Does Service Innovation Matter in High-Tech Industry

Chao-Hung Wang

Abstract


Service innovation has been found to be a major driver of innovation performance in service contexts. But this issue raises questions concerning the extent to which the relationship between market orientation and innovation performance holds in the high-tech industry. Relatively little research has examined how market orientation contributes to innovation performance through service innovation. We here report an empirical study of 235 Taiwanese high-tech firms to examine the influence of market orientation on service innovation and innovation performance. A noteworthy finding is that the impacts of customer orientation and competitor orientation on innovation performance are fully mediated by service innovation. However, service innovation does only partially mediate the relationship between inter-functional orientation and innovation performance. The findings of this study should help managers consider appropriate service innovation in high-tech industry.

Keywords


market orientation; innovation performance; service innovation

Full Text:

PDF [en]

References


ABRAMOVICI, M. Bancel-charensol, L. (2004). How to take customers into consideration in service innovation projects. The Service Industries Journal, 24, 56-78.

ADNER, R. Levinthal, D. (2001). Demand heterogeneity and technology evolution: implications for product and process innovation. Management Science, 47, 611-628.

AGARWAL, S., Erramilli, M. K., Dev, C. S. (2003). Market orientation and performance in service firms: role of innovation. Journal of Services Marketing, 17, 68-82.

AKMAN, G., Yilmaz, C. (2008). Innovative capability, innovation strategy and market orientation: an empirical analysis in Turkish software industry. International Journal of Innovation Management, 12, 69-111.

ALAM, I. (2006). Service innovation strategy and process: a cross-national comparative analysis. International Marketing Review, 23, 234-254.

ALAM, I., Perry, C. (2002). A customer-oriented new service development process. Journal of Services Marketing, 16, 515-534.

ALDAS-MANZANO, J., Ster, K. I., Vila, N. (2005). Market orientation and innovation: an inter-relationship analysis. European Journal of Innovation Management, 8, 437-452.

ALEGRE, J., Chiva, R. (2008). Assessing the impact of organizational learning capability on product innovation performance: An empirical test. Technovation, 28, 315-326.

AMARA, N., Landry, R., Traor, N. (2008). Managing the protection of innovations in knowledge-intensive business services. Research policy, 37, 1530-1547.

ARMBRUSTER, H., Bikfalvi, A., Kinkel, S., Lay, G. (2008). Organizational innovation: The challenge of measuring non-technical innovation in large-scale surveys. Technovation, 28, 644-657.

ARMSTRONG, J., Overton, T. (1977). Estimating nonresponse bias in mail surveys. Journal of marketing research, 14, 396-402.

ATUAHENE-GIMA, K. (1996). Market orientation and innovation. Journal of Business Research, 35, 93-103.

ATUAHENE‐GIMA, K. (1996). Differential potency of factors affecting innovation performance in manufacturing and services firms in Australia. Journal of Product Innovation Management, 13, 35-52.

AUGUSTO, M., Coelho, F. (2009). Market orientation and new-to-the-world products: Exploring the moderating effects of innovativeness, competitive strength, and environmental forces. Industrial Marketing Management, 38, 94-108.

AUH, S., Menguc, B. (2005). Top management team diversity and innovativeness: The moderating role of interfunctional coordination. Industrial Marketing Management, 34, 249-261.

AVLONITIS, G. J., Papastathopoulou, P. G., Gounaris, S. P. (2001). An empirically‐based typology of product innovativeness for new financial services: Success and failure scenarios. Journal of Product Innovation Management, 18, 324-342.

BAKER, W. E., Sinkula, J. M. (1999). The synergistic effect of market orientation and learning orientation on organizational performance. Journal of the academy of marketing science, 27, 411-427.

BAKER, W. E., Sinkula, J. M. (2007). Does market orientation facilitate balanced innovation programs? An organizational learning perspective. Journal of Product Innovation Management, 24, 316-334.

BATESON, J. E., Hoffman, K. D. (2011). Services Marketing, 5th ed., South-Western.

BENDAPUDI, N., Leone, R. P. (2003). Psychological implications of customer participation in co-production. Journal of marketing, 14-28.

BENNER, M. J., Tushman, M. L. (2003). Exploitation, exploration, and process management: The productivity dilemma revisited. Academy of Management Review, 28, 238-256.

