IQRA University

“A Study of Relationships

Of Market-Orientation, Strategic-

Orientation on the Firm-

Performance in the Context of

Pakistan”

Submitted to:
Dr. Sarwer Azhar

By:

1. Muhammad Salih Memon (5733)

2. Nisar Ahmed Siddiqui

3. Syed Munir Ahmed

 TABLE OF CONTENTS

CHANGES FROM FIRST ONE………………………………………………………………………3

Introduction......................................................................................................................................3
Literature Review.............................................................................................................................5
Theoretical Framework....................................................................................................................8
Research Objectives and Hypothesis...............................................................................................9
Objectives of Research ...............................................................................................................9
Hypothesis....................................................................................................................................9
Methodology..................................................................................................................................10
Results obtained are as under:........................................................................................................13
Implications and Discussions:........................................................................................................18
Limitations:....................................................................................................................................20
Table I........................................................................................................................................22
Table - II.....................................................................................................................................23
Table - IV...................................................................................................................................24
References..................................................................................................................................25

Changes We Made From First One

1. We made the reliability analysis of questions which we

received as a data and delete some questions of Market
Orientations from 32 to 22 for improving Cronbach’s alpha.
And again no question was failed not to meet the reliability
analysis for Strategic Orientation, that’s why they kept all
along.

Page 2 of 26
 2. And put the reliable variables for factor analysis for getting the
factors now new thing is that we get five factors of MO and
naming them, and again same repeated with SO for getting
four factors on the basis of theory but it is it self giving us four
factors on the basis of Eigenvalue
3. Finally we save these factors as a regression factors
4. We compute the mean of all six performances naming them as
a Firm Performance.
5. Again we compute the mean of four performances as a
Financial performance for putting it as a dependent variables
and Customer Satisfaction and Overall Business Performance
was kept as alone dependent variable.

All these things was not done in our project which was
submitted earlier

INTRODUCTION

Page 3 of 26
The relationship of the successful firm performance is for the market
orientation, and strategic orientation has remained the topic of
research since last two decades. Many conceptual and empirical
studies on various aspects of market orientation have been published.

Despite the strong theoretical arguments for positive effects of market

orientation on performance (Narver & Slater, 1990); Kohli & Jaworski,
1990); the empirical evidence for linkage is discordant (Han, Kim, &
Ketchen, 1998; Pelham, 2000)

To understand how market orientation contributes to organizational

effectiveness, researchers have recognized the importance of
examining the relationship between market orientation and
competitive strategy (Slater & Narver, 1996).

However, empirical links between these two factors are not well
established (Morgan & Strong, 1998).

The market orientation – performance relationship tends to be affected

by competitive strategy, because corporate abilities to succeed
depend not only on implementation efficiencies but also on developing
and strengthening the firms’ strategic posture. Market orientation
enables firms to produce offerings which relative to offerings by
competitors, are perceived by markets to offer better value. (Day,
1994; Slater & Narver, 1995), to be more innovative (Gatignon &
Xuereb, 1997; Han, et al., 1998) or to be superior in quality (Pelham &
Wilson, 1996).

In this study, we examine the relationship between strategic

orientation, market orientation, marketing capabilities and firm’s
performance in the context of Pakistani business.

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The problem is that the previous research on market orientation has
been mostly conducted in western countries (developed world).

The countries in transition to market based economies are good

candidates for market orientation research as customer sovereignty
issues become increasingly important ( Peng and Heath 1996).

Pakistan is one of fast developing economies. In many sectors

competitive environment is growing tremendously. Various business
concerns are adopting aggressive market orientation strategies. So
Pakistan is a good platform for testing relationship between strategic
orientation – market orientation and firm performance.

In this study, the conceptual framework is laid out in the section of

literature review and hypothesis development. It summarizes existing
research on the relationship among market orientation, strategic
orientation and firm performance and put forward the research design
of this study. Finally the theoretical and managerial implications are
highlighted followed by a discussion on the limitation of this study.

