The Role of Export Clusters in Export Performance of SMEs: The Case of Iranian Energy Industry
Abstract
Purpose: This study was carried out with the aim of exploring the effects of export clusters formation on export performance of SMEs in Iranian energy industry. Methodology/Approach: The study was undertaken through having three case studies, each on a different export cluster currently active within Iranian energy industry. The data was collected through semi-structured interviews with both managers and members of each export cluster as well as study of their archival documents. Findings: The results confirmed that all three export clusters managed to successfully identify their members’ needs and undertook certain measures within their own authority and control, to mitigate these risks. Moreover, the secondary data showed positive growth rate of export level after the establishment of these export clusters. Interestingly, the strong suits of all three export clusters were mainly related to communication and relationship aspects. These three factors were: ability to create Informal Network within members, Public Relations and Training/Consultation. Research Limitation/implication: This study was limited to the export clusters in Iranian energy industry, and on a cross-sectional time horizon basis. It therefore cannot be generalized to all industries and we might witness certain changes in findings if the study is undertaken at different point in time. However, the study shed light on certain important aspects such as nature of relationships within the members of each cluster, the role of trust management and social power as well as the need to place more focus on SMEs in export clusters. Originality/Value of paper: Even though there are recently many studies on the concept of export clusters and their positive impacts on the growth in export of various countries throughout the world; but so far, there had been no similar study undertaken with a focus on Iran and not enough empirical evidence had previously been provided on export clusters performance in a developing country.
References
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Tambunan, T. and Hendrawan, S., 2004. The developments of small and medium enterprises clusters in Indonesia. Gadjah Mada International Journal of Business, 6(1), pp.29-44.
Townsend, J.D., 2003. Understanding alliances: a review of international aspects in strategic marketing. Marketing Intelligence & Planning, 21(3), pp.143-155.
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Waite, P. and Williams, P., 2009. Collaboration or opportunism? The role of social capital in developing successful export clusters. Journal of Strategic Marketing, 17(6), pp.499-512.
Wang, S.Q, Tiong, R.L.K., Ting S.K. and Ashley, D., 2000. Evaluation and management of foreign exchange and revenue risks in China’s BOT projects. Construction Management and Economics, 18(2), pp.197-207.
Bianchi, C.C. and Ostale, E., 2006. Lessons learned from unsuccessful internationalization attempts: Examples of multinational retailers in Chile. Journal of Business Research, 59(1), pp.140–147.
Boczko, A., 2005. International payment risk. Financial Management, 5, pp.35–36.
Burt, R.S., 2000. The network structure of social capital. Research in Organizational Behavior, 22, pp.345–423.
CIA, 2014. The World Factbook: Iran. CIA Factbook. Available at: https://www.cia.gov/library/publications/the-world-factbook/geos/ir.html.
Coleman, J.S., 1990. Foundations of Social Theory, Cambridge, Massachusetts and London, England: Harvard University Press.
Dadfar, H. and Brege, S., 2012. Differentiation by improving quality of services at the last touch point: The case of Tehran pharmacies. International Journal of Quality and Service Sciences, 4(4), pp.345-363.
Dadfar, H., Brege, S. and Ebadzadeh Semnani, S.S., 2013. Customer involvement in service production, delivery and quality: the challenges and opportunities. International Journal of Quality and Service Sciences, 5(1), pp.46–65.
Du Plessis, F., 2009. Clusters: Ensuring Europe Remain Competitive in Chemicals. Chemical Week. Available at: http://www.chemweek.com/sections/other/20450.html.
Fars News Agency, 2010. Envoy: Iran to Join Gas Exporters Club Soon Available at: http://english.farsnews.com/newstext.php?nn=8810271643.
French, R.P.J. and Raven, B., 1959. The bases of social power. In: D. Cartwright, ed. Studies in Social Power. Ann Arbor, MI: Institute of Social Research: University of Michigan, pp. 151-164.
Fukuyama, F., 1995. Trust: The social virtues & the creation of prosperity, New York: The Free Press.
Guth, W.D., 1985. Handbook of business strategy, New York: Warren, Gorham & Lamont.
Håkansson, H. and Snehota, I., 1995. Developing Relationships in Developing Relationships, London & New York: Routledge.
International Trade Centre, 2005. Innovations in export strategy: Competitiveness through export clustering, Geneva. Available at: http://www.latitudeglobal.com/documents/InnovationsClusteringWeb.pdf.
