Professor AdrĂŠ N. Schreuder and Mariaan Gouws adre@consulta.co.za
MARKOR-SA: A MULTIPLE ITEM SCALE FOR THE MEASUREMENT OF MARKET ORIENTATION Whitepaper format Originally Written: May 1994 Submitted for review: Oct 1994 Paper delivered at SAIMS Conference Western Cape
This article describes the development and application of a 32-item measurement instrument (MARKOR-SA) used to conceptualize and evaluate market orientation (to be differentiated from the Kohli-Jaworski MARKOR instrument). The methodology in the development of the MARKOR-SA instrument is discussed. Findings and conclusions regarding the reliability and factor structure will be reviewed. The article closes with a brief discussion of the composition and application of the MARKOR-SA instrument and the implications posited for future research.
A
LTHOUGH the literature provides ample evidence for stating the marketing concept as the corner stone of the marketing discipline, and for the application thereof to a market orientation, little attention has been given to the measurement and implementation of market orientation. This notion is supported by the
recent prominent work in this area by Kohli & Jaworski (1990), Narver & Slater (1990) and Jaworski & Kohli (1993). The most recent article of Jaworski & Kohli (1993) was in fact published in the midst of this research. Their breakthrough article provided valuable insight into the antecedents and consequences of market orientation. The present article provides a different perspective to this interesting development in the marketing science, in the sense that it concentrates on the measurement and quantification of market orientation as a diagnostic management tool. We acknowledge the three-component conceptualization of market orientation (Jaworski & Kohli 1993) and offer a divergent perspective of our own three-component model conceptualized in the MARKOR-SA instrument.
The absence of a constructive diagnostic tool for the measurement of market orientation has been the primary reason for the inability of companies to measure the extent of market orientation achieved. A distinct need for more information on the application of the marketing concept and the real meaning of market orientation
MARKOR-SA : A Multiple item scale / 1
triggered the interest for this study. The development of the MARKOR-SA instrument was further motivated by the research of Narver & Slater (1990) and the earlier work of Kohli & Jaworski (1990).
With the prominence given to the importance of market orientation, the objective of this study is to provide new insight into the term “market orientation� and to conceptualize and derive at a reliable and valid measurement of market orientation. In the review of the concept of market orientation, new relationships between the characteristics of market orientation were investigated to be considered for inclusion into a practical model for the measurement of market orientation. All irrelevant characteristics of market orientated organizations were ignored in order to focus entirely on the most common and critical characteristics. The MARKOR-SA instrument finally suggests new perspectives for research in view of the strong evidence of new relations and dimensions.
METHODOLOGY FOR THE DEVELOPMENT OF THE MARKOR-SA INSTRUMENT The methodological foundation of this research was taken from a similar development of a multiple item scale for the measurement of service quality. (Parasuraman, Zeithaml and Berry 1988), as well as the development steps proposed in the works of Churchill (1979), Tull & Hawkins (1993) and Malhotra (1993).
The instrument was developed through the following two methodological procedures: (1)
A comprehensive review of a wide selection of secondary information sources, with a view to developing a conceptual framework of market orientation.
(2)
An exploratory investigation to generate and refine the different dimensions and variables of market orientation.
The dimensions and variables were generated from a managerial point of view.
This
entailed the scanning of available secondary sources and the use of focus group interviews with marketing organizations in the PWV-region of South Africa.
The steps used in the development of the MARKOR-SA instrument are illustrated in Figure 1 and discussed below.
Step 1 Conceptualization of market orientation During this step the concept of market orientation was investigated by means of a comprehensive literature search. The conceptual framework for the initial development of the MARKOR-SA instrument was derived from the different conceptualizations used in Kohli & Jaworski (1990), Narver & Slater (1990), Webster (1988), Trustrum (1989), McKenna (1991), Shapiro (1988), Payne (1988) and Kotler (1977). The literature review clearly showed that market orientation is much more than the mere acceptance of the marketing concept as a management philosophy.
