Market Dynamism and Firm Performance Relation: The Mediating Effects of Positive Environment Conditions and Firm Innovativeness

Authors

  • Cemal Zehir Yıldız Technical University
  • Dilek Balak Beykent University

DOI:

https://doi.org/10.5195/emaj.2018.152

Keywords:

Market Dynamism, Positive Environment Conditions, Firm Innovativeness, Firm Performance

Abstract

There has been a great interest in terms of environment and its effects in the organization. Apart from environmental conditions, market dynamism is emphasized as another important factor that affects firm performance. Organizations have to compete to survive in a changing environment. In our study, we expected to find out significant relationship through dependent variables (operational performance and market performance) and independent variable as market dynamism. Another goal of our study is to reveal the mediation effects of positive environment conditions and firm innovativeness to firm performance. It should be noted that, our study is based on a survey distributed to 327 people who work in companies in Turkey and analysis results represented the mediating effects of positive environment conditions on firm performance. The obtained data from the questionnaires are analysed through the SPSS statistical packaged software. Further, we compared relationship among the factor analysis, reliability, correlations and regressions. Consequently, our hypotheses are supported and positively related.

References

Adegbite, O. E. (2018). The Organization Business Environment Organizational Adaptations, Springer Briefs in Business, DOI: 10.1007/978-3-319-63510-1_2

Adler, P. S. and Shenbar, A. (1990). Adapting your technological base: The organizational challenge. Sloan Management Review, 25, 25–37.

Antoncic, B and Hisrich, R. D. (2001). Intrapreneurship: Construct Refinement and Cross-Cultural Validation. Journal of Business Venturing, 16, 495–527.

Auh, S. and Menguc, B. (2005). Top Management Team Diversity and Innovativeness: The Moderating Role of Interfunctional Coordination. Industrial Marketing Management, 34 (3), 249‐261.

Cadogan, J. W., Kuivalainen, O., Sundqvist, S. and Sunqvist, S. (2009). Export Market-Oriented Behaviour and Export Performance: Quadratic and Moderating Effects under Differing Degrees of Market Dynamism and Internationalization. Journal of International Marketing, Vol: 17, No: 4, 71-89.

Calantone, R. J., Cavusgil, S. T. and Zhao, Y. (2002). Learning Orientation, Firm Innovation Capability, and Firm Performance. Industrial Marketing Management, 31, 515‐ 524.

Chang, Y. and Hughes, M. (2012). Drivers of Innovation Ambidexterity in Small-To Medium-Sized Firms. European Management Journal, 30, 1-17.

Chang, Y.; Hughes, M. and Hotho, S. (2011). Internal and external antecedents of SMEs’ innovation ambidexterity outcomes. Management Decision, Vol: 49, No: 10, 1658-1676.

Damanpour F. (1991). Organizational Innovation: A Meta‐Analysis of Effects of Determinants and Moderators. Academy of Management Journal, 34 (3), 555‐ 590.

Dess G. G. and Beard DW. (1984). Dimensions of organizational task environments. Administrative Science Quarterly. 1, 52–73.

Eren, S. S. (2012). Stratejik Esneklik ve Pazar Dinamizminin Girişimsel Pazarlama Odaklılığa Etkisi. Journal of Entrepreneurship and Development, 7 (2), 101-112.

Fuentes-Fuentes M. M, Albacete-Saez C. A., Llorens-Montes F. J. (2004). The Impact of Environmental Characteristics on TQM Principles and Organizational Performance. Omega-International Journal of Management Science, 32(6), 425-442.

Goll, I. and Rasheed A. M .A. (1997). Rational Decision Making and Firm Performance: The Moderating Role of Environment. Strategic Management Journal, 18 (7), 583‐ 591.

Gunday, G., Ulusoy, G., Kılıç, K. and Alpkan, L. (2011). Effects of innovation types on firm performance. Int. J. Production Economics, 133, 662–676.

Han, J. K., Kim, N. and Srivastava, R. K. (1998). Market orientation and organizational performance: Is innovation the missing link? Journal of Marketing, 62(4), 30–45.

Homburg, C., Krohmer, H. and Workman, J. P. (1999). Strategic Consensus and Performance: The Role of Strategy Type and Market-Related Dynamism. Strategic Management Journal, Vol: 20, No: 4, 339-357.

Hult G., Tomas M., Hurley R. F. and Knight G. A. (2004). Innovativeness: Its antecedents and impact on business performance. Industrial Marketing Management, 33, 429-438.

Ikhsan, K.; Almahendra, R. and Budiarto, T. (2017). Contextual Ambidexterity in SME’s In Indonesia: A Study on How it Mediates Organizational Culture and Firm Performance and How Market Dynamism Influences its Role on Firm Performance. International Journal of Business and Society, Vol: 18 No: 2, 369-390.

Laforet, S. (2011). A framework of organizational innovation and outcomes in SMEs. International Journal of Entrepreneurial Behaviour & Research, 17(4), 380–408.

Lawson, B. and Samson, D. (2001). Developing innovation capability in organisations: A dynamic capabilities approach. International Journal of Innovation Management, 5(03), 377–400.

Li, M. and Simerly, R. L. (1998). The Moderating Effect of Environmental Dynamism on the Ownership and Performance Relationship. Strategic Management Journal, Vol. 19, 169–179.

