Achieving export competitive advantage: can global orientation and export product adaptation be reconciled?

Globally oriented firms are often associated with approaching their foreign markets with standardized offerings. As the globalization literature contends, such an approach has its roots in achieving competitive advantages and improving firm performance. Nevertheless, the exporting literature highlights the need to adapt export products in order to satisfy different customer needs. In this context, it remains critical to understand how global orientation affects different types of competitive advantage and how this impact is influenced when product adaptation is realized. We employ a cross-sectional study and we get our results based on a sample of 144 Malaysian exporting firms. Using structural equation modelling we find that global orientation positively affects the creation of both cost and distribution advantage. Nevertheless, contrary to the frequent association of a global outlook with the adoption of a more standardized approach, high quantity of product adaptation is not always incompatible with a global orientation. While it indeed hinders the creation of cost advantages, it exerts a positive influence on the global orientation – export distribution advantage relationship.