A Study of Market Orientation in American Business Schools

ABSTRACT The market orientation strategy is based upon the acceptance and adoption of the marketing concept. The market-oriented business recognizes the importance of coordinating the activities of all departments, functions, and individuals in the organization to satisfy customers by delivering superior value. Theory and empirical research suggest that greater levels of market orientation result in a greater ability of the organization to reach its objectives, in other words, higher levels of market orientation suggests better performance. The literature on market orientation however is quite sparse in the area of market orientation in the nonprofit sector. This paper extends the current research on the use of the market orientation strategy by investigating market orientation levels within college and university schools of business in the United States and comparing their levels of market orientation to levels of previously studied for profit businesses. Academic vice presidents and deans of business schools in the United States were surveyed by way of a national mail survey. All of the academic officers (VPs and Deans) were from colleges or universities that held membership in either the Association to Advance Collegiate Schools of Business (AACSB-International) or the Association of Collegiate Business Schools and Programs (ACBSP). These two organizations are both accreditation sources for schools of business. The national survey was responded to by 462 officials. Of the respondents, 223 were business school deans and 239 were academic vice presidents. The market orientation scores of these officials were compared to scores reported in the literature for business managers and also comparisons were made between various groups of the VPs and Deans by position and accreditation affiliation. Each respondent was asked to provide market orientation information about three specific customer or stakeholder groups which included students, parents of students, and employers of students. Overall, 84 different hypotheses were tested. The results of the research indicated that market orientation was significantly higher in the business organizations than in the schools of business. The paper presents details of the research process, findings, and discusses the implications of the research for schools of business. INTRODUCTION AND DEFINITIONS Can a particular organizational culture lead to improved organizational performance? If so, can a sought after culture be described and then be measured quantitatively? And, if measurements can be made will comparisons in measurements between organizations be advantageous in helping organizations improve their performance? This paper investigates these questions, measures a specific component of organizational culture, and compares two types of organizations. The component of organization culture measured is market orientation. The quantitative measurement is accomplished by way of a scaled instrument used in a national survey. The comparisons described in this research are between commercial businesses (for profit entities) and schools of business administration (non-profit entities). In marketing literature, numerous similar sounding terms are often encountered. These terms are not synonymous and should not be used interchangeably. To help avoid confusion the following descriptions and definitions are provided: 1. The marketing concept is a philosophy that advocates that a successful organization begins with identifying customer needs and wants, decides which needs to meet, and involves all employees in the process of satisfying customers. 2. Marketing orientation implies that the marketing function is the most important function within the organization and that all other functional areas are driven by the demands of the marketing department. 3. Market orientation refers to an organizational culture in which everyone in the organization is committed to the customer and adapts in a timely manner to meeting the changing needs of the customer. …