Market orientation, as seen by most scholars, includes the acceptance of a
management philosophy that places customer satisfaction central to all management thinking throughout the
MARKOR-SA : A Multiple item scale / 2
organization. It is a disposition that starts with top management and
FIGURE 1 A SUMMARY OF THE STEPS IN THE DEVELOPMENT OF THE MARKOR-SA INSTRUMENT STEP 1: CONCEPTUALIZATION OF MARKET ORIENTATION
Literature review of the nature and meaning of market orientation
STEP 2: IDENTIFICATION OF DIMENSIONS OF MARKET ORIENTATION
Exploratory investigation with the aid of secondary information sources and focus groups to identify potential dimensions of market orientation
STEP 3: GENERATE THE VARIABLES THAT REPRESENT EACH DIMENSION Generate a pool of items for the measurement instrument by the collection of variables (statements) that represent each dimension (Using secondary sources & focus groups)
STEP 4: REDUCE AND REFINE THE VARIABLES Reduce the variables in each dimension through the Q-sort technique and qualitative judgment
STEP 5: DESIGN MEASUREMENT INSTRUMENT Use the dimensions and reduced variables in a data collection instrument (structured questionnaire)
STEP 6: COLLECT THE DATA Use Useaastructured structuredquestionnaire questionnairetotomeasure measurethe theattitudes attitudesofof200 200respondents respondentsregarding the importance of dimensions and variables ofvariables market orientation regarding the importance of dimensions and of market orientation
STEP 7: REFINE THE MEASUREMENT INSTRUMENT Refine the measurement scale through the following repetitive process: Calculate the Cronbach alpha and item-to-total correlation of each dimension Eliminate variables with a low item-to-total correlation that will increase the value of the Cronbach Alpha Do a principle component factor analysis to verify the dimensionality of the scale Re-evaluate each variable and restructure the dimensions
STEP 8: FINALIZE THE MEASUREMENT INSTRUMENT Structure Structure the the final final measurement measurement instrument instrument -- allocate allocate weights weights to to dimensions dimensions en anddecide decideononmoderating and or classification variables to be included moderating and/or classification variables to be included
MARKOR-SA : A Multiple item scale / 3
which represents a way of business and general thinking that embraces all the functions within the company. Consequently the objective of achieving true market orientation is everyone’s responsibility.
The literature review on its own was not sufficient to derive a conceptual framework for the study of market orientation and more research was needed. Primary data regarding the concept of market orientation from a managerial point of view was therefore sought. This additional need for information was addressed in step 2 of the process.
Step 2 Identification of the dimensions of market orientation The different dimensions of market orientation were collected from the general body of available literature and through focus groups with marketing managers and marketing academics... The sample for the focus groups was drawn from marketing specialists and academics from the Technikon SA, Rand Afrikaans University en Senior Master of Business Management students of the latter institution.
All participants in the focus groups were selected purely on researcher judgment with reference to respective expertise and experience in the marketing practice. The primary aim of the focus group interviews was to generate additional ideas and expectations regarding the ideal level and substance of market orientation in companies in general. The focus groups also helped in identifying additional dimensions of market orientation not previously included in the present conceptualization of market orientation. The topics of discussion in the focus groups were, for example, the meaning of market orientation, critical characteristics of market orientation and profiling of an ideal market orientated organization. Two focus groups were used to reach satisfactory answers to some of the research questions.
Although considerable insight and ideas could be gathered from the available literature and focus groups, several important issues were still unresolved and acted as continuous stimulation of research thinking. The theoretical concepts and terms of market orientation and the views of marketing specialists and academics from the focus groups were then integrated into the following 15 preliminary dimensions:
1.
Managerial efficiency and style
2.
Organizational culture and climate
3.
The marketing mix
4.
Goal orientation
5.
Quality service delivery
6.
Management philosophy
MARKOR-SA : A Multiple item scale / 4
7.
Marketing research orientation
8.
Competitive advantage
9.
Business systems
10.
Employee training and orientation
11.
Strategic orientation
12.
Community / environmental orientation
13.
System orientation
14.
The role and commitment of top management
15.
Customer orientation
Step 3 Generate the variables that represent each dimension During this phase of the research variables or statements were collected that could represent the 15 preliminary dimensions of market orientation. The general point of view followed in this instance was to ensure an aggregate of all previous work on different aspects of market orientation and hence no variable or statement was excluded. The variables were collected from the relevant literature and the feedback from the two focus groups. The total item pool represented a comprehensive collection of variables obtained from the current understanding of market orientation.
Due to the aggregation philosophy of this stage of the research a total of 304 variables was included in the item pool. The number of variables was obviously too cumbersome and impractical to be used in a measurement instrument. An elimination process or refinement was needed to identify the most important variables, while still adhering to the requirement of content validity.
Step 4 Elimination and refinement of variables A comparative rating scale - the Q-sort scale - was used in the first round of elimination of variables. The refinement of variables with the Q-sort scale involved the judgmental comparative sorting of variables by expert opinion. A group of marketing experts (both practitioners and academics) had to sort a set of variables in order of importance.
Each set of variables constituted the pool of variables included in one or two dimensions
selected from the 15 preliminary dimensions. The wording of each variable was printed on separate sorting cards and respondents thus received a set of variables as a set of sorting cards. Respondents were then briefed to consider each sorting card (variable) on individual merit as well as its relative importance before placing the sorting card in one of five envelopes. The five envelopes represented a 5-point importance scale where the different envelopes were identified as follows: Envelope 1:
Extremely important
Envelope 2:
Very Important
MARKOR-SA : A Multiple item scale / 5
Envelope 3:
Neither important, nor unimportant
Envelope 4:
Not that important
Envelope 5:
Not important at all
The sample of experts was composed of five respondents from the Department of Marketing at the Technikon SA, five respondents of the Department of Marketing from the University of Pretoria and five respondents of the Graduate School of Business at the same institution.
Next, only those variables that were sorted in either the envelope marked as “Extremely important” or “Very important” were included for further analysis. This approach resulted in the elimination of 157 variables or statements and 147 statements thus remained in the item pool for further judgmental analysis by the researchers. The qualitative judgment involved the integration of similar or overlapping statements in different dimensions and those statements with more or less similar wording were consequently combined and reformulated. The total refinement process resulted in 120 remaining variables to be included into the next phase of instrument development.
