Rift Valley University Geda campus

School of Graduate Studies

Masters of Business Administration (MBA)
MBA622: Marketing Management

Article Reviewed:

Impact of Export Promotion Programs on Firm Competencies, Strategies and

Performance: The Case of Canadian High Technology Smes

By: June Francis and Colleen Collins-Dodd

Review done by:

Name ID

1. Chala Dangiya RVUGDUBAR/0009/14

2. Darartu Getachew RVUGDUBAR/0011 /14

3. Obsinan Dereje RVUGDUBAR/0033/14

4. Misgana Abebe RVUGDUBAR/0028/14

5. Wakuma Siata RVUGDUBAR/0046/14

SUBMITTED TO:

ENGIDAW S. (Ph.D.)

June 18, 2022

ADDIS ABABA, ETHIOPIA

 Article Review
Title: Impact of export promotion programs on firm competencies, strategies and performance:
The case of Canadian high-technology SMEs
The title of this paper is somehow suitable for paper. All of the journal’s body are grasped in the
title.it also conveys what is researched and how the topic addressed, the population and unit of
analysis, and the research context.
The overall purpose of the study
The overall purpose of this study is to clarifies the ways in which export promotion programs
bolster the export competence and export activities of firms by drawing on the results of a survey
of small and medium-sized Canadian high-technology firms.
The research problem
Even though the study clarifies the ways in which export promotion programs bolster the export
competence and export activities of firms, the survey is limited to specific region. The impact of
the short term for more experienced international firms who derive most of their incomes from
exporting is not considered.
The method used
The method used in this study is Survey.
Main findings
The main finding of this research is emphasis using a greater number of government programs
influences the achievement of export objectives and export expansion strategies, and enhances
export marketing competencies.
Interpretations and conclusions
The paper clearly states that by segmenting firms by level of export involvement, a clearer
picture of the benefits and limitations of export promotion programs emerges. These results
suggest that sporadic and active exporters gain the most from export promotion programs, while
there is little impact in the short term for more experienced international firms who derive most
of their incomes from exporting.
Introduction
This paper tries to address that export promotion programs are provided by governments, trade
associations and other organizations to help firms, especially small and medium-sized ones, to
overcome these limitations (Wheeler, 1990). It also clearly states that the goal of export
promotion programs is to enhance export performance by improving firms’ capabilities,
resources, and strategies and overall competitiveness (Czinkota, 1996; Diamantopoulos et al.,
1993; Seringhaus and Rosson, 1990), which in turn, have been demonstrated to improve export
performance (Aaby and Slater, 1989; Cavusgil and Zou, 1994; Zou and Stan, 1998).

The purpose of this study is to investigate whether export promotion programs bolster export
strategies and competencies as well as the achievement of firms’ export objectives – factors
commonly associated with export success. Specifically, this study examines the degree to which
firms’ use of a greater number of export assistance programs has a measurable impact on
multiple measures of export performance, achievement of export objectives, export competence
and strategies.

Specifically, the impact of the number of export promotion programs used is assessed for small
to medium sized high-technology Canadian firms. Small and medium-sized high-technology
firms represent an interesting sector in which to examine the impact of export promotion
programs.

This study extends the current research as it is one of very few published studies to examine the
impact of export promotion program usage, and it is the first to measure impact across a broad
range of outcomes and a variety of programs.

Literature Review
The motivation for the research reported in the study is export via seminars, speeches, case studies
and other communication materials enhance other programs in addition to provision of information
such as export market information, market research on foreign markets, export-marketing
seminars, and newsletters. Operational support includes exporting logistics training, marketing
assistance, trade missions, financing support, foreign buyer visits, providing contacts, and
regulatory assistance (Seringhaus and Rosson, 1990; Diamantopoulos et al., 1993).

The firm’s level of internationalization has been identified as a critical factor in developing
appropriate programs (Cavusgil, 1990; Diamantopoulos et al., 1993; Kotabe and Czinkota, 1992;
Lesch et al., 1990).
Diamantopoulos et al. (1993) propose a response hierarchy model to explain the process by which
firms might benefit from export promotion assistance programs at different stages of involvement.
In the early stages, firms can use assistance to become aware of exporting opportunities and
benefits and hence, become motivated to export.

