, this study makes three contributions to knowledge in this important area of informational resources and service capabilities. First, the study builds on the RBV (Barney, 1991) to offer a novel extension on how informational resources—a critical, yet understudied, type of

2. Theory and hypotheses Intensifying competition and increasingly knowledgeable global consumers are only two of the factors that make differentiation in the international offering important. Although product quality improvements are the obvious first step in differentiation for firms, complementary service elements offer substantial opportunities to produce customer value and improve performance (Porter, 1980). Most INVs launch their foreign activities through exports (Knight & Cavusgil, 2004), especially in the high-tech industry (Burgel & Murray, 2000). Accordingly, the primary unit of analysis in this study is the export venture of the INV firm. Fig. 1 presents a conceptual model of the study. The achievement of service advantage in the international market is depicted as contributing to the INV's export venture performance. In line with the RBV (Lockett, Thompson, & Morgenstern, 2009), this study's interest centers on the idiosyncratic firm factors that enable the INV to offer service attached to the new products during sales and distribution in the international market. The deployment of service capabilities enables INVs to achieve service advantage and export venture performance. Informational resources are deployed on two routes toward service advantage, one via service capabilities, and the other as a direct link. While the direct link involves the acquisition of informational resources, such valuable knowledge about customers, competitors, channel members and the broader market environment (Morgan et al., 2003), service capabilities allow for the development of easily delivered and serviced new products (Day, 2011; Yang et al., 2009). Furthermore, Fig. 1 depicts the influence of EO on informational resources, service capabilities and export venture performance. EO, clearly a prominent characteristic of INVs, has been examined in numerous studies since 2004 (e.g., Jones & Coviello, 2005; Mathews & Zander, 2007). Although most of the literature operationalizes EO in an 372

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Fig. 1. Conceptual Framework.

H6 (+)

Informational Resources

Entrepreneurial Orientation

H4 (+)

Service Advantage

H3 (+)

H5 (+)

Service Capabilities

H2 (+)

H8 (+)

H1 (+) H7 (+)

Export Venture Performance

combine, and integrate to achieve competitive advantage (Eisenhardt & Martin, 2000). From this array of capabilities, several pertain the firm to develop new products after learning what customers want and the alternative offers are available in the market. These new product development capabilities are at the core of the firm and should be maintained and continuously upgraded to satisfy and anticipate customer needs. Other capabilities involve the use of pricing skills to respond quickly to any customer changes (So, 2000) and the provision of high-quality distribution and after-sales service (Asugman, Johnson, & McCullough, 1997; Yu, Gilbert, & Oviatt, 2011). Firms with adaptable manufacturing processes in place are ready to adjust product design and to incorporate distributors' requests for specific product features (Calantone, Kim, Schmidt, & Cavusgil, 2006). They can develop products that are easy to support and service after sale. Accordingly, these firms enhance both their own and their distributors' advantage with end users. The service literature is largely supportive of a positive relationship between innovation in services attached to new products and performance (Agarwal, Erramilli, & Dev, 2003). Firms attempt to provide offerings that create superior customer value and satisfy customers. Subsequently, high customer satisfaction should indicate increased loyalty and profitability (Anderson et al., 1994). Alternatively, by reducing the cost of the delivered offering, firms are likely to attain higher profit margins and, thus, increase their profitability; or by lowering the product price, they are likely to achieve larger sales volume and, greater profits (Day & Wensley, 1988). For exporters, the overseas distributor becomes key when the final consumer ultimately evaluates the export venture performance, especially in terms of the level of service provided by the distributor. With time, INVs acquire an image based on, among other factors, the level of service they offer in the specific market, which affects the final consumers' buying choice. The INVs' service advantage is constantly compared with that of their competitors. Therefore, INVs putting competitive emphasis on their service component leads to the following hypothesis:

export context, in the international context, no agreement is found on how EO should be conceptualized. Some studies utilize a sort of international EO measure by changing the wording of the indicators to display the internationalization process (Kuivalainen et al., 2007). The risk of this avenue is the possibility of operating with redundant indicators (Jones & Coviello, 2005). To avoid this risk, the present study embraces the traditional measure of EO following Slevin and Terjesen (2011). 2.1. Service advantage and export venture performance Abundant studies depict a direct positive relationship between advantage and performance (Powell, 2001); however, little is known about service advantage and performance in international markets. Service advantage reflects the position that the firm has achieved in the specific market as a result of service (Kaleka, 2011). Empirical evidence from new product development studies have shown that differentiation advantage is positively related to performance (Li & Calantone, 1998). Various streams of the service literature clearly suggest a positive relationship between service quality and customer satisfaction and loyalty (Babakus, Bienstock, & Van Scotter, 2004; Mentzer et al., 2001), which, in turn, are prime determinants of long-term financial performance (Heskett, Jones, Loveman, Earl Sasser Jr., & Schlesinger, 2008). Numerous studies have found that improvements in service quality and customer satisfaction lead to improved firm performance (Anderson, Fornell, & Lehmann, 1994; Cronin, Brady, & Hult, 2000). Service advantage, as a component of the overall competitive advantage, has been shown to be positively associated with export venture performance (Morgan, Kaleka, & Katsikeas, 2004). Additionally, Ha-Brookshire and Dyer (2009) have found a positive association between service advantage and the firm's relationship performance with foreign business partners. Therefore, this study finds sufficient grounds to hypothesize the following: H1. The service advantage pursued by the INV firm is positively related to export venture performance in the international market in which the INV firm competes.

