Investigation of the relationship between market orientation, coopetition, radical innovation and firm performance

Market orientation is based on identification of existing and potential customers expectations together with needs, finding ways to meet them, while giving direction to the future market. Consideration of market needs in radical innovation activities can result in widely adopted products and make difference in the market improving firm performance. However, in today's rapidly changing markets with uncertainties, there are obstacles to cope with. Coopetition emerges as a preferable approach at this stage. In this study, a research model was developed to investigate the role of coopetition between firms that are planning to radical innovation and performance benefiting from market orientation. The aim of this study is to investigate the relationship between market orientation, coopetition, innovation and firm performance. In this context, a research model and a number of related hypotheses were developed. In order to test the hypotheses, a survey is conducted with 337 managers and white-collar employees from 127 large scale manufacturing companies listed in the top 500 large industrial organizations of 2016 list published by Istanbul Chamber of Industry. The analysis is made using SPSS software. According to the results, it can be stated that market orientation has a positive impact on firm performance and radical innovation; while it has no influence on coopetition. It is observed that, coopetition has a positive impact on radical innovation and firm performance. Another finding of the study is the mediating effect of radical innovation on the relation between coopetition and firm performance. It has also been found that, radical innovation has a partial mediating effect on the relationship between market orientation and firm performance.