Ebook Innovation in Marketing: Part 2

Ebook Innovation in Marketing: Part 2 includes the following content: Chapter 6 identification of innovative marketing strategies; chapter 7 implications for marketing strategists; chapter 8 business strategy, technology adoption, innovation and marketing capabilities; chapter 9 discussion and conclusion. Đề tài Hoàn thiện công tác quản trị nhân sự tại Công ty TNHH Mộc Khải Tuyên được nghiên cứu nhằm giúp công ty TNHH Mộc Khải Tuyên làm rõ được thực trạng công tác quản trị nhân sự trong công ty như thế nào từ đó đề ra các giải pháp giúp công ty hoàn thiện công tác quản trị nhân sự tốt hơn trong thời gian tới.

Trang 1

ENTREPRENEURIAL AND INNOVATIVE MARKETING

For more than three decades Entrepreneurial Marketing (EM) is a concept that finds itself in between two marketing domains; Marketing and entrepreneurship Marketing-Entrepreneurship Interface (MEI) is a researcher favorite, both the marketing and entrepreneurship researchers like to study this theory But also from economy, sociology, and psychology, the transformation of this construct is still underdeveloped

There are a variety of definitions and specific principles in this area are missing, practical tools are inadequately developed and as such no common theory Although it is generally agreed that entrepreneurs react differently when it comes to normal marketing, however, some of them are quite successful Without a unique definition, this makes research efforts

to be divided and misaligned Consequently, the theoretical development has to be limited to show these concepts, mostly it borrows from other social sciences and the development of conceptual models However, there is a need to develop tools, principles, and theories that can assist businesses and small startups that eyed to survive the initial stages and thrive in an increasingly hostile and unpredictable environment

IDENTIFICATION OF INNOVATIVE MARKETING STRATEGIES

CHAPTER 6

This file was downloaded by Academy of Policy and Development at 2023-02-03 04:29:51 GMT

Trang 2

This section will present a shorthistory ofthe evolution of the Entrepreneurial Marketing concept and try to analyze its most common definitions, compare it with “traditional” marketing It has a brief introduction of the most important concepts that are developed in the MEI and then look at the history of research methodologies.

THE EVOLUTION OF ENTREPRENEURIAL MARKETING

In 1982 at the University of Illinois, Chicago, a sponsored program hosted by the International Council for Small Business and American Marketing Association, came up with the term EM (Hills, Hultman et al., 2010) In this event, some of the many research topics used today were established This was a period when marketing research had never caught the interest so many researchers An annual conference on MEI has always been held since 1986 The conference is facilitated by the American Marketing Association (AMA) At this point, the interest of researchers in the field was starting to show and organized several events that end with the formation of a special interest group that spread out its wings to Europe The first conference that held and fully dedicated to the study of Entrepreneurial marketing was held in 1995 As four years later courtesy of Research in Marketing and Entrepreneurship was established

as a permanent venue for EM researchers In 2005 the International journal

of entrepreneurship was initiated under MEI Its primary function was

to link technology and marketing issues Dedicate issues of the Journal

of Small Business Management in 2008 and International Journal of Entrepreneurship and Innovation Management in 2010 showed that EM entered the mainstream of the entrepreneurship literature

In 2010, at the “Charleston Summit” held in the USA it was apparent that marketing was a secondary component of MEI that was largely entrepreneurship, therefore efforts are needed to reinstate it back to marketing In the table below (Table 1) the most significant development

in the evolution of EM is shownand how the events impacted to the development of MEI

Trang 3

DEVELOPMENT IN THE EVOLUTION OF TREPRENEURIAL MARKETING

EN-Table 3 - Evolution of Entrepreneurial Marketing 1982 - 1995

1982 First marketing and entrepreneurship

research conference (G Hills) Started the marketing and entrepreneurship

move-ment withinmarketing

1985 First empirical study of the Mel in

frontiers of entrepreneurship research (G Hills)

Started empirical research

at Mel and documented importance

1986 First research symposium in

market-ing and entrepreneurship University of Illinois at Chicago!AMA (G Hills)

Provided marketing scholars a venue to share research regarding EM

1986 Dickinson, P and Giglierano, J

“Miss-ing the Boat and Sink“Miss-ing the Boat: A Conceptual Model of Entrepreneurial Risk”, Journal of Marketing

First Journal of Marketing article to directly focus on entrepreneurship

1987 “The relationship between

entrepre-neurship and marketing in established firms”, published in the

Journal of Business Venturing (Morris and Paul)

Empirical study of the interrelationship between marketing andEntrepre- neurship Moves EM into higher academic standing with Journalof Business Venturing acceptance

1991

1989-AMA Task Force (1989) and later, Special interest Group is established for the MEl First Tracks are created in the AMA summer (1990) and winter(1991) conferences for EM.

This added entrepreneurship macy for marketing academics

legiti-1995 Carson, Cromie, McGowan, and Hill

publish first textbook Marketing and Entrepreneurship in SMEs: An Innova- tive Approach

Helps establish the content and structure of EM courses.

Trang 4

1995 First Academy of Marketing

sym-posium (U.K.) (D Carson, Andrew McAuley) Slater andNarver’s market orientation and learning organization, published in Journal of Marketing.

These two milestones helped move some scholars in mainstreammar- keting to look at the similarities between marketing andentrepreneurship

Table 4 - Evolution of Entrepreneurial Marketing 1999 - 2010

1999 Journal of Research in Marketing and

Entrepreneurship created (J Day, P

Reynolds, D Carson, G Hills)

Journal of Research in Marketing and Entrepreneurship provided an academic journal dedicated to EM- which increased the acceptance of EM scholarship

2000 Special issue of Journal of Marketing:

Theory and Practice on the MEl (M Miles)

Provided additional credible publication outlet for scholars of EM.

2001 Lodish, Morgan, and Kallianpur publish

a book based on their pioneering MBA course in EM

This text enhanced the credibility of EMas a result of Wharton Business School’s reputation

2002 Bjerke and Hultman publish

Entre-preneurial Marketing: The Growth of Small Firms in the New Economic Era

This text provided additional guidance

on content and context of EM

2002 Morris, Schindehutte and LaForge

publishEntrepreneurial marketing: A construct for integrating an emerging entrepreneurship and marketing perspective

lncreased the visibility and ity of work in EM and helped define andbound the EM construct

creditabil-2003 First conference on marketing,

entre-preneurship and innovation interface in Germania- Karlsruhe

The interest extended outside American area

theAnglo-2004 Buskirk and Lavik publish

Entrepre-neurialMarketing EM textbooks move toward the main-stream in the U.S market

Trang 5

2005 International Journal of Technology

Marketingcreated IJTM was another academic journal ini-tiated at MEl which emphasis

ontech-nology intensive products

2006 20th UlC Research Symposium on

Marketing andEntrepreneurship For the past 20 years, the symposium has been a catalyst for encouraging high

quality scholarly thought andresearch

at MEl

2007 Wharton Publishing published

Market-ing that Works: How Entrepreneurial Marketing can Add Sustainable Value to Any Sized Company, written by Lodish, Morgan, and Archambeau

Marketing tools, tactics, and strategies for marketers in every kind of company, from startup to global enterprise

2008 Special issue of Journal of Small

Busi-ness Management on the EM

Reiterated the importance of EM , as the official journal of the lnternational Council for Small Business

2009 Read, Dew, Sarasvathy, Song, and

Wiltbank publish Marketing Under Uncertainty: The Logic ofan Effectual Approach

This article introduced effectuation , an approach specific to expert entrepreneurs into the marketing field

2010 Special issue of Int J Entrepreneurship

and Innovation Management on the EM

More aspects of EM entered the stream of the entrepreneurship literature

main-2010 Charleston Summit Redefined MEl and offered a

concep-tual framework for future Researches

Source: Adapted from Hills G.E, Hultman C.M, Miles M.P (2008),

“The Evolution and Development of Entrepreneurial Marketing”, Journal

of Small Business Management, 46 (1), pp 103-104

In as much as EM has been in the market for a time, it still seems that only recently has it reached its maturity stage, where its future developments and possible future success redefined

The Definitions Analysis

As first entrepreneurial marketing defined marketing activities practiced

by small businesses and startups Research studies have indicated that there is a separation between marketing theory and marketing practice

of small companies But not every SME owner is an entrepreneurs so

Trang 6

the focus has moved in the direction of marketing practiced by many entrepreneurs An entrepreneur is that person who creates something new- according to Schumpeter, or those who are alert to innovations, according to Kinder (Metcalfe, 2006).