Step 5 Development of the measurement instrument The 120 remaining variables representing the 15 dimensions were then used to design a structured questionnaire to determine the importance of the dimensions and representing variables.
The primary objective of the
questionnaire was to verify the different variables in view of the respondents' attitude towards market orientation. The basic philosophy of the empirical stage of the research was to establish the expectations of the respondents regarding the characteristics of an ideal market orientated organization. It followed the argument that the high expectations regarding market orientation would also constitute the most important characteristics of an ideal level of market orientation.
The questionnaire construction allowed for three sections. In Section a respondents were asked to indicate their view of the importance of each of the 120 variables identified in the previous stage of the research. A seven point Likert-type scale was used to test respondents' importance rating of an ideal market orientated company. Section A was also regarded as the focus of the questionnaire and therefore had to comply with all the methodological requirements of sound measurement. Accordingly, two aspects of Section A needed specific attention before the field survey could commence.
In the first place the researchers were of the opinion that respondents would find it difficult to discriminate on a balanced Likert-scale ranging from “Not important at all” to “Extremely important”.
This argument was
supported by the fact that all of the variables included in the pool of 120, were already rated as the most
MARKOR-SA : A Multiple item scale / 6
important statements of market orientation. During the pre-test phase of the research, a split ballot approach was used to test this notion that respondents would struggle to substantially discriminate between the degrees of importance of the respective variables. One half of the pre-test respondents received a questionnaire with the normal balanced importance scale and the other half received a questionnaire with an adjusted importance scale. The adjusted importance scale was still of a seven point scale-type, but the balance of the scale structure was changed to only include the positive response categories. In this version of the scale a number 1 represented “Important” and 7 represented “Extremely Important”.
As was expected the pre-test clearly indicated a
substantially better discrimination between response categories of the adjusted unbalanced importance scale compared to the balanced importance scale.
The second important aspect of Section A involved the potential problem of respondent fatigue, especially since 120 variables had to be rated. To address this problem an overlap technique was used where four sets of 30 statements, representative of all dimensions, were overlapped in two sets of 60 statements each. In this way Section A was reduced to 60 statements. The overlapping pattern was designed to ensure an equal distribution of statements from all of the dimensions. This unfortunately required a doubling of the initially planned sample size to ensure that an equal number of respondents rated all of the statements
The final design consideration relevant to Section A, dealt with statement wording. All statements were worded positively, based on the arguments used in the approach of Parasuraman, Zeithaml & Berry (Zeithaml et al., 1990:181-183). Respondents were nevertheless reminded not to respond uniformly to all statements and to consider each statement on its individual merit for an ideal level of market orientation.
Section B of the questionnaire consisted of annotated descriptions of the 15 dimensions, where respondents had to rate the relative importance of each dimension. The methodological constraint of a large number of criteria in a constant sum scale, led the researchers to use some other form of comparative rating. Respondents were thus asked to evaluate each dimension on its individual content and allocate a mark out of 100 to describe its importance in an ideal market orientated organization.
The findings from Section B of the questionnaire showed the mean importance of the 15 preliminary dimensions to range between 76.75% and 90.63%, clearly illustrating the high importance ascribed to each of the dimensions. It was notable that respondents regarded customer orientation as the most important dimension in the measurement of market orientation (mean relative importance rating of 7.14%). This finding is consistent with the opinion found in the literature. Market orientated organizations should take note of the message that all decisions and activities in a corporation should be focused on the satisfaction of customer needs and wants.
MARKOR-SA : A Multiple item scale / 7
Other dimensions that showed a high relative importance were quality service and the role and commitment of top management with relative importance ratings of 7.03% and 7.09% respectively. Community orientation was found to have the lowest relative importance, namely 6.23%. This finding was contrary to Kotler’s (1972:48) much wider view of marketing and his argument for extending the previously established three-dimensional view of the marketing concept to include community orientation as a fourth dimension. As this research did not focus explicitly on the inclusion or exclusion of dimensions in the understanding of the marketing concept, it is suggested as an interesting topic for future research.
Section C of the questionnaire included classification data used for cross tabulation purposes. Respondents were asked to rate the overall level of market orientation achieved in their companies on a five point scale ranging from “Not at all” to “Extremely good”. The classification section also included the type of industry of each respondent, their managerial position and span of control.
The findings for Section C showed that the sample included in the research mainly comprised of marketing managers in manufacturing, finance, insurance, property and business services. The average organization has fewer than 5 000 employees and respondents have at least five people in their immediate span of control. Although the sampling frame was not specifically designed to be representative of the total business population of South Africa, it was sufficiently representative for the purpose of this research and had, according to their managerial position, sufficient knowledge and experience of market orientation. It is thus concluded that the respondents who participated in the study, could make a positive contribution to the development of the MARKOR-SA instrument.
