Importance of innovation resources for market orientation: Financial performance link : mediating role of proactive market orientation

Mil elne , Bo u ; Dlačić, Jasmina; Snoj, Bo is; Selinšek, Aleksand a A icle Impo ance o inno a ion esou ces o ma ke o ien a ion: Financial pe o mance link : media ing ole o p oac i e ma ke o ien a ion Naše gospoda s o / Ou Economy P o ided in Coope a ion wi h: Facul y o Economics and Business, Uni e si y o Ma ibo Sugges ed Ci a ion: Mil elne , Bo u ; Dlačić, Jasmina; Snoj, Bo is; Selinšek, Aleksand a (2019) : Impo ance o inno a ion esou ces o ma ke o ien a ion: Financial pe o mance link : media ing ole o p oac i e ma ke o ien a ion, Naše gospoda s o / Ou Economy, ISSN 2385-8052, Sciendo, Wa saw, Vol. 65, Iss. 4, pp. 1-13, h ps://doi.o g/10.2478/ngoe-2019-0015 This Ve sion is a ailable a : h ps://hdl.handle.ne /10419/290450 S anda d-Nu zungsbedingungen: Die Dokumen e au EconS o dü en zu eigenen wissenscha lichen Zwecken und zum P i a geb auch gespeiche und kopie we den. Sie dü en die Dokumen e nich ü ö en liche ode komme zielle Zwecke e iel äl igen, ö en lich auss ellen, ö en lich zugänglich machen, e eiben ode ande wei ig nu zen. So e n die Ve asse die Dokumen e un e Open-Con en -Lizenzen (insbesonde e CC-Lizenzen) zu Ve ügung ges ell haben soll en, gel en abweichend on diesen Nu zungsbedingungen die in de do genann en Lizenz gewäh en Nu zungs ech e. Te ms o use: Documen s in EconS o may be sa ed and copied o you pe sonal and schola ly pu poses. You a e no o copy documen s o public o comme cial pu poses, o exhibi he documen s publicly, o make hem publicly a ailable on he in e ne , o o dis ibu e o o he wise use he documen s in public. I he documen s ha e been made a ailable unde an Open Con en Licence (especially C ea i e Commons Licences), you may exe cise u he usage igh s as speci ied in he indica ed licence. h ps://c ea i ecommons.o g/licenses/by-nc-nd/4.0/ 1 NAŠE GOSPODARSTVO OUR ECONOMY pp. 1–13 ORIGINAL SCIENTIFIC PAPER Ci a ion: Mil elne , B., Dlačić, J., Snoj, B., & Selinšek, A. (2019). Impo ance o inno a ion esou ces o ma ke o ien a ion – inancial pe o mance link: Media ing ole o p oac i e ma ke o ien a ion. Naše gospoda s o/Ou Economy, 65(4), 1–13. DOI: 10.2478/ ngoe-2019-0015 DOI: 10.2478/ngoe-2019-0015 UDK: 339.138:005.591.6:658.155 JEL: M2, M3 RECEIVED: AUGUST 2019 REVISED: SEPTEMBER 2019 ACCEPTED: OCTOBER 2019 Vol. 65 No. 4 2019 Impo ance o Inno a ion Resou ces o Ma ke O ien a ion – Financial Pe o mance Link: Media ing Role o P oac i e Ma ke O ien a ion Bo u Mil elne Uni e si y o Ma ibo , Facul y o Economics and Business, Slo enia [email p o ec ed] Jasmina Dlačić Uni e si y o Rijeka, Facul y o Economics and Business, C oa ia [email p o ec ed] Bo is Snoj Re i ed Full P o esso a he Uni e si y o Ma ibo , Facul y o Economics and Business, Slo enia [email p o ec ed] Aleksand a Selinšek Uni e si y o Ma ibo , Facul y o Economics and Business, Slo enia [email p o ec ed] Abs ac The pu pose o his pape is o explo e he ela ionship be ween ma ke o ien a ion, inno a ion esou ces and companies’ inancial pe o mance. Focus is pu on he media o ole o p oac i e ma ke o ien a ion (PMO) in he ela ionship be ween eac i e ma ke o ien a ion (RMO), inno a ion esou ces and