There are numerous differences between anentrepreneur and a small business owner (Cartland, Hoy et al., 1984; Bunyan, Drogue et al., 2008) While an entrepreneur is in charge of the business to make profit and growth, the small business owner is in charge to make sure that the business to pursue his personal goal and at the same time be able to provide some benefits to his family So an entrepreneur wishes

to maximize economic performance, a small business owner wants to achieve personal goals, which may not be for economic purposes, and only needs an acceptable level of business performance Another method that shows the differences between the two is their attitude towards innovation An entrepreneur always wants to introduce new products and processes, establish or open markets, identify or source for new sources

of supply, on the same breath a small business owner does not engage in innovations or new ways of selling a buoying to improve the product or service provided

On that note, the scope moved from the entrepreneurs to companies, and this includes the big one too Big companies have a specific way

in which they behave in the e market Their approach is defined by a complex and disorderly environment that has a lot of changes that are both contradictory and too frequent The most common definition of EM

is “proactive identification and exploitation of opportunities for acquiring and retaining profitable customers through innovative approaches to risk management, resource leveraging and value creation.”

How Entrepreneurial Marketing compares to Traditional Marketing

As earlier mentioned before, EM cannot exist without the mention of

an entrepreneur In contrast to traditional marketing that is centered exclusively to the customer Entrepreneurial marketing has the customer and the entrepreneur as equally important segments that shape the culture, strategy and firm’s behavior EM is influenced by personal choices, values and characteristics But there is no agreement on the two relationships when it comes to factors related to personal characteristics

Trang 7

such as experience, education level, propensity to risk, preference for innovation, tolerance for ambiguity, and firm performance, the results being contradictory (Anderson and Tell, 2009).

Researchers will come to an agreement on how entrepreneurs think and make decisions in line withmarket practice There are five major differences in the way non-entrepreneurs think (they use predictive logic) and how entrepreneurs think (effectual logic) (Dew, R et al., 2009):

• Futuristic: we look at both the predictive for predictive logic and creative for effectual logic In predictive logic, the future

is portrayed as a causal continuation of the past and can be predicted In creative for effectual logic, the future is already definedshapes by our actions either by our past or by voluntary actions of other factors, therefore, predictions are impossible

• Decision Making: for predictive logic, actions is based on reason (purposes) Ineffectual logic, actions are based or aligned to available means Purposes come by as a result of the courses of action taken and reliant upon the available means;

• Attitude toward risk: in predictive logic, a decision is made based on the maximum gain it can bring to the business

Ineffectual logic an option is chosen based on opportunity cost;

• Attitude toward others: competition in the case of predictive

While cooperation in the case of effectual logic;

• Attitude towards contingency planning: predictive logic will use avoidance tactics while the case of effectual logic Accurate predictions, careful planning and focus on objectives

By fashioning the decision-making process according to effectual logic, it shows that entrepreneurswill puttheir trust in the future

According to then the future cannot be predicted and so they do not see the need to set objectives and therefore not seen as important They operate with what is at hand, i.e both tangible and intangible resources, their capabilities and who they already know as their network and come up with a myriadof options with different possibilities Choosing one option does not necessarily mean maximizing the results, but the opportunity cost

Effectual logic is keen on building partnerships and attracting stakeholders before being sure where his target market is or even what

Trang 8

products and services to offer Therefore, stakeholdershave room to express their views and shape the company collectively because of a group effort

This obviously contradicts the natural marketing dynamics (Sarasvathy, 2003) that give an upside-down approach where the entrepreneur starts from controlling the market based extensive research, makes an analysis, and selects a target market segment based on predictions and trends, and finally develops strategies that attract the target segment Effectual logic is the other way round, it starts from the bottom-up where the entrepreneur identifies the network (which is personal) - usually a partner

or a customer As they decide on what and how to do, they tag customers from different market segments, they will eventually define the market for the product/firm

The entrepreneur as earlier on to state, is on the side with the customer as a central element of EM If the marketing concept is based

on customer orientation, as the fundamental way of doing business, how would this perspective accommodate entrepreneurial orientation?

Entrepreneurial orientation may concur with customer orientation if the entrepreneur can at all times, put himself in the position of the customer

Many successful entrepreneurs have that innate feeling forthe needs of the customer Sometimes their initiations never accurate when put into reality Therefore, the ability to adapt to align oneself with rapid market movements is quite essential (Stokes and Wilson, 2010)

Table 5 illustrates the differences between the two concepts (Stokes, 2000b): Differences between Traditional Marketing versus EM

Table 5 - Traditional vs Entrepreneurial Marketing

Marketing Principles Traditional Marketing Entrepreneurial Marketing

Strategic orientations Customer orientated (market

driven) Innovation oriented (idea driven) Strategy Top-down approach: segmenta-

tion, targeting, positioning Bottom-up approach: targeting a limited base of customers,

further expansion

Trang 9

Methods Marketing mix (4/7 P’s) Interactive marketing methods,

word-of-mouth, direct selling, referrals

Market intelligence Formalized research and

intel-ligence systems Informal networking and infor-mation gathering

Source: Adapted from Stokes, D (2000), “Putting Entrepreneurship

into Marketing: The Process of Entrepreneurial Marketing”, Journal of Research in Marketing & Entrepreneurship, 2 (1), p 13

To summarize the differences between EM and traditional marketing, business orientation, at strategic level, tactical level and way of collecting and integrating market information - we conclude that (Stokes, 2000a):

• In business orientation EM is defined by entrepreneurial and innovation orientation, unlike traditional marketing that is defined by customer orientation, if the classical marketing construct needs an evaluation of market needs before innovation of a product, entrepreneurs will start with an idea and try to find a market for it

• At the strategic level, in traditional marketing, there is the top-down approach, which offers a clear definition of path to follow alongside consequent actions after each activity Great entrepreneurs practice the reverse by practicing the bottom up approach: once a market has been identified, the entrepreneur will test it through a trial- and-error Afterwards, the company starts to operate to serve customer needs of some clients, and the entrepreneur thinks of expanding the business Since he is in direct contact with clients, it’seasy to find out their preferences and needs Customers are later added to the business and they are normally from the same profile as the existing lot This

is not a deliberate process because new customers come as

a result of first customerrecommendations And as such the target market is created by eliminating personal preference

• At the tactical level, EM does not have to fit in the 4P’s model for entrepreneurs seem to adopt an interactive approach, because of their direct and personal contact with clients Their interactions with customers when selling Such interactions

Trang 10

are enhanced by word-of mouth an s a form of marketing and which is great for generating referrals.

