Market orientation, learning orientation, and innovation capabilities in SMEs An extended model

Abstract

Purpose - The purpose of this paper is to examine the nomological relations among market-orientation, learning-orientation and innovativeness in medium-sized business (SMEs) of developing countries. Design/methodology/approach - The study involves a questionnaire-based survey of managers from small-sized-firms operating in Turkey. A total of 157 usable questionnaires were received from managers. These were subjected to a structural equation modeling (SEM) analysis. Findings - The results show that firm innovativeness positively affects firm performance; firm learning-orientation positively influences firm innovativeness; firm market-orientation positively impacts firm learning orientation; firm learning-orientation mediates the relationship between firm market-orientation and firm innovativeness; and firm market-orientation indirectly impacts firm performance via firm innovativeness and learning. Practical implications - This study has implications for SEMs aiming at increasing their performance and innovativeness. Originality/value - The interrelationships among a firm's market-orientation, learning-orientation, and innovativeness are an important research area for investigators in the literature of management, strategy, and marketing. However, most of the empirical studies were conducted in large-scale firms in developed countries and ignored small and medium-sized business (SMEs) in general, and in developing countries in particular. The results offer both theoretical and managerial implications.