The Structure of Design Orientation and its Relationship with Market Orientation

  • Sanja Rocco
  • Aleksandra Selinšek
Keywords: design orientation, market orientation, managers, relationship, transitional economies

Abstract

Although market orientation has been investigated in numerous studies, its complex relationship with design orientation lacks research attention, especially in countries with transitional economies. Therefore, existing models of market orientation (MO) and design orientation (DO) have been investigated. The research has been executed in several stages, combining qualitative and quantitative methods. In the first, qualitative stage, a series of face-to-face in-depth interviews were conducted. In the second, quantitative stage, an Internet survey was conducted among managers and CEOs from Croatian companies in different industries. Partial Least Square and Structural Equation Modelling analyses were conducted to examine the relationships between variables of MO and DO. Results confirm the positive relationship between design orientation and market orientation. Further, results also confirm sub-hypotheses that customer orientation and strategic marketing are positively related to all dimensions of design orientation. The model could have implications for marketers, designers and managers in practice. Both concepts, MO and DO, are very complex and multidimensional, so it was not possible to investigate all the aspects of the constructs. Another limitation of the study was the sample size, as a result of a low response rate as well as a relatively high drop-out rate. The research contributes to theory highlighting the role of design as an important element of market orientation.

Downloads

Download data is not yet available.

Author Biographies

Sanja Rocco

Zagreb School of Business, Croatia
E-mail: sanja.rocco@pvzg.hr

Aleksandra Selinšek

University of Maribor, Faculty of Economics and Business, Slovenia
E-mail: aleksandra.selinsek1@um.si

References

Atuahene-Gima, K., Slater, S. F., & Olson, E. M. (2005). The contingent value of responsive and proactive market orientations for new product program performance. The Journal of Product Innovation Management, 22(6), 464–482. https://doi.org/10.1111/j.1540-5885.2005.00144.x

Bagozzi, R. P. (2012). The evolution of marketing thought: From economic to social exchange and beyond. In P. Maclaran, M. Saren, B. Stern, & M. Tadajewski (Eds.), The SAGE handbook of marketing theory (pp. 245-262). London, England: Sage.

Best, K. (2006). Design management: Managing design strategy, process and implementation. Worthing, Sussex, Ava Academia.

Black, C. D., & Baker, M. (1987). Success through design. Design Studies, 8(4), 207-216. https://doi.org/10.1016/0142-694X(87)90017-2

Blaich, R., & Blaich, J. (1993). Product design and corporate strategy – Managing the connection for competitive advantage. New York, NY: McGraw Hill.

Bloch, P. H., Brunel, F. F., & Arnold, T. J. (2003). Individual differences in the centrality of visual product aesthetics: Concept and measurement. Journal of Consumer Research, 29(4), 551-565. https://doi.org/10.1086/346250

Bodlaj, M. (2010). The impact of a responsive and proactive market orientation on innovation and business performance. Economic and Business Review, 12(4), 241–261.

Borja de Mozota, B. (2003a). Design management: Using design to build brand value and corporate innovation. New York, NY: DMI/Allworth Press.

Borja de Mozota, B. (2003b). Design and competitive edge: A model for design management excellence in European SMEs. Design Management Journal Academic Review, 2(1), 88-103.

Brown, T. (2008). Design thinking. Harvard Business Review, June, 85-92.

Bruce, M., Potter, S., & Roy. (1995).The risks and rewards of design investment. Journal of Marketing Management, 11(5), 403-17. https://doi.org/10.1080/0267257X.1995.9964356

Buchanan, R. (2015). Worlds in the making: Design, management, and the reform of organizational culture. The Journal of Design, Economics, and Innovation, 1(1), 5-21. https://doi.org/10.1016/j.sheji.2015.09.003

Centre for Design Innovation Ireland. (2007). Design difference - Design innovation research. Retrieved from: www.designinnovation.ie/downloads/ResearchMethodology.pdf.

