Market Orientation and Company Performance: A Russian Service Industry Perspective

Abstract

Purpose – This paper examines the influence of Market Orientation on business performance in the local service industry in Russia.Design/methodology/approach – The MKTOR and MARKOR models of Market Orientation were studied and evaluated. This led to the elaboration and proposal of a localized Market Orientation model which counts the peculiarities of doing business and the market in an emerging market. Such a model then provided the basis for a set of hypotheses tested by a field study of 133 organizations operating in the service industry. The impact of Market Orientation on business performance then was examined.Findings – The results demonstrate that Market Orientation produces a positive effect on performance.Practical implications – Companies may benefit by implementing Market Orientation. In the service industry, inter-functional coordination between different departments, competitive service product offers and a customer centred philosophy are the most crucial Market Orientation components. Others should not be overlooked as they also commonly provide a substantial basis for improved business performance. Being applied systematically, the Market Orientation paradigm may produce a positive effect on the business and its competitive position in the marketplace.Originality/value – This paper follows a stream of publications dedicated to the Market Orientation paradigm. Even with the number of publications on Market Orientation there is a lack of studies on its application to different markets, countries and industries. This paper contributes to the small number of publications dedicated to Market Orientation in one of the most multifaceted emerging markets, Russia. It is also the first that studies Market Orientation applied solely to service industry organizations in Russia.