BLAZEVIC, V., Lievens, A. (2008). Managing innovation through customer coproduced knowledge in electronic services: An exploratory study. Journal of the Academy of Marketing Science, 36, 138-151.

CAMBRA-FIERRO, J., Florin, J., Perez, L., Whitelock, J. (2011). Inter-firm market orientation as antecedent of knowledge transfer, innovation and value creation in networks. Management Decision, 49, 444-467.

CASSIMAN, B., Veugelers, R. (2006). In search of complementarity in innovation strategy: internal R&D and external knowledge acquisition. Management Science, 52, 68-82.

CHANG, Y. C., Chang, H. T., Chi, H. R., Chen, M. H., Deng, L. L., (2012). How do established firms improve radical innovation performance? The organizational capabilities view. Technovation, 32, 441-451.

CHEN, J. S., Tsou, H. T., Ching, R. K. (2011). Co-production and its effects on service innovation. Industrial Marketing Management, 40, 1331-1346.

CHENG, C. C., Krumwiede, D. (2012). The role of service innovation in the market orientation-new service performance linkage. Technovation, 32, 487-497.

DESHPAND, R., Farley, J. U., Webster JR, F. E. (1993). Corporate culture, customer orientation, and innovativeness in Japanese firms: a quadrad analysis. Journal of Marketing, 23-37.

DESS, G. G., Robinson, R. B. (1984). Measuring organizational performance in the absence of objective measures: The case of the privately‐held firm and conglomerate business unit. Strategic Management Journal, 5, 265-273.

FLINT, D. J., Woodruff, R. B., Gardial, S. F. (2002). Exploring the phenomenon of customers' desired value change in a business-to-business context. Journal of Marketing, 102-117.

GATIGNON, H., Xuereb, J. M. (1997). Strategic orientation of the firm and new product performance. Journal of Marketing Research, 77-90.

GEBAUER, H., Edvardsson, B., Bjurko, M. (2010). The impact of service orientation in corporate culture on business performance in manufacturing companies. Journal of Service Management, 21, 237-259.

GEBAUER, H., Fleisch, E., Friedli, T. (2005). Overcoming the service paradox in manufacturing companies. European Management Journal, 23, 14-26.

GOTTELAND, D., Boul, J. M. (2006). The market orientation–new product performance relationship: Redefining the moderating role of environmental conditions. International Journal of Research in Marketing, 23, 171-185.

GRONROOS, C. (1990). Relationship approach to marketing in service contexts: The marketing and organizational behavior interface. Journal of Business Research, 20, 3-11.

HAGEDOORN, J., Cloodt, M. (2003). Measuring innovative performance: is there an advantage in using multiple indicators? Research Policy, 32, 1365-1379.

HAIR, J. F., Anderson, R. E., Tatham, R.L., Black, W. C. (2006). Multivariate Data Analysis, 5th ed., London: Prentice-Hall.

HARMAN, H. H. (1976). Modern factor analysis, University of Chicago Press.

HIPP, C., Grupp, H. (2005). Innovation in the service sector: The demand for service-specific innovation measurement concepts and typologies. Research Policy, 34, 517-535.

HSU, L. C., WANG, C. H. (2012). Clarifying the effect of intellectual capital on performance: the mediating role of dynamic capability. British Journal of Management, 23, 179-205.

HULT, G. T. M., Ketchen, D. J. (2001). Does market orientation matter?: A test of the relationship between positional advantage and performance. Strategic Management Journal, 22, 899-906.

JAW, C., Lo, J. Y., Lin, Y. H. (2010). The determinants of new service development: Service characteristics, market orientation, and actualizing innovation effort. Technovation, 30, 265-277.

JAWORSKI, B. J., Kohli, A. K. (1993). Market orientation: antecedents and consequences. Journal of Marketing, 53-70.

JIM NEZ-JIMENEZ, D., Valle, R. S., Hernandez-Espallardo, M. (2008). Fostering innovation: the role of market orientation and organizational learning. European Journal of Innovation Management, 11, 389-412.

KALE, P., Singh, H., Perlmutter, H. (2000). Learning and protection of proprietary assets in strategic alliances: building relational capital. Stratic Management Journal, 21(3): 217-237.