inancial pe o mance in he con ex o Cen al and Eas e n Eu opean (CEE) coun ies. Resea ch builds on eliable scales. Fou hund ed and i een usable ques ionnai es we e collec ed om companies in Slo enia wi h mo e han 20 employees. The esul s show a s ong and posi i e ela ionship be ween RMO and PMO. The impac o RMO on inno a i eness as an elemen o o ganisa ional cul u e is bo h posi i e and s onge han he impac o PMO. PMO p o ed o ha e a signi ican posi i e in luence on he capaci y o inno a e. While inno a i eness alone does no di ec ly in luence inancial pe o mance, he esul s do con i m he posi i e impac o an o ganisa ional capaci y o inno a e on inancial pe o mance. The inding o ou pape is ha when PMO was included as a media o be ween RMO and he capaci y o inno a e, he esul was ha his indi ec impac p o ed o be one o he s onges in he model. Also, i p o es ha in CEE coun ies, i is impo an o s ess he in luence o ma ke and ma ke o ien a ion in building inno a ion esou ces and consequen ly inancial pe o mance. The limi a ion o he cu en s udy is ha we conside ed he ela ionship only among ew ma ke ing esou ces and o ganisa ional pe o mance. In u u e esea ch, addi ional measu es o ma ke pe o mance may be in oduced as media o s be ween inno a ion esou ces and inancial pe o mance. Keywo ds: p oac i e ma ke o ien a ion, esponsi e ma ke o ien a ion, inno a i eness, capaci y o inno a e, inancial pe o mance 2 NAŠE GOSPODARSTVO / OUR ECONOMY Vol. 65 No. 4 / Decembe 2019 In oduc ion As his ansi ion p ocess is s ill happening on coun y le el, many companies in Cen al and Eas e n Eu opean (CEE) coun ies s ill lack expe ience in o eign ma ke s and a e, in compa ison wi h de eloped coun ies, e en mo e a ec ed by he challenges o he new ma ke condi- ions. Howe e , some o hem seem o ha e a g ea e abili y o wi hs and he challenges o ope a ing unde he new economic condi ions. Hence, p esen esea ch explo es one o he possible easons o he be e pe o mance o such companies om he esou ce-based pe spec i e, which is based on he p emise ha companies can use a e esou ces and capabili ies o manage u bulen economic condi ions, pe o m be e (e.g. Ba ney, 1991; G ewal & Tansuhaj, 2001; Belak, 2013; V ečko & Lebe, 2013), unde s and consume needs mo e quickly and ans o m ma ke knowledge o adap o a changing en i onmen (B eznik, Laho nik, & Dimo ski, 2019). Hence, he pu pose o his s udy is o explo e he ole o esponsi e and p oac i e ma ke o ien a ion and inno a ion esou ces in ega d o inancial pe o mance in one o he de eloping CEE coun ies. As such, he expe iences o a de eloping CEE coun y can se e as a good benchma k o o he CEE coun ies in his ansi ion p ocess. In his p ocess, ma ke o ien a ion becomes impo an especially when obse ed oge he wi h inno a ion esou ces and linked o pe o mance. Au ho s (e.g. Hu ley & Hul , 1998; Na e , Sla e , & Ma- cLachlan, 2004; Bodlaj, Coende s, & Žabka , 2012) sugges ha esponsi e ma ke o ien a ion (RMO), p oac i e ma ke o ien a ion (PMO) and inno a ion esou ces could posi i e- ly con ibu e o company pe o mance and ma ke success. Due o he his o ical socio-economic he i age in CEE se ings, esea ch on RMO and especially PMO in ela ion o inno a ion esou ces and company pe o mance, wi h a e excep ions, has