International Performance: The Role of Inertia, Stability, and Multinational Flexibility

The role of relationship marketing (RM), referring to all marketing activities directed toward establishing, developing, and maintaining successful relational exchanges, as a potential driver of firm performance has been a topic of research for scholars over several decades. Successful interorganizational relationships are critical to firm performance because most firms must combine internal organizational capabilities and resources with services provided by external organizations to compete effectively. While much is known about these relationships, less is known about the roles of international distribution channels and their influence on export performance. This point will be discussed further below. The literature has mostly neglected to consider the roles of inertia, stability, and multinational flexibility as anteceding constructs of international relationship quality. This chapter introduces a new integrative model, which includes inertia, stability, and multinational flexibility as drivers of relationship quality and, indirectly, international performance. Second, the extant literature has focused on relationship quality using differing combinations of behavioral components. However, it has mostly neglected other potential mediators of the relationships between inertia, stability, and multinational flexibility and performance, most notably strategy-related mediators. This chapter is focused on the role of standardizations versus adaptation of the international marketing mix as a mediator. Moreover, the relationship quality literature has evolved independently of that on strategy and research integrating these theoretical domains has not emerged. This chapter includes relationship quality and international strategic thrust in an integrative model as drivers of international performance. The model is made of 11 constructs: inertia, stability, multinational flexibility, trust, commitment, communication, conflict, standardization/adaptation, cooperation, channel flexibility, and export/international performance. It is based on the RM approach, which has recognized the roles of behavioral aspects commonly referred to in the literature as relationship quality (RQ hereunder). The model includes two levels of intermediary constructs. The first includes RQ indicators namely trust, commitment, communication, and conflict as well as four components of the standardization/adaptation construct. A second level of intermediary variables consists of channel cooperation and channel flexibility. The final component of the model is export/international performance. Insights from several theories and frameworks are combined in this model. These include commitment-trust theory, the resource-based view of the firm—RBV, and the knowledge-based view of the firm—KBV. The innovative combination of these theory and views has great explanatory potential, which allow to test the relative roles of behavioral RQ and international strategies in the same study. In sum, currently, a framework for determining export/international performance is introduced. While the proposed framework is a self-contained contribution to new marketing theories, initial results from a quantitative study being conducted are presented.