Innovation and performance implications of customer-orientation across different business strategy types

Given that the ultimate goal of business is performance enhancement, this study approaches the phenomenon by drawing on resource-advantage (R-A) theory to conceptualize a model with the aim of investigating the links among composite operant resources (CORs), namely customer orientation, basic operan...

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Bibliographic Details
Published in:Journal of open innovation 2022-12, Vol.8 (4), p.1-20, Article 178
Main Author: Racela, Olimpia C
Format: Article
Language:English
Subjects:
Analysis
Analyzers
Competitive advantage
Cost analysis
customer-relating
customer-response
Customers
Emerging markets
financial performance
innovation capability
Innovations
Market strategy
market-sensing
Marketing
multiple group analysis
Multivariate analysis
Multivariate statistical analysis
Orientation
Performance enhancement
Reactors
resource-advantage theory
Strategic planning (Business)
Surveys
Variance analysis
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Summary:Given that the ultimate goal of business is performance enhancement, this study approaches the phenomenon by drawing on resource-advantage (R-A) theory to conceptualize a model with the aim of investigating the links among composite operant resources (CORs), namely customer orientation, basic operant resources (BORs), innovative capability, and financial performance across Miles and Snow's five business strategy types, including prospectors, differentiated defenders, low-cost (LC) defenders, analyzers, and reactors. The scope of this study is firms based in the emerging market of Thailand. A final sample of 395 Thai firms participated in the self-administered survey. Multiple-group structural equation modeling and multivariate analysis of variance (MANOVA) were utilized to test the hypotheses. The results revealed insightful findings that advance the strategy and innovation literature. While business strategy types moderate the proposed relationships, the only one that is uniform across all five types of firms is the positive, strong, and significant customer orientation-innovation capability link. Moreover, customer orientation and innovative capability contribute significantly to financial performance among prospectors and LC defenders. However, only the former is essential to differentiated defenders, analyzers, and reactors. Overall, the findings suggest that managers must pay attention to connections between their chosen business-level strategy, customer-focused resources, and innovation capabilities to generate the best financial performance outcomes for their firms.
ISSN:2199-8531
2199-8531
DOI:10.3390/joitmc8040178