H2. Service capabilities are positively related to the service advantage pursued by the INV firm.

2.2. Service capabilities and service advantage 2.3. Informational resources and service capabilities The combination of theoretical insights from the RBV and the relevant dynamic capabilities approach (Teece, Pisano, & Shuen, 1997) refers mainly to the role of specific firm capabilities to effectively deploy and update existing resources. An array of capabilities interact,

Informational resources accentuate several aspects. First, they emphasize better customer listening in order to increase interactivity with the broader marketing environment (Duncan & Moriarty, 1998). 373

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Informational resources also involve the firm's ability to gather data on both market components: customers and competitors (Morgan et al., 2003). Another aspect is these resources' relation to market intelligence generation, marketing communication skills, and customer-related information, all of which are intended to improve firms' understanding of the dynamics of the particular international market (Leonidou & Theodosiou, 2004). Informational resources are based on the information interchange among the firm, customers, competitors, channel members, and the broader market environment. The firms that compete in international markets and possess superior informational resources relative to competitors are more likely to develop broader and more accurate knowledge of the international market structure. Using this knowledge, firms are more able to develop products that fill gaps in the international market or add features that better meet customers' requirements (Toften & Rustad, 2005). These firms are also expected to sense market changes earlier than their counterparts and, thus, to have more time to plan their response (Capron & Chatain, 2008). Firms that develop an ability to acquire international market information can obtain better insights into the difficulties that the distributor faces and the resources and effort needed to overcome them. Often, the distributor, in part because of its closeness to the local institutions, is the main source of information on competitive tactics and new product introductions (Bonner & Walker, 2004). The distributor-sourced information on competitive moves, end-users comments, and productrelated requests contributes to developing a mutual understanding of the environment (Luo, 2001). While close relationships with the distributor help the manufacturer understand the importance that the endusers place on the international-specific market attributes, little is known about how delivering after-sales service can be used to fulfill end-users' requirements (Asugman et al., 1997). Thus, the next hypothesis is offered.

2.5. Entrepreneurial orientation and service capabilities The notion of EO suggests that some firms are more willing than others to continually search for opportunities and solutions outside the realm of their current activities. Firms with EO frequently create, define, discover, and exploit opportunities well ahead of their rivals (Lumpkin & Dess, 1996). In recent years, the RBV has been incorporated in the entrepreneurship literature (Lee, Lee, & Penning, 2001), with Alvarez and Busenitz (2001) arguing that the entrepreneurial actions that create and combine resources to create new heterogeneous resources are what contribute to a firm's competitive advantage. According to the RBV, the firm comprises a bundle of resources and can gain superior performance and competitive advantages by developing and deploying unique and idiosyncratic organizational resources and capabilities (Barney, 1991; Peteraf, 1993). Increasingly, the RBV has also been used to inform research in IE, with Knight and Cavusgil (2004) arguing that the RBV helps explain how unique organizational capabilities are developed and leveraged by the internationalizing new venture. To survive and thrive in today's global hightech environment, INVs need to sell their goods and services to overseas customers, and EO can enable them to conduct such activities effectively (Knight, 2015). EO has been found to correlate with the development of specific types of capabilities that enhance INVs' performance, allowing them to create or transform for adding value through the organization of resources. Weerawardena, Liesch, Mort, and Knight (2007) argue that understanding not just product, but also service is critical to INVs' capabilities. Service capabilities prompt firms to rapidly develop new products, successfully launch them in the international market, and attach several services to them (Yang et al., 2009). Service capabilities involve: quickly and successfully developing and launching new export venture products (Bonner & Walker, 2004); deploying sales service by using pricing skills for a rapid response to the market (Yu et al., 2011); emphasizing after-sales service (Asugman et al., 1997); and establishing and maintaining closeness with distributors and retailers (Bello et al., 2003). While the theory behind EO's relation to firm capabilities is widely accepted (Dess, Lumpkin, & Covin, 1997), still no consensus is found about the empirical implementation of this relation in the IE literature. Although most studies operationalize EO in an export context, several IE studies modify, to various degrees, the EO scale into some type of international EO measure. Scholars supporting this direction should be careful not to employ tautological indicators (Slevin & Terjesen, 2011). Extant international EO measures also vary by level of analysis. Some research views international EO as an individual characteristic (Weerawardena et al., 2007), while others strongly associated this with a decision maker's international orientation (Ibeh, 2003). Taken together, no consensus is established regarding how EO should be conceptualized in an international context, although most operationalization places EO in an export context. To advance this dispute, this study employs the traditional measure of EO to explore its effects at the export venture level of INVs. Therefore, this study hypothesizes the following:

H3. Informational resources is positively related to the INV firm's service capabilities.