• The market information gathering, the entrepreneurs already know the significanceof evaluating the marketing environment

But they rely on old methods such as personal observation or data collected through their networks of contacts They do not lay thief thruston formal research method because of their inability to believe in future predictions

• It is not surprising that the best practices in successful entrepreneurship are seen to be ignoring traditional marketing constructs (Hills, Hultman et al., 2008) Entrepreneurs do not use marketing, to them that is advertising, which is prohibitive because of the high cost and consequently cannot afford Moreover, entrepreneurs are always concerned with the current, operational issues and are likely to ignore long-term issues And they do not follow the “text book rule of marketing” But we cannot depend on these characteristics because entrepreneurs practice a different marketing strategy

in which they are able to apply any practical tactic because of their flexibility in the market place They still harbor thoughts

on how to handle long term business and customer They do not follow a logical pattern or approach Because they serve what the client wants

• Basic concepts of EM: marketing network and entrepreneurial marketing competencies

Recent research studies on Innovation Marketing Strategies, a lot of focus has been on major themes like: the type of business orientations that are used in an entrepreneurial setup (Jones and Rowley, 2009; Raju, Lineal et al., 2011; Schindehutte, Morris et al., 2008), dealing with environmental uncertainty (Johnston, Gilmore et al., 2008), value of information (Schulte and Eggers, 2010), strategies that should be used when dealing resource disadvantage (Lee, Lim et al., 1999; Stasch, 2002;

Stokes, Syed et al.,2002), the most useful plans that can add value to entrepreneurial innovations (Lodish, Morgan et al., 2001), the principles that should guide a strategic focus (Schindehutte and Morris, 2010), how

to model the decision making process (Mador, 2000) and the nature and scope of brand management within a small business and startup (Berthon,

Trang 11

Ewing et al., 2008) From various studies,two concepts with realistic and practical value of EM have been developed and they are:

• Entrepreneurial marketing competencies

MARKETING NETWORK

Here the entrepreneur has a direct interaction with his or her customers

Thus, customers are considered to be part the entrepreneur’s personal business network, alongside acquaintances and family members who may or may not be involved in any operations of the business, business partners and even competitors The personal business network contacts can be exploited by the company Employees can use it to create a business relationship with other companies who may be in the same industry and

as such, as the network expands, the company becomes part of a larger organizational network This concept of networking is taken from the social anthropology science To bring it intocontext, we need to clarify its attributes and role

According to Davern (in Rocks, Gilmore et al., 2005, p 82) this network is made of nodes and connections In social sciences, these nodes are agents and the connections being the link between them

Entrepreneurial network directs its attention to the entrepreneur/firm

as the main agent and the dyads of the firm This perspective has been borrowed from the social network perspective and from the business network perspective (Slotte-Kock and Coviello, 2010)

In EM this network can be viewed from the entrepreneur’s perspective

In this case he is the main actor / agent and the connections that the relationship is based on This concept has brought in another concept called the marketing network The new concept is defined by structural and interactional dimensions

The structural dimensions are those that relate to traits as: diversity, size, density, degree of formality, and flexibility (Rocks, Gilmore et al., 2005)

Size is the number of direct contacts the entrepreneur has to help him

in doing the marketing

Trang 12

Degree of formality is that ratio between formal (business) contacts

and informal (social) contacts If most contacts are formal sources such as customers, business partners, and people in the industry, that is a formal network A network is considered informal when most contacts are from informal sources such as family, friends, and acquaintances;

Diversity is the variety of contact sources one has The need for

mixed contact list, which should facilitate access to different information sources This contact list may be jeopardized because entrepreneurs prefer to interact with people who have similar backgrounds and attitudes

Density is the measure of the degree of connectivity between

entrepreneurs and the market environment

Flexibility defines to what extent which relationship is to be

established, maintained, developed or broken This is analyzed by the number of new contacts made from s particular contact or client

Interactional dimensions of the marketing network are related to, content, intensity, frequency and stability (Shaw, 1999)

Content refers to the meanings that others associate to relationships

and the implications they have on these relations;

Intensity captures the extent to which business or customers are

prepared to honor obligations;

Frequency is the measurement of the number of interactions that has been done with contacts in a defined period

Stability refers to the length of time a relationship has been active.

All the nine dimensions above, only two have been identified to be

of significance to EM: diversity and content When looking at diversity, there are two possible options:

Diversified network that involves a large social difference between members, a low emotional commitment and a low frequency of contacts;

Cohesive network, which involves some level of socially similar individuals who shares powerful emotional relationships and high frequency of contacts

Initially, a cohesive market network may have seemed to be the most appropriate because of the solidarity and commitment shown by its members at the

Trang 13

Start-up phase, when the company has fewer or no vital resources

This has proved to have two major setbacks (Martinez and Aldrich, 2011) First, they have very limited coverage Even though there are many sources of resources, information and capabilities needed, an entrepreneur

is still limited to the ones provided by network members The second disadvantage is the cost of the cohesive network The stronger the ties, the higher the reciprocity, which translates to entrepreneurs being forced

to share information that may have or provide additional economic and/

or emotional rewards

A branched out network offers several advantages The first being the one related to a higher possibility of finding professional help The second one is that entrepreneurs are exposed to diverse interactions and information and they are not under pressure to comply with strict requirements and so are motivated to innovate The third advantage is that entrepreneurs are not restrained by the strong relationships and hence can expand the network Let take an example By analyzing customer relationships, there are strong ties that possibly harbour negative consequences on the firm’s performance, it could be so but weak and more open ties are beneficial This is so since customers are a valuable source of information in the learning process of the company Diversity

in this type of ties can be translated into a greater degree of innovation In addition, the rule of reciprocity is to create obligations for entrepreneurs

They are under pressure to offer the best combination of quality/price, additional services and preferential treatment, at the expense of making profits

In relation to, content, the nature of relationships between network members and competitors in entrepreneurial marketing has a wide range options from competition to cooperation, collaboration and strategic alliances (O’Donnell, Carson et al., 2002)

Basic co-operation defines the relations between members of a network as simple and friendly Thus, entrepreneurs are aware that if they show kindness, when their time of need comes, they will accord the same to him

Tangible co-operation musty have visible actions: entrepreneurs are happy to share information between them in a network They can share information on between them - for example, they notify each other’s about notorious customers, and stock other competitor’s goods when

Trang 14

out of stock to maintain customer loyalty and flow If one is selling complementary products, they can cooperate and customers what they need

Collaboration involves two or more occasions in which competitors are working on the same project that is too large that needs support to

be effective and profitable between them This relationship demands stronger ties, trust and openness towards the others in the network

Strategic alliances require strong, long-lasting and intense ties and are established between companies and their own customers These customers, allow access to critical, strategic information in order to help providers to develop products they need

It is now clear that the number one role of marketing network strategies

is to be used as a vehicle to bring value, and any other opportunity bound

to help the business The network supports the creation of value through new innovation input This is the kind of environment has information and critical resources to the company and molds the communication of value, as this happens between members within it

Therefore, the market network influences entrepreneurial management and enhances the effectiveness and efficiency through the supporting the evolution of a confined market to a selective and eventually won(Gilmore, Carson et al., 2006) Unlike large companies, small firms need the network as a vital space needed to carry out marketing activities due to limited or lack of resources and capabilities

INNOVATIVE MARKETING STRATEGIES

Today we are in an environment with an intense and competitive business environment that is rapidly changing (Meira 2010) and involves the inability to predict future demands (Stalk and Hout, 1990) Many organizations should quickly adapt to these changes as they develop their business strategy for accomplishing the business strategy and get some advantages from identifiable and emerging opportunities (Eisenhardt, 1989; Hannan and Freeman, 1984) Thus , firms must prepare to deal with uncertainty and changes in the environment with appropriate strategy that is could be a competitive advantage and achieve better performance (Eisenhardt and Martin, 2000).The firm is under a challenge, the reason why they employ innovation to develop marketing strategies (Goedhuys

