Market orientation and SCM strategy on SME organizational performances: the mediating effect of market performance

Abstract

AbstractThis study aims to examine the effects of market orientation and SCM strategy on SME financial performance and operational performance by using market performance as the mediating variable. A simple random sampling technique was employed. A total of 150 SME managers and owners participated in this study. By using Structural Equation Model (SEM) with AMOS 20 software, the results found the positive effects of market orientation on market performance and on financial performance. A positive effect was also obtained in examining the relationship between SCM strategy on market and operational performances. Market performance is also empirically proven to have a significant influence on operational performance. However, the results found no significant influence of market orientation on market and financial performances. The mediating testing showed that market performance strengthens the effect of SCM strategy on operational and financial performances. The results practically highlight the need for SMEs to rely on aspects of supply chain sustainability and be oriented to existing consumer demand patterns to encourage increased and sustainable business performance. Theoretically, the findings reveal SMEs’ emphasis on the strength of SCM strategy as a marketing focus and underscore the need to satisfy end customers and supply chain management members.

Keywords

• market orientation
• SCM Strategy
• Market Performance
• Financial Performance
• Operational Performance