2.4. Informational resources and service advantage Informational resources involve the ability to collect market information, to maintain close customer relations and to effectively communicate advertising and promotional programs (Morgan et al., 2003). When the firm improves its ability to gather competitor information—such as competitors' cost structures and competitive behaviors—the firm can initiate effective cost-containment programs, which lead to low-cost advantage (Furrer, Sudharshan, Thomas, & Alexandre, 2008). This is the building block toward developing a cost-leadership strategy. A differentiation strategy requires information from competitors and the marketing environment about the degree of distinction of international products. Close customer relationships enable more effective communication of distributors' and end-users' comments, complaints, and desires to the firm, and, within the complex international market, such close relationships offer the firm the opportunity to respond (Angelsberger et al., 2017). Furthermore, through ongoing interaction, the firm develops a more holistic picture of the international market (Bello, Chelariu, & Li, 2003). Thus, the firm is better able, for example, to predict incoming order volume and ensure smooth order fulfillment. Close relationships with customers also allow the firm to acquire international market information on brand image, brand awareness, and share of mind, among other service advantages (Knox, 2004). Skillfully using marketing communications allows the firm to obtain information on the pre- and post-sales service offered (Asugman et al., 1997; Yu et al., 2011). Therefore, the following hypothesis is proposed:

H5. Entrepreneurial orientation is positively related to the service capabilities of the INV firm. 2.6. Entrepreneurial orientation and informational resources Given the high-velocity environment posed by globalization, one would expect INVs to adopt a strong entrepreneurial stance in strategy making. INVs possess a combination of innovative, proactive, riskseeking, and aggressive behaviors that cross national borders and aim to create value. EO allows INVs to creatively discover and exploit opportunities that lie outside domestic markets in the pursuit of competitive advantage. INVs, which may have fewer resources to compete head to head with larger rivals, have in their favor a strong EO and will

H4. Informational resources are positively related to service advantage in the INV firm. 374

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substantial access to financial capital; however, the effect was strongest on firms in stable environments and with less access to capital. The IE literature highlights that a contingent approach of external factors enhances the positive EO-performance relationship (Martin & Javalgi, 2016). However, these findings are not uncontested. Bauweraerts and Colot (2017), for example, find a negative EO-performance relationship in which external factors reduce the negative effect on this link. Although differences in findings may be attributed to differences in research design or to methodological idiosyncrasies, such differences apparently reflect the fact that EO may sometimes, but not always, contribute to positive performance. Therefore, this study hypothesizes:

fare better than firms that lack such an orientation (Knight, 2000). Empirical research supports the notion that the effect of EO on performance varies across different types of external environments (Covin & Slevin, 1989; Zahra & Covin, 1995) and resources internal to the firm (Brush, Greene, & Hart, 2001). Following the previous discussion about the RBV applied in IE (Knight & Cavusgil, 2004), resources are at the heart of the RBV and are used as inputs to organizational processes (Grant, 1991). The IE literature stresses the ability of INVs to rapidly acquire and use information about the market (Knight, 2015). Firms with international operations emphasize information acquisition in the specific overseas market and are likely to seek market information on customer needs (Leonidou & Theodosiou, 2004). The literature may trigger overconfidence in the current ways of carrying out information search, resulting in a myopic view of potential market segments and valuable sources of information in new markets (Petersen, Pedersen, & Lyles, 2008). However, these last arguments are most relevant to the search for opportunities in completely new markets. This study suggests that EO allows INVs to avoid myopia and overconfidence and to find market opportunities. Consequently, this evidence leads to hypothesize:

H8. Entrepreneurial orientation is positively related to the performance of the INV firm. 3. Research methodology Due to the considerable growth in manufacturing exports from Latin American countries, increased attention on the role of INVs is found in the region (Lopez, Kundu, & Ciravegna, 2009). Following an extensive program of trade liberalization, high-tech manufacturing exports from Mexico have grown substantially over the past decade (Aulakh, Kotabe, & Teengen, 2000). The sample used in this study consists of 260 INVs from Mexico, out of a total population of 1433 INVs. In Mexico, no INVs' database is found, in the government databases these firms are categorized simply as exporting firms, without a high-tech identifier. A firm-level and international-venture-level data from high- tech industries in Mexico was generated. To achieve this, databases that contained information across high-tech industries were evaluated and selected (Fernhaber, McDougall, & Oviatt, 2007). The databases were assessed for the inclusiveness of fields enabling the identification of high-tech INVs in Mexico, such as the age of the firm at exporting, the industry sector, and the firm size in terms of number of employees and sales turnover. A multi-industry sample was employed to reinforce the generalizability of the findings and to enlarge the observed variance, (Martin et al., 2017). Oviatt and McDougall (1994:49) define an INV firm as “a business organization that from inception seeks to derive significant competitive advantage from the use of resources and the sale of outputs in multiple countries.” Although this definition implies that an INV is international at inception, most scholars do not interpret this literally. Instead, they typically examine firms that internationalize within their first few years of existence. Based on Knight's (2005) suggestion that firms internationalizing after two years of founding perform better in foreign markets than those that internationalize later, this study examines INVs that internationalized within two years of their founding. This study follows the classification of the American Electronics Association to identify Mexican high-tech firms. Because INVs are SMEs that rely on cutting-edge technology to develop relatively new product innovations (Knight & Cavusgil, 2004), this study adopts the European Commission classification of SMEs regarding firm size (which is in line with that of the Mexican Ministry of Economy): Firms with 10–50 employees are considered small, and firms in the range of 51–249 employees are medium-sized. A target population of 1422 Mexican INVs was grouped together. After screening for trading status, contact details, firm characteristics, and willingness to participate, 111 firms were dropped. This screening process led to a usable sample frame of 1311 INVs. Concurrent to this screening process, the firms were pre-notified and the identity of the key respondent on each was obtained. A process was then begun of computer-assisted random calling of the firms in the usable sample frame to conduct telephone responses to the survey. After the resources were exhausted and the allowed time had elapsed, a total of 260 INVs had participated in the study. Each respondent reported on a self-identified export venture, which this study defined as a single product or product line exported to a specific export market (country). The final response rate was 19.8% of the usable sample