Trang 15

and Veugelers., 2011; Maine et al., 2014; Love et al., 2014) Since there are approaches that can be followed to establish different strategies needed to provide a sustainable superior competitive as new ideas and process that are beneficial to the firm when solving problems related

to the development or implementation (Amabile, 1996; Franken, 2007;

Kylaheiko et al, 2011)

Looking further, the quickly changing marketing environment

is turning out to be more complicated in any market, the firm in manufacturing of home decorationhas, especiallyin innovation, whether

in an open market economy, regional market, a single market, they all coalesce around one thing; market dynamism (Eisenhardt and Martin, 2000) manufacturing capability and innovation (Teece, 2007) as these firms depend on their resources to drive them to sustainable competitive advantages The firms within these wavelengths need to establish, integrate, manipulate, and reconfigure inner and outer skills changethese unstable and unpredictable business environment which are called collectively as ‘dynamic capabilities’ (Teece et al., 1998; Eisenhardt&

Martin, 2000), which are based on the resources available to the firm and because they enhance knowledge by making decisions in every situation, (Parthasarathy, Huang, and Ariss, 2012) Thus, knowledge of the market important like that of marketing innovation strategy, entrepreneurship and performance remains restrained In this dimension, very many studies have been conducted and maintain their focus on questions that are of show the relationship how a firm uses its marketing innovation strategies in relation on how the three dimensions; learning orientation, entrepreneurship, and research and development innovation strategy’s impact marketing performance (Chih-Wen Wu, 2013) This will be addresses these questions by coming back to the key concept of firm entrepreneurship, learning, orientation, and research and development innovation strategy and marketing performance

The first aim of the study will also examine the concept and construct

of firm entrepreneurship, research and development, learning orientation, innovation strategy and performance in the findings that is a reflection

of resource based theory (Barney, 1991; Wernerfelt, 1984, 1995) The second aim will be to look at the relation between the antecedent and consequences of marketing innovation strategies The third aim examines antecedent agents that drive marketing innovation strategy for the firm

Trang 16

to achieve marketing performance The fourth looks at the influence

of marketing innovation strategy through the resultant factors in order

to achieve marketing performance The last aim will be to explore influences of the moderating effect, otherwise called the market culture

The main research query in to see how the dimensions of marketing innovation strategies compete through marketing performance and also how the antecedent and consequence factors seem to influence marketing innovation strategies needed to achieve marketing performance

LITERATURE REVIEW AND HYPOTHESIS

The testing model of this study is shown in figure 1 and also and shows the reason of the effects of the three dimensions of marketing innovation strategy The effects are new product development, marketing effectiveness and advantage, customer responsiveness, and marketing performance The antecedents are the long-term vision, technology innovation, marketing resources, and most importantly, this study tries to examine market culture as the intermediary in the context of a business enterprise

The connection of the constructs is as indicated in figure19

Figure 19 - Relationship Model of Marketing Innovations Strategy and

Market-ing Performance.

Trang 17

MARKETING INNOVATION STRATEGY

Marketing innovation strategy is the significant changes evident in innovation or knowledge And is a branch from the realization of something new Gradual innovations, likewise are a big advances to an established technological knowledge (Garcia & Clanton, 2002) The idea behind marketing innovation strategies is to emphasize the sales growth

by changing consumer demands from elastic to inelastic marketing segments through the delivery of better value that is perceived to be better

to consumers (Bennett&Cooper, 1979, 1981;Hurley&Hult,1998), and as such, the marketing innovation strategy is learning orientation that bears

on learning something new and has changed over some time, both within and outside the organization through systematic patterns that include knowledge sharing between departments and the utilization of modern technology, when providing the supporting needed at the implementation stage of the firm This led to the establishment of knowledge newness

While, (Moreira and Silva, 2012) referred to marketing innovation as an innovation and capacity of a firm to invent by creating new products as the administration picks on the business sector, for instance, upgrades, new data for product changes, new strategies for deals channels, and new routines for valuing pricing goods or services, which are important for many organizations leading to marketing sustainability And Naidoo,

2010 revealed that marketing innovation is defined as the upgrades in product design, estimating, situation, innovation, and the chance of survival With an essential target of innovation being the improvement

of new or adjusted products/processes aimed at improving organizational performance and with superior performance inherently dependent

on understanding and satisfying customer needs better than one’s competitors, market orientation and innovation are intrinsically linked constructs(Augusto & Coelho, 2009; Hauser, Tellis, & Griffin, 2006)

LEARNING ORIENTATION

The first dimension of strategic marketing innovation developed from learning orientation, which mainly focuses on constructs Learning orientation basesit focuses on four critical components:

• Innovation skills

• Innovation metrics

Trang 18

• Information technology innovation

• Management process (Hamel, 2000)

Argyris (1994) madethe distinction that good communication can either have a positive or a negative effect on learning Organizational culture and the availability of resources can restrain the quality of learning (Shimizu & Hit, 2004) A learning organization definition is that firm that has the intention to create structures and strategies that aim to improve performance by enhancing organizational learning (Dodgson, 1993) The learning orientation should include the new knowledge that is created (Slater & Carver, 1995) and new knowledge that is utilized (Sinkula, Baker, &Noordewier, 1997) Consequently, the four principal dimensions

of learning orientation should include a commitment to learning Vijande, Sanzo-Perez, Alarez-Gonzalez, & Vazquez-Casielles, 2005;

(Santos-Sinkula et al., 1997), open-mindedness (Calantone, Cavusgil, & Zhao, 2002; Santos-Vijande et al., 2005; Sinkula et al., 1997), shared vision (Barker &Sinkula, 2005) and sharing knowledge between organizations (Calantone et al., 2002; Lukas, Hult, & Ferrell, 1996) The study implies that learning orientation should focus on the positive effects on new product innovation, fulfilling customer responsiveness, marketing effectiveness, marketing advantage, and marketing performance Thus the following hypothesizes:

Hypothesis 1: Learning orientation has a positive influence on:

as an essential activity of the entrepreneurship (Peterson & Berger, 1972; Shane &Venkataraman, 2000; Soriano &Peris- Ortiz, 2011), it

Trang 19

is mainly made up of three primary accomplishments that encourage entrepreneurship within a firm that faces risk taking, pro-activeness, and innovativeness (Barringer&Bluedorn, 1999; Tajeddini& Mueller, 2012;

Wiklund& Shepherd, 2003).Therefore, the definition of entrepreneurship should include entrepreneurial practices within associations (Stevenson

&Jarillo, 1990; Stopford& Baden-Fuller,1994), franchising (Shane &

Hoy, 1996), acquisitions (Gartner, 1990) and recognition of opportunities (Renko, Shrader, & Simon, 2012) The field of firm entrepreneurial orientation follows three primary branches which include the factors of identification of high levels of firm entrepreneurship (Lumpkin &Dess, 1996; Zahra, 1991), many scholars have mentioned innovation as that process that leads to a competitive advantage (Branzei and Vertinsky, 2006) To be specific marketing innovation enhances the development

of products and services using different or unique approaches (Naidoo, 2010) Prior research datashow research results of product innovation to

be a strong indicator of financial performance under advanced production and value creation (Goedhuys and Veugelers, 2011) Entrepreneurship focuses on the positive effect on new product innovation,fulfillment of customer responsiveness, and marketing performance As a result, this study shows the implication of firm effectiveness, marketing advantage and Marketing performance Thus the following hypotheses:

Hypothesis 2: Firm entrepreneurship has a positive influence on

• Development of a new product

• Gauging the responsiveness of clients

• Effectiveness in the market gradient

• Merits related to businesses

• Performance of the market

RESEARCH AND DEVELOPMENT, INNOVATION STRATEGY.