LITERATURE REVIEW

Various studies, particularly in western world, have been carried out to

find relationship between market orientation and successful firm
performance. The results of some of such studies are summarized as
under:
(i) Market place heterogeneities in customers preferences and
product supply (Hunt, 2000) make the information about
customers and competitors more and more important for a
company to survive and be superior in the market. Market
orientation manifests in the abilities of business to generate

Page 5 of 26
intelligence about customers and competitors, and to
disseminate that intelligence widely through out the organization
and to utilize the cooperation of all the departments within the
organization to create and deliver customer value (Jaworski &
Kohli, 1993). Hence dominant opinion is that market orientation is
a valuable source of competitive advantages and hence
successful firm performance.

But there are other researches as well, which suggest that the
relationship between market orientation and innovation appears
to be more complex (Martin & Grbac, 2003).

Conceptual writings suggest that the importance of market

orientation for organizational performance depends on
environmental conditions (Narver & Slater, 1990). A strong
market orientation is required to focus the organization on those
environmental events that are likely to influence their ability to
increase customer satisfaction relative to competitors (Baker &
Sinkula , 1999; Kohli & Jaworski , 1990) for example, suggest that
market orientation may not have critical importance in turbulent
environment. Technical turbulence moderates customers and
competitors orientations’ impact on innovation performance (Liu,
Luo, & Shi, 2003).

The literature places strategic market planning at the inflection

between the understanding of the firm’s external environment
and its response (Maklan, Knox, & Ryals, n.d.), strategic market
planning is concerned with adapting the organization to a
changing environment (Doyle, 1994).

Smith and McDonald (2001) present a thorough literature review

on strategic marketing planning and conclude that a there is a
broad consensus about the fundamental process of strategic
marketing planning. The following figure describes the
relationships:

Page 6 of 26
 Customer
s
Finance

Competito
R&D

Scanning
Environmental
rs

Dissemination
of Marketing
Strategic
Marketin

Insights
g
Manufactu Planning
ring
Market
trends
Logistics

Customer Regulatio
Services n

Pressure
Groups

However we presume that the conclusions drawn by the

following studies in particular, are relevant in Pakistani context.
Jaworski found that:
1. The greater the market orientation of an organization,
the greater would be the overall performance and that this
relationship would be moderated by such external forces like
weaker economy; greater market turbulence, and
competition. Kohli & Jaworski , 1990, suggest that market
orientation may not have critical importance in turbulent
environments.

( ii ) Secondly it also transpires from the review of the

related literature that the degree of the
relationship between market orientation and
firm’s performance varies from industry to
industry; for example there is visible difference between service

Page 7 of 26
 industry and manufacturing industry.
(Ahmet, Satish, & William, 2005) in their study found
the result as under:
“The results also revealed that the market orientation
performance is stronger for manufacturing firms than
for service firms.”

As reviewed about most of the researches exploring the

relationship between market orientations, strategic orientation
and firm performance have been conducted in the context of
developed countries. Pakistan is conspicuous by absence of such
research. There is also lack of research on the environment in
which various industries in Pakistan are working because from the
literature review it transpired that the relationship between
market orientation and firm performance is mediated as well as
moderated by the external environmental factors and internal
culture of the firm.

The organizational typology developed by Miles and Snow 1990 is

a good approach for categorizing the industries but no research
exists which can indicate the four categories in Pakistani context.

THEORETICAL FRAMEWORK

We believe that for a business to be successful, focus on the customer,

is very important; but at the same time the competitors can not be
ignored. The information about the customer satisfaction, his
preferences, and his needs is essential. At the same time the
intelligence about the competitors is necessary not only for increasing
the market share but also for maintaining the market share. Additional
factors i.e. technology and regulations also need to be taken care of.

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When all this information is generated and shared internally within the
department, normally it results into a proper response.

Information generation and responsiveness result into strategic

orientation or behaviors, which enhance the marketing capabilities of
the firm. Keeping all other factors including environmental, same, the
relationship between market orientation and firm performance should
be positive. However the degree of the relationship will vary according
to the nature of the industry and the competitive environment in which
the firm is working.

RESEARCH OBJECTIVES AND HYPOTHESIS

Objectives of Research

1. To analyze the contribution of strategic orientation to the firm

performance and individually (Overall business performance,
Financial performance and Customer satisfaction).

