Market Orientation: Towards an Understanding in Developing


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Old Dominion University
ODU Digital Commons
Theses and Dissertations in Business Administration

College of Business (Strome)

Summer 2001
Market Orientation: Towards an Understanding in Developing Marketplaces of South America
Howard Warren Olsen
Old Dominion University

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Recommended Citation
Olsen, Howard W.. "Market Orientation: Towards an Understanding in Developing Marketplaces of South America" (2001). Doctor of Philosophy (PhD), dissertation, , Old Dominion University, DOI: 10.25777/zch9-8q49 https://digitalcommons.odu.edu/businessadministration_etds/117
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MARKET ORIENTATION: TOWARDS AN UNDERSTANDING IN DEVELOPING MARKETPLACES OF SOUTH AMERICA
by Howard Warren Olsen B.S. May 1971, University o f Nevada, Reno M .B .A M ay 1975, University o f Montana A Dissertation Submitted to the Faculty of Old Dominion University in Partial Fulfillment o f the Requirement for the Degree of DOCTOR OF PHILOSOPHY BUSINESS ADMINISTRATION OLD DOMINION UNIVERSITY
August 2001
JonnJB. Ford, IV (Director) Kiran Karande (Member) Jarnis P. Johnson 6ruce L. Rubin (Ifiterim Dean)
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ABSTRACT
MARKET ORIENTATION: TOWARDS AN UNDERSTANDING IN DEVELOPING MARKETPLACES OF SOUTH AMERICA Howard Warren Olsen Old Dominion University, 2001 Director: Dr. John B. Ford, IV
Theory development is essential for the health and wellbeing o f marketing as it provides boundaries and a foundation for the growth o f the discipline. Kohli and Jaworski's (1990, 1993) efforts provided the critical first step in the evolution o f market orientation theory. However, evidence has not confirmed regularities in various industry circum stances as well as different international marketplaces. The literature is replete with a variety o f different scales that have been used. Finally, the concept of market orientation is based upon the premise that such activities enhance business performance, but requisite performance measures have not been properly matched with the strategy.
The primary purpose o f the dissertation was to empirically test the basic tenets o f market orientation, as defined by the MARKOR construct, in an emerging market setting. While the second purpose was to cross-culturally develop a "derived etic" marketorientation scale (Douglas and Craig 2000) that would be reconciled with the MARKOR instrument. Extensive qualitative research was conducted with practitioners and academics in Argentina and Paraguay to adequately capture the domain of market orientation and firm performance measures. Through a series o f iterations, Spanish language items and measures were developed that were reliable, valid and provided a basis for comparability o f results.
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M ultiple data collection methods were employed in Argentina— email, fax, and snowball sampling— to accumulate a response rate between 19.7% and 28.9% . A mailed questionnaire produced a net response rate o f 47.9% for Paraguayan participants.
The primary findings are best understood in stages. First, market orientation, as modeled by MARKOR, is positive and significantly related to firm performance in an emerging market setting. Second, the "derived etic" scale provided only marginal improvement in explaining the market orientation—firm performance (MO— FP) relationship. Third, the newly developed firm performance composite dramatically improved the explicability o f the relationship in both countries.
The unique implications o f the project are— MARKOR and market orientation are reliable constructs applicable in emerging markets and appropriate performance measures can enhance strategic understanding of MO— FP relationship by 100%.
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Copyright, 2001, by Howard Warren Olsen, All Rights Reserved.
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This dissertation is dedicated to my loving wife, Nancy, and our wonderful children Brett, Ryan, and Erica.
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ACKNOWLEDGEMENTS
A dissertation is a difficult, if not seemingly impossible, task to accomplish alone. It is absolutely necessary to have the support, encouragement, motivation, and love of teachers, friends, family, and the Lord. This has been a five year journey that came to fruition because o f my wonderful wife, Nancy, and my relationship with Jesus Christ. / can do a ll things through Christ Jesus who strengthens me. Philippians 4:13 (NAS)
Whenever a grouping or an order is presented, a priority is implied. However in this instance, no priority is implied as I would like to thank and acknowledge everyone once. I consider all those who supported me as family— my academic family at Old Dominion University, my extended family in South America, and my caring Olsen family.
Mv academic family: I was blessed to have Dr. John Ford as my dissertation chair. Even though he possesses a wealth o f knowledge and has tremendous experience, he treated me as a peer and not just another student. He provided a unique balance o f the theoretical and practical. I am truly fortunate to have him as my chairperson. I am extremely grateful to Dr. Kiran Karande who continually inspired me and offered practical guidance. His friendship is invaluable and is deeply cherished. I thank Dr. James Johnson who provided a twinkle in his eye that accompanied his constructive and valuable suggestions. He will always be remembered for bringing me back to reality. In addition, Dr. Susan Douglas o f New Y ork University provided indispensable insights from her wealth o f international marketing research experience. She helped me develop a solid project instead o f just a good project. I appreciate her assistance.
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I am grateful to Dr. Earl Honeycutt who functioned as Chair o f the Department of Business Administration for the majority o f my time at Old Dominion University. He provided me guidance in the doctoral program, brought stability to the department, and offered me the opportunity to be a visiting professor the last year.
