The influence of market orientation on innovation strategies
The influence of market orientation on innovation strategies
Purpose
This study examines the effects of market orientation on exploratory and exploitative innovation, and the moderating effects of family ownership on these relationships.
Design/methodology/approach
This study utilizes multi-group path analysis and confirmatory factor analysis in LISREL on data from 228 firms in the Australian service sector.
Findings
This study establishes that both customer and competitor innovation are positively related to exploitative and exploratory innovation. However, customer orientation does not lead to significantly stronger effects on exploitative innovation than on exploratory innovation, and competitor orientation does not lead to significantly stronger effects on exploratory innovation than on exploitative innovation. In addition, the study found that the relationship between customer orientation and exploratory innovation was stronger for family firms, whilst the relationships between competitor orientation and both exploratory and exploitative innovation were stronger for non-family firms.
Research limitations/implications
The cross-sectional design is one weakness of this study. In addition, as firms in the present study came from the service sector the generalizability of our findings to other sectors of the economy need to be determined.
Practical implications
These findings of this study highlight the need for managers to build a strong market orientation in order to promote innovation, and consider the effects of ownership structure on innovation strategies.
Originality/value
This study is the first to measure the relative influence of customer and competitor orientation on a firm’s use of exploitative and exploratory innovation strategies.
72-90
Newman, Alexander
d234d1cb-1a9d-4ed8-b8d3-0a6477b97a9c
Prajogo, Daniel
62076e84-0244-4013-b6f6-15ec44ba0a64
Atherton, Andrew Michael
f9cd4f73-4bd9-4546-803d-0a382be1cd72
7 January 2016
Newman, Alexander
d234d1cb-1a9d-4ed8-b8d3-0a6477b97a9c
Prajogo, Daniel
62076e84-0244-4013-b6f6-15ec44ba0a64
Atherton, Andrew Michael
f9cd4f73-4bd9-4546-803d-0a382be1cd72
Newman, Alexander, Prajogo, Daniel and Atherton, Andrew Michael
(2016)
The influence of market orientation on innovation strategies.
Journal of Service Theory and Practice, 26 (1), .
(doi:10.1108/JSTP-02-2015-0044).
Abstract
Purpose
This study examines the effects of market orientation on exploratory and exploitative innovation, and the moderating effects of family ownership on these relationships.
Design/methodology/approach
This study utilizes multi-group path analysis and confirmatory factor analysis in LISREL on data from 228 firms in the Australian service sector.
Findings
This study establishes that both customer and competitor innovation are positively related to exploitative and exploratory innovation. However, customer orientation does not lead to significantly stronger effects on exploitative innovation than on exploratory innovation, and competitor orientation does not lead to significantly stronger effects on exploratory innovation than on exploitative innovation. In addition, the study found that the relationship between customer orientation and exploratory innovation was stronger for family firms, whilst the relationships between competitor orientation and both exploratory and exploitative innovation were stronger for non-family firms.
Research limitations/implications
The cross-sectional design is one weakness of this study. In addition, as firms in the present study came from the service sector the generalizability of our findings to other sectors of the economy need to be determined.
Practical implications
These findings of this study highlight the need for managers to build a strong market orientation in order to promote innovation, and consider the effects of ownership structure on innovation strategies.
Originality/value
This study is the first to measure the relative influence of customer and competitor orientation on a firm’s use of exploitative and exploratory innovation strategies.
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More information
Published date: 7 January 2016
Identifiers
Local EPrints ID: 499064
URI: http://eprints.soton.ac.uk/id/eprint/499064
ISSN: 2055-6225
PURE UUID: e5b375e6-c562-4d56-b7d6-7eee5f7a055f
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Date deposited: 07 Mar 2025 17:42
Last modified: 08 Mar 2025 03:07
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Contributors
Author:
Alexander Newman
Author:
Daniel Prajogo
Author:
Andrew Michael Atherton
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