Lumpkin, G. T. and Dess, G. G. (2001). Linking Two Dimensions of Entrepreneurial Orientation to Firm Performance: The Moderating Role of Environment and Industry Life Cycle. Journal of Business Venturing 16, 429–451.

Matsuo, M. (2006). Customer Orientation, Conflict, and Innovativeness in Japanese Sales Departments. Journal of Business Research, 59, 242‐250.

Porter, M.E. (1991). Towards a Dynamic Theory of Strategy. Strategic Management Journal, 12, 95-117.

Rahman, S. and Bullock, P. (2005). Soft TQM, Hard TQM and Organisational Performance Relationships: An Empirical Investigation. Omega, 33, 73 – 83.

Rajapathirana, R. P. J. and Hui, Y. (2018). Relationship between innovation capability, innovation type, and firm performance. Journal of Innovation & Knowledge, Vol: 3, 44–55.

Rubera, G. and Kirca, Ahmet H. (2012). Firm Innovativeness and Its Performance Outcomes: A Meta-Analytic Review and Theoretical Integration. Journal of Marketing, Vol. 76, No. 3, 130-147.

Sen, F. K. and Egelhoff, W. G. (2000). Innovative capabilities of a firm and the Use of Technical Alliances. IEEE Transactions on Engineering Management, 47(2), 174–183.

Tanriverdi, H. and Zehir, C. (2006). Impact of Learning Organizations’ Applications and Market Dynamism on Organizations’ Innovativeness and Market Performance. The Business Review, 6(2), 238-245.

Thornhill, S. (2006). Knowledge, innovation and firm performance in high- and low-technology regimes. Journal of Business Venturing, 21, 687–703.

Ting, H. F., Wang, H. B. and Wang, D. S. (2012). The moderating role of environmental dynamism on the influence of innovation strategy and firm performance. International Journal of Innovation. Management and Technology, Vol. 3, No. 5, 517-520.

Tushman ML. and Anderson P. (1986). Technological discontinuities and organizational environments. Administrative Science Quarterly, 31, 439–465.

Venkatraman, N. and V. Ramanujam (1986). Measurement of business performance in strategy research: A comparison of approaches'. Academy of Management Review, Vol: 11, 801-814.

Yıldız, S, Baştürk, F. and Taştan Boz, I. (2014). The Effect of Leadership and Innovativeness on Business Performance. Procedia Social and Behavioral Sciences, 150, 785–793.

Zahra, S. A. and Garvis, D. M. (2000). International Corporate Entrepreneurship and Firm Performance: The Moderating Effect of International Environmental Hostility. Journal of Business Venturing, 15, 469–492.

Downloads

Published

2018-08-17

Issue

Vol. 8 No. 1 (2018)

Section

Articles

License

Authors who publish with this journal agree to the following terms:

  1. The Author retains copyright in the Work, where the term “Work” shall include all digital objects that may result in subsequent electronic publication or distribution.
  2. Upon acceptance of the Work, the author shall grant to the Publisher the right of first publication of the Work.
  3. The Author shall grant to the Publisher and its agents the nonexclusive perpetual right and license to publish, archive, and make accessible the Work in whole or in part in all forms of media now or hereafter known under a Creative Commons Attribution 4.0 International License or its equivalent, which, for the avoidance of doubt, allows others to copy, distribute, and transmit the Work under the following conditions:
    1. Attribution—other users must attribute the Work in the manner specified by the author as indicated on the journal Web site;
    with the understanding that the above condition can be waived with permission from the Author and that where the Work or any of its elements is in the public domain under applicable law, that status is in no way affected by the license.
  4. The Author is able to enter into separate, additional contractual arrangements for the nonexclusive distribution of the journal's published version of the Work (e.g., post it to an institutional repository or publish it in a book), as long as there is provided in the document an acknowledgement of its initial publication in this journal.
  5. Authors are permitted and encouraged to post online a prepublication manuscript (but not the Publisher’s final formatted PDF version of the Work) in institutional repositories or on their Websites prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work. Any such posting made before acceptance and publication of the Work shall be updated upon publication to include a reference to the Publisher-assigned DOI (Digital Object Identifier) and a link to the online abstract for the final published Work in the Journal.
  6. Upon Publisher’s request, the Author agrees to furnish promptly to Publisher, at the Author’s own expense, written evidence of the permissions, licenses, and consents for use of third-party material included within the Work, except as determined by Publisher to be covered by the principles of Fair Use.
  7. The Author represents and warrants that:
    1. the Work is the Author’s original work;
    2. the Author has not transferred, and will not transfer, exclusive rights in the Work to any third party;
    3. the Work is not pending review or under consideration by another publisher;
    4. the Work has not previously been published;
    5. the Work contains no misrepresentation or infringement of the Work or property of other authors or third parties; and
    6. the Work contains no libel, invasion of privacy, or other unlawful matter.
  8. The Author agrees to indemnify and hold Publisher harmless from Author’s breach of the representations and warranties contained in Paragraph 6 above, as well as any claim or proceeding relating to Publisher’s use and publication of any content contained in the Work, including third-party content.

Revised 7/16/2018. Revision Description: Removed outdated link.