H6. Entrepreneurial orientation is positively related to informational resources of the INV firm. 2.7. Service capabilities and export venture performance The RBV sees capabilities as central to understanding a firm's export venture performance (Morgan, Vorhies, & Schlegelmilch, 2006). Indeed, a large number empirical studies on INVs conclude that capabilities are the source of superior performance (Zahra, Duane Ireland, & Hitt, 2000; Zhou, Aiqi, & Barnes, 2012). However, little is known about service capabilities and INVs. Service capabilities reflect the firm's ability to deliver superior customer service relative to the competition and to achieve service advantage (Yang et al., 2009). The international production literature argues that capabilities in the services dimension, such as customer response, service reliability, and value added services, are drivers of firm performance (Lu, 2003). Innis and La Londe (1994) find that customer service capability is positively related to customer satisfaction, customer loyalty, and market share. Also, international production scholars find a positive effect of service capabilities on performance (Yang et al., 2009). Therefore, the following hypothesis is proposed: H7. Service capabilities is positively related to performance in the international market in which the INV firm competes. 2.8. Entrepreneurial orientation and export venture performance Much of the literature supports EO as a key ingredient for firm success (Wang, 2008; Zahra, 1991), in particular in INVs (Knight, 2000). The EO-performance literature is long-standing, and empirical evidence has shown that firms with more EO perform better (Wiklund, 1999; Zahra & Covin, 1995). Most recently, Rauch et al. (2004), based on a meta-analysis of 37 studies, conclude that the EO-performance relationship is moderately strong and that firms benefit from EO. The dominant approach, to date, has been the universal effect approach, which assumes that EO is universally beneficial for INVs (Knight, 2001). However, contradictions in the literature are detected (Habermann & Schulte, 2017). For example, Covin and Slevin (1989) find that EO is associated with performance among small firms operating in hostile environments but not among those operating in benign environments. Studies that rely on contingency models to capture the two-way interaction between EO and a characteristic of the external environment mention that, sometimes, the EO-performance relationship is positive. Wiklund and Shepherd (2005) expected to find the strongest effect on performance in the environments of small and medium-sized firms with 375

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service, and sales service. While items from Zou, Fang, and Zhao (2003) were used to capture new product and distribution capabilities, items from Katsikeas, Paparoidamis, and Katsikea (2004) were used to source sales service capabilities. A Likert-type seven-point scale was utilized to operationalize service capabilities, as well as informational resources, ranging from (1) ‘Much Worse’ to (7) ‘Much Better,’ with a mid-point label of ‘About the same.’ To operationalize service advantage, the participating INV managers were asked to estimate how their business compared with those of their competitors in many different aspects of cost, promotion, and sales advantage—i.e., the dimensions of service advantage. While cost and sales advantage items were sourced from Morgan et al. (2004), promotion items were obtained from Morgan et al. (2006). A Likert-type seven-point scale was applied to operationalize capabilities ranging from (1) ‘Much Worse’ to (7) ‘Much Better,’ with a mid-point label of ‘About the same.’ Multidimensional measures of performance should be employed in the field of marketing (Morgan et al., 2004). Accordingly, INV performance is conceptualized in this study at the export-venture level in terms of three dimensions used by Jaworski and Kohli (1993) and Walker, Kirchmann, and Conant (1987): 1) effectiveness: the extent to which organizational goals and objectives are met; 2) efficiency: the relationship between performance financial outcomes and the inputs required to achieve them; and, 3) adaptiveness: the operational ability to respond to environmental changes. In most studies, measurement of performance is unidimensional in nature, with the emphasis on measures of effectiveness. The literature shows that measures of the efficiency dimension of performance are less frequently used (Zou et al., 2003) and that the adaptiveness dimension has received scant attention. Using only unidimensional measurement approaches may lead to an incomplete understanding of a firm's performance. Therefore, this study adopts a multidimensional performance conceptualization and operationalization to reflect contemporary theoretical developments in the marketing field. Respondents were asked to provide their own ratings of performance effectiveness, efficiency, and adaptiveness (Walker & Ruekert, 1987) compared with competitors in the export market (Peng & York, 2001). Effectiveness is the success of a venture's products and programs in relation to those of its competitors in the market. Efficiency is the outcome of a venture's products and programs in relation to the resources employed in implementing them. In the present study, effectiveness and efficiency items were obtained from Vorhies and Morgan (2003) and Walker and Ruekert (1987). Adaptiveness is the venture's success in responding over time to changing conditions and opportunities in the environment. Items from Walker and Ruekert (1987) were used to measure adaptiveness. The participating INV managers were asked to provide their own rating of their firm's performance relative to their major competitors, using a Likert-type seven-point scale, ranging from (1) ‘Much Worse’ to (7) ‘Much Better,’ with a mid-point label of ‘About the same.’

