CONCLUSION, DISCUSSION AND RECOMMENDATIONS
5.1 Conclusion and Discussion
CHAPTER 5
reduce export barriers through induction of an organization to quickly search for information and resources to enter a new market. Moreover, enterprises need to engage in risk taking by investing limited resources on the untapped markets and putting export strategies into practice. Risk taking is crucial in promoting both innovativeness and proactiveness, and it fosters better export performance.
5.1.2 Export Performance Factor is Indirectly Affected by the Entrepreneurial Orientation Variable Through Internal Export Barriers Reduction Factor
Research findings indicate that if small and medium enterprises in Thailand with entrepreneurial orientation focus on proactiveness, risk taking, and innovativeness, internal environment barriers (informational barriers, resource barriers, and marketing barriers) will be reduced. This, in turn, will enhance organization export performance. This is consistent with the study on entrepreneurial orientation by Pankaj C. Patel and Rodney R. D'Souza (2009), which suggested that entrepreneurial orientation engaging proactiveness and risk taking helps reduce internal environment barriers and increase organization export performance.
5.1.3 Organization Export Performance Factor is Directly Affected by the Internal Export Barriers Variable
Research findings indicate that if small and medium enterprises in Thailand achieve a reduction in internal environment barriers (marketing barriers, resource barriers, and informational barriers) organization export performance will be enhanced. This is consistent with the studies by Seyed Hossein Jalal (2012) and Julen and Ramangalah (2003), which suggested that internal environmental barriers reduction helps increase organization export performance.
Internal export barriers refer to obstacles that occur within an organization, including resources utilization and management capability, which are within the control of the organization. Samples include the lack of a knowledgeable workforce for export markets, non-achievement of quality standards in foreign markets, shortage of financial support, know-how deficiency with respect to international markets, disappointment in product design features, as well as an unpopular image in overseas
markets. Such circumstance has resulted in entrepreneurial orientation imminently playing a key role in fostering export performance opportunities for the organization in reducing the three internal organizational challenges. Information barriers are issues related to ineffective data use for selection and contact of international markets, as well as limited information for market establishment or analysis. Samples include the lack of international market data, difficulty in seeking international business opportunities, and inability to contact overseas customers. Functional barriers denote human capital, resources, and management capability that restrict critical policies formulation and implementation for successful export practices. The decision for a small and medium sized enterprise to migrate to any given potential export markets usually rests on one person, the owner, or a small group of people in the organization.
Such decision-makers seeking international business opportunities and selecting overseas markets are required to have good training. They must be willing and able to spend time and resources efficiently (Leonidou et al., 2007). Should small and medium enterprises decide to step into global markets, some required functions include the ability to deal with the international trade documentation, along with the ability to communicate with logistics of export products and services and with customers who are the importers of products and services. Moreover, small and medium enterprises that are involved in foreign exporting of goods and services will encounter significant cost increases, such as research of potential export markets and upgrading the knowledge of export staff, which is an increase in human capital costs in order to achieve goal in international business. Marketing barriers refers to marketing tools that a business uses to achieve its marketing objectives. These tools, or 4Ps, consist of product, price, place, and promotion. Their variables are outlined below (Kotler, 1997: 98).
1) Product consists of a variety of products, quality of design, brands, packaging, warranty, size, form, and service.
2) Price includes product price, discounts, consumer‟s price perception, and time of payment.
3) Place comprises sales channels, location, inventory, and shipping.
4) Promotion includes promotions, advertising, public relations, direct sales, and sales through dealers.
The most critical marketing barriers affecting an efficient export operation are unreliable foreign representation and the lack of a plan by small and medium enterprises for the promotion of constant overseas markets development. Such barriers render higher costs for small and medium enterprises because they must search for individuals in the foreign market whose criteria are met with the organization‟s structural, operational, and behavioral requirements. By the time the desired representatives are discovered, they may have already chosen other competitors.Small and medium enterprises attempt to adapt their promotional activities to be suitable for a diverse pattern of consumption and different overseas markets trade regulation by largely focusing on the consumers in the target market to understand their norm and values. Apart from advertising, promotional barriers also include effective changes in products and packaging (Terpstra and Sarathy, 2000), offering more competitive prices to consumers (Doole and Lowe, 2001), as well as the availability of products and services in the market through extensive distribution networks.
Upon considering the size of the effect between latent variables, it is found that:
1) The latent variable, export performance, is the most directly affected by the another latent variable, entrepreneurial orientation. Entrepreneurial orientation is mostly affected by innovativeness, proactiveness, and risk taking, respectively.
2) The latent variable, export performance, subsequently is directly affected by another latent variable, internal export barriers reduction. Reducing informational barriers mainly affects internal export barriers reduction, following by reducing resource barriers and marketing barriers.
3) The latent variable, export performance, also is indirectly affected by entrepreneurial orientation as the last factor through internal export barriers reduction.
5.2 Policy Recommendations for Public and Private Sectors Management