2. To analyze the dimensions of Market orientation and how these

are related to the Firm performance and (Overall business
performance, Financial performance and Customer satisfaction).

Hypothesis

H1. Market orientation has a significant and positive role on the firm
performance
H1.1 Responsiveness has a significant and positive role on the firm
performance
H1.2 Intelligence generation has a significant and positive role on the
firm performance
H1.3 Market Analyzers has a significant and positive role on the firm
performance

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H1.4 Intelligence Disseminations has a significant and positive role on
the firm performance
H1.5 Customer Analyzers has a significant and positive role on the firm
performance
H2. Strategic orientation has a significant and positive role on the
firm performance
H2.1 Prospectors has a significant and positive role on the firm
performance
H2.2 Defenders has a significant and positive role on the firm
performance
H2.3 Analyzers has a significant and positive role on the firm
performance
H2.4 Reactors has a significant and positive role on the firm
performance
METHODOLOGY

The first question which needed to be answered in this study was “how
to measure the market orientation, strategic orientation, marketing
capabilities and firm performance?” In this respect a questionnaire has
been provided. First thing to be addressed was the reliability and
validity of this questionnaire. And with the help of reliability analysis
we check the reliability analysis of Market Orientation and Strategic
Orientation.

Fortunately the part of the questionnaire which aims at measuring

market orientation was developed by (Kohli, Jaworski, & Kumar, 1993),
it was tested and retested by them. There are substantive issues in this
questionnaire but the correlation estimates for the model are quite
inadequate for indicating the three constructs. We have adopted this

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questionnaire after making reliability analysis we get five factors of
market orientation and four factors of Strategic orientation.

Within given data, Market orientation was measured with its three
constructs- Information Generation, Information dissemination, and
Responsiveness. Furthermore, information generation was measured
by its ten indicators, information generation by its eight indicators and
responsiveness by its fourteen indicators but after running the factor
analysis we get the five factors respectively Responsiveness,
Intelligence generation, Market analyzers, Intelligence Dissemination
and Customer Analyzers and Responsiveness can be measured with its
five indicators, Intelligence generation with its five measures, Market
analyzers with its four, Intelligence dissemination with its four and in
last Customer analyzers also with its four measures (see table#1).
Whereas, strategic orientation was measured with its fifteen indicators
and four factors (see table#2).

Data of the six performance indicators i-e over all business

performance, market share, sales growth, customer satisfaction,
profitability and return on investment were given; and first of all we
make the mean of all these six indicators to get one named as Firm
performance and again make the mean of four, excluding overall
business performance, and customer satisfaction than name it as
financial performance, remaining kept as individual.

Multivariate regression (least square) models were employed among

the market orientation, strategic orientation constructs; and firm’s
performance generally on all firms. Initially, three constructs of market
orientation were regressed separately on Firm performance but it
doesn’t have any meaningful result than again we run it with five

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factors on the (Firm performance, Overall business performance,
Financial performance and customer satisfaction).
Strategic orientation again regressed with the (Firm performance,
Overall business performance, financial performance and customer
satisfaction).

Fir P = β1 + β2 Res + β3 Ig + β4 Mak anal + β5 Id+ β6Cust Anal+ µ

Fin P = β1 + β2 Res + β3 Ig + β4 Mak anal + β5 Id+ β6Cust Anal+ µ
OP = β1 + β2 Res + β3 Ig + β4 Mak anal + β5 Id+ β6Cust Anal+ µ
CS = β1 + β2 Res + β3 Ig + β4 Mak anal + β5 Id+ β6Cust Anal+ µ

Fir P = β1 + β2 Pros + β3 Def + β4 Anal + β5 Reac+ µ

Fin P = β1 + β2 Pros + β3 Def + β4 Anal + β5 Reac+ µ
OP = β1 + β2 Pros + β3 Def + β4 Anal + β5 Reac+ µ
CS = β1 + β2 Pros + β3 Def + β4 Anal + β5 Reac+ µ

Again the regression models were run to find the above relationships in
each category.

The typology of Miles & Snow was adopted which was not adopted in
previous paper due to lack of information. And we think that it requires
a separate study to classify the business firms in Pakistan into four
types described by Miles & Snow.

