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Creating a firm-level dynamic capability through capitalizing on market orientation and innovativeness

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Abstract

Drawing on the resource-based view of the firm, this study addresses the dynamic capability-generating capacity of market orientation on firm performance. Whereas prior literature has examined environmental turbulence as a contextual condition shaping the market orientation-firm performance relationship, this study takes an internal approach by focusing on existing stocks of resources within the firm while controlling for environmental conditions. A conceptual model is developed that explains how market orientation can be transformed into dynamic capability when complemented by transformational (reconfig-urational) constructs, such as innovativeness. The empirical results support the authors— theory that the effect of market orientation on firm performance is strengthened when market orientation is bundled together with internal complementary resources, such as innovativeness. The authors discuss the findings in the context of varying stages of the product life cycle and at different levels of market development.

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Authors and Affiliations

  1. Brock University, Canada

    Bulent Menguc

  2. Yonsei Univesity, South Korea

    Seigyoung Auh

Authors
  1. Bulent Menguc
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  2. Seigyoung Auh
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Additional information

Bulent Menguc (menguc@brocku.ca), Ph.D., Marmara University, is currently an associate professor of marketing at Brock University, St. Catharines, Canada. His areas of research interest include sales force management and internal marketing, strategic orientations, and cross-cultural research methodology. His research has appeared in theJournal of the Academy of Marketing Science, theJournal of Retailing, theInternational Journal of Research in Marketing, theJournal of Business Research, theJournal of Personal Selling and Sales Management, Industrial Marketing Management, theJournal of Business Ethics, and theEuropean Journal of Marketing, among others.

Seigyoung Auh (sauh@yonsei.ac.kr), Ph.D., University of Michigan, is an assistant professor at Yonsei University, South Korea. His research interests are the application of the resource-based view to marketing strategy, the role of top management teams on marketing strategy, and innovation and organizational learning. He has publications in theJournal of the Academy of Marketing Science, theInternational Journal of Research in Marketing, theJournal of Business Research, Industrial Marketing Management, and theJournal of Economic Psychology, among others.

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Menguc, B., Auh, S. Creating a firm-level dynamic capability through capitalizing on market orientation and innovativeness. J. of the Acad. Mark. Sci. 34, 63–73 (2006). https://doi.org/10.1177/0092070305281090

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