Does customer orientation always lead to greater market and financial performance? : a study of the moderating effects of internal and external environmental conditions.

The effect of customer orientation on firm performance has been a subject of controversy within the marketing and strategy literature. While the traditional normative literature argues that a devotion to serving customers’ interests will help firms to effectively satisfy customers, thus leading to s...

Full description

Saved in:
Bibliographic Details
Main Authors: Chan, Jonathan Weihao., Heng, Xue Li., Lee, Xin Hui.
Other Authors: Nanyang Business School
Format: Final Year Project
Language:English
Published: 2011
Subjects:
Online Access:http://hdl.handle.net/10356/44102
Tags: Add Tag
No Tags, Be the first to tag this record!
Institution: Nanyang Technological University
Language: English
id sg-ntu-dr.10356-44102
record_format dspace
spelling sg-ntu-dr.10356-441022023-05-19T05:41:38Z Does customer orientation always lead to greater market and financial performance? : a study of the moderating effects of internal and external environmental conditions. Chan, Jonathan Weihao. Heng, Xue Li. Lee, Xin Hui. Nanyang Business School Lewis Lim DRNTU::Business::Marketing The effect of customer orientation on firm performance has been a subject of controversy within the marketing and strategy literature. While the traditional normative literature argues that a devotion to serving customers’ interests will help firms to effectively satisfy customers, thus leading to superior performance, a number of recent studies suggest that firms could lose leadership positions if they listen too closely to customers. A closer inspection of the literature, however, reveals that most studies of the performance effects of customer orientation do not clearly distinguish the different dimensions of firm performance. The lack of clarity in the definition and measurement of firm performance could have given rise to the controversy about the effects of customer orientation. We therefore set out to examine specifically whether customer orientation positively influences market performance or financial performance (or both). As environmental conditions have significant influences on the relationship between customer orientation and performance, we also take into account the moderating effects of certain internal and external environmental conditions (namely, innovation orientation, environmental dynamism and hostility). We tested our hypotheses using data from the Markstrat simulation. Results indicate that, on the whole, customer orientation generates significant effect on financial but not market performance. However, when the firm has a low level of innovation orientation, having a strong customer orientation produces greater market performance but not financial performance. In less dynamic environments, firms with lower customer orientation tend to deliver stronger financial performance. BUSINESS 2011-05-26T01:13:22Z 2011-05-26T01:13:22Z 2011 2011 Final Year Project (FYP) http://hdl.handle.net/10356/44102 en Nanyang Technological University 56 p. application/pdf
institution Nanyang Technological University
building NTU Library
continent Asia
country Singapore
Singapore
content_provider NTU Library
collection DR-NTU
language English
topic DRNTU::Business::Marketing
spellingShingle DRNTU::Business::Marketing
Chan, Jonathan Weihao.
Heng, Xue Li.
Lee, Xin Hui.
Does customer orientation always lead to greater market and financial performance? : a study of the moderating effects of internal and external environmental conditions.
description The effect of customer orientation on firm performance has been a subject of controversy within the marketing and strategy literature. While the traditional normative literature argues that a devotion to serving customers’ interests will help firms to effectively satisfy customers, thus leading to superior performance, a number of recent studies suggest that firms could lose leadership positions if they listen too closely to customers. A closer inspection of the literature, however, reveals that most studies of the performance effects of customer orientation do not clearly distinguish the different dimensions of firm performance. The lack of clarity in the definition and measurement of firm performance could have given rise to the controversy about the effects of customer orientation. We therefore set out to examine specifically whether customer orientation positively influences market performance or financial performance (or both). As environmental conditions have significant influences on the relationship between customer orientation and performance, we also take into account the moderating effects of certain internal and external environmental conditions (namely, innovation orientation, environmental dynamism and hostility). We tested our hypotheses using data from the Markstrat simulation. Results indicate that, on the whole, customer orientation generates significant effect on financial but not market performance. However, when the firm has a low level of innovation orientation, having a strong customer orientation produces greater market performance but not financial performance. In less dynamic environments, firms with lower customer orientation tend to deliver stronger financial performance.
author2 Nanyang Business School
author_facet Nanyang Business School
Chan, Jonathan Weihao.
Heng, Xue Li.
Lee, Xin Hui.
format Final Year Project
author Chan, Jonathan Weihao.
Heng, Xue Li.
Lee, Xin Hui.
author_sort Chan, Jonathan Weihao.
title Does customer orientation always lead to greater market and financial performance? : a study of the moderating effects of internal and external environmental conditions.
title_short Does customer orientation always lead to greater market and financial performance? : a study of the moderating effects of internal and external environmental conditions.
title_full Does customer orientation always lead to greater market and financial performance? : a study of the moderating effects of internal and external environmental conditions.
title_fullStr Does customer orientation always lead to greater market and financial performance? : a study of the moderating effects of internal and external environmental conditions.
title_full_unstemmed Does customer orientation always lead to greater market and financial performance? : a study of the moderating effects of internal and external environmental conditions.
title_sort does customer orientation always lead to greater market and financial performance? : a study of the moderating effects of internal and external environmental conditions.
publishDate 2011
url http://hdl.handle.net/10356/44102
_version_ 1770566597407145984