KANDEMIR, D., Yaprak, A., Cavusgil, S. T. (2006). Alliance orientation: conceptualization, measurement, and impact on market performance. Journal of the Academy of Marketing Science, 34, 324-340.

KEEBLE, D. (1997). Small firms, innovation and regional development in Britain in the 1990s. Regional Studies, 31, 281-293.

KESKIN, H. (2006). Market orientation, learning orientation, and innovation capabilities in SMEs: An extended model. European Journal of Innovation Management, 9, 396-417.

KIRCA, A. H., Jayachandran, S., Bearden, W. O. (2005). Market orientation: a meta-analytic review and assessment of its antecedents and impact on performance. Journal of Marketing, 24-41.

KOHLI, A. K., Jaworski, B. J. (1990). Market orientation: the construct, research propositions, and managerial implications. Journal of Marketing, 1-18.

LAFORET, S. (2009). Effects of size, market and strategic orientation on innovation in non-high-tech manufacturing SMEs. European Journal of Marketing, 43, 188-212.

LAURSEN, K., Salter, A. (2006). Open for innovation: the role of openness in explaining innovation performance among UK manufacturing firms. Strategic Management Journal, 27, 131-150.

LAY, G., Copani, G., Ger, A., Biege, S. (2010). The relevance of service in European manufacturing industries. Journal of Service Management, 21, 715-726.

LI, H. L., Tang, M. J. (2010). Vertical integration and innovative performance: The effects of external knowledge sourcing modes. Technovation, 30, 401-410.

LIU, X., Buck, T. (2007). Innovation performance and channels for international technology spillovers: Evidence from Chinese high-tech industries. Research Policy, 36, 355-366.

LUKAS, B. A., Ferrell, O. (2000). The effect of market orientation on product innovation. Journal of the Academy of Marketing Science, 28, 239-247.

MENTION, A. L. (2011). Co-operation and co-opetition as open innovation practices in the service sector: Which influence on innovation novelty? Technovation, 31, 44-53.

MICHEL, S., Brown, S. W., Gallan, A. S. (2008). An expanded and strategic view of discontinuous innovations: deploying a service-dominant logic. Journal of the Academy of Marketing Science, 36, 54-66.

MOLLER, K., Rajala, R., Westerlund, M. (2008). Service innovation myopia? A new recipe for client-provider value creation. California Management Review, 50, 31.

MORGAN, R. E., Berthon, P. (2008). Market Orientation, Generative Learning, Innovation Strategy and Business Performance Inter‐Relationships in Bioscience Firms. Journal of Management Studies, 45, 1329-1353.

MULLER, E., Zenker, A. (2001). Business services as actors of knowledge transformation: the role of KIBS in regional and national innovation systems. Research Policy, 30, 1501-1516.

NARVER, J. C., Slater, S. F. (1990). The effect of a market orientation on business profitability. Journal of Marketing, 20-35.

NUNNALLY, J. C., Bernstein, I. H. (1994). Psychometric theory, New York: McGraw-Hill.

OTTESEN, G. G., NHAUG, K. (2004). Exploring the dynamics of market orientation in turbulent environments: a case study. European Journal of Marketing, 38, 956-973.

OVERVIK, O. T., Welo, T. (2011). Maximizing product innovation through adaptive application of user-centered methods for defining customer value. Journal of Technology Management & Innovation, 6, 172-192.

PASWAN, A., D'souza, D., Zolfagharian, M. A. (2009). Toward a contextually anchored service innovation typology. Decision Sciences, 40, 513-540.

PODSAKOFF, P. M., MACKENZIE, S. B., LEE J. Y. Podsakoff, N. P. (2003). Common Method Bias in Behavioral Research: A Critical Review of the Literature and Recommended Remedies. Journal of Applied Psychology, 85, 879-903.

RODR, G. P., Carbonell, R. P., Guez-Escudero, A. I. (2011). Speed or quality? How the order of market entry influences the relationship between market orientation and new product performance. International Journal of Research in Marketing, 28, 145-154.

ROTHAERMEL, F. T., Deeds, D. L. (2004). Exploration and exploitation alliances in biotechnology: A system of new product development. Strategic Management Journal, 25, 201-221.

SANTAMAR, A, L., NIETO, J. M., MILES, I. (2012). Service innovation in manufacturing firms: Evidence from Spain. Technovation, 32, 144-155.

