The impact of market orientation dimensions on client cooperation in the development of new service innovations

Abstract

PurposeCulture makes firms unique and, depending on the implemented pattern of social and managerial culture, technology, and innovation, it can have an important influence on the personality and behaviour of the firm. Although a cultural model of market orientation encourages product innovation and fosters cooperative relationships with clients, few studies analyse this important relationship from a service perspective. This research seeks to investigate the relevance of market orientation for the firm's client cooperation relationships in developing radical innovations in the service sector.Design/methodology/approachA descriptive investigation uses 433 Spanish service firms that introduced radical innovations in their product fields in the past two years. The paper conducted four discriminant analyses: one for the total sample of firms and three for the sub‐samples defined by the extent to which firms use information and communication technologies (ICTs) in their activities.FindingsThe four models reveal that customer orientation, competitor orientation, and inter‐functional coordination provide means to differentiate between firms that cooperate with their clients to innovate and firms that do not. In each model, the significance and weight of the three variables change, depending on the degree to which the firms use ICT. Therefore, the distinction between firms that cooperate and those that do not is possible mainly for the total sample of firms. For the sub‐samples, not all MO dimensions can discriminate this way.Practical implicationsThis study offers important contributions for both researchers and managers in the field of service innovation. It identifies explicitly the relationship between market orientation and cooperation, which makes it possible to extend the study and enhance comprehension of this concept to the relationship that the firm has with other agents in the value chain. Market orientation, as an inter‐firm phenomenon, may favour the design of market orientation strategies that offer superior value to the market. On the other hand, the empirical analysis shows which factors (philosophical principles, strategic implications of proactive market orientation) have the highest discriminatory power for innovative firms, according to their sector of activity. This work also identifies market orientation as an element that fosters a cooperation strategy.Originality/valueDespite the importance of market orientation for developing cooperative relationships with clients, few studies analyse the relevance of these relationships in the firm's service innovation process. The findings thus offer a valuable contribution by showing the relevance of this relationship in developing new service innovations. Furthermore, the application of Spanish ICT contributes to existing research in Spain.

The Role of Market Orientation in Innovation of Bodybuilding Clubs

“…This result is consistent with previous results by Johnson, Dibrell, and Hansen (2009), Maatoofi and Tajeddini (2011), Jiménez-Zarco, Pilar Martínez-Ruiz, and Izquierdo-Yusta (2011), Serna, Guzman, and Castro (2013), Salman (2015), and Wang (2015) (8,13,17,20,22,23). According to Wang (2015), one of the most important factor affecting innovation of organizations and companies, are organizational inner and outer factors (23).…”

“…This result is not consistent with previous results by, Johnson (8,13,17,20,22,23). The rationale behind this inconsistency may be due to the fact that with increasing competition in the sports industry of our country, sports clubs pay less attention to their competitors and their measures.…”

“…The results from the test of research model revealed that the effects of customer orientation was meaningful on innovation (β=0.31, t=3.39). Other research findings showed that competitor orientation variable has no meaningful effect on innovation of bodybuilding clubs (t=1.06, (8,13,17,20,22,23). At the present time, customer's choice has been expanded and thus companies and firms have to pay attention to the needs and interests of customers at first (29).…”

“…Maatoofi and Tajeddini (2011) conducted a research on companies manufacturing car parts in Tehran and concluded that there is a significant relationship between market orientation and innovation of these companies (20). Jiménez-Zarco, Pilar Martínez-Ruiz, and Izquierdo-Yusta (2011) conducted a study on 433 service companies in Spain, which had at least two years of experience, and concluded that the aspects of market orientation has been effective on innovation of services provided in these companies to their customers (17). Results of Kam Sing Wong and Tong research (2012) titled as the impact of market orientation on the success of new products in the electronics industry of China indicated that the aspects of market orientation has been effective on the success of new products (21).…”

“…Organizations that respond better and faster to the needs of their customers with their marketing orientation are always ahead of their competitors and possess a greater performance level than others. So no wonder organizations improve their market orientation, hence their performance (17). According to Tsiotsou and Vlachopoulou (2011) market orientation comprises three behavioral components of customer orientation, competitor orientation and coordination between tasks.…”