Step 6 Collection of data A survey was conducted to collect data from a sample of 200 respondents regarding their attitudes of the importance of the different variables and dimensions of market orientation. A “drop-off” variation of the postal survey was used, in the sense that questionnaire were personally delivered to the different organisations included in the sample. The "drop-off"-questionnaires were then distributed to the various respondents by a designated contact person in each organization.
This method of data collection was preferred to the normal postal
questionnaire, due to the particularly long and complex nature of the questionnaire. The “drop-off” method was also favoured for its lower cost and higher response rate (Lovelock et al., 1976:358).
The sampling procedure used for the research was a judgmental sampling strategy. A group of individuals on managerial level was selected as sampling frame. Managers from the marketing, finance, research, customer care, production, purchasing, human resources, administration and strategic divisions were selected to express their expectations regarding an excellent market orientated organization.
MARKOR-SA : A Multiple item scale / 8
The sampling size was determined purely on the researchers’ judgement and did not attempt to represent the total business population, as the research objective specifically stated the nature of this research to be exploratory. The sample size thus included 50 companies from the PWV-region of South Africa, where four respondents from each company had to complete one questionnaire (a total sample size of 200 questionnaires). Of the 200 questionnaires distributed with the “drop-off” method, 174 usable questionnaires were returned, which constituted a satisfactory response rate of 87%.
Step 7 Refinement of the measurement instrument The purpose of this phase in the development was to refine the measurement instrument by the reduction of scale variables and restructuring of dimensions. Scale refinement involves the elimination of those variables that do not correlate with the total rating of the dimension with which they are associated (Tull & Hawkins, 1993:321). Two well-known techniques for scale purification, namely coefficient alpha (Cronbach Alpha) and factor analysis, were used as analysis tools for this phase of the research.
Coefficient alpha was calculated to determine the internal consistency of each set of variables that represented a dimension and the overall reliability of the measurement instrument.
According to Churchill (1992:390),
coefficient alpha is a good indication of the inter correlation that exists in a set of variables. If the value of coefficient alpha for a particular dimension is low, it implies that certain variables in the dimension do not share the common interest and should thus be considered for exclusion. The criteria used to determine whether a variable should be eliminated, were similar to the suggestion of Churchill, namely the item-to-total correlation of each variable. All those variables with a low item-to-total correlation of which the elimination would increase the coefficient alpha value, were thus eliminated.
Due to the multi-dimensionality of the MARKOR-SA
instrument, the value of coefficient alpha for each dimension was calculated separately. The coefficient alpha value of the total instrument was also calculated, as all variables in the instrument are supposed to measure the same construct, namely market orientation.
With the first round of calculation of coefficient alpha values for each dimension, the values ranged between 0.306 and 0.882. Although this finding represented a satisfactory result, it was obvious that certain variables could still be eliminated to increase the respective alpha values.
All variables of each dimension were
consequently evaluated for possible improvement of alpha dimension values and low item-to-total correlation. In some “border line” cases, where an improvement in the alpha dimension value was not very clear, variables were not entirely eliminated, but combined with other variables. This process of elimination was repeated until a satisfactory coefficient alpha value was reached. The work of Churchill (1979:69) supports the theoretical arguments in favour of a repetitive process for the calculation of coefficient alpha values. It follows a procedure
MARKOR-SA : A Multiple item scale / 9
where variables with low item-to-total correlation are eliminated and the subsequent calculation of another round of alpha values until a satisfactory coefficient alpha value is reached.
The elimination process as
performed by the repetitive calculation of coefficient alpha values, caused a number of dimensions to be eliminated completely and the number of variables to be reduced to 60. The coefficient alpha values for the remaining dimensions (eight) now ranged between 0.727 and 0.911. The remaining dimensions were: Dimension 1: Managerial efficiency and style Dimension 2: The marketing mix Dimension 3: Quality service Dimension 4: Management philosophy Dimension 5: Organizational systems Dimension 6: Employee training and orientation Dimension 7: Strategic orientation Dimension 8: Customer orientation
The coefficient alpha values of the remaining dimensions were provisionally accepted as satisfactory until the final results from the following phase of the scale purification process were known.
Churchill (1979:69) suggests that, after satisfactory coefficient alpha-values have been obtained for all the dimensions in an instrument, factor analysis can be used to determine whether the number of dimensions can be empirically verified. Factor analysis is used to investigate the underlying pattern or relationship between a large number of variables to group the variables into a smaller number of factors of related variables (Hair et al., 1992:223).
In this study, factor analysis was used to determine the dimensionality of the hypothesized
dimensions in the proposed MARKOR-SA instrument. The factor analysis has therefore been instrumental in the re-evaluation of the variables and the restructuring of the original dimensions without losing any valuable data.
For the purposes of this research, the factor analysis was done from an exploratory view, without having any preconceived ideas of the final structure of the data. The specific type of factor analysis employed was the Rtype principal component analysis with an oblique rotation. Initial experimentation was done with the different rotation options of the oblique convention (Normalized Quartimax, Varimax and Equimax) and based on the most significant factor solution, VARIMAX rotation was used. VARIMAX-rotation focuses on the optimization of columns of data in the factor matrix and due to the seven point rating scale employed, the column wise rotation proved to be the best factor solution (Hair et al.., 1992:235).