Page 12 of 26
RESULTS OBTAINED ARE AS UNDER:

Fir P = β1 + β2 Res + β3 Ig + β4 Mak anal + β5 Id+ β6Cust Anal+ µ

M ode l Summary

Adjusted Std. Error of

Model R R Square R Square the Estimate
1 .201 a .040 .002 .81006
a. Predictors: (Constant), Customer Analysis, Intelligence
Generation, Resposiveness, Intelligence
Dissemination, Market Analysis

ANOVAb

Sum of
Model Squares df Mean Square F Sig.
1 Regression 3.416 5 .683 1.041 .397 a
Residual 81.368 124 .656
Total 84.784 129
a. Predictors: (Constant), Customer Analysis, Intelligence Generation,
Resposiveness, Intelligence Dissemination, Market Analysis
b. Dependent Variable: Firm Performance

a
Coe fficie nts

Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) 1.763 .071 24.697 .000
Resposiveness -.026 .073 -.033 -.358 .721
Intelligence Generation .142 .073 .173 1.945 .054
Market Analysis .064 .085 .071 .754 .452
Intelligence
-.037 .074 -.046 -.499 .619
Dissemination
Customer Analysis .010 .074 .012 .134 .894
a. Dependent Variable: Firm Performance

Fin P = β1 + β2 Res + β3 Ig + β4 Mak anal + β5 Id+ β6Cust Anal+ µ

M ode l Summary

Adjusted Std. Error of

Model R R Square R Square the Estimate
1 .186a .034 -.004 .84101
a. Predictors: (Constant), Customer Analysis, Intelligence
Generation, Resposiveness, Intelligence
Dissemination, Market Analysis

Page 13 of 26
 ANOVAb

Sum of
Model Squares df Mean Square F Sig.
1 Regression 3.177 5 .635 .898 .485 a
Residual 89.120 126 .707
Total 92.297 131
a. Predictors: (Constant), Customer Analysis, Intelligence Generation,
Resposiveness, Intelligence Dissemination, Market Analysis
b. Dependent Variable: Financial Performance

Coe fficie ntsa

Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) 1.692 .074 23.018 .000
Resposiveness -.008 .075 -.009 -.100 .920
Intelligence Generation .138 .075 .163 1.840 .068
Market Analysis .042 .086 .045 .483 .630
Intelligence
-.059 .077 -.069 -.762 .448
Dissemination
Customer Analysis -.049 .077 -.058 -.640 .523
a. Dependent Variable: Financial Performance

OP = β1 + β2 Res + β3 Ig + β4 Mak anal + β5 Id+ β6Cust Anal+ µ

M ode l Summary

Adjusted Std. Error of

Model R R Square R Square the Estimate
1 .240a .058 .024 1.079
a. Predictors: (Constant), Customer Analysis, Intelligence
Generation, Resposiveness, Intelligence
Dissemination, Market Analysis

ANOVAb

Sum of
Model Squares df Mean Square F Sig.
1 Regression 9.842 5 1.968 1.691 .141 a
Residual 160.651 138 1.164
Total 170.493 143
a. Predictors: (Constant), Customer Analysis, Intelligence Generation,
Resposiveness, Intelligence Dissemination, Market Analysis
b. Dependent Variable: Over all business performance

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 a
Coe fficie nts

Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) 1.756 .090 19.484 .000
Resposiveness -.119 .093 -.109 -1.281 .202
Intelligence Generation .134 .094 .120 1.434 .154
Market Analysis .143 .110 .114 1.292 .199
Intelligence
.093 .096 .084 .966 .336
Dissemination
Customer Analysis .053 .096 .047 .550 .584
a. Dependent Variable: Over all business performance

CS = β1 + β2 Res + β3 Ig + β4 Mak anal + β5 Id+ β6Cust Anal+ µ

M ode l Summary

Adjusted Std. Error of

Model R R Square R Square the Estimate
1 .289 a .083 .051 1.049
a. Predictors: (Constant), Customer Analysis, Intelligence
Generation, Resposiveness, Intelligence
Dissemination, Market Analysis

