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Strategic Orientation of the Firm and New Product Performance
Abstract
The authors seek to understand which of three different strategic orientations of the firm (customer, competitive, and technological) is more appropriate, when, and why it is so in the context of developing product innovations. They propose a structural model of the impact of the strategic orientation of the firm on the performance of a new product. The results provide evidence for best practices as follows: (1) A firm wishing to develop an innovation superior to the competition must have a strong technological orientation; (2) a competitive orientation in high-growth markets is useful because it enables firms to develop innovations with lower costs, which is a critical element of success; (3) firms should be consumer- and technology-oriented in markets in which demand is relatively uncertain—together, these orientations lead to products that perform better, and the firm will be able to market innovations better, thereby achieving a superior level of performance; and (4) a competitive orientation is useful to market innovations when demand is not too uncertain but should be de-emphasized in highly uncertain markets.
... On the one hand, contractor improves market competitiveness and generates economic benefits by taking the initiative to learn new knowledge, develop, acquire and apply advanced technologies and establish new construction solutions. This can lead to a positive estimation of the results of the LCB [32,33]. On the other hand, corporates are responsible environmental actors under the institutional logic. ...
... Secondly, perceived behavioral control (PBC) of contractors refers to the adequacy of their capabilities, which is another driver that should be considered under the technological logic orientation [19]. This implies a requirement for the corporate's competence in the development and application of new technologies [33]. In this paper, technology is not a narrowly defined concept but refers to specific methods and means of reducing carbon emissions [19,33]. ...
... This implies a requirement for the corporate's competence in the development and application of new technologies [33]. In this paper, technology is not a narrowly defined concept but refers to specific methods and means of reducing carbon emissions [19,33]. Thirdly, subjective norm refers to perceived stakeholder pressure on contractors to implement LCB. ...
Based on the analytical framework of the Theory of Planned Behavior (TPB), this paper decomposed the driving factors under institutional logic and technological logic, and empirically tested the driving path of the low-carbon behavior (LCB) of contractors from the perspective of corporate cognition. Moreover, this study further explored the differences in driving factors under different logic orientations and the formation mechanism of decoupling of heterogeneous LCB. The findings of this paper are as follows. Firstly, institutional logic and technological logic jointly drive the LCB of contractors. Perceived behavior control is not a sufficient condition. Secondly, institutional logic is more effective than technological logic in terms of the direction and coefficient of the driving path. Thirdly, institutional pressure does not directly lead to the decoupling of LCB of contractors but is mediated by intrinsic motivation. These findings provide support and help to the decision makers to cultivate and improve the level of contractors’ LCB in China and many other such countries that are similarly involved.
... The business conduct of a company is the primary emphasis of a company's strategic orientation, which centers on how companies should interact with external environments including customers, competitors, and technology (Day, 1994;Gatignon & Xuereb, 1997). Consequently, strategic orientation represents an outwardly focused perspective on the compatibility of strategic decisions with the environment. ...
... It is acceptable for products that have a higher degree of innovation to have greater sales and financial performance, which eventually results in improved business performance as a whole. This results in an increase in revenues (Gatignon & Xuereb, 1997;Zhou et al., 2007). ...
... The "strategic guidelines that a company employs to cultivate the appropriate dispositions for the business's continuing success" are what is meant when we talk about a company's "strategic direction" (Gatignon & Xuereb, 1997;Menguc, Auh, & Shih, 2007). The overarching principles that direct the marketing and strategy development activities of a business are referred to as its strategic orientations (Noble, Sinha, & Kumar, 2002). ...
The purpose of this research is to analyze the relationship between a company's strategic direction and the effectiveness of its service innovation and market presence. Owners and administrators were given a preliminary survey questionnaire to fill out. While correlation looks at the link between factors, regression demonstrates the null hypothesis. Customer focus, competitor focus, cost focus, inter-functional coordination, service innovation, and market success were all examined using various techniques. Our research showed that when looking at combined industries, only the link between client focus and service innovation is supported, while the link between service innovation and market performance is not. There is evidence to support the hypotheses that service innovation boosts market performance in the telecommunications sector, and that a focus on competitors and costs contributes to a more creative environment. While service innovation does support market performance in the food and beverage business, it does not support the relationship between cost orientation and inter-functional coordination. Few empirical investigations have focused on service innovation like this one. More research is needed to determine how a company's strategic direction affects its ability to innovate its products, but the findings of this study are transferable to other service industries.
... As far as strategic orientation is concerned, it denotes how a company gains competitive advantage, or otherwise how it creates "the proper behaviour for continuous superior performance of the business" [66,69], after the choice of the source of competitive advantage has been made. Different strategic orientations are associated with different sources of innovative ideas and resource investments, and as such, they are an essential part of the organizational context in which (open) innovation activities are carried out. ...
Cooperation is an important aspect of open innovation (OI) facilitated by information and communication technology (ICT). Cooperation may have two distinct forms, namely dialectic or dialogic, and it has already been argued that dialogic cooperation is more appropriate for knowledge creation and innovation. In this paper, we test the hypothesis that the choice of the form of cooperation by an organisation, and its implementation in an OI-enabling Information System, are contingent to the organisation’s strategic orientation and competitive and innovation strategies, and it is mediated by the past experience of its OI initiative managers. We also examined, for the first time, which are the antecedents of the adoption of dialogic (and indirectly, dialectic) cooperation in OI initiatives. The empirical research carried out in a sample of senior managers of different sectors in Greece suggests that companies that have extrospective strategic orientations and that adopt differentiation/innovation strategies are more likely to implement dialogic cooperation in their OI endeavors, thus increasing their knowledge creation potential. This choice is further supported by managers who have participated in other organisations’ OI initiatives in the past.
... The company's success stems from the customer-oriented principle, or it aligns and is proactively responsive to the market. Customer orientation is "'the ability and willingness to identify, analyze, understand, and respond to user needs (Gatignon & Xuereb, 1997). Logically, a constant interest in pleasing the customer leads to defining and building desired features, or advantages, into new products. ...
The research was an empirical study, aimed to investigate the impacts of Islamic customer orientation, Islamic innovativeness, halal product uniqueness, Thoyyib product uniqueness, and religion-centric product uniqueness on marketing performance. Respondents of this study were 250 food and beverage processing industries in Central Java, Indonesia. Then, data were analyzed using Partial Least Square Structural Equation Modeling (SEM PLS). The results of the research demonstrate that Islamic customer orientation and Islamic innovativeness had a positive and significant effect on Maslahah product uniqueness (halal product uniqueness, Thoyyib product uniqueness, and religion-centric product uniqueness). Islamic customer orientation, Islamic innovativeness, and Maslahah product uniqueness (halal product uniqueness, Thoyyib product uniqueness, and religion-centric product uniqueness) had a positive and significant effect on marketing performance. Islamic customer orientation was proven to have a great impact on Maslahah product uniqueness (halal product uniqueness, Thoyyib product uniqueness, and religion-centric product uniqueness) and marketing performance. Moreover, the Maslahah product uniqueness dimension, such as Thoyyib product uniqueness, had also a firm impact on improving marketing performance.
... Customer orientation is often studied as an aspect of resource dependence theory (RDT) as it includes a firms' dependence on customer revenue. Customer orientation is the level that an organization focuses on understanding and responding to customer needs on an ongoing basis, (Joshi, 2016), in order to create value for them persistently (Narver & Slater, 1990 Gatignon & Xuereb, 1997. Christenson's "Customer Power" (Christensen & Bower, 1996 and "tight coupling" (Danneels, 2003) posit that the more organizations need a customer's revenues to survive, the more they are dependent on that customer. ...
The inability of small and early firms to successfully innovate beyond their first product is a strategic problem that has been a topic of academic attention for decades. Yet the phenomenon has not abated in practice. Extant research has most often focused on the search and planning stages, and applied the resource-based view for operational problems (e.g. within R&D), for explanations and solutions. This paper tests hypotheses that emerged from our initial field research and also builds on prior scholarship. To test hypotheses, we performed a full census of all small, newer U.S. software firms and measured the magnitude of this innovation problem (scarce follow-on products) in small/newer business settings. It undertakes to understand two constructs: 1. the degree to which follow-on innovation projects (the next product) may deteriorate more than all other R&D projects in newer firms after the first product is released , and 2. to test theory-based explanations for “the why” any such deterioration may occur. The research quantifies the following: while firms do plan for follow-on innovations (the next product), these project types become uniquely resource deprived over time from their original plan when compared to the rersource changes made to all other competing R&D projects of the firm. Furthermore, our behavioral-based hypotheses from both agency and resource dependence theories are operationalized and tested for explanatory significance.