population, 260 observations which are considered adequate for analysis purposes according to Hair, Black, Babin, Anderson, and Tatham (2006). Telephone interviews were used to gain access to managers, owing to culture, managerial predisposition, and resource constraints. Usually Latin contexts, prefer in-person interviews; however, given that the INVs are geographically dispersed, the resource challenges posed by this approach were insuperable. Thus, telephone interviews was the selected method. Trained interviewers contacted the firms randomly using a computer-assisted telephone interviewing system. The system automatically controlled the sample selection by randomly dialing the numbers from the database of willing participants. Most of the respondents identified themselves as executive managers or managers (78%); the remainder were executive directors (11%), chief executive officers (5%), or in other senior positions (6%). The mean relevant work experience of the respondents was 6.8 years. A post hoc competency check on the respondents' knowledge of export venture marketing programs, competitive strategies, informational resources, and service capabilities, as well as those of their major competitors, elicited a mean of 6.00 on a seven-point scale (1 = “low knowledge” and 7 = “high knowledge”). The export ventures ranged across the following high-tech sectors: 25% computer systems design and related services; 13% computer and peripheral equipment; 18% electronic components; 22% communications equipment; and 22% measuring and control instruments. The median number of years of exporting was 13. Regarding size, 174 firms had 51 employees or more, and the remaining 86 had 10–50 employees. To assess potential non-response bias, early and late respondents were compared with respect to various characteristics, including the number of full-time employees, years of exporting, annual sales volume, age of the venture, number of export markets, key respondent's selfreported competency evaluation indicators, and construct measures. No significant difference was detected using secondary information on employee numbers and annual sales volume. The responding firms were also compared to a group of 70 randomly selected nonparticipating firms. No differences were found between respondents and non-respondents at conventional levels (p < .05). The conclusion was that non-response bias was not a significant problem in the data. To specify the domain of each construct and to develop multiple items to serve as indicators, a systematic questionnaire development process was used combining fieldwork and literature-based insights. An extensive literature search was performed to develop a preliminary survey instrument in English; then, five academic researchers in international marketing and strategy, serving as expert judges, evaluated the survey to assess face validity. Subsequently, a Spanish version of the questionnaire was developed, including business terms used in Mexico. Two language experts performed a back-translation procedure. Finally, to evaluate the relevance of the constructs to the Mexican INV business environment and the clarity of the instructions and response format, the survey was presented and then revised based a series of face-to-face meetings with nine Mexican INV managers. All construct measures were retrieved from the existing literature. EO, informational resources, service capabilities, service advantage and performance are second-order reflective constructs with three or more dimensions each. EO has four dimensions: innovativeness, aggressiveness, riskiness, and proactiveness. Innovativeness was measured with items from Hurley and Hult (1998) and Hornsby, Kuratko, and Zahra (2002), while items from Morgan and Strong (2003) were used to measure aggressiveness, riskiness, and proactiveness. A Likert-type seven-point scale was used, ranging from (1) ‘Not at all’ to (7) ‘To a great Extent,’ with a mid-point label of ‘To some Extent.’ The dimensions of informational resources are: communication (resources); market information (resources), and relational (resources). This study measured communication with items from Morgan et al. (2006); market information with items from Morgan et al. (2003); and relational items from Morgan and Hunt (1994). The dimensions of service capabilities are: new product development service, distribution

4. Analysis and results Five measurement models were estimated, one per each secondorder construct (see Table 1). The first and the third measurement models contain nine items measuring each informational resource and service advantage. The second, fourth and fifth models include 11 items assessing service capabilities, performance and EO constructs, respectively. The measurement model analyses were performed using the elliptical reweighted least squares estimation procedure in AMOS, which has proved to produce unbiased parameter estimates for multivariate normal and non-normal data. In spite of a significant chi-square (X2 = 53.549; df = 24; p < .000) in the first measurement model—as might be expected given the sensitivity of the test statistic to sample size (Bagozzi & Yi, 1988)—all other diagnostics are supportive. The 376

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Table 1 (continued)

Table 1 Measurement models and measures.

Factors and items Factors and items

Standardized Loading

Measurement model 1: informational resources construct Thinking about the specific venture, please rate your informational resources relative to your major competitors in the following areas: Communication (C.R = .95, AVE = .86) a Developing effective export advertising and 0.73b promotion programs Skillfully using marketing communications 0.90 Marketing communication skills and processes 0.87 Market Information (C.R = .95, AVE = .87) a Export market information 0.83 b Customer knowledge in this export market 0.86 Knowledge of distributors in this export market 0.62 Relational (C.R = .94, AVE = .84) a Closeness of existing customer relationships 0.84 b Strength of existing customer relationships in this 0.57 export market Number of customers with whom we already have a 0.75 relationship Goodness-of-fit statistics: χ2(d.f.) = 53.549(24), p < .000; NFI = .96; CFI = .98; RMSEA = .069 Measurement model 2: service capabilities Thinking about the specific venture, please rate your service capabilities relative to your major competitors in the following areas: New product development service (C.R = .93, AVE = .83) a Developing new export venture products with services 0.74 b Successfully launching new export venture products 0.86 with services Speedily developing and launching new export 0.86 venture products with services a Sales service (C.R = 0.89, AVE = .65) Using our pricing skills to respond quickly to any 0.52 b customer changes Delivering high-quality after-sales service 0.75 Attracting and retaining after-sales service personnel 0.78 Distribution service (C.R = .82, AVE = .73) a Providing high levels of service support to distributors 0.72 Closeness in working with distributors/retailers in 0.64 this market Adding value to distributors' businesses 0.70 Satisfying the needs of distributors 0.70 Attracting and retaining the best distributors in the 0.68 b export venture market Goodness-of-fit statistics: χ2/d.f. = 172.14(87), p < .000; NFI = .90; CFI = .94; RMSEA = .072

