How perceived institutional pressures impact market orientation

Abstract

Purpose – Literature has not paid enough attention to the antecedents of market orientation in the context of transitional economy and many authors focus on internal antecedent factors which could be controlled by the organizations. To address the research gaps, the purpose of this paper is to examine the impact of institutional pressures upon market orientation implementation in mainland China. Design/methodology/approach – Based on multiple case studies of four large B2B manufacturing firms, this paper presents a conceptual framework incorporating three kinds of institutional antecedents of market orientation. Then the developed framework is empirically tested and the impacts of antecedent factors are compared by a fully structured questionnaire survey of 235 Chinese manufacturing firms. Findings – The research findings indicate that during the market-oriented organizational change, normative and mimetic institutional pressures are important driving forces. In addition, the significant institutional antecedent factors are pressures arising from strategic partnership, system certification requirements, industry benchmarking, management consultation and intensive competition. Originality/value – This research is first of its kind as it probes into institutional antecedents of market orientation among Chinese firms by combining cross-case study and large-scale survey. It contributes greatly to the literature of market orientation and institutional theory, and also provides relevant managerial implications for firms as to how to improve market-orientation degree.