Building the conceptual model of market-driving ability in corporate entrepreneurship

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INTRODUCTION

As pointed out by Morris, Kuratko and Covin (2008:4), in today’s business the external environment is constantly changing. New technologies are developed, regulations and laws change, and competition takes place on a global level. Organisations need to have strategies and practices in place to maintain a competitive advantage and achieve firm performance. ”The riskiest strategy of all is simply to pursue business as usual” (Morris et al., 2008:4). In pursuit of firm performance and staying ahead of the competition, various approaches have been outlined by both the marketing and entrepreneurship disciplines.
Starting in 1982, several researchers assessed the commonalities between the two fields of research and how each could benefit from the other. It has been found that both research disciplines share common constructs and concepts. Research at the interface of entrepreneurship and marketing has been termed “entrepreneurial marketing” (Collinson, 2002; Collinson & Shaw, 2001; Davis, Morris & Allen, 1991; Hills, 1994; Hills & LaForge, 1992; Hisrich, 1992). Although a common definition of entrepreneurial marketing has not been established so far, certain key aspects have been identified that bring together concepts of both disciplines (Schindehutte, Morris & Pitt, 2009:29).
Various dimensions of entrepreneurial marketing have been described: Within the field of entrepreneurial marketing, firms can take a market-driven or a market-driving approach. A market-driven approach relates to learning, understanding and responding to customer needs in an existing market (Schindehutte et al., 2009:37). Market driving, on the other hand, has been described as an approach that considers existing and new markets, tries to shape, change, or create the market and/or behaviour of all stakeholders involved (Barlow Hills & Sarin, 2003; Harris & Cai, 2002; Jaworski, Kohli & Sahay, 2000; Kumar, Scheer & Kotler, 2000; Schindehutte et al., 2009).
As will be outlined in chapter three in the literature review, several researchers have been concerned with describing the essential factors of market driving, as well as its antecedents and consequences. However, the construct of market driving is not well understood and requires further research, especially regarding the measurement of market driving, influencing factors on market-driving ability and outcomes of a market-driving approach (Barlow Hills & Sarin, 2001, 2003; Carrillat, Jaramillo & Locander, 2004; Ghauri, Tarnovskaya & Elg, 2008; Harris & Cai, 2002; Jaworski et al., 2000; Kumar et al., 2000; Schindehutte, Morris & Kocak, 2008).
The purpose of this study is to develop a measure for market driving and determine firm-internal factors that influence an organisation’s market-driving ability in the South African healthcare industry. This chapter provides an introduction to the research. It will briefly outline the literature review, the research problem, the purpose of the study, research objectives, hypotheses, research methodology and importance and benefits of the study. An outline of chapter two to seven of this study is presented. In this study it was found that various terms were used by different authors, such as business, firm, organisation or corporation.
These terms are used for businesses that follow a profit-seeking purpose. The study will also describe various constructs and concepts in the field of entrepreneurship and marketing. Diamantopoulos and Schlegelmilch (2000:21) describe a concept as an “… abstraction formed from observations from numerous particular happenings.” A construct refers to “… concepts that have been consciously and deliberately invented for particular scientific purposes.” It is further noted that “… the terms ‘concept’ and ‘construct’ are often used interchangeably”. Various authors cited in this study use the terms interchangeably. A clear distinction between the terms will be made for the development of the market-driving framework.

TABLE OF CONTENT :