been neglec ed (Bodlaj e al., 2012) o has jus ocused on ela ing en i onmen al p oac i eness o company pe o mance (Ma in & G bac, 1998). Also, in de eloped economies, s udies ha ha e simul aneously examined bo h ypes o ma ke o ien a ion in ela ion o p oduc success as he ou come o capaci y o inno a e a e limi ed (e.g. Na e e al., 2004; A uahene-Gima, Sla e , & Olson, 2005; Tsai, Chou, & Kuo, 2008; Reid & de B en ani, 2010; Zhang & Duan, 2010). To da e, esea ch conce ning he ela ionship be ween RMO and inno a ion esou ces has p oduced mixed esul s. Al hough he majo i y o s udies show ha he ela ionship is posi i e (e.g. Lado & Maydeu-Oli a es, 2001; Ma suno, Men ze , & Özsome , 2002; Bake & Sinkula, 2005), some au ho s claim ha he impac o RMO on inno a ion success is no di ec (e.g. Ozkaya, D oge, Hul , Calan one, & Ozkaya, 2015). O he s ha e aised doub s abou RMO’s posi i e impac on inno a ion, sugges ing ha RMO may unde mine inno a i eness (Be hon, Hulbe , & Pi , 1999) o i may lead companies o sho -sigh ed new p oduc esea ch and de elopmen (F osch, 1996). Consequen ly, RMO solely by i sel also doesn’ p o e o be su icien p edic o o an o ganiza ion’s inancial pe o mance. These mixed esul s may be due o limi ed unde s anding o ma ke o ien a ion solely as RMO and neglec ing i s PMO pe spec i e (Na e e al., 2004). S udies (e.g. Zhang & Duan, 2010; Wong & Tong, 2012) show ha he ela ionship be ween o ganiza ional pe o mance and ma ke o ien a- ion is s onge when PMO is also p esen . Howe e , in he con ex o CEE coun ies, esea ch ega ding he in e ela- ionship be ween RMO and PMO and hei in luences on he inno a ion-pe o mance link is s ill sca ce. Namely, au ho s in simila esea ch usually include PMO and RMO as p e- decesso s o inno a ion esou ces and do no in es iga e he PMO ole as a media o in he ela ionship be ween RMO and he inno a ion-pe o mance link. This esea ch is an a emp o b idge his gap by p oposing and es ing a concep ual model explo ing he in luence o RMO on inancial pe o mance, by simul aneously exam- ining he media ing ole o PMO and inno a ion esou ces. Ou expec a ion is ha inclusion o PMO as media o in he model will augmen he in luence o RMO on inancial pe o mance. Responsi e and P oac i e Ma ke O ien a ion Ma ke o ien a ion as such has gained he a en ion o di - e en esea che s (e.g. Na e & Sla e , 1990; Kohli & Jawo ski, 1990; Na e e al., 2004; Augus o & Coelho, 2009; Zhang & Duan, 2010). Bu no all esea che s app oach ma ke o ien a ion as consis ing o RMO and PMO. The RMO pe spec i e ocuses on unde s anding and sa is ying cus ome s’ exp essed needs, while he PMO pe - spec i e ocuses hei la en ones. The RMO ep esen s, o a company, a key di e en ia ing esou ce and consequen ly in luences company pe o mance (A uahene-Gima e al., 2005; Jawo ski & Kohli, 1993; Na e & Sla e , 1990). Focus on RMO p o ides join o ganiza ional ocus o all he employees ha is mani es ed in inc eased o ganiza ional commi men and be e sa is ac ion o cus ome needs (Kohli & Jawo ski, 1990). A s ong RMO mani es s i sel h ough ma ke -o ien ed lea ning (Day, 1994; Kohli & Jawo ski, 1990; Sla e & Na e , 1995; Liu, Luo, & Shi, 2003). RMO includes cus ome o ien a ion, compe i o o ien a ion, and in e unc ional coo dina ion (Na e & Sla e , 1990) i i is 3 app oached as business philosophy; and i app oached as be- ha iou al dimension (Kohli & Jawo ski, 1990; Deshpande & Fa ley, 2004) i includes o ganiza ion-wide in elligence gen- e a ion, in elligence dissemina ion ac oss depa men s, and o ganiza ion-wide esponsi eness o ma ke in o ma ion. Nume ous au ho s (e.g. Be hon e al., 1999; Ch is ensen & Bowe , 1996; Na e e al., 2004; Blocke , Flin , Mye s, & Sla e , 2011; Voola & O’Cass, 2010) ha e c i icized he bene i s o RMO. Consequen ly, exclusi e ocus on RMO migh lead o a decep ion ha inding new ways o sa is y cus ome needs is less a ac i e (Cohen & Le in hal, 1990; Le in hal & Ma ch, 1993) and companies all in a ap o pe ec ly sa is ying exp essed needs. Bu on he long un his can hampe company success. Taking in o accoun all posi i e and nega i e dimensions o RMO, some s udies sugges ha p oac i e unde s anding and add essing o cus ome s’ la en and u u e needs may in- luence company alue-c ea ing p ocesses (e.g. Be e land, Fa elly, & Woodha ch, 2007; Tuli, Kohli, & Bha adwaj, 2007). Besides dealing wi h cus ome s’ exp essed needs, PMO ocuses on disco e ing and sa is ying he la en , un- a icula ed needs o cus ome s. Companies ha implemen PMO ake se e al ac ions o disco e ha la en cus ome ’s needs like obse ing cus ome beha iou , wo king wi h lead use s, unde aking ma ke expe imen s, and cannibalising he sales o exis ing p oduc s (Na e e al., 2004; A ua- hene-Gima e al, 2005; Jawo ski, Kohli, & Sahay, 2000). Thus, PMO leads o o ganiza ional commi men in p o iding inno a ions o he ma ke (Zhang & Duan, 2010). Au ho s (Lamo e, Be kowi z, & Fa ing on 2013) claim ha RMO is cha ac e ized by a ma ke -d i en app oach, while PMO is conside ed mo e esea ch-d i en and ocused on disco - e ing unexp essed and la en cus ome needs and p o iding p oduc s and se ices o sa is y hose needs. Ne e heless, PMO has se e al de iciencies (Le in hal & Ma ch, 1993), such as ocus on un amilia in o ma ion and knowledge as well as in o ma ion o e load ela ed o la en cus ome needs. Howe e , acco ding o Na e e al. (2004), he po en ial ad an ages o PMO clea ly exceed i s de icien- cies. The e o e, a challenge o companies is o de elop he capabili y o ini ia e gene a i e lea ning p ocesses and he associa ed elemen s in a p oac i e manne a he han as a esponse o ex e nal o in e nal challenges (Akgun, Lynn, & By ne, 2006; Bake & Sinkula, 2007). Inno a i eness and Capaci y o Inno a e Menguc and Auh (2006) di e en ia ed be ween inno a i e- ness and inno a ion, s a ing ha inno a i eness measu es he inclina ion o a company owa ds inno a i e beha iou , and is no he esul bu he means o achie ing inno a ion. Simila ly, Hu ley and Hul (1998) in oduced wo cons uc s o inno a ion: (a) inno a i eness, which e lec s openness o new ideas and is an aspec o o ganisa ional cul u e, and (b) he capaci y o inno a e, which e e s o he abili y o a company o success ully accep and implemen new ideas, p ocesses o p oduc s. Hence, inno a i eness is a cul u al aspec o he c ea ion, accep ance and in oduc ion o new ideas, p ocesses and p oduc s. In o he wo ds, i e e s o a company’s p ocli i y, ecep i i y, and inclina ion o adop ideas ha depa om he usual way o app oaching business (Zal