Does Maintaining Resources, Diversification, and Internationalization Matter for Achieving High Firm Performance? A Sustainable Competitiveness Strategy for China Taipei Firms

Abstract

This study evaluates the performance of China Taipei firms in the global business environment, focusing on the role of firm-level factors, the geographical setting context, internationalization, and product diversification. These variables are chosen for their potential to enhance resilience and bring firms into global competitiveness. This study performs a generalized least squares (GLS) and curved relationship analysis of 2160 observation samples in the panel analysis, based on a sample of 360 firms across eight industries. The analysis reveals positive correlations between non-labor-intensive operations and effective supply chain management and firms’ overall performance, while dependency on China negatively impacts performance. Notably, the degree of internationalization and product diversification significantly influences the correlations between the key predictors and geographical diversification. A highlight of this study is the application of a curvilinear relationship analysis (non-linear analysis) to assess the real assumptions, providing insight into how these factors interact to affect firm performance. This study stresses the importance of diversifying supply chains, reducing reliance on single markets like China, and enhancing supply chain efficiency through non-labor-intensive operations. This study highlights the need for supportive policies that encourage global expansion, product diversification, and competitiveness in the global business environment.