... Technologydriven strategy is defined by Gatignon, H., and J.-M. Xuereb [48] as the development, integration, and usage of new technologies in new product and service development. Recent research has shown that a technology-driven strategy has a significant impact on the development of information technology capabilities [49]. ...
All businesses have many issues, especially small and medium enterprises trying to survive with traditional technology. Therefore, enterprises need to adopt business intelligence by using the management of information technology systems to overcome the issues. This study proposes a conceptual framework that identifies the potential factors that influence the adoption of business intelligence systems in the SME industry in Libya. Therefore, this study was established based on two main theories: the technology acceptance model (TAM) and the unified theory of adopting and using technology (UTAUT). In line with the previous studies that investigated this type of influence, this study recommended a conceptual framework containing several factors: change management, knowledge sharing, information quality, IT project management, the perceived usefulness of a BIS, and the perceived ease of adoption of a BIS. This study did not consider the environmental factors’ effect on adopting a BIS (business intelligence system); this is due to the different characteristics of each small and medium enterprise in terms of the sector or industry type.
... According to Hakala (2011), strategic orientation encompasses strategic management concepts that influence and guide an organization's endeavors, with the aim of ensuring sustainability and superior outcomes. In a similar vein, Gatignon and Xuereb, (1997), contend that strategic orientation is the primary approach adopted by firms towards certain behaviors aimed at gaining a competitive edge. In essence, strategic orientation reflects the managerial mindset towards competition and environmental factors. ...
... Novel products are attractive to customers due to their newness. In addition, the novelty offers a new experience to the buyer and induces purchase intention [46]. ...
Creativity is vital and a key determinant for the success of many organizations in today’s competitive environment. Research in marketing has suggested that collaborative communication is important to sustain a competitive advantage. Leveraging a resource-based view, this research provides a comprehensive view examining the different facets of collaborative communication—reciprocal feedback, rationality, formal communication, and informal communication, on the meaningfulness and novelty of new product creativity, and their impacts on new product performance. Based on 181 sets of responses, our findings indicate that rationality posits a significant positive effect on the meaningfulness of new product creativity, which in turn contributes to new product performance. As for the novelty of new product creativity, it is influenced by informal communication whilst the use of information and communication technologies (ICT) further strengthens the positive association between informal communications and the novelty of new product creativity. This study provides theoretical contributions to the new product development literature as well as practical insights for organizations on the importance of collaborative communication to new product creativity and improvements in new product performance.
Background and Aim: Exporting has different productivity effects on Chinese firms depending on their competitive strategic orientations. This research aims to investigate the opinion level of competitive strategic orientations of export companies in Suzhou City, China, and to study the guidelines of competitive strategic orientations of export companies in Suzhou City, China. Materials and Methods: The quantitative research approach is going to be followed for this paper's investigation. 109 enterprises in Suzhou City that are involved in exporting will make up the entire sample size for the research. To collect information for this inquiry, a questionnaire was used as the primary tool of data collection. To do data analysis and determine the data that was given, statistical characteristics such as the mean and standard deviation were utilized. Results: The study examines export enterprises in Suzhou, China, and finds moderate degrees of technology, learning, and market orientations. The aim is to improve these companies' competitive strategic orientations. Market orientation focuses on customer requirements, while competitive orientation fulfills competitors' dormant requirements. A learning orientation fosters a culture of learning, expansion, and innovation, with core values of commitment, open-mindedness, and shared goals. Conclusion: The study analyzes Suzhou export enterprises' technology, learning, and market orientations, aiming to enhance competitive strategic orientations, customer requirements, and innovation through a learning culture. Suzhou City export companies should differentiate, educate employees, reduce costs, and implement quality manufacturing. Prioritize technological, product, process, and communication innovation, while focusing on long-term future growth and market-demanding strategies.
Purpose
This paper aims to analyze the impact of gender in leadership on strategic orientation and the relative impact of these strategic orientations on organizational performance with the leadership of each gender.
Design/methodology/approach
Cross-sectional survey-based data were collected from 1,260 logistics companies, and 503 responses were found suitable for further data evaluation. Structural equation modeling (SEM) and regression analysis were used to analyze the data and test the hypotheses.
Findings
Results show that managers' gender affects only the aggressiveness subdimension ( p = 0.018 and ß = 0.114) in strategic orientation decisions and that male managers tend to be more aggressive-oriented than female managers. Strategic orientation is more effective on organizational performance. More clearly, when female executives use the same strategic orientation as their male counterparts, organizational performance is higher than that of male executives.
Research limitations/implications
Managers' power is related to social norms about their valuable contribution to the organization and roles are associated with experiences. Thus, at different levels of management, different results will be obtained.
Practical implications
Organizations should only define leadership roles in masculine terms with information or research that explains how women leaders can contribute to the organization's outcomes.
Social implications
The lack of fit model should not be expected when determining executive-level female leaders' performance.
Originality/value
There is a significant potential in studying strategic decision-making and whether the ability to provide effective organizational outcomes is related to a person's gender. Even if previous literature suggests that gender stereotypes affect perceptions of men's and women's fit for executive positions, the strategic conception of organizational decisions is immune to gender, but strategy execution is not.
L’orientation marché affecte positivement la performance commerciale et financière d’une organisation sur le court et le long terme. Pourquoi le style de leadership transformationnel du dirigeant favorise-t-il l’émergence d’une culture orientée marché dans l’organisation ? Sous quelle condition cette influence est-elle plus forte ? Dans cette note de recherche, nous analysons 163 dyades dirigeants/collaborateurs de PME sénégalaises et montrons, conformément à la théorie de l’apprentissage social : (1) que le leadership transformationnel du dirigeant stimule l’orientation marché à travers ses effets sur la qualité des échanges entre dirigeant et collaborateurs et (2) que cet effet indirect est positivement modéré par le niveau d’orientation marché du dirigeant lui-même (médiation modérée).
The adoption and implementation of digital information management systems is largely viewed as a means for promoting efficiency in organisations. Conversely, the realisation of the benefits derived from full utilisation of integrated digital information management systems still remain distant, pointing to lack of efficiency for some universities, particularly in the context of Sub-Saharan Africa. This lack of efficiency on the part of some universities suggests the need for accelerated incremental or adaptive digital innovations which are regarded as antecedents for the full utilisation of digital information management systems. Owing to this, the purpose of this study is to investigate the influence of digital information management systems as an antecedent for human resource functions in promoting efficiency. The hypotheses are tested using a sample size of 202 comprising senior managers, heads of sections and human resource personnel. The authors identify enterprise resource planning and human resource information systems as factors that bring efficiency to human resource functions. Organisational efficiency is associated with sound human resource functions driven by full utilisation of digital information management systems. Furthermore, the realisation of efficiency requires commitment of resources by the organisation. The empirical outcomes suggest that the digital information management system in place is predominantly used for recruitment, training and development processes while performance management processes are largely done manually. This paper contributes to the research literature on the significance of digital information management systems utilisation particularly from Sub-Saharan Africa. Also, the study provides a new empirical test using a data set of 202 decision makers such as senior managers and heads of sections.
Drawing upon the resource-based perspective, we develop and test a serial mediation model of CEO ethical leadership and environmental performance. Specifically, we propose that ethical leadership enhance environmental performance and this link is explained by green IT capital and green technology innovation, with a particular focus on the moderating role of firm technological orientation. The hypothesized relationships were tested in structural equation modeling with survey data from 303 Saudi small and medium-sized enterprises (SMEs). The results illustrate that the indirect effect of CEO ethical leadership on environmental performance is serially mediated by green IT capital and green technology innovation. The results also show that firm technological orientation moderates the relationship between CEO ethical leadership and green IT capital. This study offers practical insights and suggests that SMEs leadership focus on the creation and implementation of green infrastructure for successful implementation of green practices that can contribute to improved environmental performance.
