Market Orientation and Organizational Performance

Chee-Hua Chin, May-Chiun Lo and T. Ramayah

SAGE Open, 2013, vol. 3, issue 4, 2158244013512664

Abstract: Orientation plays a vital role for organizations to compete to create sustainable competitive advantage. The objective of this study is to examine the relationship between market orientation (MO) and organizational performance (OP) with service quality (SQ) as a moderator in the context of the hotel industry in Malaysia. MO and OP were conceptualized as three- and two-dimensional constructs, respectively, whereas SQ, which consists of two-dimensional constructs, namely, technical quality and functional quality, was used as a moderator. Data were gathered through a survey using a structured questionnaire with a sample of 187 executive-level employees employed in hotels rated three stars and above in Malaysia. SmartPLS 2.0 (M3) with path modeling and bootstrapping was used to examine the standard error of the estimate and t -values. The findings suggest that only competitor orientation dimension of MO was significantly related to OP, whereas customer orientation and inter-functional coordination were not related. Interestingly, SQ was found to have moderated the relationship between MO and performance of the hotels in Malaysia. SQ exists to fill in the gap between customers’ expectations and their perception of the service providers’ performance that further creates differentiation and competitive advantage, which enhance MO practices and ultimately lead to improvements in the firm’s performance. Implications of the findings, potential limitations of the study, and directions for future research are highlighted.

Keywords: market orientation; service quality; organizational performance; hotel industry; Malaysia (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:sae:sagope:v:3:y:2013:i:4:p:2158244013512664

DOI: 10.1177/2158244013512664

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