man, Duncan, & Holbek, 1973; Hu ley & Hul , 1998) and implies a will- ingness o o go old habi s and y un es ed ideas (Menguc & Auh, 2006). F om he ma ke ing poin o iew being ma ke -o ien ed means a long- e m commi men o unde s anding cus ome needs and a he same ime o de eloping inno a i e solu- ions ha p oduce supe io cus ome alue (Sla e & Na e , 1998). As such, inno a i eness could be unde s ood as almos necessa y pa o ma ke o ien a ion. In ou concep ualisa ion, inno a i eness includes o ganisa- ional lea ning as he cen al mechanism by which o ganisa- ions de elop capabili ies and adap o hei en i onmen s. Acco ding o Cahill (1996) inno a i eness s ongly mo i- a es he capaci y o inno a e bu only when combined wi h esou ces and o he o ganisa ional cha ac e is ics (Hu ley & Hul , 1998). The de ini ion o he capaci y o inno a e unde sco es he emphasis on wha Roge s (1983) e e ed o as he p edi usion aspec o inno a ion, ha is, he ea ly p o- duc ion o adop ion o inno a ion by a company (Hu ley & Hul , 1998). As we can lea n om some au ho s (e.g. Han, Kim, & S i as a a, 1998; Menguc & Auh, 2006), in he p esen economic si ua ion wi h he g ow h o com- pe i ion in ensi y and unce ain y, he company’s capaci y o inno a e is impo an o achie ing compe i i e ad an- age. We assume ha companies wi h a g ea e capaci y o inno a e a e be e a de eloping and launching success ul new p oduc s and se ices in compa ison wi h hei com- pe i o s bu wi h he necessa y p econdi ion o RMO and PMO exis ence. In gene al, au ho s (e.g. Hu ley & Hul 1998; Han e al., 1998; P ajogo & Ahmed, 2006) ag eed ha inno a i eness and he capaci y o inno a e a e ecognized as c i ical asse s ha gene a e alue in he ma ke place and in he s ock ma ke and a e he e o e among he mos impo an ac o s ha impac business pe o mance. Bo u Mil elne , Jasmina Dlačić, Bo is Snoj, Aleksand a Selinšek: Impo ance o Inno a ion Resou ces o Ma ke O ien a ion – Financial Pe o mance Link: Media ing Role o P oac i e Ma ke O ien a ion 4 NAŠE GOSPODARSTVO / OUR ECONOMY Vol. 65 No. 4 / Decembe 2019 De elopmen o Hypo heses Responsi e ma ke -o ien ed beha iou is cha ac e ised by p oximi y, e i nemen , e i ciency and implemen a ion, which e l ec exploi a ion (Cohen & Le in hal, 1990; Le in hal & Ma ch, 1993), whe eas p oac i e ma ke -o ien ed beha iou is cha ac e ised by disco e y, a ia ion, inno a ion and isk- aking. The o me deepens exis ing compe ence, and he la e b oadens exis ing compe ence (Tsai e al., 2007). Acco ding o A uahene-Gima e al. (2005), RMO augmen s he impac o PMO by encou aging ealism in he company’s a emp o o ay in o new and dis an cus ome needs. Thus, i ensu es he e ec i eness o PMO by sa egua ding agains undue isk- aking (see Jawo ski e al., 2000; Na e e al., 2004; Sla e & Na e , 1998). Despi e Na e e al.’s (2004) a gumen ha in o de o de elop and main ain a compe i- i e ad an age, companies should inc easingly complemen RMO wi h PMO, o da e he e is, o ou knowledge, s ill no e idence o how RMO and PMO a e ela ed. This leads o he i s hypo hesis: H1: A esponsi e ma ke o ien a ion (RMO) is posi i ely ela ed o p oac i e ma ke o ien a ion (PMO). The e y essence o inno a i eness as a cul u al p edispo- si ion o de eloping new p ocesses and p oduc s clea ly indica