The international business environment is both dynamic and turbulent. Accordingly, a new venture’s strategic orientation (SO) and ability to undertake strategic renewal (SR) are of great importance to its survival, growth and international performance. Building on the dynamic capability perspective, we explore how SR capability mediates the relationship between SO and the performance of mature born global firms (BGFs). In particular, we examine the direct and indirect interplay between the SO of BGFs and their performance outcomes. We use a sample of 195 export-oriented BGFs, derived from the Bangladeshi apparel industry. We use a hierarchical regression analysis technique to test the direct effects. The mediation effect is examined using three statistical tests – Baron and Kenney’s (1986) causal steps approach, the Sobel test, and the Hayes indirect effect with bootstrapping method – to ensure the validity and reliability of our findings. The results reveal a positive association between SO and the performance of BGFs, and that this relationship is mediated by the firms’ SR capability. We contribute to a greater understanding of the drivers of mature BGFs’ international performance by demonstrating a direct link between their SO and SR capability, which in turn affects their performance outcomes.
Purpose
In this study, the researchers explored the roles played by digital technologies and digital innovation (DI) in Pakistan's Information, Communication and Technology (ICT) companies' firm performance (FP).
Design/methodology/approach
The researchers used a quantitative study to gather cross-sectional data from employees working in Pakistan's ICT companies. The authors based this study's findings on 396 valid samples.
Findings
The structural equation modeling (SEM) findings underline that digital capability (DC), digital orientation (DO) and digital transformation (DT) have positive and significant effects on DI and FP. Moreover, there is a positive and significant relationship between DI and FP. Finally, DI mediates DC's, DO's and DT's associations with FP.
Practical implications
By committing to embracing new digital technologies and updating existing DCs to become innovation leaders and to improve FP, the findings will help sectors to take advantage of developing digital technologies and the trend toward digitalization. The results are also valuable for policymakers when considering if SMEs should be provided with more money for the digital up-skilling of their employees. Finally, this study's findings enrich the depth of literature about companies' use of digital technologies.
Originality/value
This study's empirical findings confirm the roles played by DC, DO and DT in improving DI and FP in a developing country such as Pakistan.
Despite a growing literature on open innovation in new product development (NPD), little is known about when openness is most beneficial during the innovation process. This study investigates the effectiveness of opening up NPD projects early or late, or before or after product launch, leading to four intertemporal NPD strategies: closed-closed, closed-open, open-closed, and open-open. Utilizing novel data of product innovation and market performance of 536 digital games, the authors study the effects of intertemporal NPD strategies on new product market performance under moderating effects of technological capability, marketing capability, and project complexity. The results indicate that the early open (open-closed) NPD strategy outperforms the late open (closed-open) strategy. Furthermore, the positive effect of open NPD strategies is stronger when technological capability is high, but weaker when marketing capability is high and when projects are complex. This study contributes to the literature by proposing a typology of NPD strategies that conceptualizes open innovation before and after product launch, and by demonstrating that NPD benefits from early openness, although firms decide to close the NPD project after launch. Managerially, this study offers empirical evidence that open NPD strategies with a consideration of project contingencies are important predictors of new product success.
The dynamics of change in the business environment catalysed by globalization, changing consumer preferences, and a whirlwind of technological development have exerted immense pressure on commercial banks to introduce up-to-date products and services for sustainability. Product innovation has thus become a vital tool for survival and development. This study examined the influence of product innovation on the competitiveness of commercial banks in Kenya. The theory of creative destruction served as the study's guide. The study utilized a positivist research philosophy. Descriptive and correlational research designs were used. The target population consisted of 175 directors and general managers of Tier 1 commercial banks. Stratified and simple random sampling was then employed to select 122 respondents. Primary data was collected using closed and open-ended questionnaires. A pilot study was done on Equity Bank. To test validity, the study used content and construct validity. The study utilized descriptive and inferential analysis. Descriptive analysis included the use of frequencies, percentages, mean, and standard deviation, while inferential statistics employed correlation and simple linear regression analysis. Data collected from open-ended questionnaires was analysed using content analysis. The results were presented in tables. The study found that product innovation had a positive and significant influence on the competitiveness of commercial banks in Kenya (t = 0.6.438, P = 0.000). The study thus recommends that commercial banks embrace product innovation as a tool to achieve competitiveness. Product innovation should be enhanced by carrying out regular surveys, seeking client views in the development of mobile and internet product innovations, and training clients on the usage of mobile and internet banking products before onboarding.
Purpose
The authors examine the spillover effects of CEO removal on the corporate financial policies of competing firms among S&P 1500 firms.
Design/methodology/approach
The authors used generalized estimating equations (GEE) on a sample of S&P 1,500 firms from 2000 to 2018 to test this study's research hypotheses. Return on assets (ROA), investment policy, and payout policy are used as proxies for corporate policies.
Findings
The authors found an increase in ROA and dividend payout in the immediate aftermath. Further, this study's hypothesis does not hold for R&D expenditure and net-working capital as the authors found an insignificant change in them in the immediate aftermath. However, the authors found a significant reduction in capital expenditure, supporting this study's hypothesis in the context of investment policy. Institutional investors and product similarity moderated the spillover effect on corporate policies (ROA, dividend payout, and capital expenditure).
Originality/value
The authors address a novel aspect of CEO performance-induced removal due to poor performance, i.e., the response of other CEOs to CEO performance-induced removal. This study's findings add to the literature supporting the bright side of CEOs' response to CEO performance-induced removal in peer firms due to poor performance.
Big data-driven innovation gains momentum in the developing world by tackling grand challenges and making a pronounced and lasting impact. However, research has still not answered the key question regarding the dimensions of big poverty data analytics (BPDA) capabilities for creative service offerings nor their effects on economic and social outcomes. This study fills this gap by conducting a two-phase Delphi study and two rounds of surveys focusing on a globally leading microcredit institute in a developing country. The study conceptualizes management (analytics climate, cross-functional integration), platform (technology and data), and talent (pattern spotting and market ambidexterity) capabilities as the dimensions of BPDA capability. It further investigates creative service offerings (meaningfulness and novelty) as the mediator between BPDA—new service performance (economic outcome from the firm's end) as well as BPDA—quality of life (social outcome from consumer's end). Our research advances, first, the microfoundational view of dynamic capability (DC) theory in the emerging data-driven innovation paradigm by specifically identifying the complementary and co-specialization attributes of six microfoundations (i.e., analytics climate, cross-functional integration, data, technology, pattern spotting, and ambidexterity). In addition to DC, our study extends social innovation literature by establishing the connection between the instrument (BPDA capability) and outcome view (quality of life) of social innovation to tackle grand challenges in the developing world. Finally, our study extends creativity theory by introducing creative service offerings as a mediator and highlighting its role in the novel and meaningful solutions to social problems. Overall, this study is a pioneer in conceptualizing and empirically validating a research model that uncovers the potentially complex nuances between BPDA capability-creative offerings and innovation outcomes to tackle the grand challenge of poverty. Its findings are scholarly significant and executive worthy and constitute a major advancement in extant studies regarding how creative services are developed using BPDA and their impact on the firm's profitability and consumer well-being.
The study aims to define strategic orientations and examine the relationship between entrepreneurial orientation activities and firm performance. For this purpose, the concepts of strategic orientation, entrepreneurial orientation and firm performance are explained in the relevant sections based on the research in the literature. The study used international examples that associate the entrepreneurial orientation of family and non-family companies with firm performance. One of the most important results of the study is that the entrepreneurial orientation of family firms has a weak or non-existent relationship with firm performance. Family businesses tend to be less involved in entrepreneurial orientation activities than non-family companies. Another important result is that entrepreneurial orientation has a more positive effect on the performance of non-family firms than family firms. This study is likely to positively contribute to the literature by providing a new perspective to scientists and administrators and summarizing important resources in one place. The study differs from similar studies as it deals with the relationship between entrepreneurial orientation and firm performance by including family and non-family companies in the process with a holistic approach. Since the samples subject to the study were selected without making any distinction between country, sector and size in this research, the scope is limited. The relationship between entrepreneurial orientation and firm performance could not be determined statistically since the study is qualitative.