t-Value

Standardized Loading

Measurement model 4: Export venture performance construct Please evaluate your export venture performance over the past year, relative to your major competitors, in terms of: Efficiency (C.R = .94, AVE = .80)c Return on investment (ROI) 0.79 b Return on sales (ROS) 0.76 Export venture margin 0.80 Reaching export venture financial goals 0.73 Effectiveness (C.R = .96, AVE = .90) c Positive changes in market share 0.79 b Market share growth 0.87 Growth in sales revenue 0.84 Adaptiveness (C.R = .88, AVE = .66) c Overall export venture performance 0.64 Number of successful new export venture products 0.73 Time to market for new export venture products 0.76 Responding to competitors product changes 0.48 b Goodness-of-fit statistics: χ2(d.f.) = 89.12(46), p < .000; NFI = .92; CFI = .94; RMSEA = .067

13.39 13.28

15.46 10.42

9.25 12.99

Measurement model 5: Entrepreneurial orientation construct Please evaluate the entrepreneurial orientation related to the export venture in terms of: Innovativeness (C.R = .89, AVE = .76) c Innovation in your company is perceived as too risky 0.78 b and is resisted (R) Employees are penalized for new ideas that don't 0.97 work (R) Management actively seeks innovative ideas 0.34 Aggressiveness (C.R = .88, AVE = .72) c Sacrifice profitability to gain market share 0.62 b Cut prices to increase market share 0.57 Seek market share position at the expense of cash flow 0.95 and profitability Riskiness (C.R = .81, AVE = .60) c Conservative with major decisions 0.65 b New projects are approved stage by stage 0.49 Support projects where expected returns are certain 0.48 Proactiveness (C.R = .70, AVE = .57) c Look out for business 0.92 b First to introduce new brands 0.42 Goodness-of-fit statistics: χ2(d.f.) = 89.743(40), p < .000; NFI = .88; CFI = .93; RMSEA = .069

13.13 13.09

7.38 7.43 9.60 8.80 9.42 9.40

t-Value

12.50 13.30 12.01

14.56 14.11 6.56 6.94 7.04

11.45 5.52

7.92 7.26

5.65 5.62

3.12

Notes: CR = composite reliability, AVE = average variance extracted. a Anchored by 1 = “much worse” and 7 = “much better”. b Fixed to set the scales. c Anchored by 1 = “not at all” and 7 = “to a great extent”.

Measurement model 3: service advantage construct Here, do you mean “To what extent does…” or “To what extent is your current service advantage… due to the following”? To what extent is your current service advantage for this export venture do the following: Cost (C.R = .92, AVE = .79) a Raw material costs 0.70 b Actual selling price 0.77 9.85 Payment and credit terms 0.72 9.54 Promotion (C.R = .96, AVE = .85) a 0.74 b Brand image 0.84 13.30 Brand awareness 0.89 14.12 Share of mind 0.84 13.34 Brand personality Sales advantage (C.R = .99, AVE = .96) a Pre- and after-sales technical support 0.94 b Pre- and after-sales service availability 0.94 29.74 Pre-and after-sales service expertise 0.90 26.25 Pre-and after-sales service quality 0.93 28.99 Goodness-of-fit statistics: χ2(d.f.) = 119.894(41), p < .000; NFI = .95; CFI = .97; RMSEA = .086

other fit indexes (normed fit index [NFI] = 0.96; comparative fit index [CFI] = 0.98; and root mean square error of approximation [RMSEA] = 0.069) suggest that the model fits the data satisfactorily. Items loaded heavily on their posited constructs and had t-values greater than 9.25. Likewise, the second measurement model exhibits a good overall fit with the data (NFI = 0.90; CFI = 0.94; RMSEA = 0.072) in spite of a significant chi-square (X2 = 172.14; df = 87; p < .000) (Bagozzi & Yi, 1988). The chi-square ratio (X2/df = 1.978) is in line with the suggestion of adequate fit for minimum discrepancy (X2/df < 2) (Byrne, 1989). The other fit indexes suggest that the model fits the data satisfactorily (NFI = 0.90; CFI = 0.94; RMSEA = 0.072). Items loaded heavily on their posited constructs and had t-values greater than 7.38. Similarly, the third measurement model, related to service advantage, presents a good overall fit with the data (NFI = 0.95; CFI = 0.97; RMSEA = 0.08). The fourth measurement model, which corresponds to performance, shows good fit values (NFI = 0.92;

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Table 2 Descriptives and correlations. Measure

M

SD

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

1. New product 2. Sales service 3.Distribution 4. Cost 5. Promotion 6. Service Adv 7. Efficiency 8. Effectiveness 9. Adaptiveness 10.Communication 11.Informational 12.Relational 13. Innovativeness 14. Agressiveness 15. Riskiness 16.Proactiveness