ANOVAb

Sum of
Model Squares df Mean Square F Sig.
1 Regression 14.309 5 2.862 2.602 .028 a
Residual 157.262 143 1.100
Total 171.570 148
a. Predictors: (Constant), Customer Analysis, Intelligence Generation,
Resposiveness, Intelligence Dissemination, Market Analysis
b. Dependent Variable: Customer satisfaction

a
Coe fficie nts

Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) 1.962 .086 22.713 .000
Resposiveness .052 .089 .048 .579 .563
Intelligence Generation .168 .089 .153 1.895 .060
Market Analysis -.015 .101 -.013 -.153 .879
Intelligence
.018 .092 .016 .194 .847
Dissemination
Customer Analysis .276 .093 .247 2.972 .003
a. Dependent Variable: Customer satisfaction

Fir P = β1 + β2 Pros + β3 Def + β4 Anal + β5 Reac+ µ

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 M ode l Summary

Adjusted Std. Error of

Model R R Square R Square the Estimate
1 .296 a .087 .061 .81929
a. Predictors: (Constant), Reactor, Prospector, Defender,
Analyzer

ANOVAb

Sum of
Model Squares df Mean Square F Sig.
1 Regression 8.815 4 2.204 3.283 .013 a
Residual 91.960 137 .671
Total 100.775 141
a. Predictors: (Constant), Reactor, Prospector, Defender, Analyzer
b. Dependent Variable: Firm Performance

Coe fficie ntsa

Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) 1.649 .070 23.578 .000
Prospector .197 .066 .242 2.965 .004
Defender -.056 .073 -.062 -.758 .450
Analyzer -.099 .073 -.111 -1.353 .178
Reactor .081 .070 .095 1.156 .250
a. Dependent Variable: Firm Performance

Fin P = β1 + β2 Pros + β3 Def + β4 Anal + β5 Reac+ µ

M ode l Summary

Adjusted Std. Error of

Model R R Square R Square the Estimate
1 .199 a .040 .013 .86956
a. Predictors: (Constant), Reactor, Prospector, Analyzer,
Defender

ANOVAb

Sum of
Model Squares df Mean Square F Sig.
1 Regression 4.419 4 1.105 1.461 .217 a
Residual 106.616 141 .756
Total 111.035 145
a. Predictors: (Constant), Reactor, Prospector, Analyzer, Defender
b. Dependent Variable: Financial Performance

Page 16 of 26
 Coe fficie ntsa

Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) 1.578 .073 21.627 .000
Prospector .144 .070 .170 2.064 .041
Defender -.050 .075 -.056 -.671 .504
Analyzer -.061 .077 -.066 -.798 .426
Reactor .035 .072 .041 .489 .625
a. Dependent Variable: Financial Performance

OP = β1 + β2 Pros + β3 Def + β4 Anal + β5 Reac+ µ

M ode l Summary

Adjusted Std. Error of

Model R R Square R Square the Estimate
1 .316 a .100 .076 1.035
a. Predictors: (Constant), Reactor, Prospector, Analyzer,
Defender

ANOVAb

Sum of
Model Squares df Mean Square F Sig.
1 Regression 18.180 4 4.545 4.240 .003 a
Residual 164.003 153 1.072
Total 182.184 157
a. Predictors: (Constant), Reactor, Prospector, Analyzer, Defender
b. Dependent Variable: Over all business performance

Coe fficie ntsa

Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) 1.700 .084 20.350 .000
Prospector .262 .082 .244 3.184 .002
Defender -.071 .087 -.063 -.820 .413
Analyzer -.131 .085 -.118 -1.531 .128
Reactor .141 .084 .130 1.693 .093
a. Dependent Variable: Over all business performance

CS = β1 + β2 Pros + β3 Def + β4 Anal + β5 Reac+ µ

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 M ode l Summary

Adjusted Std. Error of

Model R R Square R Square the Estimate
1 .367 a .135 .113 1.052
a. Predictors: (Constant), Reactor, Prospector, Analyzer,
Defender