es i s connec ion wi h RMO. Na e and Sla e (1990) emphasised ha RMO e e s o a cul u e ha places a high p io i y on c ea ing buye alue while also consid- e ing o he s akeholde s and emphasising esponsi eness o ma ke in o ma ion. Companies wi h a s ong RMO a e likely o de ise and adap p oduc s, se ices and p ocesses ha con inue o mee he needs o he e ol ing ma ke . Acco dingly, i is likely ha inno a i eness na u ally l ows ou o a ocus on being esponsi ely ma ke -o ien ed (Hul , Hu ley, & Knigh , 2004). Jawo ski and Kohli (1993, p. 56) ha e a gued ha ‘as a ma ke o ien a ion essen ially in ol es doing some hing new o di e en in esponse o ma ke condi ions, i may be iewed as a o m o inno a- i e beha iou .’ S udies indica e ha RMO is an impo an p edecesso o inno a i eness ega dless o he indus y in which he company is ac i e (e.g. A uahene-Gima, 1996; Han e al., 1998; Ngo & O’Cass, 2012; Tsai e al., 2008). Acco ding o Deshpande and Fa ley (2004), inno a i e- ness is he mos impo an consequence o RMO, and he concep s should complemen each o he (Hu ley & Hul , 1998; Han e al., 1998). Thus: H2: Responsi e ma ke o ien a ion (RMO) is posi i ely ela ed o inno a i eness. A ma ke o ien a ion, whe he RMO o PMO, should be he ounda ion o a business’s inno a ion e o s (Na e e al. 2004). PMO enables he companies o wo k closely wi h lead use s, which is linked o inno a i e de elopmen s (Lilien, Mo ison, Sea ls, Sonnack, & Hippel, 2002). PMO is by i s de i ni ion linked wi h inno a i eness, which is a cul u al aspec o he c ea ion, accep ance, and in oduc- ion o new ideas, p ocesses, and p oduc s. The empi ical e idence o Na e e al. (2004) sugges s ha PMO inc eas- es he explana o y powe o RMO well beyond ha ob ained by RMO alone. The same s udy also e ealed ha PMO is signi i can ly and posi i ely ela ed o inno a ion o ien a ion as he dimension o o ganisa ional cul u e. Some esea ch e en ound ha PMO has a g ea e impac on inno a i eness han RMO (Li e al., 2008; Zhang & Duan, 2010). Since PMO is an e olu iona y consequence o RMO and comple- men s i om he pe spec i e o la en needs, i should ha e he po en ial o media e he PMO – inno a i eness ela ion- ship. Acco dingly, we o mula e he ollowing hypo heses: H3: P oac i e ma ke o ien a ion (PMO) is posi i ely ela ed o inno a i eness. H4: P oac i e ma ke o ien a ion (PMO) media es he ela- ionship be ween esponsi e ma ke o ien a ion (RMO) and inno a i eness. The e has been ex ensi e esea ch conce ning he ela ion- ship be ween RMO and new p oduc success, con i ming a posi i e ela ionship (e.g. Lado & Maydeu-Oli a es, 2001; Ma suno e al., 2002) be ween he concep s. As assumed, companies wi h a g ea e capaci y o inno a e a e be e a de eloping and launching success ul new p oduc s (P ajogo & Ahmed, 2006). Companies wi h a s ong RMO a e mo e likely o iden i y and espond o new p oduc oppo uni ies han companies wi h weake ma ke o ien a ions (Bake & Sinkula, 2005; Hooley, G eenley, Cadogan, & Fahy, 2005) and a e also mo e likely o be he i s o ma ke wi h new gene a ions o exis ing p oduc s and se ices (Day, 1994). RMO may educe isks in he p oduc de elopmen p ocess and enhance he likelihood o new p oduc success (A - uahene-Gima e al., 2005; Jawo ski e al., 2000; Lukas & Fe ell, 2000; Na