• Page no
• Declaration of original work
• Acknowledgements
• Summary
• List of figures
• List of tables
• Chapter 1: Introduction and background to study
  • 1.1 Introduction
  • 1.2 Literature review
  • 1.2.1 Defining entrepreneurship, corporate entrepreneurship, marketing and entrepreneurial marketing
  • 1.2.2 Entrepreneurial marketing: entrepreneurial orientation and market orientation as the core elements
  • 1.2.3 Conceptual model of market-driving ability in corporate entrepreneurship
  • 1.2.4 Measuring instruments and statistical model of market-driving ability
  • 1.3 Research problem
  • 1.4 Purpose of the study
  • 1.5 Research objectives
  • 1.6 Hypotheses
  • 1.7 Research methodology
  • 1.7.1 Research design
  • 1.7.2 Sampling
  • 1.7.3 Data collection
  • 1.7.4 Data analysis
  • 1.8 Importance and benefits of the study
  • 1.9 Outline of the study
  • 1.10 Referencing technique
  • 1.11 Abbreviations
• Chapter 2: Entrepreneurial marketing
  • 2.1 Introduction
  • 2.2 Entrepreneurship and marketing: History and definition
  • 2.2.1 Entrepreneurship
  • 2.2.2. Corporate entrepreneurship
  • 2.2.3. Marketing
  • 2.2.4 Entrepreneurial marketing
  • 2.3. Entrepreneurial marketing: concepts and frameworks
  • 2.3.1 Entrepreneurial orientation
  • 2.3.1.1 Dimensions of entrepreneurial orientation
  • 2.3.1.2 Antecedents and consequences of an entrepreneurial orientation
  • 2.3.2 Corporate entrepreneurship
  • 2.3.2.1 Dimensions of corporate entrepreneurship
  • 2.3.2.2 Antecedents and consequences of corporate entrepreneurship
  • 2.3.3 Market orientation
  • 2.3.3.1 Dimensions of market orientation
  • 2.3.3.2 Antecedents and consequences of market orientation
  • 2.4 Conclusion
• Chapter 3: Entrepreneurship and marketing: Value creation as the link
  • 3.1 Introduction
  • 3.2 Market-driven versus market-driving behaviour
  • 3.3 Market-driving concepts and frameworks
  • 3.3.1 Firm-internal dynamics: radical innovation (Kumar, Scheer & Kotler, 2000)
  • 3.3.2 Firm-external dynamics: shaping market structure and behaviour (Jaworski, Kohli & Sahay, 2000)
  • 3.3.3 Four tenets of market driving (Harris and Cai, 2002)
  • 3.3.4 Combining firm-external and firm-internal dynamics (Barlow Hills & Sarin, 2001, 2003)
  • 3.3.5 Conceptual framework of market-driving strategy (Carrillat, Jaramillo & Locander, 2004)
  • 3.3.6 Developing supplier relationships to support market-driving strategy (Ghauri, Tarnovskaya & Elg, 2008)
  • 3.3.7 Integrative model of sustainable advantage (Schindehutte, Morris & Kocak, 2008)
  • 3.4 Summary of market-driving concepts and frameworks
  • 3.5 Defining market driving
  • 3.6 Suggestions for market-driving research
  • 3.7 Building the conceptual model of market-driving ability in corporate entrepreneurship
  • 3.7.1 Market-driving elements
  • 3.7.1.1 Market sensing
  • 3.7.1.2 Customer preferences
  • 3.7.1.3 Alliance formation
  • 3.7.2 Firm-internal factors influencing market-driving ability
  • 3.7.2.1 Corporate entrepreneurial management
  • 3.7.2.2 Entrepreneurial capital
  • 3.7.2.3 Strategic orientation
  • 3.7.2.4 Entrepreneurial behaviour
  • 3.7.3 Outcomes of market-driving ability
  • 3.7.3.1 Relative competitive strength
  • 3.7.3.2 Firm performance
  • 3.8 Conclusion
• CHAPTER 4: Developing a model of market-driving ability in corporate entrepreneurship
  • 4.1 Introduction
  • 4.2 Literature review on measuring instruments
  • 4.2.1 Measuring instruments for market driving
  • 4.2.2 Measuring instruments for entrepreneurship
  • 4.2.2.1 Entrepreneurial orientation measuring instruments
  • 4.2.2.2 Corporate entrepreneurship measuring instruments
