Mediating Role of Organizational Innovation on Market Orientation and Business Performance: SEM-AMOS Approach

Abstract

This study investigated the mediating role of organizational innovativeness on the relationship between
market orientation and performance. Past literature has not fully investigated which strategy among
market development (international expansion) and technology development (investment in research and
development) will result in a higher performance outcome for a market oriented organization. SEM Amos
method was used for to analyze data gathered from a survey of 396 small and medium‐sized enterprises
from manufacturing sectors in Malaysia. Findings of this study suggest that in order to sustain their
competitive advantage, market oriented firms need to enhance their innovation process to improve
business performance.