Organizational Antecedents of External Orientation: An Empirical Analysis of Customer and Competitor Orientations

Abstract

Strategic orientations have attracted scholars’ attention across disciplines, and their pros and cons have been studied extensively. However, research has focused more on market orientation than on other strategic orientations and has addressed outcomes of these orientations more than their antecedents. Our study aims to advance the literature on orientations by identifying drivers of customer and competitor orientations. We developed and tested a model of several antecedents of customer and competitor orientations. Based on Jaworski and Kohli (1993), the antecedents include three multifaceted sets of factors: management, departments, and the organization with five facets, namely risk taking, conflicts, connectedness, formalization, and centralization. We examined several hypotheses regarding the relationships between these antecedents and customer and competitor orientations. Data were collected through a professional online panel company. The sample included 185 individuals who responded to a questionnaire which contained items in 5-point scales (1 = strongly disagree to 5 = strongly agree) and developed in previous research. All scales were reliable with Cronbach’s alpha coefficient exceeding 0.70 (Nunnally 1978). The findings show that four factors affected customer orientation, namely risk-taking, conflicts, connectedness, and centralization while two factors affected competitor orientation, namely risk-taking and conflicts. Accordingly, these findings provide several insights that contribute to the marketing strategy literature and have implications for practicing managers. Among the two orientations, the most influential antecedent is Risk-Taking. Therefore, in order to be successful in improving their company on all levels, managers must be willing to take risks. Only by doing so they can capitalize on opportunities and respond to competitive threats in the marketplace. References available upon request.