Customer orientation and organizational innovation: the case of environmental management practices

This study aims to investigates the effect of three customer orientation components – customer information-processing, responsiveness and values and norms – on a firm’s decision to adopt environmental management practices. Consistent with the literature on strategy and industrial marketing, the authors also examine the moderating effect of marketplace characteristics.

The authors use a linear model on a sample of 4,324 French firms with ten or more employees.

Based on a large-scale survey of firms across industries, the results indicate that customer information-processing and values and norms directly contribute to the adoption of environmental management practices. Furthermore, the effect of customer information-processing is shown to be contingent on market competition.

The findings have direct practical implications. When managers recognize the importance and usefulness of customer orientation, they understand the need to formulate organizational strategies in terms of environmental management practices that reflect customer expectations. In addition, following the strategic fit approach, customer orientation should fit with the specific market environment to stimulate the adoption of environmental management practices. In other words, the findings are useful for managers, who can assess the specific environmental characteristics they are facing and align these with customer orientation to build competitive advantage.

The findings indicate that the different dimensions of customer orientation distinctly affect a firm’s decision to adopt environmental management practices. In this sense, the authors argue that they capture different facets of the customer orientation measure, which points to the importance of analyzing the dimensions of customer orientation separately. Furthermore, rather than analyzing aggregate measures of corporate social responsibility, the authors selected environmental orientation as a specific dimension, which has received less attention in the industrial marketing literature. Finally, the main findings mark an important contribution to the literature because they provide deeper insights into the conditions under which customer orientation dimensions drive the adoption of environmental management practices.