Research Application in Global Business

This report provides a critical review of a research article focusing on the application of marketing innovation in global business, specifically examining how Chinese manufacturing SMEs survive economic crises. The report appraises the research objectives, methodology (using a longitudinal survey with structural equation modeling), conclusions, and limitations. The analysis covers the relationship between market orientation, marketing innovation, competitive advantage, and firm survival. Key findings highlight the link between marketing innovation (as incremental innovation) and firm survival, particularly for those with strong inter-functional coordination. Limitations discussed include the use of self-reported data, the exploratory nature of the cross-sectional study, and the focus solely on Chinese SMEs. The report concludes by suggesting areas for future research, emphasizing the need for more robust methodologies and broader sample representation.

Research Application in Global
Business

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
Critical Appraisal of the Research Objectives.............................................................................1
Critical Appraisal of the Research Methodology........................................................................3
Critical evaluation of the research conclusions...........................................................................5
Critical evaluation of the limitations...........................................................................................6
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Marketing management is an organizational discipline which emphasize on practical
application of marketing orientation, methods and techniques within the company. Due to
globalization, the business activities of the firms are affecting on large level. The purpose of this
report is to write a critical review of an article related to the subject of Industrial Marketing
Management. It will perform the critical evaluation of all the parts of the article that is literature
review, research methodology, findings, conclusion etc. A critical appraisal of the research
methodology and method used by the authors will also be made.
Critical Appraisal of the Research Objectives
Following are the research objectives of the study:
 To identify how marketing innovation can assists in withstanding the challenges of
operating under the current economic conditions
 To establish a link between market orientation and market innovation
 To examine how manufacturing SMEs in China survives through economic crisis
The major aim of the research is to investigate whether marketing innovation defined as
improvements in the marketing mix can assist in withstanding the challenges of operating under
current economic conditions. However the research objectives of the study are not defined
clearly within the article. It is very important that researcher should describe the objectives of the
investigation in clear and concise manner (Aras and Crowther, 2012). It becomes easier for the
readers to identify with the topic. Although special focus is paid on small and medium
manufacturing enterprises in China. It is good that researcher has tried to keep a focused
approach throughout the study.
The existing literature has been developed in line with the research objectives. Literature
review talks about market innovation, orientation and business strategy (Bradshaw and Urquhart,
2015). The broad premise of this literature suggests that the ability to innovate is a key
mechanism for organizational growth and renewal. In the academic world, innovation has been
the subject of sparse scrutiny. The relationship between market orientation and innovation has
not been completely explained. This research is making the effort to show the link between both
the variables.
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Hence it can be said that this investigation has the potential to produce something which
has not been offered earlier. Further it was derived that in the existing literature marketing
innovation has been positioned as a type of incremental innovation (Burlton, 2015). It is a
dominant form of innovation which is related with an existing product, service, process,
organization or method whose performance has been significantly enhanced or upgraded. This
type of innovation is used on constant basis within the high technology business. The main focus
is on continuously improving the services and adding on new features to the product (Motohashi,
2015). It seems to be correct because market innovation is essential in order to compete with the
other players in the market. It is regarded as the incremental innovation because it is also
important for the company to remain upgraded and updated from time to time. It is always
essential to come out with something new and innovative for the customers (Navarro and et.al.,
2011).
On the other side there is radical innovation also. These are refer to major changes in
technology and knowledge that stem from the discovery of something new. It is to be noted that
this type of innovation puts a significant impact on a market and on the economic activity of
companies in that market (Varadarajan, 2010). The impact is opposed to their novelty. It may
include change in the market structure, development of new market, rendering existing products
obsolete. However, it might not be apparent that an innovation is disruptive until long after it has
been introduced. The cut-off point between incremental and radical innovation might be placed
at different levels (Alon, Jaffe and Vianelli, 2012).
The literature review also discovers that market orientation focuses on the company’s
ability to become responsive to customers and other relevant stakeholders such as employees,
competitors etc, in order to achieve profits. It is correctly stated that because it is important for
the company to understand its customers and makes arrangements for their needs (Doole, and
Lowe, 2012). Other stakeholders such as employees and competitors are also to be given
priority. Competition level is high in every sector and there is always a battle going on between
several brands. In that case, customer’s needs and preferences also changes from time to time.