The third attribute of strategic marketing innovation that was developed from research and development innovation focus concept Research and development innovation strategies emphasize on programs and processes that include creating innovative creations ((Nohria&Gulati, 1996;

Utterback, 1975), innovation adoption (Dodgson,1993) and innovation

Trang 20

diffusion ((Huarng, 2010; Huarng, 2011; Rogers,1995) there is also an emphasis on quality, price and customer satisfaction, and the need for anincreased awareness of new innovations(Barkema, Baum, &Mannix, 2002; Chaston& Scott, 2012; Pettigrew,Woodman, & Cameron, 2001;

Woodside, Ko, &Huan, 2012) Innovation strategies a business plan is seen asa center of debate for many researchers over the years, apparently because of its central role in organizational adaptation and renewal towards the path to competitive advantage (Kim &Huarng, 2011;

Lewis, Welsh, Dehler, & Green, 2002; Parellada, Soriano, &Huarng, 2011) Research and development, innovation strategies are defined as

an alternative marketing strategy for problem solving in a company, fulfillment of customer expectations, and application that are involved commercialization of a product or service (Chaston& Scott, 2012;

Zairi, 1994) and lead to better performance and greater market returns (Chaston& Scott, 2012; Zairi, 1994) As a consequence of this study the implication is that research and development, innovation strategy places its focus on the positive effects on new product development, marketing effectiveness, customer responsiveness fulfillment, marketing advantage, and marketing performance Thus, the hypotheses that follow:

Hypothesis 3: R&D Innovation Strategy has a Positive Influence

• Customer responsiveness

• Marketing effectiveness

NEW PRODUCT DEVELOPMENT

In business and designing, new product development (NPD) is the term used to portray the entire procedure of putting up another product

or administration for sale to the public There are two parallel ways engaged with the NPD procedure: one includes the thought era, product outline and detail designing; alternate includes statistical surveying and showcasing examination In todays dynamic business condition, the basic factor which holds the way to your market achievement is your capacity

to dispatch and grow new products and administrations in a speedier and cost-proficient way, while confronting the different difficulties of

Trang 21

expanded many-sided quality, flow of globalization, decreased cost and diminished process durations

New product innovation can likewise be a potential wellspring of huge economies of scale for the firm New products might have the capacity to utilize a considerable lot of an indistinguishable crude material contributions from the association’s current products, and might have the capacity to be sold by the company’s current deals drive – bringing about generously bring down unit costs (and thus higher edges) for the firm Moreover, new product innovation can be an essential wellspring

of use for the firm to use in its associations with its appropriation channel accomplices Firms that have various effective products in their portfolios can charge more noteworthy consideration and need treatment, for example, favored rack space and installment terms, from wholesalers and retailers This is an especially essential thought given the way that expansive retailers, for example, Wal-Mart and Target, have advanced into places of noteworthy channel power and impact Moreover, the picture and notoriety of the firm and its brands is intensely affected by the number and gauge of effective products in its portfolio Nike has upgraded its general image notoriety, well past the domain of athletic footwear, because of its effective presentation of golf hardware and supplies, swimwear, soccer gear and clothing, and additionally various fruitful products that interest to tennis, ball, and baseball devotees

From a more extensive advertising point of view, firms that build up the fundamental organizational structures and procedures to consistently and proficiently create new products will probably be tuned in to their clients’ needs and needs Coordinate correspondence with clients, a fundamental establishment of new product improvement, enables firms

to take in their necessities and tailor products and administrations to their novel prerequisites This immediate client correspondence grants firms to pick up an abundance of helpful client bits of knowledge that should impact each zone of the showcasing blend – including valuing, appropriation channel, and innovation blend choices

New-product development is the firm’s capability to build and improve

on a product and eventually launching the new product into the market

The new product is usually high quality and obviously low price and usually the launch is always done an appropriate time Similarly, different scholars mention that clients understand the need to get associated with

Trang 22

a good product, good price, and it should be the best choice (Racela and Thoumrungroje, 2010: Hult et al.,2004) However, some scholars have revealed that new product development as the number one driving force organizational survival (Brown and Eisenhardt, 1995) This further implies that a new innovation will increase marketing advantage Thus, the following hypothesis:

Hypothesis 4: New product development has a positive influence on marketing advantage.

Customer Responsiveness

Customer Responsiveness is the look on the firm’s competence in how they respond to client demands and needs and the value of delivery they give their customers The focus is based on; identification, analyst, understanding, and answering their queries (Johnson and others, 2003)

In addition to that, it also involves the willingness to formulate a response

to the client’s needs, their satisfaction and the provision of support for both product and services Likewise, customer orientation is basically the focus placed on sufficient understanding of target customers in order

to deliver superior values to all clients (Never and Slater, 1990) Earlier studies confirm that this level of customer responsiveness that gives the organization the space it needs for product differentiation in order

to sustain customer loyalty and extends the value addition to customers (Magritte, 1998) Customer responsiveness refers to the ability of the firm to quickly respond and help the customer in need (Lee and Lin, 2005) Consequently the firm has the ability to share market information and be able to anticipate and respond to the market needs They collect and disseminate market information throughout the organization and thus increasing customer satisfaction (Deighton, 1997) The study implies that customer responsiveness and focus has a positive effect on gaining market share Thus the hypothesis:

Trang 23

Hypothesis 5: Customer responsiveness has a positive influence on marketing advantage.

Nwokah (2006) has an argument that, there exist five factors that drives the marketing effectiveness, marketing infrastructure, marketing strategy, marketing execution creative marketing, and external factors Further, Ussahawanitchakit (2012) presents findings that market effectiveness has a strong impression on customer satisfaction, long term growth, market orientation, profitability, and firm’s performance It is expected that market effectiveness directly affects the market advantage Thus, the hypothesis:

Hypothesis 6: Marketing effectiveness has a positive influence on marketing advantage.

MARKETING ADVANTAGE

Marketing advantage is the firm’s deliberate action to alter its ability

to design, create and develop a distinctive image of the product on offer with the aim of beating the competitors (Kotlerand Keller, 2009; Phokha, Ussahawanitchakitm, 2011) The source of advantage largely depends

on the firm’s resources and actions that provide better performance (Barney, 1991) To implement marketing advantage with a new product means it has to be of higher quality and offered at a reasonable price, outstanding quality in design and modern innovation, should be unique and has a respectable reputation among its competitors (Thipsri and Ussahawanitchakit, 2008) The customer must have the perception of value in receiving benefits and features as a result of product development

Trang 24

They should be able to relate to it and respond to the clients in terms of satisfaction and better performance (Ussahawanitchakit, 2005) In this study, marketing advantage is used to refer to the organization’s ability to develop new products with unique and superior features which should be

a step further that the nearest competitor in terms of quality, uniqueness and reasonable price Additionally, (Kaleka, 2002) made a point that there are two unique types of being at an advantage when competing product rivals The two should be cost and differentiation advantage

As far as Zhou, Brown, and Dev (2008) are concerned, the competitive advantage of any organization should include a price or coat quality, product innovation, quality, and reliability in delivery The timing should also be timed perfectly in order to align the organization for success

Also, Stewart (1997) in his work indicated a better performance in an export venture is likely if the exerting firm is able to achieve a balance between its internal and external environment Because of this study the implication is that marketing advantage has a positive effect on marketing performance Thus, the hypothesis:

Hypothesis 7: Marketing advantage has a positive ence on marketing performance.

influ-MARKETING PERFORMANCE

In previous studies on this subject, (Arthurs and Busenitz (2006) and (Gao 2010) proposed that marketing be defined as an emphasis of the firm success which should comprise marketing capability as a response

to market performance and requirements At the same time, (Barczak

et al 2008) posits that marketing performance is the degree to which the new product is set to meet that customer expectations with a focus

on to sales, profitability, larger market share than competitors , and the ability of the same firm to react to competitor actions and still maintain customer satisfaction Likewise, (Murray and Chao 2005) used the following parameters to define marketing performance New product development speed, product quality, and development cost efficiency