Later, firms require information about exporting and export planning support. In the third and final
stage of the model, firms need assistance in conducting exporting activities such as selling their
products in export markets. Czinkota (1996) utilizes a similar approach, whereby export
development is viewed as an adoption process, moving from motivation and informational needs
in the early stages through training on export mechanics, and then communications, logistics and
sales support as firm’s tryout exporting as a route to greater profitability.

This study also contributes to the growing literature on high-technology firms. High-technology
firms look to exports to achieve the rapid growth required to shorten the pay-back time for product
research, and to establish themselves in as many markets as possible before competitive pressures
extinguish opportunities (Roberts and Senturia, 1996). This study demonstrates the contribution
of export promotion programs to export success for these firms, and importantly was particularly
useful for those firms that are not yet established in export markets.

Research Design/Methodology
The methodology used in this paper is Sampling. The survey questionnaire was developed after a
review of the export performance literature, in-depth interviews and pre-testing with 25 senior
executives in information technology and telecommunication firms in these sectors, and
consultation with Industry Canada and other trade organizations and industry associations’
representatives. In addition, a French version was created for Quebec firms [2].

The methods for data collection and analysis, sample and sampling technique used in this paper is
questionnaire. The 22-page questionnaire took approximately one hour to complete. It covered a
wide range of issues relating to firm performance, characteristics, strategy and use of Canadian
international business development programs. Firms were asked to rate their perceived
achievement of seven export objectives. Cavusgil and Zou’s (1994) export objectives were
measured on nine-point scales anchored by “missed objective” and “surpassed objective”.
Firm competencies in marketing, and export marketing specifically, were measured by the
following items:

• overall marketing competence;

• competence with distribution;
• developing contacts in export markets; and
• information acquisition in foreign markets.

Respondents were asked to compare their competencies relative to competitors on nine-point

scales anchored by “well below average” and “well above average”. In addition, firms were asked
the degree to which they undertook formal export planning, measured on a nine-point scale where
1 = not at all and 9 = very much.

Export expansion strategies via new markets and/or new products were captured with four items
that measured the degree to which new geographic or new product markets would be a priority for
firms in the next year, and the next three years were included to capture export expansion
strategies. An additional item assessed firms’ plans to increase export intensity “next year” and
“next three years”. All of these items were measured on nine-point scales where 1 = not at all and
9 = very much.

Firms were asked to indicate which of the following best described their firm:

• pre-exporters –may not export at all but are getting ready to export and may export to a limited
degree;
• sporadic exporters – sporadically involved in export markets;
• active exporters – actively involved in exporting; or
• majority exporters – derive a majority of their sales from exports.

Results/Findings
The findings of the study presented clearly and consistently, in line with the stated aims of the
research. This study provide evidence of and clarify the nature of the impact of these export
assistance programs and the impact of export promotion program usage. The paper also tries to
address active exporters use the greatest numbers of export assistance programs on average, with
pre-exporters using the least. Majority exporters use slightly more programs than sporadic
exporters.

Discussion
The export objectives and competency items were factor analyzed in order to understand the
dimensionality of the constructs. Principal components analysis of the seven export objectives
items produced two factors with eigenvalues greater than one, and extracted 76 percent of the
total variance with acceptable communalities and a fairly clean structure.

An important contribution of this study is the identification of impact measures that are more
closely associated with the kind of outcomes that should be expected from export assistance.
Researchers had criticized economic measures such as export sales and export growth as being
unlikely to demonstrate the impact of export promotion (e.g. Diamantopoulos et al., 1993).

Conclusion
Industry Canada is the department of the Government of Canada responsible for trade, trade policy
and investments as well as leading the “National Sector Teams” – a joint effort by firms, industry
associations, and governmental international trade programs.
The purpose of this study is to investigate whether export promotion programs bolster export
strategies and competencies as well as the achievement of firms’ export objectives – factors
commonly associated with export success. Specifically, this study examines the degree to which
firms’ use of a greater number of export assistance programs has a measurable impact on
multiple measures of export performance, achievement of export objectives, export competence
and strategies. This study extends the current research as it is one of very few published studies
to examine the impact of export promotion program usage.

Critique
It is well written Research, and achieved what it set out to do. Starting from the abstraction to
which clearly states the research aim. The sampling was reasonable in order to address the
intended population. The research design is expressed from a different perspective, and a
reasonable pilot test measurement was used in order to address the weakness and to test the
method of assigning weights and ratings. However, the use of both quantitative and qualitative
method was unnecessary which gave the same result in the conduct.