The aim of this chapter is to investigate mechanisms for improving supply chain open innovation networks (SCOINET) while improving capabilities. In doing so, we explore the determinants to improve SCOINET. These determinants come under the umbrella of two types of capabilities related to technology being employed and interactions happening in SCOINET. By applying a twofold research method, this study employs the analytical hierarchical process (AHP) and interpretive structural modelling (ISM). In doing so, AHP is applied to prioritize and rank the capabilities with respect to their relevance for improving SCOINET. The prioritized technological capabilities are technological capacity and technological orientation, while the interactive capabilities are digital trust and relational capital. Moreover, the ISM technique is applied to ascertain the interactions and interdependencies of these capabilities. As a result of this study, a framework is developed to facilitate collaborations and functioning of SCOINET to make them integrated, visible, and resilient. This framework guides policy makers to develop open innovation networks not only for the supply chain but also for other functions. This is the first ever study to present capability framework for SCOINET. Finally, researchers are provided with directions to conduct further research related to SCOINET.KeywordsOpen innovationSupply chain networksTechnological capabilitiesInteractive capabilitiesDigital trust
Many social enterprises have founders who worked in commercial organisations before they engaged in social entrepreneurship, but how that sort of individual-level imprinting exerts an enduring effect on social enterprise performance remains under-examined. Drawing from imprinting theory and the strategic orientation literature, this study examines how and under which conditions social entrepreneurs’ commercial imprint plays a significant role in shaping the performance of their social enterprises. Studying 230 social enterprises in China, this research shows that founders’ most recent for-profit work experience prior to starting their social enterprise has an enduring impact on organisational performance. Moreover, when the founder commercial imprint aligns with the strategic choice that the social enterprise leverages, it creates more benefits for social enterprise performance. This study provides insights into how social entrepreneurs’ career imprints transfer and are adapted to the context of social entrepreneurship. In addition, it enriches the literature by identifying boundary conditions of imprinting effects regarding social enterprise performance.
Purpose
Digitally oriented firms are faced with new opportunities and risks in today’s ever-changing world. Drawing upon organisational entrainment theory, this study investigates how supply chain (SC) entrainment improves the effects of digital orientation on firm performance through absorbing risks and exploiting opportunities.
Design/methodology/approach
Survey data were collected from 307 Chinese manufactures and analysed using structural equation modelling and regression analysis.
Findings
The results show digital orientation absorbs risk through evoking three SC entrainment dimensions (i.e. internal entrainment, entrainment with customers and entrainment with suppliers). Entrainment with customers and suppliers mediate the relationship between internal entrainment and firm performance. An opportunity exploitation mechanism is evidenced by the moderating effects of internal and external entrainment on the relationship between digital orientation and firm performance.
Practical implications
The empirical findings provide timely insights for managers to fully harness the benefits of digital orientation by using SC entrainment, i.e. to match the tempo and pace of internal and external cyclical activities to reduce the risks and increase the benefits of adopting advanced digital technologies. The authors show managers how to adjust their organization’s actions to keep tempo and synchronous phase with their SC partners.
Originality/value
The study introduces and conceptualizes a construct (i.e. SC entrainment) to understand how risks and opportunities arising from digital transformation can be addressed to maximize the value of advanced digital technologies.
Building on a robust data set of 281 manufacturing and service firms in the UK, the paper offers an empirical analysis of relationship between the three strategic orientations and novel business model (BM). The paper plugs the gap around design and implementation of new BM and role of diverse strategic orientations. The empiric in the paper is supported by structure equation modelling and findings confirm the validity of the model thereby providing theoretical support around complexity of BM and its relationship with three strategic orientations. In the light of strategic importance around renewed business model, our paper is a timely contribution to understanding some of the antecedents of novel business model, its link to business performance and implementation of BM across firms in manufacturing and service sectors.
We explore the relationship between strategic orientations (market orientation and entrepreneurial orientation), organizational ambidexterity, and sustained competitive advantage under the mediation of Industry 4.0 readiness. Based on data from a sample of 144 SMEs belonging to different economic sectors, we employed partial least squares-structural equation modeling to test our hypotheses. Empirical research suggests that market orientation and entrepreneurial orientation have a favorable relationship with Industry 4.0 readiness and sustainable competitive advantage. Moreover, our findings reveal that entrepreneurial orientation has a greater effect on SCA than market orientation in emerging markets. Furthermore, Industry 4.0 readiness acts as a full intermediary between strategic orientations and sustainable competitive advantage. This study contributes to the existing literature by exploring the relationship between strategic orientation and sustainable competitive advantage through Industry 4.0 as the mediator. SMEs' managers can use these findings to rethink their technology adoption strategies and exploitative and explorative approaches.
Purpose
This research aims to examine the moderating role of digital orientation (DO) on the relationship between innovation and internationalization by framing the relationship under an agency, resource-based view (RBV) and organization orientation (OO) theory.
Design/methodology/approach
This study focuses on a sample of 392 listed companies in Malaysia from 2011 to 2018 and estimates the model under the double clustered regression, dynamic GMM panel model and one-lagged model to tackle endogeneity and reversal causality. This study also did a logit model as an additional robustness check.
Findings
The findings support the RBV perspective: Companies with intensive innovation have high internationalization. However, the findings refute OO theory by revealing the evidence that DO leads to low internationalization. Supplemental analysis suggests that innovation impact on internationalization occurs in assets and sales internationalization (exports).
Research limitations/implications
According to the RBV theory, innovation is strategic value creation for the organization to achieve competitiveness. A company can expand its market internationally when the business process is more productive and efficient due to innovation. The innovation process is closely related to DO. Hence, this research explores whether DO may strengthen the effect of innovation on the internationalization process.
Originality/value
This study examines the effect of DO on innovation and internationalization implementation by contesting agency theory, RBV theory and OO theory within an emerging country context.
Digital project teams are constantly faced with undeniable challenges of how to improve team performance in the interactive era of knowledge economy and digital economy. This study aims to explore the mediating role of digital capability between knowledge heterogeneity and team performance and the moderating role of knowledge conversion. This study is quantitative and horizontal, focusing on digital project teams in China. The findings indicate that team knowledge heterogeneity can predict team performance, in which team digital capability plays a mediating role. Internal knowledge conversion enhances the positive relationship between team knowledge heterogeneity and capability, and further, external knowledge conversion enhances the moderating role of internal knowledge conversion. The originality of this study is that, concerning the relationship between knowledge heterogeneity and team performance, it is the first time to develop a model that regards digital capability as a mediator and knowledge conversion as a moderator. We constitute a significant contribution to the literature. Additionally, this study contains a series of practical implications which may contribute teams to a competitive advantage in emerging markets.
The antecedent influence of technology innovation, regulatory regimes and stakeholders’ pressure on green supply chain management have been investigated disparately, with mixed results. This study aimed to explore the potential and specific effects of these selection pressure among sampled construction organizations in Sarawak Malaysia using the Triple Embeddedness Framework as an underpinning theory. Using a self-report online survey instrument, we sampled 350 contractors in Sarawak, and 114 responses were received after repeated reminders. However, after removing seven incomplete responses, only 107 usable surveys were considered for data analysis, denoting a response rate of 30.6%. Data screening was then carried out using SPSS version 23, while SmartPLS version 3.2 was used to assess the measurement and structural models. The findings suggest that regulatory pressure and technology orientation positively relate to the contractors’ green supply chain management. There is also a significant mediation of technology orientation in customer, regulatory pressure and green supply chain management relationships. This study contributes to the construction project supply chain body of knowledge by channelling the Triple Embeddedness Framework toward green supply chain management by providing empirical grounds from the hypothesized relationships. Stakeholders’ unification is also suggested for sustainable upstream and downstream integration.
Purpose
In the current study based on the resource-based view (RBV), a three-way interaction model tests the relationships among human and social capital resources, innovation orientation (IO) and innovation capability in the context of new ventures.
Design/methodology/approach
Hierarchical linear regression modeling presents the linear relations at two decision layers of start-ups, their founders and managers. Data is collected and analyzed from 233 new ventures in Turkey.
Findings
Findings of the two and three-way interaction analyses indicate a positive relationship between human capital and innovation capability when social capital and IO are high; however, the relation turns off when low.
Research limitations/implications
The study extends the previous works on the proposed link between intellectual capital (IC) resources and innovation, by confirming the moderating role of social capital and IO on the positive association between human capital resources and innovation capability.