Marketing performance is a reflection on a firm’s profitability level The marketing performance when measured should be able to capture the overall performance for both current and future levels More clearly, a broad and balanced performance criteria thatinclude financial and non-

Trang 25

financial activities, will help marketers to fully grasp the performance actions of their strategies (Varadarajan and Jayachandran, 1999)

Financial performance may just be another term for financial measures which define the profit margin, revenue growth, and return on investment

The marketing performance is an implication of the measures taken by marketers such as the volume of new customers, market share, and sales volume (Jaakkola et al., 2010; Kaynak and Kara, 2004) All firms should

as a matter of principle, look for ways to remain profitable and grow in maximum sales alone

The study of new product success shows a positive link that is there between market share and return on investment (ROI) measures (Baker and Sinkula, 1999; Morgan et al., 2003) (Hooley et al 2005) made their argument known by saying that a more superior marketing performance will resultin better financial (Moreover, Morgan 2012) argued that marketing performance is that ability of the firm to be able to increase its salesvolume and a sum up of all the firm activities which in any case should

be the ultimate goal of any organization that is keen on being the best in the market Market performance is also a measurement of accounting indicators like cash flows and profitability (O’Sullivan and Abela 2007) made a suggestion that marketing performance is measured by the value

of the return on resources (ROA), and return on investment (ROI)

However, the marketing performance can be a measure of sales volume, sales growth, and the market share, whereas financial performance can be

a measure based profitability, a percentage of sales, return on investment (ROI), profit margin, and profit growth (Hultman et al., 2011) Thus, marketing performance is the view that looks at the outcomes used to indicate the firms’ success, such as customer satisfaction, sales growth, customer acceptance, market share, and overall performance (Barczak

et al., 2008; Hultman et al., 2011; Jampaphang and Ussahawanitchakit, 2013)

LONG TERM VISION

Vision is projected as a future image of the business Vision should be a basic factor that reveals a clear conception that is a representation of the present and the future of the present situation and the future objectives that depicts the objective of a business The best way to use vision for

an organization is to make sure that the use of methods stipulated in

Trang 26

achieving the objectives (Ozmen and Sumer, 2011) Long term vision is depicted as Moreover, long-term is seen to be implicit the same way the organization is about the future state of the organization The planning

of a long termvison is a simple description of how the organization wants the world to look at them This can also be said to the outward picture that any external entity can relate tothe organization More like

a replication of the potentials and values of the primary stakeholders

of the business entity(Jackson and Schuler, 1995) May studies have been conducted on the importance of vision and its construction to an effective organizational results? Thus, vision focuses on the importance for organizations (Conger, 1998) this includes future planning with

a main purpose Moreover, can be used to provide effort to effect organizational change (Belasco and Stayer, 1994) In addition, the vision that is based on organizational future, motivation, innovation, or purpose

is functionally applied (List et al., 2012) Thus, long term vision in the definition can be viewed as purposeful guideline or idealized goal that clearly defines the firm’s operations, showing clearly long-term planning for future achievement based on the potential capacity to enhance new management and offer the best organizational development As a result

of this study the implication of one term vision has its focus as a positive effect on marketing innovation strategy Thus, the hypothesis:

Hypothesis 8: Long term vision has a positive influence on marketing innovation strategy

Trang 27

and there have been many other classifications Gilbert et al (2005) demonstrate how IBM marketed both their human and technical competencies in transforming themselves from a product based company

to an enterprise solution provider But to imply that this was a unique or unusual initiative would be highly questionable identified four categories

of market-based resources such as

• Customer linking capabilities

• Market innovation capabilities

• Human resource resources

• Reputational resources (Hooley et al., 2005)

Thus, marketing resources can also take the definition to include resource, knowledge, and capabilities of the firm The implication of this study is that that marketing resource is focused to have a positive effect

on marketing innovation strategy Thus, the hypothesis:

Hypothesis 9: Marketing resource has a positive influence on marketing innovation strategy

• Learning orientation

• Firm entrepreneurship

• R&D innovation strategy

TECHNOLOGY GROWTH

Technology growth points to the speed in which a firm moves forward

in the adoption, use and integration of technology in the organization

The change of technology is associated with innovative new technology products which impacts on the firm’s operation procedures (Glazer and Weiss, 1993) Technology innovation is the reason for the revolutionized business processes and procedures For example, the acceptance of information technology has radically changed the way we provide information, communicate and transact The speed of technological innovation is getting higher without the possibility of changing any time soon It is getting intense and virtually all technologies develop in an amazing situation The growth of technology plays a big role when it comes to deciding the best coordination mechanisms and implementation into the organizational structure Firms need to continuously update their processing systems and equip their workforce and prepare them to

Trang 28

deal with this rapid growth, firms need to be able to support new work procedure New technology always comes with new challenges that continue to bring with them new challenges and investment opportunities

in employee development, these opportunities need to and change into value through effective and progressive technology management (Rudez and Mihalic, 2007) In today’s world, firms need to acquire new ways and embrace new technologies

Therefore, firms must have or experience, technology changes

as it grows and interacts with both technology and other external organizations continuously (Allred and Swan, 2004) Firms should focus their production advantages through the integration of new technology and the development of employee technical expertise Similarly, the organizational IT process is a learning process whereby new technological knowledge is harnessed Shorter product life and the consequent need for workers to be able to absorb new skills quickly impact on education and training needs The company offers on and off-site classroom education and training, laboratory training, and structured training in the workplace for employees at all levels of the organization

Trang 29

INNOVATION, AND COMPETITIVE ADVANTAGE

Competition is more and more prevalent on a typical business environment, the management decision making process, and the firm’s environment and so on The market globalization is profoundly influenced how the companies compete among themselves and competitors for their own survival These changes and challenges have been quite prevalent in the last and current century, the frequent need of doing something new, improved or unique for the consumers shows the level of competition that companies are going through The breakthrough invention of yesterday is undergoing challenges and competition from similar technologies today and it will possibly not be in the market tomorrow or in the near future

The market forces are affected by many factors that range from consumers’ socioeconomic conditions to a firm’s ability to show and create a product for consumption Thus, product innovation is one of the companies’ biggest competitive factor that increases their legitimacy and marks a niche in their operating area

IMPLICATIONS FOR MARKETING STRATEGISTS

CHAPTER 7

Trang 30

The rise of concern for people’s health has led to the growth on the development of production processes that offer differentiated products, such as foods that provide health benefits the basic nutritional functions and organic foods that are free from artificial inputs such as chemical fertilizers and pesticides Organic product may present a higher cost to the consumer compared to conventional products, the organic products market shows an increase in the last few years.