Chandler Jr., Alfred D. (1991). The functions of the HQ unit in the multibusiness firm. Strategic Management Journal, 12(52), 31-50. https://doi.org/10.1002/smj.4250121004

Chitturi, R., Raghunattan, R., & Mahajan, V. (2008). Delight by design: The role of hedonic vs. utilitarian benefits. Journal of Marketing,72(3), 48-63. https://doi.org/10.1509/JMKG.72.3.048

Coley, L. S., Mentzer, J. T., & Coope, M. (2010). Is consumer orientation a dimension of market orientation in consumer markets? Journal of Market Theory and Practice, 18(2), 141-154. https://doi.org/10.2753/MTP1069-6679180203

Design Council. (2015). Innovation by design: How design enables science and technology research to achieve greater impact. Retrieved from: https://www.designcouncil.org.uk/resources/report/innovation-design.

Design Council. (2018). The design economy 2018: The state of design in the UK. Retrieved from: https://www.designcouncil.org.uk/resources/report/design-economy-2018.

Deshpande, R., & Farley, J. (1998). Measuring market orientation: Generalization and synthesis. Journal of Market-Focused Management, 2(3), 213-232. https://doi.org/10.1023/A:1009719615327

Design Management Institute. (2015). Design Value Index results and commentary. Retrieved from: https://www.dmi.org/page/2015DVI-andOTW.

European Commission. (2013). Implementing an action plan for design driven innovation. EC Commission staff working document, SWD (2013) 380 final, Brussels.

Gemser, G., & Leenders, MAAM. (2001). How integrating industrial design in the product development process impacts on company performance. The Journal of Product Innovation Management, 18(1), 28-38. https://doi.org/10.1111/1540-5885.1810028

Gorb, P. (1990). Design management: Papers from the London Business School. London, Phaidon Press.

Grinstein, A. (2008) The relationships between market orientation and alternative strategic orientations: A meta-analysis. European Journal of Marketing, 42(1/2), 115-134. https://doi.org/10.1108/03090560810840934

Gumesson, E. (1991). Marketing orientation revisited: The crucial role of the part-time marketer. European Journal of Marketing, 25(2), 60-75. https://doi.org/10.1108/03090569110139166

Han, S. H., Yun, M. H., Kim, K., & Cho, S. (1998). Development of a usability evaluation method. Technical Report (97-G-17-01-A-15). Ministry of Science and Technology of South Korea.

Hertenstein, J., Platt, M., & Veryzer, R. W. (2005). The impact of industrial design effectiveness on corporate financial performance. The Journal of Product Innovation Management, 22(1), 3-21. https://doi.org/10.1111/j.0737-6782.2005.00100.x

Homburg, C. & Pflesser, C. (2000). A multiple-layer model of market-oriented organizational culture: measurement issues and performance outcomes. Journal of Marketing Research, 37(4), 449-462. https://doi.org/10.1509/jmkr.37.4.449.18786

Jaworski, B. J, & Kohli, A. K. (1993). Market orientation: antecedents and consequences. Journal of Marketing, 57(3), 53-70. https://doi.org/10.1177/002224299305700304

Kahn, K. B. (2001). Market orientation, interdepartmental integration, and product development performance. Journal of Product Innovation Management, 18(5), 314-323. https://doi.org/10.1111/1540-5885.1850314

Kohli, A., Jaworski, B., Kumar, A. (1990). Market orientation: The construct, research propositions and managerial implementations. Journal of Marketing, 54(2), 1-18. https://doi.org/10.1177/002224299005400201

Kohli, A., Jaworski, B., Kumar, A. (1993). MARKOR: A measure of market orientation. Journal of Market Research, 30(4), 467-477. https://doi.org/10.1177/002224379303000406

Jaworski, B., Kohli, A. & Sahay, A. (2000). Market driven versus driving markets. Journal of the Academy of Marketing Science, 28(1), 45–54. https://doi.org/10.1177/0092070300281005

Kootstra, G. L. (2009). The incorporation of design management in today’s business practices: An analysis of design management practices in Europe. DME Survey, Inholland.

Marketing Department of the Faculty of Economics and Business and Marketing Institute. (2008). Marketing in the 21st century/Marketing v 21. stoletju. Maribor, University of Maribor.

Milfelner, B. (2009). The role of proactive and responsive market orientation in the development of a firm’s innovation resources. Naše gospodarstvo/Our economy, 55(1/2), 51-58.