  • 4.2.3 Measuring instruments for entrepreneurial capital
  • 4.2.4 Measuring instruments for market orientation
  • 4.2.5. Measuring instruments for firm performance and relative competitive strength
  • 4.3 Literature review on statistical modelling
  • 4.3.1 Measurement model
  • 4.3.1.1 Scale development
  • 4.3.1.2 Reliability and validity assessments of the measurement model
  • 4.3.1.3 Model misspecification and its impact
  • 4.3.2 Structural model
  • 4.4 Model of market-driving ability in corporate entrepreneurship
  • 4.4.1 Measurement models
  • 4.4.1.1 Measurement model for market driving
  • 4.4.1.2 Measurement model for corporate entrepreneurial management
  • 4.4.1.3 Measurement model for entrepreneurial capital
  • 4.4.1.4 Measurement model for strategic orientation
  • 4.4.1.5 Measurement model for entrepreneurial behaviour
  • 4.4.1.6 Measurement model for firm performance and relative competitive strength
  • 4.4.2 Structural models
  • 4.4.2.1 Direct effects model (model 1)
  • 4.4.2.2 Moderating effects model: Management level (model 2)
  • 4.4.2.3 Moderating effects model: Industry focus (model 3)
  • 4.5. Conclusion
• Chapter 5: Research design and methodology of the study
  • 5.1 Introduction
  • 5.2 Research problem
  • 5.3 Research objectives
  • 5.4 Hypotheses
  • 5.5 Research methodology
  • 5.5.1 Research design
  • 5.5.1.2 Purpose of the study
  • 5.5.1.3 Time dimension
  • 5.5.1.4 Topical scope
  • 5.5.1.5 Research environment
  • 5.5.1.6 Participants’ perception
  • 5.5.2 Sampling
  • 5.5.3 Data collection
  • 5.5.3.1 Instrument used to collect empirical data
  • 5.5.3.2 Measurement of the research instrument
  • 5.5.3.3 Reliability and validity of the measuring instrument
  • 5.5.4 Data analysis with structural equation modelling
  • 5.5.4.1 Covariance-based structural equation modelling (CBSEM)
  • Model specification and estimation
  • Evaluating model fit
  • 5.5.4.2 Partial least-squares path modelling (PLS-PM)
  • Model specification and estimation
  • Evaluating model fit
  • 5.5.4.3 CBSEM and PLS assumptions and conditions
  • 5.5.4.4 Application of PLS for the purpose of this study
  • 5.6 Conclusion
• Chapter 6: Data analysis and findings
  • 6.1 Introduction
  • 6.2 Descriptive analysis
  • 6.3 Measurement models
  • 6.3.1 Measurement model for market driving
  • 6.3.2 Measurement model for corporate entrepreneurial management
  • 6.3.3 Measurement model for entrepreneurial capital
  • 6.3.4 Measurement model for strategic orientation
  • 6.3.5 Measurement model for entrepreneurial behaviour
  • 6.3.6 Measurement model for firm performance and relative competitive strength
  • 6.4 Structural models
  • 6.4.1 Direct effects model (model 1)
  • 6.4.2 Moderating effects model: Management level (model 2)
  • 6.4.3 Moderating effects model: Industry focus (model 3)
  • 6.5 Conclusion
• Chapter 7: Summary, conclusions and recommendations
  • 7.1 Introduction
  • 7.2 Research results and theory revisited
  • 7.2.1 Measuring market driving: research implications
  • 7.2.2 Firm-internal factors influencing market-driving ability and outcomes of a market-driving approach
  • 7.3 Contribution to business science
  • 7.4 Managerial implications
  • 7.5 Limitations of the study
  • 7.6 Future research recommendations
  • 7.7 Summary and conclusion
• References
  • Annexure A: Research questionnaire
  • Annexure B: Original outer loadings for reflective indicators
  • Annexure C: Cross-loadings for first-order reflective concepts

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MEASUREMENT MODEL TO ASSESS MARKET-DRIVING ABILITY IN CORPORATE ENTREPRENEURSHIP