Practical implications
The results show that for start-up companies, the co-existence of strong social capital and the strategic orientation towards innovation is required for the effective utilization of human capital for generating innovation capability within the organization. Thus, this study highlights the importance of networks, alliances and social relationships, together with the unification of strategic thinking, organizational learning and a culture of innovation for attaining innovation goals, which are crucial for the survival and success of these units.
Originality/value
This study presents the first model in the literature which examines the moderating effects of IO and social capital on the human capital-innovation capability relationship.
The purpose of this study is to explore the influence of a CEO’s market orientation on the strategic orientations of Small and Medium Enterprises (SMEs). A survey was conducted and data were collected from a sample of 175 Senegalese SMEs. The data were analyzed using structural equation modeling in STATA. The results show that some dimensions of a CEO’s market orientation positively influence SMEs’ strategic orientations. The findings imply that CEOs must individually exhibit market-oriented behaviors to encourage the development of strategic orientations in their SME. This study contributes to the development of the literature on individual market orientation by revealing that the CEO’s market orientation constitutes a key factor for the strategic orientation in SMEs
This study aimed at analyzing the influence of the use of technology on the use of financial services and innovation of SMEs in Africa. The study further analyzes the mediating role of the use of financial services on firm use of technology-innovation relationships among SMEs in Africa. The study utilizes data retrieved from the enterprise survey portal. The analysis employs multiple regression to test the models using SPSS, and the Sobel test further examines mediation. The results reveal a significant positive association of firm use of technology on the use of financial services and innovation. Also, there is a positive association between the use of financial services and SME innovations in Africa. The study found partial mediation of the use of financial services on the use of technology-innovation relationships. The results have implications on African SMEs need to amplify the sensitization and emphasis on fostering the use of technology in innovating new products and processes. While promoting innovation, the use of technology can enhance financial inclusion resulting in wider and deeper financing options for enterprises in Africa, which are deeply hampered by financial and technological vulnerability.
The aim of the study was to examine the impact of strategic orientation on organizational ambidexterity. Therefore, it focused on five-star hotels in Jordan. Data were primarily gathered through self-reported questionnaires created by Google Forms which were distributed to a random-stratified sample of (215) managers. In total, (193) responses were received including (8) invalid to statistical analysis due to uncompleted or inaccurate. Hence, the final sample contained (185) responses suitable to analysis requirements. Structural equation modeling (SEM) was conducted to test hypotheses. The results showed that strategic orientation had a positive impact on organizational ambidexterity. Moreover, the results indicated that the highest impact was for technology orientation. Based on the study results, the researchers recommend hotel managers to develop strategic directions by updating their general strategies to contribute to increasing the market share compared to other competing hotels.
Purpose
This paper aims to examine how market globalization orientation (i.e. a firm’s strategic commitment to developing the target markets beyond national borders) influences business-to-business (B2B) practices to achieve competitive performance outcomes.
Design/methodology/approach
A conceptual framework shows how to translate strategic orientation into integrated organizational practices for competitive outcomes. A research model defines key variables (drivers, B2B practices and performance outcomes). The research model is tested using an international survey of 439 firms from four continents. And the analysis results are reported.
Findings
The results suggest that market globalization orientation influences organizational practices and external B2B network processes to achieve desirable performance outcomes. Integrated product development is a crucial linkage mechanism that enables firms to translate strategic network coordination and product innovation goals into improved manufacturing and firm performance.
Research limitations/implications
First, macro-level factors (e.g. the changing attitudes of domestic stakeholders toward globalization) do not necessarily dictate the critical aspects of the micro-level responses (e.g. firm-level practices). Despite negative narratives of globalization at the macro-level (e.g. economic inequality, unwanted immigration that spreads transmissible diseases, supply chain disruptions), firm-level responses toward global markets are determined by their missional direction and strategic priorities for achieving competitive advantage by expanding their B2B supply chains and market frontiers (Adams et al. , 2019; Kobrin, 2020; Witt, 2019; Zinn and Goldsby, 2020). Second, the findings suggest that many firms take globalization orientation as an essential strategic driver that governs critical operational and network practices for achieving desirable performance outcomes. Market globalization orientation motivates B2B firms of all sizes –including small and medium-sized enterprises (SMEs) – to pursue globalization in their unique paths of differentiation. Globalization orientation expands their spheres of influence beyond their local, regional and domestic fronts. The globalization orientation of business leadership motivates firms to stretch their business frontiers without self-imposed geographical constraints.
Practical implications
Competitive firms choose market globalization orientation in their supply flow and implement strategic and operational practices to pursue global market opportunities. Globalization orientation is imperative to firms that seek new growth engines to achieve competitive performance that appeals to diverse market segments of the world.
Social implications
Outstanding firms expand their value frontiers to secure a flexible supplier base and reach out to diverse B2B customers in their domestic and global market segments. This study also suggests that firms with a market globalization orientation aim to develop novelty products, offer essential services, support the livelihood goals of people and pursue a shared vision of a sustainable planet.
Originality/value
In the context of conflicting societal attitudes and political priorities toward globalization, this study examines the crucial role of market globalization orientation. Using an empirical study, this paper suggests that globalization efforts succeed as firms deploy their internal and network resources to address people’s essential and timeless needs beyond national boundaries.
Housing delivery is facing substantial environmental sustainability threats. Consequently, the housing industry is constantly adopting broad-based actions to sustain the environment and make delivery more efficient and risk-averse. Such regulatory models are sometimes targeted at the housing developers’ readiness, the dimensions of market volatility, technology, and the firm's resources. These variables are more profound within an emerging economic context such as Malaysia, and previous research investigating sustainability agenda in housing delivery has neglected their impacts within the housing developer's perspective. This study tested regional-scale hypotheses regarding predictors of ecological sustainability across the state of Sarawak Malaysia. It was hypothesised that the critical dynamics of technology, developer's readiness, resources, regulatory framework, market turbulence, and uncertainty would increase the likelihood of cumulative environmental sustainability in housing delivery. A sample of 221 Housing developers registered under the Sarawak Housing and Real Estate Developers’ Association and allied professionals were sent a self-report online survey instrument, and 144 completed questionnaires were returned, indicating a 65 per cent response rate. Subsequently, SPSS and SmartPLS were used for data analysis. SPSS was used for data screening, while SmartPLS was used to assess the measurement and structural models. Structural equation models show that improved technology, developer's readiness, and regulatory apparatus are the better correlated with environmental sustainability performance.
Bu araştırma COVID-19 pandemisi ile iş çevrelerinde gelişen süreçten en çok etkilenen grupta yer alan KOBİ'lerin stratejik yönelimlerinin örgütsel dayanıklılıklarına etkisini incelemektedir. Araştırma modeli ve hipotezler, Türkiye'de hizmet sektöründe faaliyet gösteren 500 KOBİ’nin sahip/ortak/üst düzey yöneticisi ile görüşülerek yüz yüze anket yöntemiyle toplanan veriler üzerinde Yapısal Eşitlik Modellemesi tekniği kullanılarak incelenmiştir. Analizler sonuçlarına göre teknoloji yönelimi, pazar yönelimi, girişimsel yönelim ve öğrenme yöneliminin örgütsel dayanıklılığı anlamlı ve pozitif yönlü etkilemektedir. Ayrıca araştırma sonuçlarına göre teknoloji yönelimi örgütsel dayanıklılığı görece en fazla etkileyen stratejik yönelimken, firmaların çoklu stratejik yönelimlere sahip olması örgütsel dayanıklılığa sahip olmalarına olumlu katkılar sunacaktır. Bu araştırma, bakış açısı ve bulgularıyla hem ilgili literatüre katkı sağlamakta hem de uygulayıcılar için ufuk açıcı niteliktedir.
Despite the predominant focus on the effect of digital orientation on innovation performance from firm level, few studies have considered the collaboration network contexts, and there is a “black box” in understanding the digital orientation-innovation outputs relationship. The study draws on the knowledge-based view to explain the digital orientation-innovation outputs relationship, and opens up the black box of the innovation process through which digital orientation affects innovation outputs by proposing the missing link of knowledge management practices (knowledge acquisition and knowledge creation). In addition, the study links the literature on digital orientation and network centrality linkage by providing novel insights into how to match digital orientation and network centrality for superior innovation outputs. By adopting the survey approach, we collected two-waved survey data from a total of 286 Chinese firms, and conducted hierarchical linear regressions to test our hypotheses. The empirical results demonstrated that digital orientation has a stronger influence on exploratory innovation relative to exploitative innovation. Knowledge acquisition mediates the impact of digital orientation on exploratory innovation, while knowledge creation does not mediate the impact of digital orientation on exploitative innovation. Network centrality strengthens the influence of digital orientation on exploratory and exploitative innovation.
