Linking Market Orientation Capabilities to Organizational Performance: A Research Framework and Empirical Test

Abstract

Despite overwhelming research on market orientation, during the last 30 years, the need for consolidation is addressed. This research investigates the role of market orientation capability in the marketing–performance outcome chain. Three fundamental capabilities are conceptualized – market exploration, market orientation exploration, and market orientation tacitness – and included as antecedents of the market orientation capability. The hypothesized model includes operational and organizational performance variables and combines key-informant data and accounting-based data for five years. The model is tested with a single industry of 297 companies that provide support for the expected direct and indirect effects of market orientation capability. The inclusion of the three fundamental capabilities as antecedents of market orientation explains 74% of its variance and have a significant indirect impact on sales growth and profitability. The chapter suggests that there remain numerous important unanswered questions in conceptualizing and empirically studying market orientation capabilities.

Citation

Sandvik, K., Dahr, K.U.D. and Lambe, C.J. (2021), "Linking Market Orientation Capabilities to Organizational Performance: A Research Framework and Empirical Test", Kumar, V. and Stewart, D.W. (Ed.) Marketing Accountability for Marketing and Non-marketing Outcomes (Review of Marketing Research, Vol. 18), Emerald Publishing Limited, Leeds, pp. 129-151. https://doi.org/10.1108/S1548-643520210000018006