Nothing Special   »   [go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/a/eee/jbrese/v98y2019icp462-474.html
   My bibliography  Save this article

Factors impacting firm failure and technological development: A study of three emerging-economy firms

Author

Listed:
  • Karabag, Solmaz Filiz
Abstract
Several studies examine the successful globalization and technological development of emerging-economy firms. However, few discuss why some other emerging-economy firms do not develop sufficient technological capabilities, and thus, fail in domestics and global markets. Consequently, the understanding of emerging-economy firm diversity is limited. By analyzing the failure of three firms in two major industries in Turkey, this study identifies a complex set of factors contributing to this outcome. These factors include political risk, macroeconomic regime, national technology policies, and industry dynamics, as well as firm-related factors such as ownership, strategic intent, and the approach to, and current stage of, technology capability development. The results indicate that some of these factors support firm success in the short term but discourage learning and technological capability building, and thus, cause firm failures in the long term. Thus, the study illustrates the importance of studying emerging-economy firms from an extended contextual and temporal perspective.

Suggested Citation

  • Karabag, Solmaz Filiz, 2019. "Factors impacting firm failure and technological development: A study of three emerging-economy firms," Journal of Business Research, Elsevier, vol. 98(C), pages 462-474.
    • Handle: RePEc:eee:jbrese:v:98:y:2019:i:c:p:462-474
    DOI: 10.1016/j.jbusres.2018.03.008
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0148296318301346
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jbusres.2018.03.008?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Amankwah-Amoah, Joseph & Zhang, Hongxu, 2015. "Business failure research," MPRA Paper 67848, University Library of Munich, Germany.
    2. Maidique, Modesto A. & Zirger, Billie Jo, 1985. "The new product learning cycle," Research Policy, Elsevier, vol. 14(6), pages 299-313, December.
    3. Tilman Brück & Wim Naudé & Philip Verwimp, 2013. "Business under Fire: Entrepreneurship and Violent Conflict in Developing Countries," ULB Institutional Repository 2013/167759, ULB -- Universite Libre de Bruxelles.
    4. Sameeksha Desai & Zoltan J. Acs & Utz Weitzel, 2013. "A Model of Destructive Entrepreneurship," Journal of Conflict Resolution, Peace Science Society (International), vol. 57(1), pages 20-40, February.
    5. Tarun Khanna & Jan W. Rivkin, 2001. "Estimating the performance effects of business groups in emerging markets," Strategic Management Journal, Wiley Blackwell, vol. 22(1), pages 45-74, January.
    6. Amankwah-Amoah, Joseph, 2016. "An integrative process model of organisational failure," Journal of Business Research, Elsevier, vol. 69(9), pages 3388-3397.
    7. Jose E. Galdon Sanchez & James A. Schmitz, 2003. "Competitive pressure and labor productivity: world iron ore markets in the 1980s," Quarterly Review, Federal Reserve Bank of Minneapolis, vol. 27(Spr), pages 9-23.
    8. Nam, Kyung-Min, 2015. "Compact organizational space and technological catch-up: Comparison of China's three leading automotive groups," Research Policy, Elsevier, vol. 44(1), pages 258-272.
    9. Brian J. Aitken & Ann E. Harrison, 2022. "Do Domestic Firms Benefit from Direct Foreign Investment? Evidence from Venezuela," World Scientific Book Chapters, in: Globalization, Firms, and Workers, chapter 6, pages 139-152, World Scientific Publishing Co. Pte. Ltd..
    10. Osman Tuncay Aydas & Kivilcim Metin-Ozcan & Bilin Neyapti, 2005. "Determinants of Workers' Remittances : The Case of Turkey," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 41(3), pages 53-69, May.
    11. Demir, FIrat, 2009. "Financial liberalization, private investment and portfolio choice: Financialization of real sectors in emerging markets," Journal of Development Economics, Elsevier, vol. 88(2), pages 314-324, March.
    12. Abdulkadir Abdulrashid Rafindadi & Zarinah Yusof, 2014. "Are the Periods of Currency Collapse an Impediment to Entrepreneurship and Entrepreneurial Haven? Evidence from Regional Comparison," International Journal of Economics and Financial Issues, Econjournals, vol. 4(4), pages 886-908.
    13. Rudiger Dornbusch, 1992. "The Case for Trade Liberalization in Developing Countries," Journal of Economic Perspectives, American Economic Association, vol. 6(1), pages 69-85, Winter.
