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views of Hultman et al. (2011) that, “co-alignment of the firm‟s resources/capabilities and environmental forces can adequately explain export performance of SMEs.” Considering the aforementioned views, this study used a combination of both RBV and Contingency Theory, since both have a similar objective in trying to establish how SMEs achieve sustainable export performance. The two theoretical frameworks were combined and applied, given the fact that a number of similar studies (Hall & Cook 2009; Zhang, Tansuhaj & McCullough 2009; Demoah 2011; Xie & Suh 2014; Lengler et al., 2016) on the export performance of SMEs also employed one or more of the theoretical frameworks. Overall, it was envisaged that the combination of the RBV and the Contingency Theory (CT) in explaining the export performance of SMEs was more comprehensive than could be achieved if only one theoretical framework was used. From the aforementioned, it is implied that there is need to discuss the market-driven strategies of the SMEs in the context of the changing external environment. Thus, having briefly discussed the RBV theory, the focus now moves to the Contingency Theory.
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conditions (e.g. the demand condition, type of industry, industry structure, general technological development and government programmes).”
The aforementioned researcher further argues that “there cannot be an independent emergent and/or strategic approach by a firm, because the structure of the environment and its conditions directly or indirectly shape a firm‟s strategy”
(Demoah, 2011:75).
Garengo, Biazzo and Bititci (2007) have criticised many studies on organisational performance which have not taken cognisance of the impact of organisational size on the firm‟s performance. Bititci, Garengo, Dörfler and Nudurupati (2012) have also criticised such research studies, raising doubt on the credibility of the results, and therefore state that researchers should take note and differentiate between SMEs and larger firms when studying performance. Taylor and Taylor (2013) provide evidence on the effect of firm size on organisational performance, and thus state that, there are six factors which have significant influence on SME‟s performance measurement implementation and these are, crafting of the strategy, strategy activation process, organisational learning, quality management and the leadership of senior management. According to CT, “Performance is attributed to the effect of external fit between the demands of the firm‟s environment and the design of its internal structure, as well as an internal fit among key design components of strategy, structure, systems, and culture” (Van De Ven et al., 2013:395).
Islam and Hu (2013:5160) highlight that, a study conducted by Hayes (1977) which showed that, the three major contingencies affecting subunits performance were internal factors, interdependency factors and environmental factors.” Boso (2010:96) argues that “It is perhaps a truism that any theory of corporate or business strategy must be, by definition, contingency-based.” Similarly, Van De Ven et al. (2013:396) highlight that “any proposition that contains a moderating variable is a contingency theory” Thus, a fundamental assumption underlying the CT is that there is no one way of organising, and that any one way of organising is not equally effective under all situations or contexts. Thus, the market- driven strategies alone are not sufficient enough to explain the export performance of SMEs, hence the use of the CT. Furthermore, Van De Ven et al. (2013:396) argue that the “Contingency Theory is useful because it helps to explain how firms match resources with the corresponding environment context.” Some researchers (Virvilaite et al. 2011; Gabrielsson, Gabrielsson, & Seppälä, 2012) highlight that there is no one applicable strategy that is
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optimal for all firms despite their resource advantages and environment conditions. Given such a scenario “many researchers have concentrated on examining the extent to which organisational characteristics and the broader external environment forces influence the link between organisational strategy and performance” (Boso, 2010:96).
In light of the above, this study has taken into consideration the impact of contingency factors on the export performance of SMEs, namely; export market characteristics (environmental turbulence/export market turbulence, cultural similarity and market competitiveness), industry characteristics (technological intensity, R & D intensity, labour productivity, export concentration, competitor networks vs. firm networks) and export marketing barriers (exchange rate volatility, political, legal and procedural barriers) respectively, as factors contributing to the export performance of SMEs. Furthermore, the use of a combination of theories rather than a specific theory was considered ideal in this study since a single theory could not adequately explain the export performance of the SMEs (Chen et al., 2016).
Furthermore, the use of a market-driven model (e.g. customer focus, distinctive capabilities, customer value and cross-functional) alone may not have explained the external variables (e.g. market characteristics, industry characteristics and export marketing barriers), which are potential contributors to the export performance of SMEs. The use of combined theories also helped to bridge the gap between the internal and the external environments. Moreover, the use of moderating variables was envisaged to contribute to the advancement of the market- driven model by incorporating market and industry characteristics, which were not considered by all previous research scholars. The CT states that “organisational performance is largely shaped by the organisation‟s external and internal context” (Andrews et al., 2015:3). Organisational capability is mainly concerned with the utilisation of internal resources to generate organisational competencies (Boso, 2010). An alternative view on the role of the internal context within the CT, “may be integrated by stating that there are two main contingencies, task and size” (Islam & Hu, 2013:5159). The two indistinguishable key internal structure contingencies are likely to be the major enablers of development of capability and opportunity to its external environment (Pablo, Reay, James, & Ann, 2007).
The CT was also used in other studies (e.g. Andrew & Boyne 2014; Jung & Kim 2014), where “organisational size was a major concern” (Adrews et al. 2015:3). This study was concerned about external factors and marketing strategies (market-driven strategies) which stimulated the export performance of SMEs in Zimbabwe and as such, the use of both the Contingency and RBV theories was deemed desirable, especially when the size of the
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organisation (SMEs) was taken into account. Therefore in this context, the empirical validation of this theoretical template utilised a firm‟s factors such export market characteristics, industry characteristics and export market charateristics as proxies for contingent factors (external factors). Since several studies (Pride & Ferrel, 2010; Auboin &
Ruta, 2011:3; Khattab et al., 2012; Sorokina, 2012; Jalali, 2012; Ricci & Trionfetti, 2012:552; Hashem & Irshaidat, 2014:104; Xie & Suh, 2014:210) advocate that export market characteristics, industry characteristics and export market characteristics have an effect on the export performance of a firm, the CT was used to develop H5, H6 andH7.