The Survival of Market Orientation through Artificial Selection

Abstract

IntroductionMarket has been conceptualized as an organizational culture and a resulting behavior for creating superior value for customers (Kohli & Jaworski, 1990; Narver & Slater, 1990). Throughout the years of research, it has been shown to have a positive impact on performance (Kirca, Jayachandran, & Bearden, 2005). As the importance of a market in business becomes evident, more attention is being given to the question of can it be Quantitative research has shown that top management focus, inter-departmental coordination, and a market-based reward system act as antecedents to a market (Kirca et al., 2005). However, qualitative studies on the mechanisms of developing a market (Gebhardt, Carpenter, & Sherry, 2006; Kennedy, Goolsby, & Arnould, 2003) have only recently begun to appear.1One problem with prior research is that it does not consider organizational path dependencies. In some cases, path dependency may make it almost impossible to develop a market orientation. The most extreme case is when a homogeneous sales organization, which for many years had the opposite of a market orientation, namely a selling orientation, aims to develop a market orientation. According to the theory of evolution in organizational change literature (Van de Ven & Poole, 1995), even when a market is formed locally, it may be selected out by natural selection. In such circumstances, just how can a market be developed? Examining this issue will add new angles to the existing literature on market orientation.This study presents a case of a Japanese automobile dealer that has shifted from a traditional selling to a process-focused market (Kosuge, 2011). What occurred at this company between 2001 and 2009 was not natural selection. Out of 54 shops competing with one another, only three started to develop a form of market orientation. They were performing poorly and, therefore, could have been selected out, if left to their own devices. However, the top management allowed the three shops to survive and deliberately made an effort to spread the form of market within the organization. In other words, institutional isomorphism occurred in these 54 shops through artificial selection.Phase 1: Resistance from a Great MajoritySales staff at this company was given short-term quotas for new car sales. Their primary focus was on achieving those quotas. The sales force disregarded customers' needs and did whatever could to sell what the company wants to sell. There was a lack of organizational effort to understand market trends and create value for customers. Just as with other companies in this industry, the company had pursued to maximize sales over the past decades. However, the top management started to doubt the long-term sustainability of this business approach and began a program to shift toward a market in 2001.2In an organizational culture where results are everything, the sales staff, who had focused only on their performance, perceived this program to be contradictory to the traditional sales style. Also, when the top management emphasized the importance of processes, it was met with resistance.Think about it. Don't you wonder what process there is in a sales company? It's ridiculous! How many have you sold?...So no matter what you try, if your numbers don't improve, it's all the same to the guys upstairs.You can't do anything if all you're thinking about is short-term goals like having to reach a certain sales target every day.The greater the emphasis on a process orientation, the more the sales force held on to their traditional sales style, noting that they can't complain as long as we just achieve good results.In addition, a team orientation means that salespeople work together to contact customers, share their know-how with each other, and function as an organization. …