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Title: Market orientation, alliance governance and innovation
Author: Chen, Yao
Awarding Body: University of Manchester
Current Institution: University of Manchester
Date of Award: 2018
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Innovation is the source of building competitive advantages in an enterprise, industry or country. With the increasing competition in the global market, as well as the ever-changing market demand, companies must strategically cultivate innovation-based competitive advantages. In the context of economic transition, how to play an active role by market orientation and thus effectively enhance their level of innovation, is currently one of the core issues the companies face within the process to enhance their capabilities of independent innovation. Therefore, from the perspective of an intermediating mechanism between market orientation and innovation, this study focuses in-depth on how to enhance innovation for market-oriented firms on the basis of related theoretical and empirical research. This study first reviews the existing literature on the relationship between market orientation and innovation, and then puts forward that distributor alliance governance mechanism may be the middle mechanism of in the link between market orientation and technological innovation. This research focuses on this research question because the existing literature did not study the impact mechanism of market orientation on innovation although some studies have confirmed that a market-oriented company will be more likely to achieve innovations. In business practices, firms maintaining market orientation cannot necessarily be able to succeed in innovation. Therefore, whether in theory or in practice, there is the need to explore the middle mechanism between market orientation and enterprise innovation. Manufacturing enterprises' innovations are often based on an accurate grasp of consumer needs, competitor activities and industry-changing technologies. When companies understand this information, they may be able to research and develop innovative products and services which is targeted on the specific needs of consumers, thus win in the competition. However, manufacturers often do not directly deal with consumers, and cannot always carry out market research. The distributor alliances are often the closer part of the consumers. Distributors are not only able to gather information about the feedback of consumers, but also convenient to collect information on business activities of manufacturers' competitors. Therefore, the enterprises that take proper governance on distributors are likely to provide a good foundation for business innovation. Therefore, this study proposes alliance governance may be the mediating mechanism between market orientation and technological innovation. This research discusses the important role of alliance governance (AG) as a mediating mechanism in the relationship between market orientation (MO) and innovation, and compares the differences between the influences of different dimensions. The study aims to reveal the influence mechanism of different types of alliance governance on the relationship between market orientation and innovation. Based on a sample of 122 Chinese manufacturing enterprises, the study finds that: (1) contractual governance (CG) will increase when customer orientation (CuO) and competitor orientation (CoO) become higher, and contractual governance will affect radical innovation (RI) in a U-shaped way; (2) trust governance (TG) will increase when inter-functional coordination (IC) becomes higher, and trust governance has a positive impact on both radical innovation and incremental innovation (II). The findings are meaningful for research into the relationship between market orientation and innovation, and have managerial implications in helping different types of market-oriented firms make appropriate choices for alliance governance in order to improve both radical and incremental innovation.
Supervisor: Holland, Christopher ; Allen, Matthew Sponsor: Not available
Qualification Name: Thesis (D.B.A.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available
Keywords: incremental innovation ; radical innovation ; market orientation ; alliance governance