Firms are required to design their strategies in response to those needs and requirements. Kohli
and Jaworski (1990), Narver and Slater (1990), Jaworski and Kohli (1993), and Kohli, Jaworski
and Kumar (1993) are the four seminal studies on market orientation. These four articles are the
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research foundations of a large body of literature which can be grouped in two major strands that
is on the basis of behavioural and cultural perspective (Fawzy and Dworski, 2010).
The behavioural perspective views market orientation as a behavioural response to the
competitive operational dynamics faced by the organization (Hollensen, 2015). Cultural
perspective on the other hand states that it is a company’s culture that most effectively and
efficiently creates the necessary behaviours for the creation of superior value for buyers and thus
superior performance for the business. In this study culture conceptualisation of market
orientation is adopted on the basis that culture has the potential to influence behaviours
(Wickramasinghe and TAKANO, 2010). It is very true because every culture has its own
background and perceptions. There are several aspects attached to a particular culture depends
upon which the people make their decisions. It influences their behaviour and also moulds their
decisions.
Most studies examining market orientation have investigated a direct relationship with
performance. However, a few others have inferred innovation as a moderating variable between
market orientations and performance. These studies conceptualize innovation as the actual
mechanism which transforms orientation into superior performance (Fawzy and Dworski, 2010).
This research extends this debate by suggesting that the link between innovation and
performance is arbitrated by the potential of the company to develop and sustain a competitive
advantage. Hence it can be said that this literature review has focused on very intellectual aspects
related to innovation, market orientation, culture etc. There is a direct relationship between these
factors and company’s performance (Bradshaw and Urquhart, 2015).
Critical Appraisal of the Research Methodology
For this research, survey methodology was used for the purpose of collecting the data. It
is a field of applied statistics and investigates the sampling of individual units from a population
and the related survey data collection methods (Burns, 2007). These methods include
questionnaire and approaches for improving the number and accuracy of responses to surveys.
For this research, longitudinal approach has been adopted under which information is gathered
from the same people in repeated manner. This type of survey has the ability to reflect patterns of
a variable over time. Hence it becomes easy to study cause and effect relationship (Diment,
2012). It is very effectual in discovering sleeper effects and connections between different events
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over a long period of time. However, it can be criticized that research cannot become dependent
on same group of people every time. There is another weakness associated with the longitudinal
data is that it is collected at multiple points and those observation periods are pre-decided and it
cannot taken into consideration whatever has happened in between those touch points. Another
drawback is the idea of panel conditioning where over time, participants can change their
viewpoints in unknowing manner (Friese, 2012).
Questionnaire instrument has been used for the purpose of data collection. It is
appropriate for the research because it aids in collecting large amount of data from a large group
of people in a short span of time and in relatively cost effective manner (Goddard and Melville,
2004). It can be carried out by the researcher or by any number of people with limited affect to
its validity and reliability. Further results of the questionnaire are easily quantifiable. Apart from
the benefits this instrument also carries some disadvantages. It can be criticized that the
technique fails to understand some forms of information i.e. changes of emotions, behaviour,
feelings etc (Jackson, 2010). There is a lack of validity and there is no method to tell how
truthful a respondent is being. Hence it becomes difficult to interpret the results of the
questionnaire.
For this research, random sampling technique has been adopted. This technique is
appropriate because it reduces the chances of human biasness in selection of sample. Hence it
gives the sample that is highly representative of the population which is being studied (Kuada,
2012). It facilities to make generalizations from the sample to the population. However it can be
criticized that this method can be applied only when the list of population is available and
complete. Even if a list is readily available, it might be difficult to gain access to that list. The list
may be protected by privacy policies and also needs a lengthy process to attain permissions
(McBurney and White, 2009). Further the selected sample might be hard to reach due to
geographic position or other aspects making it an expensive as well as time consuming approach.
The researcher is also faced with practical constraints in terms of time availability and access to
certain parts of the study area. It may also lead to poor representation of the population area that
is China (Jackson 2010). Hence it becomes very difficult because the study area is very large.