4.85 5.16 4.77 5.16 5.38 5.73 4.68 5.43 4.77 4.72 5.76 5.82 5.00 4.63 5.24 5.13

1.61 1.31 1.33 1.31 1.59 1.48 1.50 1.23 1.44 1.48 1.21 1.16 1.28 1.31 1.16 1.31

0.44 0.36 0.12 0.23 0.18 0.27 0.22 0.44 0.46 0.36 0.30 0.17 0.07 0.16 0.27

0.48 0.36 0.40 0.48 0.36 0.40 0.46 0.43 0.49 0.46 0.32 0.01 0.27 0.24

0.19 0.24 0.25 0.37 0.27 0.33 0.29 0.50 0.28 0.17 0.00 0.12 0.08

0.53 0.53 0.54 0.45 0.39 0.35 0.28 0.39 0.32 −0.01 0.33 0.13

0.54 0.48 0.40 0.49 0.43 0.22 0.34 0.23 −0.05 0.26 0.30

0.28 0.37 0.32 0.37 0.36 0.36 0.21 −0.07 0.34 0.25

0.51 0.59 0.28 0.24 0.28 0.31 −0.06 0.31 0.25

0.48 0.29 0.37 0.44 0.26 0.01 0.22 0.38

0.35 0.30 0.37 0.29 −0.03 0.43 0.36

0.37 0.39 0.11 0.01 0.18 0.17

0.71 0.24 0.19 0.13 0.07

0.26 0.09 0.18 0.14

0.13 0.39 0.20

0.11 0.16

0.29

Notes: Correlations ≥.12 or ≤.12 are significant at p = .05 (two-tailed).

4.1. Structural model and results

Table 3 Structural model. Structural relationships Hypothesized links H1 Service advantage → performance H2 Service capabilities → service advantage H3 Informational resources → service capabilities H4 Informational resources → service advantage H5 Entrepreneurial orientation → service capabilities H6 Entrepreneurial orientation → informational resources H7 Service capabilities → performance H8 Entrepreneurial orientation → performance Goodness-of-fit statistics: χ2(d.f.) = 243.543(89), p < .000; NFI = .85;

Standardized loading

t-Value

.31 .61 .53

3.10⁎⁎ 5.00⁎⁎ 5.98⁎⁎

.14

1.40

.40

4.29⁎⁎

.34

3.80⁎⁎

.30 .47

2.51⁎ 4.11⁎⁎

To test the study's hypotheses, the parsimonious structural model estimation procedure was used. The parsimonious approach entails averaging the indicators for each construct to form manifest composites. By conducting such a procedure, the first-order construct is represented by one single indicator, and the second-order constructs are treated in the model as being first-order with composites of their dimensions (Morgan et al., 2004). All constructs in this study are secondorder and presented in the model as composites of their dimensions. Because the number of parameters estimated relative to sample size is a key determinant of convergence, standard errors, and model fit, this method was critical to achieving a ratio of sample size to estimated parameter greater than five, which is necessary to attain reliable parameter estimates (Bentler, 1995). As such, composite measures were used as manifest indicators for each latent construct by averaging the items of each subscale. In addition, in modeling higher-order constructs, it is crucial to check visually whether the additional level satisfies the t-rule of identification—e.g., whether the number of data variances and co-variances equals or exceeds the number of parameters to be estimated (Byrne, 2001). This was checked through each construct. Given the relatively large sample, the significant chi-square is not surprising (X2 = 243.543; df = 89; p < .000). The fit indexes (NFI = 0.85; CFI = 0.90; RMSEA = 0.082) suggest that the structural model demonstrates a good fit with the data (see Table 3). The empirical assessment of key relationships predicted in the theoretical model (Fig. 1) indicates support for seven of the eight relationships examined (Table 3). In support of H1, the results indicate that service advantage is a predictor of performance (β = 0.31, p < .01). This finding is in keeping with Henard and Szymanski (2001) and Carbonell and Rodriguez (2006), as well as with Morgan et al. (2004), who identified service advantage as one of the most important drivers of performance because of the relative superiority of a venture's value offering as a determinant of target customers' buying behavior. Likewise, service capabilities are positively associated with service advantage, thus supporting H2 (β = 0.61, p < .01). This finding is consistent with the literature arguing that key service capabilities secure higher-up coordination of functional activities by supporting choices about how the venture will compete for target customers in order to achieve its desired goals (Teece et al., 1997). While informational resources are positively linked to service capabilities, as per H3 (β = .53, p < .01), they are not linked to service advantage. The relation between informational resources and service advantage shows a non-significant low loading path that fails to give

CFI = .90; RMSEA = .082

Notes: Critical value (α = .5) = 1.645. ⁎ p ≤ .05 (one-tailed as we hypothesize directionality). ⁎⁎ p ≤ .01 (one-tailed as we hypothesize directionality).

