Beyond financial indicators: An assessment of the measurement of performance for international new ventures

Abstract

 This study examines the measurement of performance for international new ventures (INVs)  We adopt a mixed methods approach using exploratory interviews and a quantitative survey sample of 310 New Zealand and Australian firms  We find that INVs use a variety of international performance measures which includes financial and operational performance indicators and organisational effectiveness  We find that INVs tend to be more international performance oriented than non-INVs  Our study also indicates that financial performance is generally more important than operational performance for INVs  We also find industry-specific differences in that manufacturing INVs tend to place more importance on financial performance than service INVs *Highlights (for review)

The Effect of Global Orientation on the Performance of International New Ventures: Evidence from Italy

“…In spite of this limitation (which we acknowledge in the last section), accounting performance may provide interesting, though partial, insights on the relationship between geographic scope and performance in the INV context. This view is in line with very recent research (Trudgen and Freeman 2014;Gerschewski and Xiao 2015), which demonstrates the importance of financial measures to the assessment of INV performance.…”

SME internationalization: How does the opportunity-based international entrepreneurial culture matter?

“…In the present research, all investigated firms had enhanced performance to ensure that they shared some common features. Internationalized SMEs use both financial and operational indicators to assess their performance (Gerschewski and Xiao, 2015).…”

Performance measurement choices in international joint ventures: What factors drive them?

“…Similarly in international business, organizational performance measurement is an increasingly important topic (Bititci, Garengo, Dörfler, & Nudrupati, 2012;Gerschewski & Xiao, 2015;Hult et al, 2008) and it is even more important in the case of international joint ventures (IJVs) (Arino, 2003;Geringer & Hebert, 1991;Glaister & Buckley, 1998a;Ozorhon, Arditi, Dikmen, & Birgonul, 2011). An IJV in this study is regarded as a separate entity formed by two or more partners with an expected proportional share of dividend as compensation (see e.g.…”

“…Killing, 1983;Zou et al, 1998). Financial measures are based on the reliance on cost information and financial data which are short-term in nature (Jusoh et al, 2008), and on information about sales such as sales volume, ratio of foreign sales to total sales, and sales growth (Gerschewski & Xiao, 2015). They provide guidance to effective performance for firms in their aim to reach their targets and are a direct reflection of current profitability and operating efficiency, and future earning potential (Spencer, Joiner, & Salmon, 2009).…”