Fornell and Larckers 1981 procedure is used to check the psychometrics5 of the

Fornell and larckers 1981 procedure is used to check

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Fornell and Larcker’s (1981) procedure is used to check the psychometrics[5] of the confirmed scales. Table VIII verify the convergent and discriminant validity of internationalisation strategies and generic strategies. Before commenting the hypotheses, we notice from Figure 3 and Table VII that focus strategies seem to be used by firms to differentiate themselves (0.34), not to develop a focus-oriented cost leadership role – the fourth strategy in Porter’s (1980) taxonomy. Figure 2. Three models of strategy – performance Generic Performance International Model 1 Direct Model 2 Indirect Model 3 Direct+indirect International Performance Generic Generic International Performance x 2 df x 2 /df p CAIC CFI R 2 Direct model 627.55 570 1.10 0.05 2 2,481.43 0.97 0.47 Indirect model 633.28 570 1.11 0.03 2 2,475.69 0.97 0.46 Indirect þ direct model 625.47 567 1.10 0.04 2 2,467.50 0.98 0.50 Table VI. Comparing direct and indirect models Structural coefficient Differentiation $ cost leader 0.17 Differentiation $ focus 0.34 Differentiation ! follower 0.17 Differentiation ! challenger 0.37 Cost leader ! stepwise 2 0.36 Cost leader ! integration 0.46 Cost leader ! challenger 0.33 Focus ! challenger 0.18 Focus ! stepwise 2 0.22 Follower ! stepwise 2 0.22 Follower ! alliance 0.23 Follower ! integration 0.34 Alliance ! challenger 0.25 Stepwise ! performance 2 0.35 Integration ! Performance 0.08 Challenger ! performance 0.24 Cost leader ! performance 0.30 x 2 ¼ 625.47; df ¼ 567; GFI ¼ 0.71; AGFI ¼ 0.66; CFI ¼ 0.98; NFI ¼ 0.79; NNFI ¼ 0.97; RMSEA ¼ 0.04; R 2 ¼ 0.50; P ¼ 0.04 Table VII. A model of strategic choice and performance Strategy development in markets 533
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Also, differentiation and cost leadership are correlated (0.17), thus casting doubt on the “stuck in the middle” argument put forward by Porter (1980). Turning now to the hypothesis tests (Table IX) we note first that standardisation does not emerge as a strategic alternative that is significantly linked with any other strategy in the model as suggested in the H1 , H4 , H5 . Second, we observe that H1 (cost leadership) and H2 (differentiation) concerning the other strategic dimensions are supported, left for one: contrary to our expectations, followership is positively linked to differentiation. Furthermore, differentiation strategies only indirectly have a negative impact on stepwise strategies through cost leader and focus strategies. They also only indirectly impact positively on integration through cost leader strategies. Third, we observe that Convergent validity Discriminant validity ( R 2 # 0.5) (a) Generic strategies t $ 2 Differentiation Cost leader Differentiation t $ 5.11 Cost leader t $ 3.88 0.01 Niche t $ 4.56 0.07 0.00 (b) Internationalisation strategies t $ 2 Follower Alliance Stepwise Challenger Follower t $ 5.3 Alliance t $ 4.08 0.04 Stepwise t $ 4.84 0.04 0.00 Challenger t $ 4.41 0.08 0.06 0.08 Integration t $ 3.5 0.07 0.02 0.11 0.06 Table VIII. Convergent and discriminant validity of the two classes of strategy Figure 3. Model of international marketing strategies and performance Follower 0.34 0.25 0.30 –0.22
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