FIRMS STRATEGIC MOVES AND THEIR EFFECTS ON PERFORMANCE: INTERNATIONALIZATION, TECHNOLOGY, INNOVATION & STRATEGIC INVESTMENTS

Abstract

For sustainable competitive advantage, firms seek to enhance their performance as competition increases and technologies develop rapidly. Drawing on the resource-based view theory, degree of internationalization (DOI) is the strategy that can drive firm performance. This study investigates how DOI influences firm performance and volatility. Emphasizing the moderating role of technological capabilities, product innovation, and strategic investments, they are resources that enable firms to improve their performance. However, the findings of this study indicate that these strategies are not extending their effectiveness to firm volatility, as DOI does not show linkage to increasing or decreasing risk with and without these mechanisms. Product innovation strategy is excluded, as it shows an effective source of growth and, at the same time, a mitigation mechanism of risk. This research provides three contributions. First, this study introduces a dual view by analyzing both performance improvement and the volatility that is related to risk and uncertainty, aiming to understand their connection to success and how firms balance their resources to achieve it. This perspective provides firms with valuable insights into their growth achievements and the generation of these returns over time. Second, by integrating technological capabilities and investment decisions, firms can manage and optimize their internal and external factors to achieve sustainable competitive advantage in global environments. Third, the study examines the utilization of the three important strategic aspects that contribute to firm value creation. The study collects data from Bloomberg sources, focusing on the S&P 1500 firms from 2010 to 2024 to ensure representativeness.