ANOVAb

Sum of
Model Squares df Mean Square F Sig.
1 Regression 27.043 4 6.761 6.110 .000 a
Residual 173.729 157 1.107
Total 200.772 161
a. Predictors: (Constant), Reactor, Prospector, Analyzer, Defender
b. Dependent Variable: Customer satisfaction

a
Coe fficie nts

Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) 1.884 .084 22.532 .000
Prospector .347 .083 .310 4.168 .000
Defender .009 .086 .008 .101 .919
Analyzer -.119 .085 -.104 -1.398 .164
Reactor .171 .083 .154 2.062 .041
a. Dependent Variable: Customer satisfaction

IMPLICATIONS AND DISCUSSIONS:

The analysis of the data was carried out from different angles. Firstly it
was explored as to what are the contributions of the market
orientations to the firm’s performance. Secondly effort has been made
to identify positive and significant impact of Strategic orientation the
firm performance.

The analysis is two-fold. It transpired that in scenario one Market

orientation has the factors of:
1. Responsiveness
2. Intelligence Generation
3. Market Analyzers
4. Intelligence Dissemination
5. Customer Analyzer

Page 18 of 26
And market orientation have insignificant role and some of
independent variables named as (Responsiveness and Intelligence
dissemination has a negative impact on the firm performance)

Whereas Market Orientation have insignificant effect on the Dependent

variables (Overall Business performance, financial performance and
customer satisfaction)

It is puzzling to find that in manufacturing sector, and service sector

both insignificant impact on (Overall Business performance, financial
performance and customer satisfaction).

And about the strategic orientation have four factors (Table#2)

Whereas Strategic Orientation have significant role on firm

performance and R2 = 8.7% and
According to the coefficients prospector have significant and positive
roll on the firm performance but standard error is too much which
shows that this tool of questionnaire is not properly working in our
system or our economic system doesn’t suits with these tools.

And when we are individually talking about overall business

performance than relationship is significant with strategic orientation
and R2 = 10% and according to coefficients prospector again have a
significant and positive relationship with the overall business
performance, defender and analyzer have insignificant and negative
relationship with the dependent variable.

In the last Strategic orientation have a positive and significant impact

on customer satisfaction, R2 = 13.5% and according to the coefficients

Page 19 of 26
Prospector and Reactor have significant and positive impact on
customer satisfaction.

The findings carry significant insights for the managers. The managers
are concerned about four issues pertaining to market orientation. First,
how can market orientation be implemented? Second, what is its effect
on performance? Third, how does the market orientation –
performance relationship vary across cultural and business context?
Fourth, what are the processes through which market orientation
enhances its performance?

LIMITATIONS:

Although this study may be the first type of study in Pakistan, but it
provides interesting insights into the relationships of market
orientation, strategic orientation, marketing capabilities on firm
performance. Several limitations of this study should be acknowledged.
First, this study relied mainly on the data as well as on the
questionnaire provided. The firms selected for the study may not be so
much representative, 15 – 20% data pertaining to various variables
was missing.

Second, this study relied primarily on subjective measures of

performance, based on the perceptions of the managers. Third, we did
not examine the differences in market orientation and other constructs
between state owned and private sector enterprises.

This study would have given better results on the program LISREL.

Finally, this study did not examine the potential impact of the
environment of the market orientation – performance relationship.

Page 20 of 26
Pakistan shares similar characteristics with other emerging economies
where competition is increasingly intensive and market environment is
substantially turbulent and dynamic. Therefore, another important
future research direction is to examine whether the mediating effects
of competitive strategy in the market orientation – performance
relationships is moderated by environmental impact such as
competitive intensity, in the perspective of globalization and WTO.

Page 21 of 26
 Table I
Question F1 F2 F3 F4 F5
Responsiveness:
We are quick to respond to significant changes in our competitors pricing .759
structures.
If a major competitor were to launch an intensive marketing campaign targeted to .732
Cronbach's
our customers, we would implement a timely response immediately
Alpha
We periodically review our product development efforts to ensure that they are in .651
.681
line with what customers want.
Several departments get together periodically to plan a response to changes taking .621
place in our business environment.
Principles of market segmentation drive new product development efforts in our .598
organization.
Intelligence Generation:
Individuals from our production department interacts directly with the customers to .754
learn how to serve them better.
In this business unit we meet with the customers formally at least once a year to .659
find out what products or services would they need in the future Cronbach's
When some thing important happens to a major customer of the market, the whole .592 Alpha
company knows about it with in a short period .709
In our company we do a lot of in-house market research. .521