A conceptual model linking market orientation, marketing innovation, competitive
advantage and firm survival is tested by using structural equation modelling. The modelling is a
bunch of statistical methods which are designed to test a conceptual model (Goddard and
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Melville, 2004). It includes factor analysis, path analysis and latent growth modelling. The
modelling opens up with vast variety of possibilities. It facilitates the analysis of latent variables
and their relationships. It offers the chance to examine the dependencies of physiological barriers
with measurement errors. It also allows joint estimation of several models, each of them having
different sub-groups (Burns, 2007). The technique offers numerical estimates for each of the
parameters in the model in order to reflect the strength of the relationships. Hence it can be
diagnosed which observed variables are good reflectors of the latent variables.
However it can be criticized that structural equation modelling is a complex technique. It
is to be noted that even the simplest SEMs will include tens of parameters due to availability of
several parameter matrices in a SEM. Further there is a problem of omitted variables (Diment,
2012). Hence it becomes difficult to analyse the results in the absence of variables.
Critical evaluation of the research conclusions
The findings from the study suggest three simple messages. First, Chinese Manufacturing
SME’s had developed and sustained a competitive advantage and had a greater perceived
likelihood of survival from the exiting economic crisis, regardless of the type of competitive
advantage analysed. This study has been encouraged through a need to improve the
understanding of the current crisis being experienced in the global manufacturing sector. Three
major findings were emerged from this research. It was derived that market orientation and
market innovation has been linked with each other. In the overall research it has been founded
that the whole area of research is very broad and large. In order to understand this study in a
more effective manner, it is necessary to have an appropriate research objective. Further, it has
been founded that it is essential to have a proper objective so that readers can easily identify the
topic. In addition to this, the whole study has given an appropriate result on the basis of Chinese
small to medium manufactures. It justify whether incremental innovation activities could
increasing the likelihood the surviving the current industry crisis.
Economic crisis has been considered as a major aspect due to which global
manufacturing sector us collapsing. Further, this study has presented marketing innovation as a
form of incremental innovation. It has been articulated that innovation puts an significant impact
on the market as well as several economic activities of companies. It may be impacted on
positive as well as negative manner. It can bring several changes in the whole market structure
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and also go through the development of new markets. Somehow it helps the companies in
defining a particular with a new concept in the existing market. It clearly articulate that due to
the marketing innovation there are several changes which are taking place such as improvements
in product design, placement, promotion or pricing, and the likelihood of survival. Further, a
conceptual model of market orientation, marketing innovation and competitive advantage has
been linked together in order to derive several findings such as:
1. Chinese manufacturing SMEs had a greater likelihood of survival
2. Marketing innovation assisted in sustaining competitive advantages based on
differentiation and cost leadership.
3. In case of having good inter functional coordination capabilities Chinese manufacturers
can improve their marketing innovation capabilities
It has been founded that there is a direct relationship between the marketing innovation as
well as performance of company. Nonetheless, innovation transforms orientation into superior
performance. This study aids to be a marketing innovation literature and determined it as a key
capability that small and medium manufacturers can use to manage their environment. It is the
best way through which they can survive into the tough timings of the economic crisis as well.
Somehow this study has been contributed that marketing innovation is the vast area by which
companies can perform better. Moreover, there are several weaknesses which have been
identified in the methodology section as well. It has been criticized that research cannot become
dependent on same group of people every time. In addition to this, a conceptual model linking
market orientation, marketing innovation, competitive advantage and firm survival. This link and
relationship can be tested by using structural equation modelling. It has been concluded that it is
a complex technique. Due to this, it has been stated that it is essential to overcome with these
weaknesses through post-hoc correlation analysis using objective dummy measures of survival.
Critical evaluation of the limitations
Findings of any research are required to be interpreted with caution due to
methodological limitations. First the caveats concerning self-reported questionnaire is applied to
this research. For instance the dependent measure of survival used in this research is of
perceptual nature (Diment, 2012). It is informed and developed on the basis of interviews in the
pre-testing stage. The observed Cronbacj alpha of 0.68 for survival reflects the potential
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reliability concerns. It also recommends the need for measure refinement in future studies. This
research makes an effort to reduce this weakness through a post-hoc correlation analysis on the
basis of dummy measures of survival (McBurney and White, 2009). However it can be said that
collected data is accurate as of the first quarter of 2009.
