Iiro Vaniala

Market Orientation and Innovation in Dynamic Competitive Markets

Market orientation is a source of sustainable competitive advantage in static markets. When competition in the markets becomes more dynamic, sustaining a competitive advantage is challenging. Consequently, sustainable competitive advantage may merely be achieved by concatenating the temporal advantages emerging in the market. In order to obtain temporal competitive advantages, the potential of market orientation is deployed through strategic capabilities and actions. While the extant research has focused on examining the relationship between market orientation and inter-firm capabilities, little attention has been given to competitive actions, particularly in dynamic contexts. In this study, the authors examine the relationship between market orientation, innovation actions, and business performance. Specifically, the focus of innovation actions is on product innovation aggressiveness since it represents the competitive action domain of innovativeness. An analysis of 181 firms across various industries in competitive dynamic environment reveals the important role of competitive aggressiveness in a firm’s new product-related actions. Moreover, to be able to leverage product innovation aggressiveness for superior business performance within a dynamic competitive environment, the firm benefits tremendously from having a market-oriented culture in place. Market orientation plays an important role in accelerating product innovation aggressiveness, especially when the rate of technological change is low.

Customer Empowerment, Top Management Team and Product Development: Success Paths in Turbulent Markets

Customer knowledge has been identified as a key condition for product development success. Traditionally customer knowledge is generated through market research techniques like focus groups and surveys. It has been argued that product development success in today’s dynamic markets requires a shift from traditional market research to increased emphasis on customer empowerment. This is the direct, persistent and interactive collaboration with the customers. It has been postulated, that involving customers in closer proximities to product development project thresholds will generate novel product ideas that are more likely to be valued by customers, thus increasing the likelihood of product development success. Additionally, it has been noted that customer empowerment activities have the propensity to improve product quality and reduce risk. When a firm decides to implement activities of customer empowerment, it needs to be geared to appropriately manage these interactions and the various forms of information that these are intended to bring about. It is at this stage where the actions of the top management team (TMT) of the firm are crucial in terms of making the strategic decisions that guide product development.