A relatively high factor loading of 0.60 was used as criterion for inclusion of variables into the final factor solution. The factor analysis and VARIMAX rotation was repeated three times, each time eliminating variables
MARKOR-SA : A Multiple item scale / 10
with factor loadings less than 0.60 or low communalities. The repetitive factor analysis resulted in a final factor solution of 32 variables, loading significantly on three distinct factors. The closing phase of the scale purification process involved the calculation of coefficient alpha values and item-to-total correlation for each of the three factors derived from the final factor solution.
When interpreting the results of the final alpha calculation, being at its lowest with a value of 0.886 and with the highest value at 0.948, the results can be described as exceptional. The 32 final variables representing three factors were consequently structured as the MARKOR measurement instrument with three distinct dimensions.
CONCLUSIONS AND FINDINGS REGARDING THE RELIABILITY AND FACTOR STRUCTURE OF THE MARKOR-SA INSTRUMENT The central finding of this paper is the operationalization of a 32-item scale construct with three dimensions as measurement instrument for market orientation. Dimension 1 is represented by 16 variables, dimension 2 by 10 variables and dimension 3 by the six remaining variables of the instrument. A summary of the statistical results of the scale purification of the MARKOR-SA instrument is presented in Table 1 below and clearly shows the high level of internal consistency and reliability of the instrument.
The high coefficient alpha values of the three dimensions show that the instrument can be regarded as having a satisfactory high internal consistency between the different variables. The table also shows high item-to-total correlation of the variables, which can be interpreted as the extent to which the variables share a common underlying interest within each dimension.
The overall coefficient alpha value for the 32-item MARKOR-SA instrument is 0.95 and thus shows substantial proof that the three dimensions represent a reliable measure of market orientation. The reliability of the MARKOR-SA instrument is further illustrated by the high factor loadings of the different variables represented in each dimension. In view of these high factor loadings, the conclusion can be made that the variables are closely related in respect of the underlying factor structure of each dimension.
MARKOR-SA : A Multiple item scale / 11
Table 1 Summary of statistical results of the MARKOR-SA instrument
Factor(Dimension)
Coefficient alpha values
Number of variables each factor
1
0.948
16
2
0.939
10.000
3
0.886
6.000
Item-to-total correlation
Factor loadings
0.598 0.726 0.781 0.593 0.746 0.819 0.748 0.664 0.706 0.717 0.665 0.754 0.741 0.794 0.641 0.738 0.748 0.722 0.739 0.808 0.766 0.711 0.803 0.743 0.763 0.722 0.643 0.645 0.756 0.678 0.784 0.703
0.696 0.763 0.690 0.766 0.780 0.755 0.734 0.803 0.670 0.724 0.821 0.696 0.680 0.733 0.701 0.683 -0.768 -0.716 -0.773 -0.738 -0.751 -0.728 -0.728 -0.789 -0.844 -0.805 0.597 0.704 0.699 0.712 0.772 0.648
Eigen values of factors
Cumulative variance
12.76
0.81
5.381
0.951
1.729
0.966
Another indication of the high reliability of the MARKOR-SA instrument is the high percentage of cumulative variance explained by the three dimensions. The cumulative variance explained by the three dimensions is in excess of 95% (96.59%), which can be regarded as substantial proof of high measurement reliability.
The
MARKOR-SA instrument can consequently be regarded as a reliable scale construct for the measurement of market orientation.
The summary of statistical results in Table 1 also reveals a strong correlation between the variables that represented the three identified dimensions of market orientation. In conclusion of the statistical results, the
MARKOR-SA : A Multiple item scale / 12
researchers regarded the factor solution as satisfactory and could thus attach significant meaning to each dimension.
The three dimensions of market orientation included in the final MARKOR-SA instrument were then closely evaluated for underlying meaning and appropriate naming of each dimension. The dimensions were named and described as follows:
Dimension 1:
Customer orientation
The optimal satisfaction of customer needs and expectations is the driving force of the market orientated company, according to which the organization is managed, decisions are taken, products and services are designed, the mission, objectives and strategy are developed and the activities of employees are directed.
Dimension 2:
Organizational systems and strategy
This dimension represents the planned integration of systems and methods for continuous collection, filtration, analysis, storage and dissemination of relevant information.
Relevant information should include customer
needs, marketing opportunities and threats, marketing activities, marketing plans, and marketing performance. All the information should be integrated into the formulation of corporate mission and strategy.
Dimension 3:
Employee commitment
Dimension 3 comprises the dexterity, skill and commitment of all employees (including management) of an organization regarding optimal customer orientation and service quality.
A description of the 32 items of the MARKOR-SA instrument grouped into the three dimensions of market orientation, is as follows:
DIMENSION 1: CUSTOMER ORIENTATION 1.
The managers of XYZ Company have a service orientated leadership style that is focused on customer satisfaction.
2.