Moll, I., Montana, J., Guzman, F., & Praallada, F. S. (2007). Market orientation and design orientation: A management model. Journal of Marketing Management, 23(9), 861-876. https://doi.org/10.1362/026725707X250368

Morgan, N. A., Vorhies, D. W., & Mason C. H. (2009). Market orientation, marketing capabilities, and firm performance. Strategic Management Journal, 30(8), 909-920. https://doi.org/10.1002/smj.764

Narver, J., & Slater, S. (1990). The effect of a market orientation on business profitability. Journal of Marketing, 54(4), 20-35. Doi: https://doi.org/10.2307/1251757

Narver, J. C., Slater, F. S., & MacLachlan, D. L. (2004). Responsive and proactive market orientation and new-product success. The Journal of Product Innovation Management, 21(5), 334-347. https://doi.org/10.1111/j.0737-6782.2004.00086.x

Nunnally, J. C. (1978). Psychometric theory (2nd ed.). New York, NY: McGraw-Hill. Rae, J. (2013). What is the real value of design? DMI Review, 24(4), 30-37.

Rae, J. (2015). The power & value of design continues to grow across the S&P 500. DMI Review, 27(4), 4-11.

Rau C., Zbiek, A., & Jonas J., M. (2017). Creating competitive advantage from services. Research-Technology Management, 60(3), 48-56. https://doi.org/10.1080/08956308.2017.1301003

Sarstedt M., Ringle, C. M., & Hair, J. F. (2017). Partial Least Squares Structural Equation Modeling. In C. Homburg et al. (eds), Handbook of Market Research (3rd ed.). https://doi.org/10.1007/978-3-319-05542-8_15-1

Sisodia, R. S. (1992). Competitive advantage through design. Journal of Business Strategy, 13(6), 33-40. https://doi.org/10.1108/eb039525

Slater F. S., & Narver, J. C. (2000). The positive effect of a market orientation on business profitability: A balanced replication. Journal of Business Research, 48(1), 69–73. https://doi.org/10.1016/S0148-2963(98)00077-0

Snoj, B., Milfelner, B., &Gabrijan, V. (2007). An examination of the relationships among market orientation, innovation resources, reputational resources, and company performance in the transitional economy of Slovenia. Canadian Journal of Administrative Sciences, 24(3), 151–164. DOI: https://doi.org/10.1002/cjas.22

Srinivasan, R., Lilien, G. L., & Rangaswami, A. (2006). The emergence of dominant designs. Journal of Marketing, 70(2), 1-17. https://doi.org/10.1509/jmkg.70.2.001

Teece, D. J., Pisano, G., & Shuen A. (1997). Dynamic capabilities and strategic management. Strategic Management Journal, 18(7), 509-535. https://doi.org/10.1002/(SICI)1097-0266(199708)18:7<509::AID-SMJ882>3.0.CO;2-Z

Trinchera, L., Russolillo, G., & Lauro, C. N. (2008). Using categorical variables in PLS path modelling to build system of composite indicators. Statistica Applicata, 20(3-4), 309-330.

Tsai, K., Chou, C., & Kuo, J. (2008). The curvilinear relationships between responsive and proactive market orientations and new product performance: a contingent link. Industrial Marketing Management, 37(8), 884-894. https://doi.org/10.1016/j.indmarman.2007.03.005

Ulrich, K. T., & Eppinger, S. D. (2003). Product design and development. New York, NY: McGrawHill/Irwin.

Venkatesh, A., Digerfeldt-Månsson, T., Brunel, F. F., & Chen, S. (2012). Design orientation: A grounded theory analysis of design thinking and action. Marketing Theory, 12(3), 289-309. https://doi.org/10.1177/1470593112451388

Veryzer, R. W., & Borja de Mozota, B. (2005). The impact of user-oriented design on new product development: An examination of fundamentals relationship. Journal of Product Innovation Management, 22(2), 128-143. https://doi.org/10.1111/j.0737-6782.2005.00110.x

Von Stamm, B. (2003). Managing innovation, design and creativity. London, England: John Wiley & Sons Ltd.

Voola, R., & O’Cass, A. (2010). Implementing competitive strategies: The role of responsive and proactive market orientations. European Journal of Marketing, 44(1/2), 245-266. https://doi.org/10.1108/03090561011008691

Published
2019-01-18
How to Cite
Rocco S., & Selinšek A. (2019). The Structure of Design Orientation and its Relationship with Market Orientation. Naše gospodarstvo/Our Economy, 65(3), 50-62. Retrieved from https://journals.um.si/index.php/oe/article/view/2154