SIN, L. Y., Alan, C., Yau, O. H., Lee, J. S., Chow, R. (2002). The effect of relationship marketing orientation on business performance in a service-oriented economy. Journal of Services Marketing, 16, 656-676.

SLATER, S. F., Narver, J. C. (1994). Does competitive environment moderate the market orientation-performance relationship? Journal of Marketing, 46-55.

SONG, L. Z., Song, M., Di Benedetto, C. A. (2009). A Staged Service Innovation Model. Decision Sciences, 40, 571-599.

SPOHRER, J., Maglio, P. P. (2008). The Emergence of Service Science: Toward Systematic Service Innovations to Accelerate Co‐Creation of Value. Production and Operations Management, 17, 238-246.

STRAUB, T., Kohler, M., Hottum, P., Arrass, V., Welter, D. (2013). Customer Integration in Service Innovation: An Exploratory Study. Journal of Technology Management & Innovation, 8, 25-33.

SUNDBO, J.. Gallouj, F. (2000). Innovation as a loosely coupled system in services. International Journal of Services Technology and Management, 1, 15-36.

TEECE, D. J. (2007). Explicating dynamic capabilities: the nature and microfoundations of (sustainable) enterprise performance. Strategic Management Journal, 28, 1319-1350.

TSAI, K. H. (2009). Collaborative networks and product innovation performance: Toward a contingency perspective. Research Policy, 38, 765-778.

TSAI, K. H., WANG, J. C. (2008). External technology acquisition and firm performance: A longitudinal study. Journal of Business Venturing, 23, 91-112.

TSIOTSOU, R. H. (2010). Delineating the effect of market orientation on services performance: a component-wise approach. The Service Industries Journal, 30, 375-403.

V ZQUEZ, R., Santos, M. L., Álvarez, L. I. (2001). Market orientation, innovation and competitive strategies in industrial firms. Journal of Strategic Marketing, 9, 69-90.

VANDERMERWE, S., Rada, J. (1989). Servitization of business: adding value by adding services. European Management Journal, 6, 314-324.

VARGO, S. L., Lusch, R. F. (2004). The four service marketing myths remnants of a goods-based, manufacturing model. Journal of Service Research, 6, 324-335.

VARGO, S. L., Lusch, R. F. (2008). From goods to service (s): Divergences and convergences of logics. Industrial Marketing Management, 37, 254-259.

VOON, B. H. (2006). Linking a service-driven market orientation to service quality. Managing Service Quality, 16, 595-619.

WANG, C. H. (2011). The moderating role of power asymmetry on the relationships between alliance and innovative performance in the high-tech industry. Technological Forecasting and Social Change, 78, 1268-1279.

WANG, C. H., Hsu, L. C. (2014). Building exploration and exploitation in the high-tech industry: The role of relationship learning. Technological Forecasting & Social Change, 81, 331-340.

XAVIER MOLINA-MORALES, F., Teresa Mart Nez-Fern Ndez, M., Torl, V. J. (2011). The dark side of trust: the benefits, costs and optimal levels of trust for innovation performance. Long Range Planning, 44, 118-133.

YAM, R., Lo, W., Tang, E. P., Lau, A. K. (2011). Analysis of sources of innovation, technological innovation capabilities, and performance: An empirical study of Hong Kong manufacturing industries. Research Policy, 40, 391-402.

ZENG, S. X., Xie, X., Tam, C. (2010). Relationship between cooperation networks and innovation performance of SMEs. Technovation, 30, 181-194.

ZHOU, K. Z., Brown, J. R., Dev, C. S. (2009). Market orientation, competitive advantage, and performance: A demand-based perspective. Journal of Business Research, 62, 1063-1070.

ZHOU, K. Z., Kin, C., Tse, D. K. (2005). The effects of strategic orientations on technology-and market-based breakthrough innovations. Journal of Marketing, 42-60.




DOI: http://dx.doi.org/10.4067/S0718-27242014000200004



Copyright (c)



2017 © Universidad Alberto Hurtado - Facultad de Economía y Negocios. 
Erasmo Escala 1835 - Santiago, Chile.
Economic Analysis Review | Observatorio Económico | Gestión y Tendencias 

Journal Supported by Chimera Innova Group