    14. Henry Mintzberg, 1978. "Patterns in Strategy Formation," Management Science, INFORMS, vol. 24(9), pages 934-948, May.
    15. Utterback, James M. & Suarez, Fernando F., 1993. "Innovation, competition, and industry structure," Research Policy, Elsevier, vol. 22(1), pages 1-21, February.
    16. Amankwah-Amoah, Joseph & Durugbo, Christopher, 2016. "The rise and fall of technology companies: The evolutional phase model of ST-Ericsson's dissolution," Technological Forecasting and Social Change, Elsevier, vol. 102(C), pages 21-33.
    17. Anthony Onwuegbuzie & Nancy Leech, 2007. "A Call for Qualitative Power Analyses," Quality & Quantity: International Journal of Methodology, Springer, vol. 41(1), pages 105-121, February.
    18. Hobday, Mike, 1995. "East Asian latecomer firms: Learning the technology of electronics," World Development, Elsevier, vol. 23(7), pages 1171-1193, July.
    19. André Sapir & Jaime de Melo, 1991. "Trade theory and economic reform: North, South and East," ULB Institutional Repository 2013/8084, ULB -- Universite Libre de Bruxelles.
    20. Pamukcu, Teoman, 2003. "Trade Liberalization and Innovation Decisions of Firms: Lessons from Post-1980 Turkey," World Development, Elsevier, vol. 31(8), pages 1443-1458, August.
    21. Amankwah-Amoah, Joseph, 2014. "Old habits die hard: A tale of two failed companies and unwanted inheritance," Journal of Business Research, Elsevier, vol. 67(9), pages 1894-1903.
    22. Keun Lee, 2013. "Capability Failure and Industrial Policy to Move beyond the Middle-Income Trap: From Trade-based to Technology-based Specialization," International Economic Association Series, in: Joseph E. Stiglitz & Justin Yifu Lin (ed.), The Industrial Policy Revolution I, chapter 4, pages 244-272, Palgrave Macmillan.
    23. Lall, Sanjaya, 1992. "Technological capabilities and industrialization," World Development, Elsevier, vol. 20(2), pages 165-186, February.
    24. Henry Mintzberg & James A. Waters, 1985. "Of strategies, deliberate and emergent," Strategic Management Journal, Wiley Blackwell, vol. 6(3), pages 257-272, July.
    25. Jenson, Ian & Leith, Peat & Doyle, Richard & West, Jonathan & Miles, Morgan P., 2016. "The root cause of innovation system problems: Formative measures and causal configurations," Journal of Business Research, Elsevier, vol. 69(11), pages 5292-5298.
    26. Tilman Brück & Wim Naudé & Philip Verwimp, 2013. "Entrepreneurship and Violent Conflict in Developing Countries," WIDER Working Paper Series wp-2013-028, World Institute for Development Economic Research (UNU-WIDER).
    27. Ronald Kroeze & Sjoerd Keulen, 2013. "Leading a multinational is history in practice: The use of invented traditions and narratives at AkzoNobel, Shell, Philips and ABN AMRO," Business History, Taylor & Francis Journals, vol. 55(8), pages 1265-1287, November.
    28. Demir, Firat, 2004. "A Failure Story: Politics and Financial Liberalization in Turkey, Revisiting the Revolving Door Hypothesis," World Development, Elsevier, vol. 32(5), pages 851-869, May.
    29. Joseph Amankwah-Amoah & Yaw A. Debrah, 2014. "Air Afrique: the demise of a continental icon," Business History, Taylor & Francis Journals, vol. 56(4), pages 517-546, June.
    30. Raveendra Chittoor & MB Sarkar & Sougata Ray & Preet S. Aulakh, 2009. "Third-World Copycats to Emerging Multinationals: Institutional Changes and Organizational Transformation in the Indian Pharmaceutical Industry," Organization Science, INFORMS, vol. 20(1), pages 187-205, February.
    31. Linsu Kim, 1998. "Crisis Construction and Organizational Learning: Capability Building in Catching-up at Hyundai Motor," Organization Science, INFORMS, vol. 9(4), pages 506-521, August.
    32. Jenson, Ian & Leith, Peat & Doyle, Richard & West, Jonathan & Miles, Morgan P., 2016. "Innovation system problems: Causal configurations of innovation failure," Journal of Business Research, Elsevier, vol. 69(11), pages 5408-5412.