Managers of XYZ Company have the ability reach meaningful decisions based on available market information.
3.
XYZ Company continuously develops and adjusts its existing market offer to keep in pace with the changes in customer needs and preferences.
4.
XYZ Company has a clearly defined driving force to determine which market offer should be implemented and to whom.
MARKOR-SA : A Multiple item scale / 13
5.
The elements of the marketing mix (product, price, place and promotion) of XYZ Company support and enhance each other to ensure that customers readily prefer its market offer as opposed to its competitors.
6.
The employees at XYZ Company that deal directly with customers, have the skills and knowledge to deliver excellent service - they are able to identify and solve customer problems in a courteous, dignified, friendly and supportive manner.
7.
XYZ Company continuously strives for excellence in customer satisfaction (delight) to be better than other organizations.
8.
XYZ Company gives recognition to and awards employees based on achievement and meeting of objectives regarding customer satisfaction.
9.
All employees of XYZ Company accept customer orientation as an integral part of the corporate culture.
10.
Employees at XYZ Company do not regard a customer with a problem as a burden, but as a source of information.
11.
XYZ Company regards customer issues as of decisive importance in the formulation of a mission, strategy and objectives.
12.
XYZ Company has contingency plans and can react fast and effectively to changes in the environment.
13.
XYZ Company takes the opportunities and threats in the marketing environment into consideration when developing marketing strategies and plans.
14.
XYZ Company regularly re-evaluates its market offer, markets and marketing performance.
15.
The marketing activities of XYZ Company focus on the long term satisfaction of customer needs and establishing long term relationships with stake holders.
16.
XYZ Company develops customized marketing strategies for different target markets.
DIMENSION 2: 17.
ORGANIZATIONAL SYSTEMS AND STRATEGY
The marketing communication strategy of XYZ Company conveys the need satisfying advantages and benefits of its market offer to the target market.
18.
XYZ Company has an information system for the collection of real customer needs and uses the market information as foundation for all organizational activities and decisions.
19.
The marketing manager of XYZ Company is included in the top management team that formulates the corporate mission, objectives and strategy according to customer needs.
20.
XYZ Company develops and implements its strategy, policy and plans according to the needs, forces and opportunities in the market.
21.
XYZ Company has a sense of entrepreneurship and dynamics - management and employees use a proactive, innovative and entrepreneurial approach to react to the trends and changes in the external environment.
MARKOR-SA : A Multiple item scale / 14
22.
XYZ Company achieves its competitive advantage by determining customer needs and by delivering its market offer more satisfactory, effective and efficient than competitors.
23.
XYZ Company determines both current and future customer needs.
24.
XYZ Company seeks opportunities to satisfy the unsatisfied needs of customers.
25.
XYZ Company uses research to determine who its customers are, what their needs are and how to satisfy them.
26.
XYZ Company recognizes quality service and optimal customer satisfaction as a prerequisite for profitability and long term growth.
DIMENSION 3: 27.
EMPLOYEE COMMITMENT
Employees at XYZ Company have sound business judgment - insight, instinct, sensitive understanding of human nature and the ability to take decisive marketing decisions.
28.
Employees at XYZ Company are intelligent and eager to learn - they have a constant desire to learn more about the needs and preferences of customers.
29.
XYZ Company continuously improves the quality and efficiency of its market offer and its service quality to provide better value to its customers.
30.
XYZ Company delivers fast and efficient service - appointments are kept, customers do not have to wait long for service and the market offer is delivered on time.
31.
XYZ Company has service orientated employees - all personnel are informed of customer issues and accept the responsibility to satisfy customer needs and expectations.
32.
The training programs at XYZ Company include the learning of skills and techniques of customer relations (e.g. telephone etiquette, handling of enquiries and sales techniques).
Although the high reliability and internal consistency were regarded as important conditions for the validity of the MARKOR-SA instrument, this does not provide sufficient proof of the overall measurement validity. When evaluating the MARKOR-SA instrument qualitatively, it does measure what it is supposed to measure.
The
variables of the three dimensions of the MARKOR-SA instrument compare positively with other attempts to evaluate market orientation (See checklists for market orientation in Thomas, 1989; Ames, 1970; Michaels, 1984 and Kotler, 1977). In the absence of statistical verification of validity, the researchers provisionally regard the MARKOR-SA instrument as a valid measurement instrument for the evaluation of market orientation.
THE COMPOSITION OF THE MARKOR-SA MEASUREMENT INSTRUMENT The MARKOR-SA instrument’s a basic framework consists of comprehensive perception statements for each of the three dimensions of market orientation. The following sections are identified in the model:
MARKOR-SA : A Multiple item scale / 15
Section A - comprises of 32 statements to measure respondents’ perception of their organizations’ market orientation on a balanced 10-point scale. Respondents’ perception and experience of the organization in which they are employed are thus measured. The balanced 10-point scale is marked according to the extent that a respondent agrees that the organization possesses the characteristic described in a statement. A 10-point scale was preferred for its ease of calculating the weighted model index score as a percentage. The weighted model index score is thus an indication of the organizations’ unweighted level of market orientation.
