The innovativeness effect of market orientation and learning orientation on business performance

Abstract

PurposeThe purpose of this paper is to provide a quantitative analysis, in which learning orientation, market orientation, entrepreneurial orientation, and innovativeness function as key success factors in technology‐intensive firms. The authors formulate a structural equation model to examine the relationship among these constructs.Design/methodology/approachA structural equation model was designed to examine the relationship. To test the model, the authors conducted covariance structural analyses of data collected from 333 venture companies, including innovation companies, in Taiwan.FindingsThe central finding is that learning orientation plays a full mediating role in the relationship between market orientation and innovativeness. The results indicate that organizational structure (formalization and decentralization) does not play a moderating role in the relationship between innovativeness and business performance; however, the extent of formalization of an organizational structure negatively correlates with business performance.Practical implicationsMarket orientation can strengthen innovativeness via organizational learning. In the high‐tech industry, the market information obtained from customers and competitors helps firms to keep an eye on the market. For better competitive advantages and business performance, firms must have learning capabilities and employees' identity with corporate mission.Originality/valueThe research empirically examines the mediating role of learning orientation and the moderating role of organizational structure in the model. The findings indicate that firms should strengthen their learning orientation and innovativeness, and avoid interfering in the organizational structure to improve business performance.

Innovation behaviour and the use of research and extension services in small-scale agricultural holdings

“…Our findings support earlier studies (e.g., Slater & Narver, 1995;Baker & Sinkula, 2002;Lin et al, 2008) noting the positive role of MO and LO as sound antecedents of innovation. The notion of causality of farmers' attitudes in our empirical research opens possibilities to investigate the acceptance of specific services supported by the current AKIS.…”

“…LO influences firms' propensity to create and use knowledge, and affects an organization's degree of information use and active learning as one important internal resource (Cohen & Levinthal, 1990;Farrell, 1999;Chaston et al, 2001;Anderson & Bookock, 2002). However, it is a time-consuming process that requires commitment and managerial skills, what can represent a constraint for SME (Lin et al, 2008). Furthermore, learning in SMEs is reactive in the short term and might suggest an adaptive behaviour rather than innovativeness .…”

“…Trice & Beyer (1991) assert that MO and LO are entrepreneurial attributes that are very closely associated with innovation activities and culture. Extensive research also suggests a positive relationship or interdependence between LO and MO (Day, 1994;Slater & Narver, 1995;Sinkula et al, 1997;Baker & Sinkula, 2002;Bell et al, 2002;Lin et al, 2008). Grinstein (2008) also suggest that firms with lower learning capabilities have an inflexible construction of MO, which involves that market oriented effort of those firms could be associated to imitation rather than innovation.…”

Strategic Orientations and SME Performance: Moderating Effect of Absorptive Capacity of the Firm

“…Hakala (2010) described it as templates for the ways of conducting business activity to maintain and improve the organizational performance. Scholars have considered that both market orientation and entrepreneurial orientation have positive influence on firm performance (Slater & Narver, 2000;Lin, Peng, & Kao, 2008;Reijonena & Komppulab, 2010;Fauzul, Takenouchi, & Yukiko, 2010;Chandrakumara, De Zoyza, & Manawaduge, 2011;Wang, 2008). Although market orientation has been found to be positively related to sustainable competitive advantage (Aziz & Yassin, 2010) and innovation performance (Mavondo, Chimhanzi, & Stewart, 2005), a number of studies have also proven that market orientation is a poor predictor SME performance and even detrimental when the demand uncertainty is at a higher level (Gao, Zhou, & Yim, 2007;Ledwith & Dwyer, 2009 Vol.…”

Job Satisfaction among the Bankers: An investigation on Islamic Financial Institution in Eastern Region of Malaysia

“…The creation of a good human relation activities is very much related to the management of employment relationship (Lin et., 2008). With this establishment it will further enhance the spirit of healthy competition within the firm (Andonova and Zuleta, 2007).…”