    33. Yadong Luo & Rosalie L Tung, 2007. "International expansion of emerging market enterprises: A springboard perspective," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 38(4), pages 481-498, July.
    34. Amsden, Alice H., 1992. "Asia's Next Giant: South Korea and Late Industrialization," OUP Catalogue, Oxford University Press, number 9780195076035.
    35. Tom McGovern, 2007. "Why do successful companies fail? A case study of the decline of Dunlop," Business History, Taylor & Francis Journals, vol. 49(6), pages 886-907.
    36. AkbostancI, Elif & Tunç, Gül Ipek & Türüt-AsIk, Serap, 2011. "CO2 emissions of Turkish manufacturing industry: A decomposition analysis," Applied Energy, Elsevier, vol. 88(6), pages 2273-2278, June.
    37. Yasuhiro Yamakawa & Mike W. Peng & David L. Deeds, 2008. "What Drives New Ventures to Internationalize from Emerging to Developed Economies?," Entrepreneurship Theory and Practice, , vol. 32(1), pages 59-82, January.
    38. Maria Isabella Leone & Toke Reichstein, 2012. "Licensing‐in fosters rapid invention! the effect of the grant‐back clause and technological unfamiliarity," Strategic Management Journal, Wiley Blackwell, vol. 33(8), pages 965-985, August.
    39. Khalid Sekkat (ed.), 2010. "Market Dynamics and Productivity in Developing Countries," Springer Books, Springer, number 978-1-4419-1037-0, October.
    40. Tarun Khanna & Yishay Yafeh, 2005. "Business Groups and Risk Sharing around the World," The Journal of Business, University of Chicago Press, vol. 78(1), pages 301-340, January.
    41. Hung, Shih-Chang & Whittington, Richard, 2000. "Playing by the Rules: Institutional Foundations of Success and Failure in the Taiwanese IT Industry," Journal of Business Research, Elsevier, vol. 47(1), pages 47-53, January.
    42. Joel A. C. Baum & Jitendra V. Singh, 1994. "Organizational Niches and the Dynamics of Organizational Founding," Organization Science, INFORMS, vol. 5(4), pages 483-501, November.
    43. Celasun, Oya, 1998. "The 1994 currency crisis in Turkey," Policy Research Working Paper Series 1913, The World Bank.
    44. Stewart Thornhill & Raphael Amit, 2003. "Learning About Failure: Bankruptcy, Firm Age, and the Resource-Based View," Organization Science, INFORMS, vol. 14(5), pages 497-509, October.
    45. Canbas, Serpil & Cabuk, Altan & Kilic, Suleyman Bilgin, 2005. "Prediction of commercial bank failure via multivariate statistical analysis of financial structures: The Turkish case," European Journal of Operational Research, Elsevier, vol. 166(2), pages 528-546, October.
    46. Christopher Kobrak & Andrea Schneider, 2011. "Varieties of business history: Subject and methods for the twenty-first century," Business History, Taylor & Francis Journals, vol. 53(3), pages 401-424.
    47. Mairi Maclean & Charles Harvey & Lindsay Stringfellow, 2017. "Narrative, metaphor and the subjective understanding of historic identity transition," Business History, Taylor & Francis Journals, vol. 59(8), pages 1218-1241, November.
    48. Ansal, Hacer K., 1990. "Technical change and industrial policy: The case of truck manufacturing in Turkey," World Development, Elsevier, vol. 18(11), pages 1513-1528, November.
    49. Amann, Edmund & Cantwell, John (ed.), 2012. "Innovative Firms in Emerging Market Countries," OUP Catalogue, Oxford University Press, number 9780199646005.
    50. Donald C. Hambrick & Richard A. D'Aveni, 1992. "Top Team Deterioration as Part of the Downward Spiral of Large Corporate Bankruptcies," Management Science, INFORMS, vol. 38(10), pages 1445-1466, October.
    51. Derek Matthews, 2000. "Oral history, accounting history and an interview with Sir John Grenside," Accounting History Review, Taylor & Francis Journals, vol. 10(1), pages 57-83.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Merendino, Alessandro & Sarens, Gerrit, 2020. "Crisis? What crisis? Exploring the cognitive constraints on boards of directors in times of uncertainty," Journal of Business Research, Elsevier, vol. 118(C), pages 415-430.
