Content area
Full text
An executive summary for managers and executive readers can be found at the end of this article.
Introduction
This study explores the customer responsiveness of the industrial firm and its impact on the firm's performance. By drawing on the competitive dynamics literature, the study shows how dyadic competition and the firm's age weaken the positive performance impact of customer responsiveness. Customer responsiveness is an activity of market orientation that has been established as a major antecedent of firm performance ([54] Rodriguez Cano et al. , 2004; [29] Kirca et al. , 2005). Market orientation is defined as organizational activities that are related to the firm's generation and dissemination of market intelligence, including the firm's responsiveness to market intelligence ([30] Kohli and Jaworski, 1990). Thus, market orientation comprises various cross-functional activities directing at creating superior value for customers through continuous assessments of needs of customers ([11] Deshpandé and Farley, 1998).
To some extent the firm responds to customer needs and customer responsiveness is defined as the action taken in response to market intelligence concerning individual needs of target customers ([30] Kohli and Jaworski, 1990; [31] Kohli et al. , 1993). For the industrial firm, customer responsiveness includes value-adding activities such as solving customers' problems (e.g. [38] Matthyssens and Vandenbempt, 2008), building relationships with customers (e.g. [65] Storbacka and Nenonen, 2009), and customizing the offering (e.g. [56] Schlegelmilch and Ambos, 2004).
As the intention of market orientation as a whole is to create superior value in comparison with value created by competitors, the customer responsiveness activity may be an effective strategy for the industrial firm to differentiate from competitors (e.g. [41] Norman et al. , 2007; [62] Sorensen, 2009; [68] Ulaga and Eggert, 2006). By emphasizing a differentiation strategy of customer responsiveness, the firm may be equipped to achieve a competitive advantage and high performance levels owing to its greater knowledge of customer needs and to the reputation it builds ([30] Kohli and Jaworski, 1990; [39] Narver and Slater, 1990).
The dominant view is that market orientation is positively associated with organizational performance ([24] Jaworski and Kohli, 1993; [59] Slater and Narver, 1994). However, meta-analyses report mixed findings on the performance impact of market orientation ([54] Rodriguez Cano et al. , 2004; [29] Kirca et al....