Managing in an economic crisis: The role of market orientation in an international law firm

Abstract

This research paper contributes to the understanding of the relationship between market orientation and performance in the context of a law firm during a time of economic crisis. The contribution is twofold, adding to the fairly limited research on market orientation within law firms, and to the limited research on the role of market orientation in times of economic crisis. The findings, from the questionnaire survey and semi-structured interviews within practice groups of a large multinational law firm, conclude that market orientation is important during an economic crisis. Those practice groups with higher market orientation scores withstand the increased turbulence and outperform those practice groups with lower market orientation scores.

Resilience building in service firms during and post COVID-19

“…Previous research supports the positive effect of market orientation capability on service firms' performance during crises. Lettice et al (2014) showed that law firms with high scores of market orientation capability had a better subjective performance during the 2008-2009 economic crisis than the firms with low market orientation capability. Market intelligence collection assisted the firms in developing an understanding of existing markets' status, competitors, threats, opportunities, and growth potential for new markets and services.…”

“…Regarding market intelligence dissemination, Lettice et al (2014) found that the law firms had a low capability to effectively disseminate market intelligence during the recession, which prevented them from having a return on their investment in market intelligence collection. The low capability of market dissemination is due to the lack of either interdepartmental communication or a shared understanding of the market among employees (Gebhardt et al, 2019;Lettice et al, 2014). To enhance interdepartmental communication, the development of a robust communication system through a considerate and participative leadership style and the adoption of proper information systems is essential (Strese et al, 2016).…”

“…In order to develop a shared understanding of the market and increase market intelligence dissemination capability, service firms can use five practices: (1) distribution of market intelligence by providing reports and presentations to internal stakeholders and sharing a performance dashboard with them; (2) centralization of market intelligence within the organization and assigning its management to the intelligence team; (3) tailoring market intelligence for each user group in the organization based on their preexisting market conceptions; (4) familiarizing organization members with the world of customers and other stakeholders through empathic learning methods such as secondhand ethnographic stories; and (5) encouraging organization members to learn about customers' worlds through experiential learning methods such as direct interaction with customers (Gebhardt et al, 2019). Lettice et al (2014) found that market responsiveness had the highest score among all three stages of market orientation and exerted the most significant influence on law firms' subjective performance during the recession. Other studies also supported the positive effect of responsive market orientation on firms' performance during a crisis (e.g.…”

Firm Performance During Economic Crisis: The Role of Strategic Orientations and Financial Capital

“…В ряде ра-бот, учитывающих контекст экономическо-го кризиса (см., напр. : [Grewal, Tansuhaj, 2001;Huhtala et al, 2014;Lettice, Tschida, Forstenlechner, 2014;Naidoo, 2010;Soininen et al, 2012]), изучается преимуще-ственно один тип стратегических ориента-ций, что дает представление об отдельном Результаты деятельности фирмы в период экономического кризиса... РЖМ 15 (2): 131-162 (2017) аспекте стратегии, однако не позволяет рассмотреть стратегическое поведение фир-мы с различных сторон. Кроме того, не-благоприятная экономическая среда в зна-чительной степени ограничивает ресурсы фирмы, наиболее существенными из кото-рых выступают финансовые ресурсы, спо-собные трансформироваться в другие фор-мы ресурсов и восполнять их нехватку в ключевых областях деятельности фирмы [Cooper, Gimeno-Gascon, Woo, 1994;Wiklund, She pherd, 2005].…”

European enterprises in crisis time

“…In a crisis, but not limited to, companies should first of all be actively carry out market-oriented activities [11,6]. In this regard, information should be intensively collected and disseminated, especially in large enterprises, enabling them to rapidly respond to market changes.…”