A solid doctoral program is composed o f two basic elements— faculty and students. There is no doubt that God brought together the perfect mix o f classmates, American and international, for my tenure at Old Dominion. We continually supported and extended care for each other throughout the program. I would like to express my deepest gratitude to Mark, Mahesh, Carla, Ceyhan, Turkan, Janet, Fahad, and David. In many respects, we truly became family. However, special thanks and accolades are to be extended to David Lambert. David and I w alked through many situations together. W ithout his continual inspiration and challenges, I would still be working on this research project. I wish him the absolute best in all his endeavors and a growing and deepening marriage to Jennifer.
Mv South American family: In Buenos Aires, Lorena Reich provided relentless support and constructive evaluations. Even though she is young in years, she provided profound wisdom o f the Argentine society. Her translation efforts were flawless. My deepest appreciation is extended to her. I am grateful to Jaqueline Pels o f Universidad Torcuato Di Telia who, in her very busy schedule, was always available to provide assistance in a thorough, discerning review and logistical support. Dr. Nelson Aguilera o f Universidad Americana (Asuncion, Paraguay) fully embraced this research project, and I am grateful for his support because a credible research project was accomplished in
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Paraguay. Without the friendship and concern o f these people, it would have been impossible for me to complete this cross-cultural project.
Mv caring Olsen family: I want to especially thank my wife, Nancy, who stood by my side and selflessly encouraged me to stay the course and wonderfully blessed me with her faith, love, and hope. It is absolutely impossible to state in w ords the gratitude and love I have for her. Our children— Brett, Ryan, and Erica— inspired dad to persevere and are a true blessing from the Lord. I want to acknowledge w ith great respect my parents, Warren and Loretta. Their continual encouragement was truly heartfelt.
Most o f all I want to acknowledge and thank Jesus Christ, my Lord and Savior. H e performed numerous miracles in my life during the past five years from passing the GMAT, passing the comprehensive exams, to obtaining the perfect position at the University of Nevada, Reno.
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TABLE OF CONTENTS
LIST OF TABLES......................................................................................................... LIST OF FIGURES.......................................................................................................
IN T R O D U C T IO N ......................................................................................................... STATEMENT OF THE PROBLEM.................................................................... SIGNIFICANCE OF PROBLEM.......................................................................... LIMITATIONS OF RECENT RESEARCH........................................................ OBJECTIVES............................................................................................................ ELEMENTS OF THE RESEARCH PLAN......................................................... S Y N O P S IS ................................................................................................................
REVIEW OF THE LITERATURE............................................................................. IN T R O D U C T IO N .................................................................................................... MARKETING CO NCEPT..................................................................................... MARKET ORIENTATION.................................................................................... INTERNATIONAL ASPECTS OF MARKET ORIENTATION.................... FIRM PERFORM ANCE........................................................................................ MACROENVIRONMENTAL ISSUES................................................................
RESEARCH DESIGN AND METHODOLOGY.................................................... I N T R O D U C T IO N ................................................................................................... MEASURE AND INSTRUMENT DEVELOPMENT....................................... POPULATION FOR THE STUDY....................................................................... DATA COLLECTION............................................................................................ PROCEDURE FOR DATA ANALYSIS.............................................................
RESULTS OF THE RESEARCH PROJECT............................................................ DATA COLLECTION AND RESPONSE RA TES........................................... DEVELOPMENT OF CONSTRUCTS AND VALIDATION......................... HYPOTHESIS TESTING - STAGES 1 AND 2 ................................................. HYPOTHESIS TESTING - STAGES 3 ............................................................... MACROENVIRONMENT AL ISSUES...............................................................
DISCUSSION AND IMPLICATIONS...................................................................... DISCUSSION OF RESULTS................................................................................. SUBSTANTIVE ISSU ES....................................................................................... METHODOLOGICAL ISSUES............................................................................ MANAGERIAL IMPLICATIONS....................................................................... PROJECT LIMITATIONS AND RESEARCH DIRECTIONS........................
B IB L IO G R A P H Y .......................................................................................................... A PP E N D IC E S ............................................................................................................... V ITA ................................................................................................................................

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Market Orientation: Towards an Understanding in Developing