Section B - a constant sum scale where respondents have to indicate the relative importance of the three dimensions of market orientation. The marks allocated to each dimension should thus add up to 100.
Section C - represents the classification data and consists of data on the respondents’ demographic characteristics, managerial positions, span of control and general assessment of the market orientation of their organization. Valuable information could also be obtained when comparing the overall assessment of the market orientation with that of major competitors. The actual classification included in this section will be determined by the specific organization using the MARKOR-SA instrument.
THE APPLICATION OF THE MARKOR-SA INSTRUMENT The MARKOR-SA instrument can be used to evaluate the level of market orientation achieved within an organization, or to improve the understanding of the concept, identify problem areas in conflict with market orientation, and most important, to improve the general market orientation. A wide spectrum of business can use the MARKOR-model without fear of it being irrelevant to their specific situation, as the instrument provides for the generic application of market orientation within companies.
The framework also allows for contextual
changes in statements or for using examples to enhance variables, thus further improving the relevance and practicality of the instrument.
It is suggested that the MARKOR-SA instrument be administered to all management levels within the organization. Market orientation has in part been defined as a management philosophy and should thus be evaluated within the management ranks. The typical manager would also have first-hand knowledge and experience due to their respective management positions.
This would therefore qualify managers to indicate their perceptions and
experience regarding the market orientation of their company as conceptualized by the three-dimensional MARKOR-SA instrument.
According to Kohli & Jaworski (1990:7), Ames & Hlavacek (1989:179), Webster (1988:37), Shapiro (1988:123) and Thomas (1989:131), it seems that management commitment appears to be an essential criterion for market orientation. Consequently the perception of management will be extremely important in evaluating the market
MARKOR-SA : A Multiple item scale / 16
orientation of any organization. It has been shown that market orientation is not limited to the authority or responsibility of the marketing department, but should be extended to include managers from all levels, departments and divisions within the total organization.
The data obtained from the MARKOR-SA instrument have specific implication for management. In the first place the evaluative properties of MARKOR allow management to identify certain problem areas within the three dimensions of the model.
The MARKOR-SA instrument can secondly be used to classify managers into categories according to their individual market orientation index scores. Comparing the different categories of managers on aspects such as background, educational level, training and experience, the organization can identify possible areas of improvement or future training.
A third implication of the MARKOR-index scores for management is the comparison of different departments regarding their respective market orientation perceptions. This type of comparison can thus help in identifying problem departments, where increased motivation and training should be focused. In this respect, it is also possible to change the statements in the MARKOR-SA instrument to be more applicable to the different departments within the organization.
The MARKOR-SA instrument can be extremely valuable to periodically monitor the improvement of corporate culture and management philosophy with respect to market orientation. Valuable information could also be collected in administering the MARKOR-SA instrument to the ordinary employee in the company. This type of MARKOR analysis should not be used as an indication of the real level of market orientation, but rather to enhance the analysis done at management level. The employee perceptions of market orientation could provide the company with a good indication of the dissemination of management philosophy and consequently how to improve on the understanding of market orientation by contact personnel. During the employee assessment, all problems and suggestion for improvement should be analysed carefully for the development of a market orientated culture in the total organization. The objective of measuring and evaluating market orientation should be the pro-active identification of strengths and weaknesses regarding the organizations’ customer orientation, systems, strategy and employee commitment.
RESEARCH LIMITATIONS The following potential shortcomings of this study should be taken into consideration: 
A sample of 200 respondents was possibly too small for the development of a measurement instrument, especially if it is considered that a relationship of four to five times the number observations is needed for
MARKOR-SA : A Multiple item scale / 17
factor analysis. This relationship is, however, to some extent conservative relative to the relationship of three to one realized in the final number of variables included into the MARKOR-SA instrument.
Although a good coverage of business sectors was obtained with the sampling in this study, some sectors were under represented. These segments include agriculture, forestry, hunting & fisheries, mining, gas & water, construction, community services and social services. The researchers are however convinced that the universal application of the MARKOR-SA instrument would not be dramatically influenced by the exclusion of these diverse business sectors and will submit this notion for future research.
During the initial exploratory phases of the study, the focus groups and the Q-sort procedure an overall low level of consciousness of market orientation was encountered. A lack of knowledge and insight into the concept of market orientation could consequently be regarded as a major opportunity for the application of the MARKOR-SA instrument and various forms of future research on this topic.
IMPLICATIONS FOR FUTURE RESEARCH One of the objectives of this study was to submit priorities for future research regarding the understanding of the concept of market orientation. Although the potential for future research in terms of extension and application of the MARKOR-SA instrument is unlimited, we will suffice with the following suggestions:
The reliability, validity and universal acceptance of the MARKOR-measurement instrument should in the first place be further investigated and verified. The following specific aspects are appropriate:
Continuous research should be done to determine the consistency of results obtained with the MARKOR-SA instrument. Only repeated verification of the reliability and validity of the instrument would act as proof of its practicality as a measurement instrument for market orientation.