Digitalization is increasingly seen as a strategic means for firms to yield competitive and environmental advantages. Still, current empirical research does not yet provide ample evidence on how a firm's strategic posture towards digitalization connects to environmental performance. This study examines the link between digital orientation and environmental performance as well as the moderating role of technological turbulence. The natural-resource-based view and literature on strategic orientations provide the conceptual foundations. The hypotheses are tested with data from 515 U.S. Standard and Poor's 500 companies with 2,800 firm observations from 2009 to 2019. The results indicate that, first, a firm's digital orientation has a significant and positive effect on environmental performance and, second, this effect is even more pronounced in technologically turbulent business environments. In sum, our findings suggest that managers can improve their firm's environmental performance and competitive position by increasing the digital orientation within their organizations. We thus add to the literature on the natural-resource-based view by identifying digital orientation as a strategy aligned with the natural environment. Finally, we derive practical implications for managers and policymakers aiming to bring together digitalization and green strategies.
This study aims to improve state regulation and administration of quasi-state sector of environmental sustainability in the Republic of Kazakhstan within the social sustainability paradigm. This study is due to the need to search the balance of business interests, and efficient use of resources and their conservation on a global scale. The issues of state asset management are identified and ways to resolve them are proposed based on the corporate foresight methodology using the strategic planning mechanism. As a result of the analysis of the tools introduced into the practice of leading transnational corporations, the main directions are identified in which it is advisable to take measures aimed at streamlining and optimizing the quasi-public sector in the Republic of Kazakhstan. This article presents proposals for improving state regulation and administration of quasi-public companies in the Republic of Kazakhstan. The outcomes of this study can assist policymakers, experts, and stakeholders in gaining awareness about these problems while simultaneously improving sustainability practices.
The authors outline a conceptual framework for analyzing differences in competitive marketing behavior of businesses in established industrial markets. They explicitly distinguish between retaliatory and cooperative marketing behavior. The structural characteristics of the served markets and the competitive positions of businesses are postulated to affect the nature and likelihood of retaliatory and cooperative behavior with respect to price and sales force expenditures. The authors specify different models explaining these dimensions of competitive marketing behavior at the strategic business unit level and test their hypotheses by estimating the various competitive behavior models using relevant data obtained from the PIMS (Profit Impact of Market Strategies) Program. The empirical results support several theoretical arguments and provide insights into the determinants of competitive marketing behavior in industrial markets.
The marketing literature has traditionally assumed that people in marketing and sales play a central role in product development activities. Though recent work has recognized that marketing may be less central in high-tech firms, there has been little empirical examination of the role marketing does play in these situations. This article, based on nine months of participant observation in a computer systems firm, first provides an overview of the product development process and then describes impediments that prevent marketing groups from exerting greater control over product development decisions. The author then turns to ways in which marketing groups work within these constraints, exerting their influence through informal networks, coalition building to champion specific projects in engineering, and going to the external market to “complete the product” for their respective market segments. He concludes by assessing the implications for research in high-tech firms and considering managerial implications.
This article reports the results of Project NewProd, an extensive investigation into what separates successful from unsuccessful new industrial products. Multivariate methods are used to probe this success/failure question. The dimensions underlying success and failure are identified. The dominant role of product strategy and the need for a strong market orientation clearly are demonstrated.
This article reports the results of Project NewProd, an extensive investigation into what separates successful from unsuccessful new industrial products. Multivariate methods are used to probe this success/failure question. The dimensions underlying success and failure are identified. The dominant role of product strategy and the need for a strong market orientation clearly are demonstrated.
A working paper in the INSEAD Working Paper Series is intended as a means whereby a faculty researcher's thoughts and findings may be communicated to interested readers. The paper should be considered preliminary in nature and may require revision.
The authors outline a conceptual framework for analyzing differences in competitive marketing behavior of businesses in established industrial markets. They explicitly distinguish between retaliatory and cooperative marketing behavior. The structural characteristics of the served markets and the competitive positions of businesses are postulated to affect the nature and likelihood of retaliatory and cooperative behavior with respect to price and sales force expenditures. The authors specify different models explaining these dimensions of competitive marketing behavior at the strategic business unit level and test their hypotheses by estimating the various competitive behavior models using relevant data obtained from the PIMS (Profit Impact of Market Strategies) Program. The empirical results support several theoretical arguments and provide insights into the determinants of competitive marketing behavior in industrial markets.
In this second article for The Journal of Product Innovation Management, Robert G. Cooper shows that firms can be clustered according to five general types of new product strategies. Depending on the measure of success, some strategies are more successful than others. One strategy, however, stands out for its success on all measures. Others are consistently unsuccessful. The strategies are described in such ways that managers can position the strategies of their own firms and compare their results with those of the firms Professor Cooper studied.
The marketing literature has traditionally assumed that people in marketing and sales play a central role in product development activities. Though recent work has recognized that marketing may be less central in high-tech firms, there has been little empirical examination of the role marketing does play in these situations. This article, based on nine months of participant observation in a computer systems firm, first provides an overview of the product development process and then describes impediments that prevent marketing groups from exerting greater control over prod¬uct development decisions. The author then turns to ways in which marketing groups work within these constraints, exerting their influence through informal networks, coalition building to champion specific projects in engineering, and going to the external market to "complete the product" for their respective market segments. He concludes by assessing the implications for research in high-tech firms and considering managerial implications.
Market pioneers outsell later entrants in both consumer and industrial markets. Entry barriers arising from preemptive positioning and switching costs have been advanced to explain this market share difference, termed "pioneering advantage." However, empirical studies show that pioneering advantages are present even in mature markets in which brands reposition and switching costs are minimal. In these cases, the authors argue that pioneering advantage can arise from the process by which consumers learn about brands and form their preferences. This process can produce a preference structure that favors the pioneer, making it difficult for later entrants to "compete away" the pioneer's large market share, even if brands can reposition and switching costs are minimal.
An evolutionary model of technological change is proposed in which a technological breakthrough, or discontinuity, initiates an era of intense technical variation and selection, culminating in a single dominant design. This era of ferment is followed by a period of incremental technical progress, which may be broken by a subsequent technological discontinuity. A longitudinal study of the cement (1888-1980), glass (1893-1980), and minicomputer (1958-1982) industries indicates that when patents are not a significant factor, a technological discontinuity is generally followed by a single standard. Across these diverse product classes, sales always peak after a dominant design emerges. Discontinuities never become dominant designs, and dominant designs lag behind the industry's technical frontier. Both the length of the era of ferment and the type of firm inaugurating a standard are contingent on how the discontinuity affects existing competences. Eras of ferment account for the majority of observed technical progress across these three industries.
What is the key to success in industrial product innovation? This question is frequently posed, and many authors and managers have speculated as to which critical factors or variables decide the fate of new industrial products. What is missing in the debate is evidence based on actual new product successes and failures. Project NewProd is an investigation that was designed to fill this void. In this article we report the results of a study into a large number of successful and unsuccessful new products, project NewProd, whose goal was to identify the determinants of commercial success in industrial product innovation.
What are the keys to superior new product performance? Integrates the
results of several of NewProd studies of hundreds of new product
successes and failures. Identifies the key drivers of new product
performance, where “performance” is measured in a variety of ways,
including profitability, market share, meeting objectives, impact on the
company and speed to market. Derives eight key lessons from the studies:
the need for product superiority; a strong market orientation; solid
up-front homework; early and sharp product definition; a
cross-functional team approach; focus and project prioritization;
quality of execution; and a systematic stage-and-gate new product
process. Explains the implications of each of these eight factors
– what they mean in terms of management action. Cycle time reduction and
time to market are overriding concerns in the study. Identifies the four
most important determinants of cycle time reduction.
