Networking, technological learning and international performance: the role of expansion strategy in an emerging economy

Purpose Companies must continually adjust their resources to maintain competitive advantages in response to changes in global and regional markets. While existing literature emphasizes the influence of dynamic capabilities (DCs) on international performance, however, there is limited empirical research supporting this relationship in emerging economies. In these contexts, companies are required to leverage their resources and strategies to navigate the challenges imposed by foreignness. Design/methodology/approach This research focuses on two main DCs: networking and technological learning. In total, 6 main hypotheses were assessed using data from 138 knowledge-based export companies in Iran. Hypotheses were tested using partial least squares structural equation modeling. Findings The findings show that, further to the direct impact of DC on international performance, international expansion strategy partially mediates this relationship. Expansion strategy includes both entry mode choice and export market diversity, with the latter showing a higher mediating effect. Practical implications We suggest managers should align their expansion strategies with their capabilities to ensure sustained international success, especially in the face of challenges that emerging economies face today amid increasing political tensions. Originality/value This research suggests that investigation of the moderating effects of international expansion strategies provides a new perspective on how dynamic capabilities affect international performance in emerging economies.