The focus of this chapter is to help identify how innovations have contributed to the achievement on the competitive advantages in a firm

or business that embraces such innovations for competitive advantage

In order to achieve this objective, we will first look the several definitions independently, applying depth analysis of the subject matter and the main consideration that need when planning innovation

Innovation

The technological progress and innovation ideas and methodologies contributes to the country’s economic development A lot should be attributed to the workers’ who have the qualifications and the experience, which should be the most crucial factors of the productivity growth and improvement in all areas of innovations In a way, innovation is turning out for many companies, the only surviving competitive strategy and development strategy, apart from the possibility of looking at other market opportunities that can guarantee competitive advantages (Porter, 1999)

Schumpeter (1977) was the first scholar to ever mention the relevance of the innovation inbusiness development when opposing other findings from fellow economists In a typical market in earlier times, companies operated in a market with no changes, this made it possible for companies to have space in the operating environment Facing such situation, Schumpeter (1977) explained new findings and mentioned that the role of an entrepreneur in the economy is to ensure a continuous flow

of economic development These findings are what contributed to other scholars who were influenced by him when they talked about innovation, others like (Nelson & Winter (1982) and Dose (1982) Added other factors which have been considered essential for innovation, they are:

Trang 31

in practice projects of the products and manufacturing processes which are new for them” Innovation can also be said to be the economic and financial outcome of the introduction of a new methods and technology

in an organization for the purpose of making it grow A firm is seen as being innovative when it introduces goods and services that are new in the market and did not exist previously The innovation includes the use

of new organizational methods which that was part of the production process (Pelegrin&Antunes, 2013)

The Oslo Manual (Finep, 2004), defines innovation as the introduction

of novel product (good or service) or a major improvement, a new process, a new marketing method, a new organizational method on business practices, on the organization of the workplace or on the external relations, or still the reorganization of part or the whole institution

As far as the relevance and need for innovation for firms, (Hitt et

al (2002, p 523) posits that “[ ] innovations are crucial, because they distinguish their products and services from the competitors, creating an additional or new value to customers” On the same idea, (Zawislak (1995,

p 127) had a mention of innovation as “[ ] the knowledge developed

by practice can be a source of competitive advantages” for organizations

According to (Paiva et al (2004, p 69) innovation “[ ] is a process of change, such as any organizational activity that can be managed with the goal of bringing future competitive advantages to companies that do so”

Innovation is one of the crucial strategy available for a business to compete (Giget, 1997), and in succession, looking at the results from previous studies indicates that innovation is responsible for 80% to 90% of productivity growth of any firm For Quandt (2013), this rise in production has contributed to the expansion of the economic and social inputs of the firms, clients, and even the country’s economy

According to the Oslo Manual (Finep, 2004), firms will only innovate when they focus on maximizing profit, therefore to gain some advantage

Trang 32

in relation to competitors Hence, we can try to understand innovation in the following dimensions.

[ ] as a new production process or the change in the existing process

on machines, equipment, installations, labor methods, management methods, etc., that were different and new to an organization (Machado,

2007, p 16)

Therefore, innovation is said to be the financial and economic outcome

of the introduction of a new technology into the organization outfit for the purpose of seeing it grow From this perspective, it is then clear that for a firm to be a winner in its domain, based on the product or service

in which it operates in, by confining competitors to follow and never overtake the product In this case, the introduction of a technological innovation is focused on product, materials or the processes and defined

in a business model mainly focused on the management aspects or visible market opportunities, the firm will be creating a competitive advantage, and eventually contributes to greater financial results

Competitive Advantage

The markets are becoming more complicated and unpredictable, so demanding, away from the management, mechanisms which can follow and identify future trends in the industry in which the firm operates in

By knowing the competitors in terms of their movements is an important thing for a firm to be aware of In modern business environment, it may no longer be possible to expect that a competitor to innovate without having

a counter market strategy to respond to either imitations or challenges from other companies (Day &Reibstein, 1999)

This dynamism establishes a new standard in which firms seeking

to report and to adhere to when there is an increase in innovations in terms of processes, products, organization of the production and ways of marketing The rate responses, in which the firm will follow, also depends

on the internal capacities, the organizational ability and the productive capabilities (Ferraz et al., 1995)

This is one way in which the competitive advantage of a firm

is accomplished, by creating a value in a product or in a process that

is extraordinary and is beyond the thinking of the current crop of

Trang 33

competition in the market (Porter, 1989; Barney, 1991) Additionally, this is a measure of competition as it indicates the position of the firm over its competitors all through the entire industry Furthermore, it is possible for a company to come up with a high technological product that does not have any competitive edge and a competitor decides to commercialize a low quality product, which is the only one in the market can be said to enjoy a competitive advantages (Barros, 2001).

In another work by, (Porter (1990)ended questions asin some countries develop more than the others Defining the discussion in order

to help with the answer, when analyzing an entire industry, it is easy to note that some firms enjoy more market share while the others just show

up and are constantly following What this reflects is that the firm can take advantage of their individual capacities and competencies and create

a goal of promoting development, growth and through this they can achieve a competitive advantage This way, the same developed countries will be more developed and a result become more competitive than others, because they implement their individual capacities and internal productive capacities (strength and opportunities) that enable them to be transformed into competitive advantages, and this is something that other firms (the followers) are not able to do Inspire of that, firms still are able to enjoy comparative advantages that, as (Ricardo (1982), says, he refers to the natural conditions of a place For instance, the climate and the soil one region can produce more fruits than another region And in that case competitive advantages can be combined with the comparative advantages, and turn the region or a firm highly to be highly competitive

Low production cost and differentiation of specific products and services are other two important sources of competitive advantages, this according to (Porter (2000) The low production cost can be reached when a firm produces a product and upon offering it, it sells it based on the comparative nature and of course better than competitors who have also adopted similar price strategies The differentiation of a product refers to that capacity of offering buyers an exceptional and better value

as far as the quality, special features or assistance services Both are part

of the competitive process or campaign and are directly involved in their creation for competitive advantages and support (Porter, 2000)

Trang 34

INNOVATION AS A COMPETITIVE ADVANTAGE FACTOR

It is necessary to emphasize how people look at innovation as acasual, meaningless activity, making the competitive advantage generation possible for the firm It is common that managers seek the survival of the organization in the initial moments and, later, the expansion of their activities through strategies that unfold in differentiation or competition for costs, either having a broad or specific focus In this process, it is also natural to imagine that the challenges appear and that firms seek adaptation

to the context, preferably in a unique way over their competitors Giving these assurances, in order to achieve sustainable competitive advantages, there is the need of implementing new procedures and attributes, internal

or external, which so far has not been used by the market or by the organization It is in this context that the function of innovation is inserted

as a competitive advantage generation factor

PERFORMANCE SUPERIORITY

Both the theory and science part of quality and continuous improvement

in thefield of quality and its continuous betterment has been the basis

of the interest of many resisters who have an interest and d passion in Business Process Management (Trkman, 2010; Kung and Hagen, 2007;

Smith and Fingar, 2003) The concept of performance brought in a new perspective to the whole cycle of business performance and process management as has been studied by (Smith2007) The modern era perspective of the performance superiority has redefined its own course which is determined by the resources a company has at its disposal The resources should the cannot be imitated by the competitors, otherwise the company will lose its advantage on performance superiority these resources can either be unseen resources that are what are seen as the raw material to achieve superiority Superiority touches both the operational and competitive performance of a company and that is the reason why many researchers have been locked in this study (Chen and Lin, 2006, Sittimalakorn and Hart, 2004) In this section we will look at superiority

in operational business performance and that of competitive business performance The two are seen as a source or factors that can be used to evaluate business superiority (Yaghi, 2010)

Trang 35

Views on Performance Superiority

Researchers that share the same view on resource driven superiority will obviously point out that there the significance of the nonphysical resources such as the reputation of the firm and its ability to sustain it for the longest time possible as they seek to maintain performance (Chen&

Lin, 2006) Other scholars have linked the nonphysical resources such

as a good reputation as a factor that may affect the quality of product or services being produced Some of these studies such as the one done by (Sittimalakorn and Hart, 2004) he was investigating measurements and the standards of the market as one of the reasons that lead to performance superiority Other market standards included things like resources, social and environmental relationship, staff retention, especial ally of the key technical ones, the degree of creativity, the value of investment and the quality of management product Tang and Ogunlana (2003, p 274) made his own presentation by on how a firm that uses information technology

in the formulation of management policies and improving the knowledge needed to make superior products or services helped them improve on quality performance and ultimately also give the company an upper hand on maintaining a good reputation across the entire industry and get a good grip on the giant market share And Forza (1996) mentioned that superiority in operational process performance is made possible through the integration of managing the product flow all the way from the supplier until it reaches the steps of the steps of the consumer He also pointed out that a company that wants to achieve business superiority performance should re-align its ways of interactions with their clients and formulate it in such a way that they can gain an advantage over competitors There have been studies on the external effects that have

a direct impact on the firm’s strategic plans It has been said that these effects form the basic element needed in achieving superior performance

