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Customer involvement and service firm internationalization performance: An integrative framework

Author

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  • Xiao Zhang

    (Department of Business Administration, School of Business, Nanjing University, Jiangsu, China)

  • Weiguo Zhong

    (Department of Strategic Management, Guanghua School of Management, Peking University, Beijing, China)

  • Shige Makino

    (Department of Management, Chinese University of Hong Kong, Shatin, Hong Kong)

Abstract

To overcome the costs of doing business abroad, researchers have suggested either legitimacy- or efficiency-based solutions. However, both types of solutions still treat host-country customers as external to the theory. We highlight the role of customers in the international professional business service setting and argue that customer involvement is positively related to the perceived internationalization performance of multinational corporations (MNCs). MNCs with managers who perceive higher legitimacy pressures and greater needs for local knowledge tend to undertake greater efforts to build customer involvement. Furthermore, we develop a configuration framework between perceived strategic needs and MNCs’ capabilities. Specifically, MNCs that match relational capability with legitimacy needs and absorptive capacity with knowledge needs are more likely to engage in customer involvement. Our survey of 175 Chinese MNCs provides evidence that customer involvement is positively related to perceived internationalization performance. When MNCs’ relational capabilities are stronger, the positive relationship between legitimacy pressure and customer involvement increases. By contrast, MNCs with greater perceived market ambiguity improve customer involvement only when they have stronger absorptive capacity. We conclude that MNCs may simultaneously reduce legitimacy and efficiency costs through customer involvement after considering the fit between perceived environmental pressures and firm capabilities.

Suggested Citation

  • Xiao Zhang & Weiguo Zhong & Shige Makino, 2015. "Customer involvement and service firm internationalization performance: An integrative framework," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 46(3), pages 355-380, April.
  • Handle: RePEc:pal:jintbs:v:46:y:2015:i:3:p:355-380
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    Cited by:

    1. Zahoor, Nadia & Al-Tabbaa, Omar, 2021. "Post-entry internationalization speed of SMEs: The role of relational mechanisms and foreign market knowledge," International Business Review, Elsevier, vol. 30(1).
    2. Tao Bai & Stephen Chen & Xiao He, 2019. "How Home-Country Political Connections Influence the Internationalization of Service Firms," Management International Review, Springer, vol. 59(4), pages 541-560, August.
    3. Liu, Yihui & Wu, Aiqi & Song, Di, 2022. "Exploring the Impact of Cross-side Network Interaction on Digital Platforms on Internationalization of Manufacturing Firms," Journal of International Management, Elsevier, vol. 28(4).
    4. Taylor, Murray & Jack, R. & Madsen, T. & Alam, M.A., 2021. "The nature of service characteristics and their impact on internationalization: A multiple case study of born global firms," Journal of Business Research, Elsevier, vol. 132(C), pages 517-529.
    5. Xiao Zhang & Luqun Xie & Jiatao Li & Li Cheng, 2022. "“Outside in”: Global demand heterogeneity and dynamic capabilities of multinational enterprises," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 53(4), pages 709-722, June.
    6. Jen-Chieh Lee & Tyrone T. Lin, 2020. "Decision Analysis on Sustainable Value: Comparison of the London and Taiwan Markets for Product Integration of Family Security Services and Residential Fire Insurance," JRFM, MDPI, vol. 13(11), pages 1-15, October.
    7. Fascia, Michael, 2022. "Viewpoints of Epistemic Principals between Knowledge and Information," OSF Preprints cdx8a, Center for Open Science.
    8. Ryazanova, Olga & McNamara, Peter & Aguinis, Herman, 2017. "Research performance as a quality signal in international labor markets: Visibility of business schools worldwide through a global research performance system," Journal of World Business, Elsevier, vol. 52(6), pages 831-841.
    9. Shufeng Simon Xiao & Yong Kyu Lew & Byung Il Park, 2019. "‘2R-Based View’ on the Internationalization of Service MNEs from Emerging Economies: Evidence from China," Management International Review, Springer, vol. 59(4), pages 643-673, August.
    10. Popli, Manish & Raithatha, Mehul & Ahsan, Faisal Mohammad, 2021. "Signaling behavioral intent through better governance: A study of emerging market multinational enterprises," Journal of Business Research, Elsevier, vol. 135(C), pages 697-710.
    11. Xie, Xuemei & Wang, Lijun & Zhang, Tao, 2023. "Involving online community customers in product innovation: The double-edged sword effect," Technovation, Elsevier, vol. 123(C).
    12. Huang, Dongdong & Tsui-Auch, Lai Si & Dieleman, Marleen & Gomulya, David, 2024. "Politically connected EMNCs in a (de)globalising world: A review and future research directions," International Business Review, Elsevier, vol. 33(3).
    13. Bo Bernhard Nielsen & Catherine Welch & Agnieszka Chidlow & Stewart Robert Miller & Roberta Aguzzoli & Emma Gardner & Maria Karafyllia & Diletta Pegoraro, 2020. "Fifty years of methodological trends in JIBS: Why future IB research needs more triangulation," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 51(9), pages 1478-1499, December.
    14. Fiona Kun Yao & Kaifeng Jiang & Danielle R. Combs & Song Chang, 2022. "Informal institutions and absorptive capacity: A cross-country meta-analytic study," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 53(6), pages 1091-1109, August.
    15. Cheng, Li & Wang, Yue & Zhang, Xiao & Zhu, Di, 2023. "Double-edged sword of global demand heterogeneity: How service multinationals capture the benefits and mitigate the costs of managing customer knowledge," Journal of Business Research, Elsevier, vol. 154(C).
    16. Chang, Kuo-Hsiung & Gotcher, Donald F., 2020. "How and when does co-production facilitate eco-innovation in international buyer-supplier relationships? The role of environmental innovation ambidexterity and institutional pressures," International Business Review, Elsevier, vol. 29(5).
    17. Najafi-Tavani, Zhaleh & Mousavi, Sahar & Zaefarian, Ghasem & Naudé, Peter, 2020. "Relationship learning and international customer involvement in new product design: The moderating roles of customer dependence and cultural distance," Journal of Business Research, Elsevier, vol. 120(C), pages 42-58.
    18. Mandi E & Qiyuan Zhang & Kevin Zheng Zhou & Chuang Zhang, 2024. "Interfirm trust and subsidiary performance of emerging market multinational enterprises: an examination of contingent factors," Asia Pacific Journal of Management, Springer, vol. 41(2), pages 583-614, June.
    19. Junzhe Ji & Pavlos Dimitratos & Qingan Huang & Taoyong Su, 2019. "Everyday-Life Business Deviance Among Chinese SME Owners," Journal of Business Ethics, Springer, vol. 155(4), pages 1179-1194, April.
    20. Grego, Marica & Magnani, Giovanna & Denicolai, Stefano, 2024. "Transform to adapt or resilient by design? How organizations can foster resilience through business model transformation," Journal of Business Research, Elsevier, vol. 171(C).
    21. Buckley, Peter J & Cui, Lin & Chen, Liang & Li, Yi & Choi, Yoona, 2023. "Following their predecessors’ journey? A review of EMNE studies and avenues for interdisciplinary inquiry," Journal of World Business, Elsevier, vol. 58(2).
    22. Zhang, Yufeng & Yang, Zhibo & Zhang, Tao, 2018. "Strategic resource decisions to enhance the performance of global engineering services," International Business Review, Elsevier, vol. 27(3), pages 678-700.
    23. Niittymies, Aleksi & Pajunen, Kalle, 2020. "Cognitive foundations of firm internationalization: A systematic review and agenda for future research," International Business Review, Elsevier, vol. 29(4).

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