The concept of customer orientation in salespeople is defined, a scale is developed to measure the degree to which salespeople engage in customer-oriented selling, and the properties of the scale are reported. A test of the nomological validity indicates the use of customer-oriented selling is related to the ability of the salespeople to help their customers and the quality of the customer-salesperson relationship.
In recent years, academic and practitioner interest has focused on market orientation and factors that engender this orientation in organizations. However, much less attention has been devoted to developing a valid measure of market orientation. Here we define market orientation as the organizationwide generation of market intelligence pertaining to current and future needs of customers, dissemination of intelligence horizontally and vertically within the organization, and organization-wide action or responsiveness to market intelligence. The authors describe a procedure to develop a measure of the construct. Key features of the research methodology include several rounds of pretesting, a single-informant assessment, and a multi-informant (both marketing and nonmarketing executives) replication and extension. The multi-informant results indicate that the proposed 20-item market orientation scale (MARKOR) may be best represented by a factor structure that consists of one general market orientation factor, one factor for intelligence generation, one factor for dissemination and responsiveness, one marketing informant factor, and one nonmarketing informant factor. Taking into account the informant factors, the subsequent validation tests are moderately supportive of the market orientation construct. The authors discuss methodological, substantive, and application directions for future research in light of these findings.
Drawing on research in marketing strategy and industrial organization economics, the authors develop a model to describe the impact of strategies for introducing a new brand, aspects of the competitive environment, and firm characteristics on the performance of new brands. They test the model for 68 new brands in the pharmaceutical industry using a nested error component model. The results indicate which factors affect brand introduction strategies in marketing.
Market pioneers outsell later entrants in both consumer and industrial markets. Entry barriers arising from preemptive positioning and switching costs have been advanced to explain this market share difference, termed “pioneering advantage.” However, empirical studies show that pioneering advantages are present even in mature markets in which brands reposition and switching costs are minimal. In these cases, the authors argue that pioneering advantage can arise from the process by which consumers learn about brands and form their preferences. This process can produce a preference structure that favors the pioneer, making it difficult for later entrants to “compete away” the pioneer's large market share, even if brands can reposition and switching costs are minimal.
Recent studies have shown evidence of a positive relationship between market orientation and performance. However, some scholars have suggested that competitive environment could moderate this relationship. The authors investigate how competitive environment affects the strength of the market orientation-performance relationship and whether it affects the focus of the external emphasis within a market orientation—that is, a greater emphasis on customer analysis relative to competitor analysis, or vice versa, within a given magnitude of market orientation. Their results provide very limited support for a moderator role for competitive environment on the market orientation-performance relationship. The benefits of a market orientation are long term though environmental conditions are often transient, and thus being market oriented is cost-effective in spite of any possible short-term moderating effects of the environment.
The literature reflects remarkably little effort to develop a framework for understanding the implementation of the marketing concept. The authors synthesize extant knowledge on the subject and provide a foundation for future research by clarifying the construct's domain, developing research propositions, and constructing an integrating framework that includes antecedents and consequences of a market orientation. They draw on the occasional writings on the subject over the last 35 years in the marketing literature, work in related disciplines, and 62 field interviews with managers in diverse functions and organizations. Managerial implications of this research are discussed.
Marketing academicians and practitioners have been observing for more than three decades that business performance is affected by market orientation, yet to date there has been no valid measure of a market orientation and hence no systematic analysis of its effect on a business's performance. The authors report the development of a valid measure of market orientation and analyze its effect on a business's profitability. Using a sample of 140 business units consisting of commodity products businesses and noncommodity businesses, they find a substantial positive effect of a market orientation on the profitability of both types of businesses.
Considerable progress has been made in identifying market-driven businesses, understanding what they do, and measuring the bottom-line consequences of their orientation to their markets. The next challenge is to understand how this organizational orientation can be achieved and sustained. The emerging capabilities approach to strategic management, when coupled with total quality management, offers a rich array of ways to design change programs that will enhance a market orientation. The most distinctive features of market-driven organizations are their mastery of the market sensing and customer linking capabilities. A comprehensive change program aimed at enhancing these capabilities includes: (1) the diagnosis of current capabilities, (2) anticipation of future needs for capabilities, (3) bottom-up redesign of underlying processes, (4) top-down direction and commitment, (5) creative use of information technology, and (6) continuous monitoring of progress.
This article takes as its central concern the diffusion of high technology innovation among business organizations. A set of propositions is developed that focuses on the competitive factors influencing diffusion. The article suggests how the supply-side competitive environment and the adopter industry competitive environment both affect diffusion of new technologies. The article seeks to extend the current behavioral paradigm for studying innovation diffusion by incorporating competitive factors as explanatory variables.
“Quadrads” (double dyads) of interviews, each conducted with a pair of marketing executives at a Japanese vendor firm and a pair of purchasing executives at a Japanese customer firm, provided data on corporate culture, customer orientation, innovativeness, and market performance. Business performance (relative profitability, relative size, relative growth rate, and relative share of market) was correlated positively with the customer's evaluation of the supplier's customer orientation, but the supplier's own assessment of customer orientation did not correspond well to that of the customer. Japanese companies with corporate cultures stressing competitiveness (markets) and entrepreneurship (adhocracies) outperformed those dominated by internal cohesiveness (clans) or by rules (hierarchies). Successful market innovation also improved performance.
The authors provide an empirical test of the effects of competition on the adoption of technological innovations by organizations. They follow the conceptualization developed in the model they proposed previously in the Journal of Marketing. An empirical study of the factors accounting for the adoption or rejection of a high technology innovation is reported. The results suggest that firms most receptive to innovation are in concentrated industries with limited price intensity and that supplier incentives and vertical links to buyers are important in achieving adoption. The results also suggest that adopters can be separated from nonadopters by their information-processing characteristics.
Rudy Moenaert, William Souder, Arnoud De Meyer, and Dirk Deschoolmeester report the results of their study of forty technologically innovative Belgian companies to examine the interaction between marketing and R&D. They studied one commercially successful and one commercially unsuccessful technological product innovation project in each participating company and collected data from one marketing and one R&D respondent per project. Communication flows between marketing and R&D are increased under conditions involving formalization of projects, decentralization, positive interfunctional climate, and role flexibility.
This descriptive study explores the reasons for integration of the personal selling function, i.e., the use of employee (“direct”) salespeople rather than manufacturers' representatives (“reps”). A hypothesized model is developed based on both transaction cost analysis and the sales force management literature. Data from 13 electronic component manufacturers covering 159 U.S. sales districts are used to estimate a logistic model of the probability of “going direct” in a given district. Results are shown to be stable across specification and estimation methods and to fit the data well. The transaction cost model is generally supported. The principal finding is that the greater the difficulty of evaluating a salesperson's performance, the more likely the firm to substitute surveillance for commission as a control mechanism, i.e., to use a direct sales force. Among other findings, direct sales forces are also associated with complex, hard-to-learn product lines and with districts that demand considerable nonselling activities. Several factors prove unrelated, including company size, the amount of travel a district requires, and the importance of key accounts.
L'objet de cette recherche est d'étudier les liens qui existent entre l'environnement externe d'une organisation et ses processus d'innovation. Le principal résultat met en évidence la coexistence de deux marchés, le marché virtuel et le marché réel dans lesquels évoluent respectivement les projets de développement et les produits commercialisés.
The concept of customer orientation in salespeople is defined, a scale is developed to measure the degree to which salespeople engage in customer-oriented selling, and the properties of the scale are reported. A test of the nomological validity indicates the use of customer-oriented selling is related to the ability of the salespeople to help their customers and the quality of the customer-salesperson relationship.
This research uses innovation characteristics to assess product potential at two points in time. The two phases of the study consist of: (1) proposing and estimating purchase intention models and (2) reconciling predicted success with actual product performance. The investigation focuses on the impact of perceived product attributes, environmental variables, and consumer traits on the purchase intention of actual innovations within several technologically intensive product categories. Differences in model specification and parameter values are noted across product types. Results indicate consistency in the impact of product attributes across categories on an innovation's acceptability, but suggest differences in model specification with respect to environmental variables and consumer traits. The existence of a generic-to-specialized innovation continuum is a possible cause of the heterogeneity in results across products. An ex post analysis of the innovations indicates that, while success can be predicted quite accurately using perceived product attribute ratings, consumer and environmental variables should not be ignored for particular categories. The study has implications for the early screening of innovative durables, specifically with respect to forecasting model potential, determining product design and positioning, and developing promotional messages.
