Article: Why do market orientation, product innovation capability, marketing performance, and competitiveness of small and medium-scale enterprises differ? Journal: International Journal of Productivity and Quality Management (IJPQM) 2025 Vol.45 No.2 pp.165 - 186 Abstract: The study aims to explore how market orientation, product innovation capability, and marketing performance relate and differ in influencing competitive advantage among small and medium-scale enterprises (SMEs). Employing a quantitative method, the research involves SME business owners and managers from three different types of SMEs. A Bayesian regression model was utilised to test the hypothesised research model. Empirical findings indicate that market orientation, product innovation capability, and marketing performance positively and significantly correlate with competitive advantage. While driving firms to enhance competitiveness, notable differences in SMEs' characteristics concerning market orientation, product innovation capability, marketing performance, and competitive advantage underscore their importance. This study contributes to enriching the body of knowledge, particularly in understanding the interconnectedness among these constructs as integral elements of competitive advantage's definitions and origins. The practical implications are expected to guide business owners and managers in making more informed and appropriate decisions. Inderscience Publishers - linking academia, business and industry through research

Title: Why do market orientation, product innovation capability, marketing performance, and competitiveness of small and medium-scale enterprises differ?

Authors: Onan Marakali Siregar; Selwendri; Muhammad Dharma Tuah Putra Nasution

Addresses: Faculty of Social and Political Science, Universitas Sumatera Utara (USU), Indonesia ' Faculty of Social and Political Science, Universitas Sumatera Utara (USU), Indonesia ' Doctoral Program in Management Science, Faculty of Economic and Business, Universitas Sumatera Utara, Sumatera Utara 20222, Indonesia; Universitas Pembangunan Panca Budi, Medan, North Sumatera, Indonesia

Abstract: The study aims to explore how market orientation, product innovation capability, and marketing performance relate and differ in influencing competitive advantage among small and medium-scale enterprises (SMEs). Employing a quantitative method, the research involves SME business owners and managers from three different types of SMEs. A Bayesian regression model was utilised to test the hypothesised research model. Empirical findings indicate that market orientation, product innovation capability, and marketing performance positively and significantly correlate with competitive advantage. While driving firms to enhance competitiveness, notable differences in SMEs' characteristics concerning market orientation, product innovation capability, marketing performance, and competitive advantage underscore their importance. This study contributes to enriching the body of knowledge, particularly in understanding the interconnectedness among these constructs as integral elements of competitive advantage's definitions and origins. The practical implications are expected to guide business owners and managers in making more informed and appropriate decisions.

Keywords: market orientation; product innovation capability; marketing performance; competitive advantage; small and medium-scale enterprises; SMEs.

DOI: 10.1504/IJPQM.2025.146636

International Journal of Productivity and Quality Management, 2025 Vol.45 No.2, pp.165 - 186

Received: 08 Jan 2023
Accepted: 16 Jun 2023
Published online: 10 Jun 2025 *

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Title: Why do market orientation, product innovation capability, marketing performance, and competitiveness of small and medium-scale enterprises differ?

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