The initial item pools should be
administered to different survey populations, to determine whether the same observations are obtained.
The measurement instrument should be tested in more realistic and practical situations to verify the validity of the three dimensions and applicability to all business sectors of the economy.
Although the instrument development ensured the inclusion of most of the concepts and principles from the available literature on market orientation, further study is still needed to compare the MARKOR-SA instrument with other conceptual frameworks of market orientation. In this regard, the researchers will specifically look at the prominent work of Jaworski & Kohli (1993) in future research.
CLOSING COMMENTS The findings and conclusions from this study were in general satisfactory and the research objectives were attained in the culmination of a 32-item multiple scale construct for the measurement of market orientation. The
MARKOR-SA : A Multiple item scale / 18
multiple item scale conceptualized market orientation as a three-dimensional construct with the following dimensions:
customer orientation;
organizational systems and strategy, and
employee commitment.
The operationalization of the scale construct was successfully applied in a reliable and valid measurement of market orientation.
We conclude with the premise that market orientation is a customer orientated philosophy that forms an integral part of corporate culture and managerial philosophy. This can only be achieved with a customer focus, welldeveloped systems and strategies and the total commitment of all employees regarding the optimal customer satisfaction and service quality.
REFERENCES
AMES, B.C. (1970), "Trappings vs. Substance in Industrial Marketing", Harvard Business Review, (July-August), 93-102. AMES, B.C. & HLAVACEK, J.D (1989), Market Driven Management. Homewood, Illinois: Dow Jones-Irwin. CHURCHILL Jr., G.A.(1979), "A Paradigm for Developing Better Measures of Marketing Construct", Journal of Marketing Research, Vol. XVI, (February), 64-73. CHURCHILL, G.A (1992), 2nd Edition. Basic Marketing Research. Orlando: The Dryden Press. HAIR, J.F., ANDERSON, R.E., TATHAM, R.L. & BLACK, W.C. (1992). 3rd Edition. Multivariate Data Analysis. New York: Macmillan Publishing Company. JAWORSKI, B.J. & KOHLI, A.K. (1993), "Market Orientation:
Antecedents and Consequences",
Journal of
Marketing, Vol. 57, (July), 53-68. KOHLI, A.K. & JAWORSKI, B.J., (1990), "Market Orientation:
The Construct,
Research Propositions, and
Managerial Implications", Journal of Marketing, Vol. 54, (April), 1-18. KOTLER, P.(1972), "A Generic Concept of Marketing", Journal of Marketing, Vol. 36, (April), 46-54. (1972),
"What consumerism means for marketers",
Harvard Business Review,
(May-June),
48-57.
MARKOR-SA : A Multiple item scale / 19
(1977), "From Sales Obsession to Marketing Effectiveness",
Harvard Business Review,
(November-December), 67-75. LOVELOCK, C.H., STIFF, R., CULLWICK, D & KAUFMAN, I.M.(1976), "An Evaluation of the Effectiveness of Drop-Off Questionnaire Delivery", Journal of Marketing Research, Vol. XIII, (November), 358-364. MALHOTRA, N.K. (1993), Marketing Research: An Applied Orientation. New Jersey: Prentice-Hall, Inc. McCARTHY, E.J. & PERREAULT, W.D. (1993), Basic Marketing, 11th Edition, Homewood: Richard D. Irwin, Inc. McKENNA, R.(1991), "Marketing is Everything", Harvard Business Review, (January-February), 65-79. MICHAELS, E.G (1984), "Marketing Muscle", in Marketing Management and Strategy., P. Kotler & K.K. Cox, reds. Englewood Cliffs: Prentice-Hall, Inc, 21-36. NARVER, J.C. & SLATER, S.F.(1990), "The effect of a Market Orientation on Business Profitability", Journal of Marketing, Vol. 54, (October), 20-35. PARASURAMAN, A., ZEITHAML, V.A. & BERRY, L.L. (1988), "SERVQUAL: A Multiple-Item Scale for Measuring Consumer Perceptions of Service Quality", Journal of Retailing, Vol. 64, No. 1, (Spring), 12-40. PAYNE, A.F.(1988), "Developing a Marketing-oriented organization", Business Horizons, Vol. 31, (May-June), 46-53. SHAPIRO, B.P.(1988),
"What the Hell is Market oriented?",
Harvard Business Review, Vol. 66,
(November-December), 119-127. TRUSTRUM, L.B.(1989), "Marketing: Concept and Function", European Journal of Marketing, Vol. 23, 48-56. THOMAS, M.J. (1989), Marketing Handbook, 3rd Edition. Brookfield: Gower. TULL, D.S. & HAWKINS, D.I. (1993), Marketing Research: Measurement and Method, 5th Edition, New York: Macmillan Publishing Company. WEBSTER Jr., F.E. (1988), "The Rediscovery of the Marketing Concept", Business Horizons, Vol 31, (May-June), 29-39. ZEITHAML, V.A., PARASURAMAN, A. & BERRY, L.L. (1990), Delivering Quality Service. New York: The Free Press.
MARKOR-SA : A Multiple item scale / 20