This empirical study compares the marketing strategies and organisations of a matched sample of American, Japanese and local competitors in the British market. Japanese subsidiaries in Britain are shown to be much more marketing oriented, more single minded in their pursuit of market share and more alert to strategic opportunities than their U.S. and British counterparts. American subsidiaries appear less committed to the UK, home country oriented and, like their British competitors, excessively concerned with short term profit performance.
Having estimated a linear regression with p coefficients, one may wish to test whether m additional observations belong to the same regression. This paper presents systematically the tests involved, relates the prediction interval (for m = 1) and the analysis of covariance (for m > p) within the framework of general linear hypothesis (for any m), and extends the results to testing the equality between subsets of coefficients.
"Quadrads" (double dyads) of interviews, each conducted with a pair of marketing executives at a Japanese vendor firm and a pair of purchasing executives at a Japanese customer firm, provided data on corporate culture, customer orientation, innovativeness, and market performance. Business performance (relative profitability, relative size, relative growth rate, and relative share of market) was correlated positively with the customer's evaluation of the supplier's customer orientation, but the supplier's own assessment of customer orientation did not correspond well to that of the customer. Japanese companies with corporate cultures stressing competitiveness (markets) and entrepreneurship (adhocracies) outperformed those dominated by internal cohesiveness (clans) or by rules (hierarchies). Successful market innovation also improved performance.
Drawing on research in marketing strategy and industrial organization economics, the authors develop a model to describe the impact of strategies for introducing a new brand, aspects of the competitive environment, and firm characteristics on the performance of new brands. They test the model for 68 new brands in the pharmaceutical industry using a nested error component model. The results indicate which factors affect brand introduction strategies in marketing.
In recent years, academic and practitioner interest has focused on market orientation and factors that engender this orientation in organizations. However, much less attention has been devoted to developing a valid measure of market orientation. Here we define market orientation as the organizationwide generation of market intelligence pertaining to current and future needs of customers, dissemination of intelligence horizontally and vertically within the organization, and organizationwide action or responsiveness to market intelligence. The authors describe a procedure to develop a measure of the construct. Key features of the research methodology include several rounds of pretesting, a single-informant assessment, and a multi-informant (both marketing and nonmarketing executives) replication and extension. The multi-informant results indicate that the proposed 20-item market orientation scale (MARKOR) may be best represented by a factor structure that consists of one general market orientation factor, one factor for intelligence generation, one factor for dissemination and responsiveness, one marketing informant factor, and one nonmarketing informant factor. Taking into account the informant factors, the subsequent validation tests are moderately supportive of the market orientation construct. The authors discuss methodological, substantive, and application directions for future research in light of these findings.
This article takes as its central concern the diffusion of high technology innovation among business organizations. A set of propositions is developed that focuses on the competitive factors influencing diffusion. The article suggests how the supply-side competitive environment and the adopter industry competitive environment both affect diffusion of new technologies. The article seeks to extend the current behavioral paradigm for studying innovation diffusion by incorporating competitive factors as explanatory variables.
The authors provide an empirical test of the effects of competition on the adoption of technological innovations by organizations. They follow the conceptualization developed in the model they proposed previously in the Journal of Marketing. An empirical study of the factors accounting for the adoption or rejection of a high technology innovation is reported. The results suggest that firms most receptive to innovation are in concentrated industries with limited price intensity and that supplier incentives and vertical links to buyers are important in achieving adoption. The results also suggest that adopters can be separated from nonadopters by their information-processing characteristics.
Getting an innovation adopted is difficult; a common problem is increasing the rate of its diffusion. Diffusion is the communication of an innovation through certain channels over time among members of a social system. It is a communication whose messages are concerned with new ideas; it is a process where participants create and share information to achieve a mutual understanding. Initial chapters of the book discuss the history of diffusion research, some major criticisms of diffusion research, and the meta-research procedures used in the book. This text is the third edition of this well-respected work. The first edition was published in 1962, and the fifth edition in 2003. The book's theoretical framework relies on the concepts of information and uncertainty. Uncertainty is the degree to which alternatives are perceived with respect to an event and the relative probabilities of these alternatives; uncertainty implies a lack of predictability and motivates an individual to seek information. A technological innovation embodies information, thus reducing uncertainty. Information affects uncertainty in a situation where a choice exists among alternatives; information about a technological innovation can be software information or innovation-evaluation information. An innovation is an idea, practice, or object that is perceived as new by an individual or an other unit of adoption; innovation presents an individual or organization with a new alternative(s) or new means of solving problems. Whether new alternatives are superior is not precisely known by problem solvers. Thus people seek new information. Information about new ideas is exchanged through a process of convergence involving interpersonal networks. Thus, diffusion of innovations is a social process that communicates perceived information about a new idea; it produces an alteration in the structure and function of a social system, producing social consequences. Diffusion has four elements: (1) an innovation that is perceived as new, (2) communication channels, (3) time, and (4) a social system (members jointly solving to accomplish a common goal). Diffusion systems can be centralized or decentralized. The innovation-development process has five steps passing from recognition of a need, through R&D, commercialization, diffusions and adoption, to consequences. Time enters the diffusion process in three ways: (1) innovation-decision process, (2) innovativeness, and (3) rate of the innovation's adoption. The innovation-decision process is an information-seeking and information-processing activity that motivates an individual to reduce uncertainty about the (dis)advantages of the innovation. There are five steps in the process: (1) knowledge for an adoption/rejection/implementation decision; (2) persuasion to form an attitude, (3) decision, (4) implementation, and (5) confirmation (reinforcement or rejection). Innovations can also be re-invented (changed or modified) by the user. The innovation-decision period is the time required to pass through the innovation-decision process. Rates of adoption of an innovation depend on (and can be predicted by) how its characteristics are perceived in terms of relative advantage, compatibility, complexity, trialability, and observability. The diffusion effect is the increasing, cumulative pressure from interpersonal networks to adopt (or reject) an innovation. Overadoption is an innovation's adoption when experts suggest its rejection. Diffusion networks convey innovation-evaluation information to decrease uncertainty about an idea's use. The heart of the diffusion process is the modeling and imitation by potential adopters of their network partners who have adopted already. Change agents influence innovation decisions in a direction deemed desirable. Opinion leadership is the degree individuals influence others' attitudes
Innovation is conceptualized in different ways from firm to firm. While some firms tend to accept a more conservative approach towards innovation, other firms approach innovation from a more entrepreneurial perspective. A conservative model of innovation and an entrepreneurial model of innovation are presented, considering such firm characteristics as environmental variables, information processing variables, structural variables, and decision making variables. The methodology for the study includes data collected via questionnaire from 52 diverse firms in the Montreal region; these firms represent a variety of industries, including broadcasting, food, electronics, chemicals, and publishing, to name a few. The data were analyzed using both a correlational analysis and curvilinear regression analysis to better understand the influence of the respective variables for each model. The findings indicate that innovation within conservative firms correlates positively to the aforementioned variables. Within conservative firms, innovation occurs when 1) environmental challenges and instabilities are present; 2) these instabilities are made explicit to and analyzed by the management team; and 3) financial and structural resources are available for innovation to occur. Entrepreneurial firms also exhibit positive correlations with environmental and structural variables; however, negative correlations are also observed regarding information processing, decision making, and structural integration. Innovation occurs on an extreme level within entrepreneurial firms except in cases when information processing systems, as well as analytical and strategic planning processes and structural integration devices, warn the management team of the risks associated with extreme innovation. The results indicate that a balance between the extremes of conservativism and entrepreneurship must be considered. (AKP)
The assessment of company performance is one of the major dilemmas facing the strategic researcher. This paper reviews the alternative methods available, then uses one approach, peer assessment, to produce a guide to British company performance. Britain's best companies are identified and their profiles are examined. Their declared financial strengths and relative weaknesses in marketing and innovation are identified.
Strategic management researchers often encounter problems obtaining objective measures of selected aspects of organizational performance that are reliable and valid. With privately-held firms, such data are frequently unavailable. With conglomerate business units, all or parts of such data are inextricably interwoven with corporate-wide data. This paper examines the usefulness of subjective performance measures, obtained from top management teams, when problems are encountered in obtaining accurate performance data.