The Role of Market Orientation and Learning Orientation in Improving Innovativeness and Performance of Small and Medium Enterprises

Abstract

The purpose of study is to describe contradiction relationship between market orientation toward organizational performance and to provide a quantitative analysis, in which learning orientation, market orientation, entrepreneurial orientation, and innovativeness function as the key success factors in technology-intensive firms. The authors formulate a structural equation model to examine the relationship among these constructs. A structural equation model was designed to examine the relationship. To test the model, the authors conducted covariance structural analyses of data collected from 150 small medium enterprises in Banyumas Regency. The central finding is that learning orientation plays a mediating role in the relationship between market orientation and innovativeness. <br />The results indicate that innovativeness has effect on business performance. Market orientation can strengthen learning orientation and innovativeness. In the small medium enterprises, 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 organizational mission. The findings indicate that firms should strengthen their learning orientation and innovativeness to improve business performance

Market Orientation and Firm Performance among Nigerian SMEs: The Moderating Role of Business Environment

“…Most of these studies have found a strong positive correlation between market orientation and performance (Hooley et al, 2000;Shoman & Rose, 2001;Grainer & Padanyi, 2005;Olavarriete & Friedman, 2008;Li & Justin, 2008;Morgan et al, 2009;Dauda & Akingbade, 2010); though there are a small number of studies that found no positive linear relationship between market orientation and firm's performance (Au & Tse, 1995;Demirbag et al, 2006). Previous studies have suggested a direct relationship between market orientation and business performance, using the business environment as moderator (Suliyanto and Rahab, 2012). A review of the literature suggests that despite the many studies that have been undertaken to learn about market orientation, certain important variable such as the environment in which the business is conducted have not been given desired attention in the literature.…”

“…The measurement of firm performance and market orientations were adopted frm Suliyanto and Rahab (2012). A measure of business environment was adopted from the work of Abd Aziz (2011).…”

“…Market orientation refers to a business behavior which ensures that products and services are developed such that meet customer needs and expectations (Suliyanto & Rahab, 2012;Polat & Mutlu, 2012). In this association, a market-oriented firm shall involve the customer in designing the marketing mix in order to provide customer value.…”

Market Orientation and Entrepreneurial Success: Mediating Role of Entrepreneurial Learning Intensity

“…Therefore, this study was driven as to further explore the importance of market orientation (MO) among service SMEs in Malaysia. Furthermore, the effects of MO on business performance generally need to be confi rmed (Cambra-Fierro et al 2012;Jain & Ali 2013;Mohammed Abdulai & Baba Yusif 2012;Suliyanto & Rahab 2012).…”

Analysis of Market Orientation on Business Performance in the Multinational Service Industries

“…Morgan et al (2009) also recommended for future researchers to assess the value of market orientation in organizations-especially on its measurement. Racela et al (2007: 146) ;Mokhtar et al (2009;Suliyanto and Rahab, 2012) all observed that, research on market orientation, as a concept, was still inadequate with limited studies in developing nations like Asia and Africa. Finally, there is a problem of limited studies on marketing managers, particularly on multinational business activities in developing African countries.…”