Iranian National Statistics Portal, 2014. Export Statistics. Iranian National Statistics Portal. Available at: www.amar.org.ir.
Kapila, P. and Hendrickson, C., 2001. Exchange rate risk management in international construction ventures. Journal of Management in Engineering, 17(4), pp.186-192.
Karimi, M., 2008. Engineering Services Export Improvements. Iran Daily. Available at: http://www.nitc.co.ir/iran-daily/1387/3278/html/.
Ling, F.Y.Y. and Hoi, L., 2006. Risks faced by Singapore firms when undertaking construction projects in India. International Journal of Project Management, 24(3), pp.261-270.
Masurel, E., 2001. Export Behavior of Service Sector SMEs Export Behavior of Service Sector SMEs. International Small Business Journal, 19(2), pp.80-84. Available at: http://isb.sagepub.com/cgi/doi/10.1177/0266242601192005.
Nadvi, K. and Barrientos, S., 2004. Industrial clusters and poverty reduction: Towards a methodology for poverty and social impact assessment of cluster development initiatives. Vienna: United Nations Industrial Development Organization.
Oliver, C., 1990. Determinants of Interorganizational Relationships: Integration and Future Directions. Academy of Management Review, 15(2), pp.241-265.
Onkvisit, S. and Shaw, J.J., 2004. International marketing: Analysis and strategy, 4th ed., London & New York: Routledge.
Oxelheim, L., 1984. Exchange risk management in the modern company – A total perspective, Scandinavian Institute for Foreign Exchange Research. Available at: http://lup.lub.lu.se/record/1514131.
Oyewole, P., 2001. Prospects for Developing Country Exports of Services to the Year 2010: Projections and Public Policy Implications. Journal of Macromarketing, 21(1), pp.32-46.
Perez-Aleman, P., 2005. CLUSTER formation, institutions and learning: The emergence of clusters and development in Chile. Industrial and Corporate Change, 14(4), pp.651-677.
Pfeffer, J. and Salancik, G.R., 1978. The External Control of Organizations: A Resource Dependence Perspective, New York, NY: Harper and Row.
Porter, M.E., 1990. The Competitive Advantage of Nations, New York: The Free Press: A division of Simon & Schuster Inc.
Porter, M.E., 1998. Clusters and the New Economics of Competition. Harvard Business Review, (November-December), pp.77-90.
Russo, F., 2005. Export Consortia a tool to increase SME exports. Vienna: United Nations Industrial Development Organization. Available at: https://www.unido.org/fileadmin/media/images/Services/Export_Consortia/flyer_en.pdf.
Scheer, G. and von Zallinger, L., 2007. Cluster Management – A Practical Guide, Part B: Tools, Eschborn: Deutsche GTZ GmbH.
Segal-Horn, S., 1994. The Challenge of International Business, London: Kogan Page.
Sousa, C.M.P. and Bradley, F., 2009. Effects of Export Assistance and Distributor Support on the Performance of SMEs: The Case of Portuguese Export Ventures. International Small Business Journal, 27(6), pp.681-701.
Tambunan, T. and Hendrawan, S., 2004. The developments of small and medium enterprises clusters in Indonesia. Gadjah Mada International Journal of Business, 6(1), pp.29-44.
Townsend, J.D., 2003. Understanding alliances: a review of international aspects in strategic marketing. Marketing Intelligence & Planning, 21(3), pp.143-155.
UNIDO, 2003. To enhance the contribution of an efficient and competitive small and medium sized enterprise sector to industrial and economic development of Islamic Republic of Iran, United Nations Industrial Development Organization.
Venkateswara Rao, S.N., 2002. Diagnostic study, SME Foundry Cluster Hyderabad (Aandhra Pradesh). UNIDO, Cluster development programme, India.
Waite, P. and Williams, P., 2009. Collaboration or opportunism? The role of social capital in developing successful export clusters. Journal of Strategic Marketing, 17(6), pp.499-512.
Wang, S.Q, Tiong, R.L.K., Ting S.K. and Ashley, D., 2000. Evaluation and management of foreign exchange and revenue risks in China’s BOT projects. Construction Management and Economics, 18(2), pp.197-207.
Authors
Ebadzadeh Semnani, S. S., Dadfar, H., & Brege, S. (2015). The Role of Export Clusters in Export Performance of SMEs: The Case of Iranian Energy Industry. Quality Innovation Prosperity, 19(2), 137–160. https://doi.org/10.12776/qip.v19i2.612
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