    2. Athreye, Suma & Saeed, Abubakr & Saad Baloch, Muhammad, 2023. "The survival of outward investments from China and India: Is there a North-South divide?," Journal of Business Research, Elsevier, vol. 154(C).
    3. Munjal, Surender & Bhasin, Niti & Nandrajog, Divya & Kundu, Sumit, 2022. "Examining the evolution of emerging market multinational enterprises’ competitive advantages: Evidence from India," Journal of Business Research, Elsevier, vol. 145(C), pages 732-744.
    4. Kuckertz, Andreas & Bulut, Cagri & Brändle, Leif, 2024. "Unobserved heterogeneity in firm performance: The alignment of entrepreneurial orientation and organizational error management culture," Journal of Business Research, Elsevier, vol. 179(C).
    5. Cheng, Ruiqi & Yuan, Peng & Jiang, Gongxiong, 2023. "Growth, agglomeration externalities, and survival: Evidence from Chinese manufacturing start-ups," Journal of Business Research, Elsevier, vol. 154(C).
    6. Iheanachor, Nkemdilim & Umukoro, Immanuel Ovemeso & David-West, Olayinka, 2021. "The role of product development practices on new product performance: Evidence from Nigeria's financial services providers," Technological Forecasting and Social Change, Elsevier, vol. 164(C).
    7. Muhammad Zeeshan Shaukat & Madiha Saleem & Muhammad Usman Ajmal Mirza & Abdul Basit & Abdul Aziz Khan Niazi, 2023. "Using Interpretive Structural Modelling (ISM) to Impose Hierarchy on Critical Issues of Contractual Bargaining: A Study of Construction Industry of Pakistan," Journal of Policy Research (JPR), Research Foundation for Humanity (RFH), vol. 9(3), pages 69-84.
    8. Zhao, Shasha & Liu, Xiaohui & Andersson, Ulf & Shenkar, Oded, 2022. "Knowledge management of emerging economy multinationals," Journal of World Business, Elsevier, vol. 57(1).
    9. Reis, Germano Glufke & Heidemann, Marina Sucha & Borini, Felipe Mendes & Molento, Carla Forte Maiolino, 2020. "Livestock value chain in transition: Cultivated (cell-based) meat and the need for breakthrough capabilities," Technology in Society, Elsevier, vol. 62(C).
    10. Engzell, Jeanette & Karabag, Solmaz Filiz & Yström, Anna, 2024. "Academic intrapreneurs navigating multiple institutional logics: An integrative framework for understanding and supporting intrapreneurship in universities," Technovation, Elsevier, vol. 129(C).
    11. Zhang, Haoyu & Shi, Yongjiang & Liu, Jianxin & Wu, Xiaobo, 2021. "How do technology strategies affect the catch-up progress of high-tech latecomers? Evidence from two Chinese research-institute-transformed telecommunications firms," Journal of Business Research, Elsevier, vol. 122(C), pages 805-821.
    12. Hoskins, Jake D. & Carson, Stephen J., 2022. "Industry conditions, market share, and the firm’s ability to derive business-line profitability from diverse technological portfolios," Journal of Business Research, Elsevier, vol. 149(C), pages 178-192.
    13. Shi, Jincheng, 2024. "Adaptive change: Emerging economy enterprises respond to the international business environment challenge," Technovation, Elsevier, vol. 133(C).
    14. Hülya Ünlü & Serdal Temel & Kristel Miller, 2023. "Understanding the drivers of patent performance of University Science Parks in Turkey," The Journal of Technology Transfer, Springer, vol. 48(3), pages 842-872, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Amankwah-Amoah, Joseph, 2016. "An integrative process model of organisational failure," Journal of Business Research, Elsevier, vol. 69(9), pages 3388-3397.
    2. Zhang, Haoyu & Shi, Yongjiang & Liu, Jianxin & Wu, Xiaobo, 2021. "How do technology strategies affect the catch-up progress of high-tech latecomers? Evidence from two Chinese research-institute-transformed telecommunications firms," Journal of Business Research, Elsevier, vol. 122(C), pages 805-821.
    3. Pradeep Kanta Ray & Sangeeta Ray & Vikas Kumar, 2017. "Internationalization of latecomer firms from emerging economies—The role of resultant and autonomous learning," Asia Pacific Journal of Management, Springer, vol. 34(4), pages 851-873, December.