This research has contributed to make three important discoveries. First is that innovation
as a driver of performance has been well established in the literature. Marketing innovation is not
a strong determinant of performance and has received less scrutiny (Kuada, 2012). The research
also adds to the marketing innovation literature. It has viewed the innovation as the key resource
and capability which is used by the small and medium manufacturing firms for the purpose of
managing their environment. Secondly, it has extended the extant literature through investigating
how market orientation facilitates the companies to increase their innovating potential and
ultimately perform better (Jackson, 2010). However it can be criticized that this study fails to
leave any sustainable evidence of research. That means the sample has been taken from Chinese
manufacturing companies only. The results could not be framed for the entire population.
In this research the companies that were noted as the survivor of crisis, might surrender to
the ramifications of the economic crisis in future. It might be true because the market conditions
do not remain stable every time, they changes at frequent intervals (Goddard and Melville,
2004). If the survivor firms do not able to cope up with the market conditions, it really becomes
difficult for them to respond to the market changes. It requires application of different effective
strategic business strategic through which business can be survived. There is a need of
manpower who is capable of preparing contingency plans for the company for the purpose of
getting protection from the crisis.
The second limitation of the research is that findings are ought to be only exploratory in
nature. It is because a cross sectional study is not capable of capturing a longitudinal type
phenomenon such as firm survival. A follow up study at the end of the current crisis would aid in
authenticating the current exploratory findings. Further within the findings it has been noticed
that exploratory nature of this study reflects that no casual relationships can be inferred from the
empirical results. Despite of that the empirical analysis shows observed correlation.
Another limitation is that this research does not lay emphasis on medium to large
manufacturers. It is true to some extent because it is essential to take into account both types of
firms whether big or small size. It is because difference in the results may be noticed due to this
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factor. Additional research is therefore required to give more information on the role of
marketing innovation. This will help in assisting medium to large manufacturing companies for
the purpose of managing the current industrial and economic crises.
CONCLUSION
From the above study it can be concluded that it is difficult for the companies to survive
through the crisis. Market Innovation helps in developing a sustainable competitive advantage on
the basis of differentiation and cost leadership strategies. This research also makes its significant
contribution towards concerned literature which can be very resourceful for the other
researchers. There are certain limitations which are highlighted during the study. These
limitations are required to be taken care by the future researchers who wish to perform
investigation on this research. It is recommended to select some other areas of research such as
product development, market capitalization etc.
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REFERENCES
Alon, I., Jaffe, E. and Vianelli, D., 2012. Global Marketing: Contemporary Theory, Practice,
and Cases. McGraw-Hill Higher Education.
Aras, G. and Crowther, D., 2012. Business Strategy and Sustainability. Emerald Group
Publishing
Bradshaw, K. and Urquhart, C., 2015. Theory and practice in strategic planning for health
information systems. Springer International Publishing.
Burlton, R. T., 2015. Delivering business strategy through process management. Handbook on
Business Process Management 2. pp.45-78.
Burns, M., 2007. Marketing Research. Pearson Education India.
Diment, K., 2012. Qualitative Research in Accounting & Management. Q methodology: is it
useful for accounting research. 9(1) pp.66 – 88.
Doole, I. and Lowe, R., 2012. International marketing strategy. Cengage Learning.
Fawzy, L. and Dworski, L., 2010. Emerging Business Online: Global Markets and the Power of
B2B Internet Marketing. FT Press.
Friese, S., 2012. Qualitative Data Analysis with ATLAS. SAGE.
Goddard, W. and Melville, S., 2004.Research Methodology: An Introduction. Juta and Company
Ltd.
Hollensen, S., 2015. Marketing management: A relationship approach. Pearson Education.
Jackson, S. 2010. Research Methods: A Modular Approach. USA: Cengage Learning.
Kuada, J., 2012. Research Methodology: A Project Guide for University Students. Sam fund
slitteratur.
McBurney, D. and White, T. 2009. Research Methods. Cengage Learning.
Motohashi, K., 2015. Global Business Strategy: Multinational Corporations Venturing Into
Emerging Markets. Springer International Publishing
Navarro, A. and et.al., 2011. Integrated model of export activity: analysis of heterogeneity in
managers' orientations and perceptions on strategic marketing management in foreign
markets. Journal of Marketing Theory and Practice. 19(2).
Varadarajan, R., 2010. Strategic marketing and marketing strategy: domain, definition,
fundamental issues and foundational premises. Journal of the Academy of Marketing
Science. 38(2). pp.119-140.
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Wickramasinghe, V. and TAKANO, S. E., 2010. Application of Combined SWOT. Sage.
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