The activities of different departments in this organization are well coordinated. .470
Market Analyzers:
We often talk or survey those who can influence our end users purchases, e.g. .723
retailers and distributors.
In our company several departments generate information on competitors .664
Cronbach's
independently.
Alpha
We have interdepartmental meetings at least once a quarter to discuss market trends .618
.594
and developments.
Our company periodically circulates documents, such as, reports, newsletters, trade .448
journals that provide information on our customers
Intelligence Disseminations:
We collect industry information by informal means, e.g. lunch with industry .764
friends, talk with trade partners etc.
We periodically review the likely effect of changes in our business environment, .744
Cronbach's
e.g. regulation on our customers.
Alpha
A lot of informal "chat" in our organization concerns our competitor's tactics or .482
.670
strategy.
Marketing personnel of our company spend time discussing customers future needs .417
with other functional departments.
Customer Analyzers:
We survey end users at least once a year to assess the quality of our products and .700
services.
Data on customer satisfaction are disseminated at all levels in this unit on a regular .606
Cronbach's
basis.
Alpha
When we find customers would like us to modify a product or service the .570
.626
department involved makes concerted efforts to do so.
When we find that customers are unhappy with the quality of our service we take .422
immediate corrective action.
Eigenvalue 6.587 1.803 1.440 1.267 1.202
% of Variance 29.941 8.196 6.545 5.757 5.465

Cumulative of these factors are (56%) and suppress factor loadings at (.40) which is statistical
significant because when we are giving it the practical significance at (.50) than many variables
are with the missing values which will not give us correct interpretation that’s why we are using
statistical significance.

Page 22 of 26
 Table - II
Question F1 F2 F3 F4
Prospector:
Our organization responds rapidly to early signals concerning areas of .787
opportunity and these responses often lead to a new round of Cronbach's
competitive action. Alpha
Our firm typically operates within a broad -product market area that .708 .620
undergoes periodic redefinition
Our firm values being the 'first in' in new product and market areas .632
even if not all of these efforts prove to be highly profitable.
Defender:
Our firm tends to offer a more limited range of products and services .693
than its competitors.
Our firm attempts to maintain a stable, limited line of products or .562
services.
Our firm is often not in the forefront of developments in the industry--- .545
Cronbach's
it tends to ignore industry changes that have no direct influence on
Alpha
current areas of operation and concentrates on doing the best job
.594
possible in a limited area.
Our firm tries to protect its product market by offering higher quality .476
product/superior service and or lower prices etc.
However our firm may not maintain market strength in all markets that .472
it enters.
Analyzer:
Our firm normally responds in those areas where it is forced to by .733
environmental pressures
Our firm is usually not as aggressive in maintaining established .646
products and markets as some of our competitors, nor are we willing to
Cronbach's
take as many risks as other competitors.
Alpha
Our firm does not appear to have a consistent product-market .582
.623
orientation.
Our firm carefully monitors the actions of major competitors in areas .457
compatible with our stable product market base, and we are frequently
the 'second in' with a more cost-efficient product or service.
Reactor:
Our firm is also quick to move out quickly to follow a carefully .684
selected set of more promising new developments in the industry. Cronbach's
Our firm is seldom 'first in' with new products or services. .629 Alpha
Our organization attempts to locate and maintain a secure niche in a .402 .428
relatively stable product or service area.
Eigenvalue 3.850 1.775 1.244 1.107
% of Variance 25.66 11.831 8.294 7.382
7

Cumulative of these factors are (53%) and suppress factor loadings at (.40) which is statistical
significant because when we are giving it the practical significance at (.50) than many variables

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are with the missing values which will not give us correct interpretation that’s why we are using
statistical significance.

Table - IV

Performance Indicator (Pi)

Sign Indicators
P1 Over all business performance
P2 Market share
P3 Sales Growth
P4 Customer satisfaction
P5 Profitability
P6 Return on Investment

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