CFI = 0.94; RMSEA = 0.067) with a chi-square ratio (X2/df = 1.937) aligned with the adequate fit for minimum discrepancy of Byrne (1989). The fifth measurement model, which corresponds to EO, shows good fit values (NFI = 0.88; CFI = 0.93; RMSEA = 0.069) with a chisquare ratio (X2/df = 2.24) aligned with the adequate fit for minimum discrepancy of Byrne (1989). Unidimensionality is also obtained in all measurement models based on the good fit values of the fit statistic. The measurement models themselves offer support for convergent validity if the overall goodness-of-fit indexes demonstrate a good fit of the hypothesized relationships to the data, and all factor and item loadings are high and significant (Anderson & Gerbing, 1988). In general, the results exhibit a good fit of the measurement models to the data and high standardized loadings, significant at p < .000. Furthermore, average variance extracted (AVE) estimates for the measures range from 0.63 to 0.90 (see Table 1). Composite reliability coefficients for all scales range from 0.82 to 0.93, suggesting satisfactory internal consistency. Fornell and Larcker's (1981) test of discriminant validity was employed. This procedure involves assessing whether the AVE for every construct's measure is larger than the squared phi correlation of that construct with all other constructs in the model. All AVE estimates compare favorably with the corresponding squared phi correlations. Table 2 presents Pearson's correlations and descriptive statistics of the measures. In summary, the measures possess adequate psychometric properties. 378

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support of projects in which expected returns are uncertain benefits the development of new export ventures. The results indicate a positive relationship between EO and performance; this relationship suggests that when management actively seeks innovative ideas, the INV firm can easily adapt by responding to competitors' product changes. Besides, the service capabilities of INV firms are positively related to performance. This finding reveals that providing high levels of support to distributors will lead to positive changes in the market share of INVs. Furthermore, service advantage is positively related to the performance of INV firms. This finding clarifies that the share of mind contributes to reaching export venture financial goals.

strong support to H4 (β = 0.14, p < 1.4). This is documented in the literature, where informational resources, as an “outside-in” process, do not lead directly to a service advantage. Rather, they inform and complement other “inside-out” processes, such as new product development and distribution integration, whose outputs are more easily assessed by the market, potentially leading to service advantage (Day, 1994). The results also show that EO triggers the RBV with positive relations with informational resources and service capabilities, supporting H5 (β = 0.40, p < .01) and H6 (β = 0.34, p < .01). Furthermore, the results show that service capabilities link positively to performance (β = 0.30, p < .05), thus supporting H7. This implies that INVs focusing on new product development, sales service, and distribution support develop service capabilities to build superior performance. In addition, the results suggest that EO is positively associated with performance (β = 0.47, p < .01), upholding H8.

6. Further research and limitations The first limitation of this study is the cross-sectional research design. This design prohibits causal inference, and temporal effects analyses among EO, service capabilities, informational resources, service advantage, and export venture performance. While this limitation is common in studies conducted within the area of accelerated internationalization (Freeman & Cavusgil, 2007), further research should be aimed at generating longitudinal data to capture dynamic influences. Second, and related, in part, to the first limitation, reverse causation cannot be ruled out in the theoretical framework of this study. Third, the unit of analysis in the study is the export venture of the INV firm. No accommodations were made to assess the related or discrete effects of service capabilities, informational resources, and service advantage regarding other concurrent and historical ventures. In addition, in this study, the export venture is defined as a single product or product line exported to a specific export market. Though this was necessary delimit condition, this study lost some richness. Fourth, these data were generated among the INVs of a single country. Therefore, the results are limited to this country's framework, and caution should be exercised in attempting to draw generalizations to other contexts. Fifth, a multiindustry sample was used to increase generalizability, and, as a result, the sample became heterogeneous, and the ability to represent a single industry closely was lost.

5. Discussion and conclusions High-velocity competitive environments evolve in a continuous process that forces rapid strategic decisions (Wirtz et al., 2007). Firms' ability to progress rapidly and appropriately is based on a service advantage that allows them to decide which strategy will enable them to achieve superior performance. This study is an attempt to advance the literature by analyzing an integrative model of service advantage of INVs. The study's findings support seven of the eight hypotheses and confirm the efficacy of the measurement approaches used to capture the focal constructs. This study makes three valuable contributions to knowledge. First, it builds on the RBV to propose an original extension of how informational resources interact with other firm-level features to determine service advantage in high-velocity environments. Second, this study contributes to the INV literature by providing new insights into the role of service capabilities, which map a unique network of relationships in the extant literature. This study empirically analyzes the mediation role of service capabilities with informational resources and service advantage to achieve superior export venture performance. These results indicate that the high-velocity environment in which INVs find themselves produces a need to develop new philosophies and strategies for attaining an advantage. The results show that service capabilities may facilitate the adoption of a service advantage based on brand image, brand awareness, raw material costs, and the pre-and post-sales service in a particular international market, indicating gaps in the fulfillment of customer needs for differentiated low-cost products. Possessing information about doing business in the international market and knowledge of one's competitors would lead to an effective response to competitors' pricing tactics. This superior quality in the channel relationships may be employed to produce differentiated products and to achieve production cost reductions based on a cost leadership service advantage. Alternatively, by reducing the cost of their delivered offerings, firms are likely to both attain higher profit margins and, thus, increase their profitability, or to lower the product's price and achieve larger sales volume and greater profits. The results speak to an important set of firms hitherto ignored in the service capabilities debate: high-tech INVs. The findings confirm a direct effect of service advantage on the export venture performance of INVs. The precursors of this effect are informational resources and service capabilities, which, therefore, create an important causal mechanism that helps explain how service advantage affects INVs' performance. As a result, INVs' skill in using marketing communications facilitates the delivery of highquality, after-sales service, with a positive effect on service advantages such as sales service quality and brand personality. Third, the findings affirm the positive relation of EO with informational resources and service capabilities. Consequently, these findings clarify the aggressive behavior of INVs to sacrifice profitability in order to gain market share favors the closeness of existing customer relationships. Also, the INVs'

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