    4. Stefano Elia & Surender Munjal & Vittoria G. Scalera, 2020. "Sourcing Technological Knowledge Through Foreign Inward Licensing to Boost the Performance of Indian Firms: The Contingent Effects of Internal R&D and Business Group Affiliation," Management International Review, Springer, vol. 60(5), pages 695-721, October.
    5. Bilgili, Tsvetomira V. & Kedia, Ben L. & Bilgili, Hansin, 2016. "Exploring the influence of resource environments on absorptive capacity development: The case of emerging market firms," Journal of World Business, Elsevier, vol. 51(5), pages 700-712.
    6. Rishika Nayyar & Rajdeepa Maity, . "Overcoming institutional voids in the home country for internationalization: an exploratory examination of institutional strategies of Indian MNEs," UNCTAD Transnational Corporations Journal, United Nations Conference on Trade and Development.
    7. Becker-Ritterspach, Florian & Bruche, Gert, 2012. "Capability creation and internationalization with business group embeddedness – the case of Tata Motors in passenger cars," European Management Journal, Elsevier, vol. 30(3), pages 232-247.
    8. Jiang, Marshall S. & Branzei, Oana & Xia, Jun, 2016. "DIY: How internationalization shifts the locus of indigenous innovation for Chinese firms," Journal of World Business, Elsevier, vol. 51(5), pages 662-674.
    9. Bersant Hobdari & Peter Gammeltoft & Jing Li & Klaus Meyer, 2017. "The home country of the MNE: The case of emerging economy firms," Asia Pacific Journal of Management, Springer, vol. 34(1), pages 1-17, March.
    10. Mike W. Peng & Sergey Lebedev & Cristina O. Vlas & Joyce C. Wang & Jason S. Shay, 2018. "The growth of the firm in (and out of) emerging economies," Asia Pacific Journal of Management, Springer, vol. 35(4), pages 829-857, December.
    11. Tarighi, Sina & Shavvalpour, Saeed, 2021. "Technological development of E&P companies in developing countries: An integrative approach to define and prioritize customized elements of technological capability in EOR," Resources Policy, Elsevier, vol. 72(C).
    12. Murat A. Yülek, 2017. "On the Middle Income Trap, the Industrialization Process and Appropriate Industrial Policy," Journal of Industry, Competition and Trade, Springer, vol. 17(3), pages 325-348, September.
    13. Binz, Christian & Gosens, Jorrit & Hansen, Teis & Hansen, Ulrich Elmer, 2017. "Toward Technology-Sensitive Catching-Up Policies: Insights from Renewable Energy in China," World Development, Elsevier, vol. 96(C), pages 418-437.
    14. Thomas Gries & Wim Naudé, 2021. "Extreme Events, Entrepreneurial Start-Ups, and Innovation: Theoretical Conjectures," Economics of Disasters and Climate Change, Springer, vol. 5(3), pages 329-353, October.
    15. Fagerberg, Jan & Srholec, Martin & Verspagen, Bart, 2010. "Innovation and Economic Development," Handbook of the Economics of Innovation, in: Bronwyn H. Hall & Nathan Rosenberg (ed.), Handbook of the Economics of Innovation, edition 1, volume 2, chapter 0, pages 833-872, Elsevier.
    16. Tan, Danchi & Meyer, Klaus E., 2010. "Business groups' outward FDI: A managerial resources perspective," Journal of International Management, Elsevier, vol. 16(2), pages 154-164, June.
    17. Cuervo-Cazurra, Alvaro & Rui, Huaichuan, 2017. "Barriers to absorptive capacity in emerging market firms," Journal of World Business, Elsevier, vol. 52(6), pages 727-742.
    18. Guo, Yanting & Zheng, Gang, 2019. "How do firms upgrade capabilities for systemic catch-up in the open innovation context? A multiple-case study of three leading home appliance companies in China," Technological Forecasting and Social Change, Elsevier, vol. 144(C), pages 36-48.
    19. Li, Shenxue & Easterby-Smith, Mark & Hong, Jacky F.L., 2019. "Towards an understanding of the nature of dynamic capabilities in high-velocity markets of China," Journal of Business Research, Elsevier, vol. 97(C), pages 212-226.
    20. Cuervo-Cazurra, Alvaro & Pananond, Pavida, 2023. "The rise of emerging market lead firms in global value chains," Journal of Business Research, Elsevier, vol. 154(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jbrese:v:98:y:2019:i:c:p:462-474. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/jbusres .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.