Critical Essay on Market Orientation: Antecedents and Consequences

2021-05-06 21:16:39
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Introduction

This survey is directed towards addressing the effects of marketing orientation on the performance of employees as well as that of the organization. Organizational factors that are related to market orientation are believed to affect employee commitment, teamwork, and the performance of the business indirectly. The research starts by briefly reviewing the literature discussions on market orientations and then discussing the consequences and antecedents of that particular direction (Kohli, & Jaworski, 1993).

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Antecedents of Market Orientation

The beginning set of antecedents presented in the study concerns the management of an organization by the top management. Various writers argue that top management plays a very crucial part in directing organization values and orientations. The second set of market orientation antecedents discusses the risk that top management poses to the business. Responding to the dynamic market needs necessitates the introduction of new goods and services that cater to the changing customer needs and expectations (Jaworski & Kohli, 1993). Since it is always risky to introduce new products in the market due to failure problems, the top management must demonstrate a willingness to take the risk and view failure as a natural part of running the business. The interdepartmental difference is another factor that has a notable effect on market orientation. Interdepartmental conflicts are often caused by the difference between the desired and actual response. These conflicts can affect market orientation as well as business performance. Lastly are the businesses reward/evaluation methods that are believed to have a significant effect on employee behaviors (Jaworski & Kohli, 1993). The methods and systems used to evaluate the performance of managers and junior employees and the rewarding systems impact employee satisfaction which in turn affect customer satisfaction indirectly and hence affects the overall performance of the business.

Existing Scales

Existing scales are used for evaluating the organization structure construct of formalization, departmentalization as well as centralization. Authors developed an extensive pool for every construct in the study independently. A subset was then selected from the pool using the method of ability to convey uniqueness. Items were then evaluated for clarity and effectiveness due to the centrality of the market orientation. Conflict and connectedness that existed between various departments were measured by a 7-item measurement. Conflict factors concerned the level to which objectives of different departments were incompatible. Market orientations were evaluated by a 32-item measurement (Gatignon, Gotteland & Haon, 2016). Two separate scales assessed the emphasis of top management on market orientation and risk aversion. The first level contained a pair of items. The risk aversion level was made up of six items. The performance of the business was evaluated using a pair of different approaches discussed in the literature, the objectives and judgmental. Teamwork and organizational commitment were evaluated by a pair of 7-item scales (Kohli, & Jaworski, 1993).

Market Orientation Examples

The first sample in the survey was obtained from the member companies of the Marketing Science Institute and the leading 1000 companies in sales revenues. The second set of samples was the American Marketing Association membership roster that contained names of various informants. 500 names were randomly picked from the mentioned sampling after excluding those that were viewed to be low on their company’s hierarchy (Jaworski & Kohli, 1993). Thirteen persons were then selected from the 500 giving a functional base of 487. These were the samples that were used for the survey. For a response rate of 42.7 percent, 230 responses were obtained.

Based on market orientation antecedents, there is a high similarity in the results from the two observed samples. According to the general results, there are several factors that are responsible for driving market orientation. The risk aversion behavior of managers has a negative effect on how an organization responds (Gatignon, Gotteland & Haon, 2016). Top management should keep on emphasizing the importance of continuous tracking and response to market development to the workers. Connections between various departments in an organization enhance market orientation. Organizations that conduct employee motivations through rewards based on parameters such as the satisfaction of customers and employee-customer relationship are substantially market-oriented. Results obtained from the two samples also suggest that market orientation is inhibited by the centralization of decision-making. Formalization also has no relation to market direction. Judging from overall performance, market orientation is seen to have an impact on business performance. However, considering a market share, market orientation appears to have no relation to business performance (Gatignon, Gotteland & Haon, 2016).

Conclusion

From the research, it is clear that top management should work hard to upgrade market orientation. They should also be sensitive to their employees and it is crucial for them to identify and respond to market changes. Managers should develop a willingness to take a risk since this will encourage the junior employee to take chance when introducing new products in the market as a way of responding to the new changes in the market (Kohli, & Jaworski, 1993).

From the study, there are several areas that need further analysis. The effect of market orientation on the performance of the business should look into since it has different dimensions and is broad. More research should be carried out on the factors that influence the market orientation

References

Gatignon, H., Gotteland, D., & Haon, C. (2016). Strategic and Market Orientations. In Making Innovation Last: Volume 1 (pp. 97-152). Palgrave Macmillan UK.

Jaworski, B. J., & Kohli, A. K. (1993). Market orientation: antecedents and consequences. The Journal of Marketing, 53-70

Kohli, A. K., & Jaworski, B. J. (1993). Market orientation: Antecedents and consequences. Journal of marketing: A quarterly publication of the American marketing association, 57(3), 53-70.

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