Others, such as Hoskisson et al 1999) has been able to see a link in the company’s superiority to the features of its organizational structure

This measurewas seen as either an access or a restriction of gaining an entry into the market The linkages are variable, product innovation, and the company’s performance in the industry (Seth & Thomas, 1994)

This view made an assumption that every business has its ownresearch capabilities that are not imitated and cannot be imitated, eLee et al, 2001)

Schmalensee (1985) employed a new way of analyzing the practicality

Trang 36

of the factors of a business and their individual effect on the company’s superiority, at the same time Rust et al (1994) adopted the dimension of quality and the impact it has superior performance through the reduction

of costs and improvement of loyalty to customers and creating avenues

to attract new customers As Schmalensee (2003, p 14) may have said that companies that enjoy superior performance must face the constant struggle to stay on track by maintaining and improving on the areas that keep them at the superiority level Many researchers have been able to identify the effective cofactors that help in the sustenance of superior performance, McGaham& Porter (1999) stated that industries suffer while

on their way to superior performance than they do on regular business operations They also went ahead and noted that the company’s size, market share, products’ options, and company growth have a positive link to superior performance sustenance (Drouopoulos&Lianos, 1993) won the same note Robert & Dowling (2002) said superior performance had a relation to the companies’ good reputation There is also the link to market strategies, where the companies concerned have a reliable costing strategy that helps them keep their standards and reputation on top of everyone (Alulakh et al, 2000) Further to extra-ordinary performance with the aim of creating value for their clients through various means other than the good services can also create a clear distinction of the company from its competitors (Hutchinson, et al, 2007)

WHAT ARE THE PERSPECTIVES OF BUSINESS PROCESSES MANAGEMENT?

Following is a study, Irmily (2011) said that Gillot’s opinion (2008) that listed four perspectives as detailed below:

• Business perspective: is an inclusion of three properties that are:

• Organization’s strategy

• Market compatibility

• Organization’s target market position

Organization perspective: an inclusion of the properties linked with performance and improvement, they include:

Trang 37

• Financial goals

• Access time to the market

• Level of service quality

a multi-processing when creating aproduct or during the provision of services and handling customers

Technology, perspective: comes in two levels, one is the ability to use existing information to facilitate processes, the other one is the use and implementation of technology and its impact in processes continuity

Different Models and Types of Business Processes

When researchers look at models and types of business processes, they a have different views and perspectives, Baker and Maddux (2008) looked

at them a customer’s external process marketing, internal processing and production, sales and services after the sale, and the distribution processes Llewellyn and Armisted (2000) said that business models were just the operational processes that were in line with the organizational way of doing things, in terms of strategies, the creation and sale of goods and services, and marketing and eventually selling the products Gillot (2008) looked at the models and divided them into four groups;

• Integration processes

• Human or cooperation processes

• Decision making processes

• Documentation processes

Whereas, Barnes (2008) made a classification and put them into three types based on the type of resource being transferred during the entire process;

• Materials treatment processes

Trang 38

• Information processing

• Customers’ following up processesIrmily(2010) further classified them into primary processes as either productsor services has to start and ends at the client’s desk, the other classification that starts and ends at the customer and the other classification (secondary processes) that acts as a foundation for the primary processes and are related to the employees, suppliers, administrative process and stakeholders

The Business Process Cycle

There are researchers that attempted to address the different stages of the business processcycle and came up with different definitions and methods that can be used to look at them Gillot (2008) made a case by saying that the stages of the business process cycleincluded:

• Modeling the processes

Irmily (2010) said that the stage should include the following:

• Identifying and designing the processes

• Process implementation

• Follow up on the control processes

• Process development

Singh (2012) made a classification based on the following activities:

• Designing the processes

• Modeling the processes

• Implementing the processes

• Controlling the process

• Development of the processes

Business Processes, Management and its Dimensions

Business process management (BCM) is a manageable way of improving the quality of goods and service development through the identification

of the design, model, documentation, and process controls All this is

Trang 39

done to ensure that there is an improvement on the entire business process made to achieve an integrated operational outcome This outcome should

be able to linkto the resources and help them be in line with the firm’s strategic goals (Gillot, 2008, p25) The following classifications should make it easier for the understanding of the entire business process, this according to (Irmily, 2011):

Identification and designing processes:

Here we are supposed to identify, analyze and determine the processes and the general perspective and nature and size of the entire business process Also look at other options and benefits by being able to identify abilities, goals, integrated value and resources

Modeling and documenting the processes:

Identification of the goals, responsibility and limits that will accurately portray a careful analysis of the information being used and the planning process At this stage one should understand the expected impact on the system and perform an evaluation and the feedback

Following up and controlling the processes:

This is a follow up process and associated activities, procedures, technology, procedures, resources, technology and information that should be used to review the continuous process and be able to control implementation and corrective procedures and come up with outputs from a planned scope

Improving the processes:

This is an approach involving the methods used in the analysis and development of the existing process The aim is to improve the future performance and give room for improved performance

Superiority in business performance:

Most successful organizations always have a different perspective to the administrative, organizational, and leading ways that gives them the advantage of being able to maintain a better view of performance

Trang 40

superiority This gives them the bestidea of transforming better and helps in the improvement of superiority Al-Khafagi& Al- Ghalbi (2010) looked at the trends that center on processes that aid an organization gain superiority and therefore gain competitive advantage Superiority can also be achieved through a unique performance by choosing the best skill that keeps the company ahead by using comparative points

as a reference Yaghi (2009) decides to use the financial strength and competitive superiority underline their performance superiority, Porter (1985) made an observation that a company’s superior performance is tied to the level of the company’s performance and progress

FIRM’S OBJECTIVES TO INNOVATION

Every firm has unique characteristics that define the basis for innovation (Glockler 2013) More studies place their focus on the traits of the firm and one of the biggest trait they look at is the research and development, level of skills, and organizational structures The studies also look at the implications each of these traits in line with external knowledge acquisition (Freel and Aslesen 2013; Spithoven, Clarysse, and Knockaert 2011) Moon (2011), made an argument that a firm’s innovation strategy and objectives are as important as defining thefirms’ quest for knowledge acquisition Some findings dwell on the size and departmental differences and recognizes the rationale for having external knowledge and how the quest differs depending on the size of the firm (Moon 2011; Vahter, Love, and Roper 2013) Vahter et al (2013) entered into the debate by saying that the quest for external knowledge adds more value if smaller companies embraced the path because of their weak knowledge base

Many debates have been sustained on a firm’s activities that are aligned to its innovation objectives They normally have a presentation

of a level of diversity of the firm relative to the risk factors and rewards for every major innovation There is the need to strike a balance in the use of these resources and what they can do in helping a firm get to new levels of innovation However, there are three unique perspectives that can said to be related to the research studies for innovation First, there is a clear demarcation between the two strategies, innovation-based and imitation-based (Shenkar 2010; Schnaars 1994; Bolton 1993)

Both the strategies usually found on every new product that has been released into the market Imitations may be new from the perspective

Tiêu đề	Identification Of Innovative Marketing Strategies
Tác giả	G. Hills, Hultman
Trường học	University of Illinois, Chicago
Chuyên ngành	Marketing
Thể loại	research paper
Năm xuất bản	2010
Thành phố	Chicago

Định dạng
Số trang	133
Dung lượng	6,52 MB