e e al., 2004). Thus, we p opose he ollowing: H5: Responsi e ma ke o ien a ion (RMO) is posi i ely ela ed o he capaci y o inno a e. La en cus ome needs, which a e he e y essence o PMO, a e equen ly linked o he capaci y o inno a e (Lilien e al., 2002). Focusing on la en ma ke needs may ale he company o new ma ke and echnology de elopmen s as well as ideas ha challenge exis ing cause–e ec ela ion- ships. Such an o ien a ion inc eases he company’s abili y o add new a ian s o ma ke in o ma ion in p oduc de elop- men , which esul s in adical p oduc s wi h unique bene i s (Le in hal & Ma ch, 1993). 5 Some s udies, ocused on he ela ionships among RMO, PMO and new p oduc success, con i m ha bo h RMO and PMO ha e a posi i e e ec on new p oduc success (Na e e al., 2004; A uahene-Gima e al., 2005; Tsai e al. 2008; Zhang & Duan, 2010). Howe e , he esul s o h ee me- a-analyses conce ning he ela ionship be ween an RMO and new p oduc success a e no uni o m (Hena d & Szy- manski, 2001). This may be because in hese s udies, PMO and he capaci y o inno a e we e no included as media o s o he ela ionship be ween RMO and pe o mance. This leads o he ollowing hypo heses: H6: P oac i e ma ke o ien a ion (PMO) is posi i ely ela ed o he capaci y o inno a e. H7: P oac i e ma ke o ien a ion (PMO) media es he e- la ionship be ween esponsi e ma ke o ien a ion and he capaci y o inno a e. An inno a i e o ganisa ional cul u e may s imula e he capaci y o inno a e when o he aspec s o a ma ke -o i- en ed cul u e a e also p esen . As al eady s a ed, combining inno a i eness as an aspec o o ganisa ional cul u e wi h esou ces and o he o ganisa ional cha ac e is ics, c ea es a g ea e capaci y o inno a e. Hu ley and Hul (1998) em- pi ically show he posi i e impac o inno a i eness on a capaci y o inno a e, using his esul as an a gumen o he inclusion o bo h concep s in ma ke o ien a ion-o - ganisa ional pe o mance ela ionship models. Inno a- i eness is expec ed o ha e a media ing powe only when combined wi h a capaci y o inno a e. This leads o ou eigh hypo heses. H8: Inno a i eness is posi i ely ela ed o capaci y o inno a e. Inno a i eness and he capaci y o inno a e ha e he po- en ial o sa is y he di e en o changing demands o cus- ome s and o accommoda e unce ain ies. In hei seminal wo k, Zal man e al. (1973) p oposed ha inno a i eness is he medium o business success in he wake o app op ia e in elligence ga he ing and decision making (e.g. Hu ley & Hul , 1998). Resea ch in ma ke ing indica es ha inno a- i eness has posi i e consequences o a ious i nancial pe o mance ou comes (e.g. Rube a & Ki ca, 2012; Ve- ga-Vazquez, Cossío-Sil a, & Ma ín-Ruíz, 2012). Also, companies wi h a g ea e capaci y o inno a e can de elop a compe i i e ad an age and achie e highe le els o pe - o mance. Bo h inno a ion esou ces a e impe uses o com- pe i i e ad an ages (e.g. P osenak, Mulej, & Snoj, 2008) and impo an o ganisa ional pe o mance di e en ia ing ac o s (e.g. Fage be g & Godinho, 2005; Da ila, Eps ein, & Shel on, 2006). Conce ning he ac ha i nancial indica o s a e he ul ima e judge o o ganisa ional pe o mance and, om an economic poin o iew, also e l ec he alues o all o he non- i nancial indica o s (such as ma ke pe o mance indica o s, in e nal o ganisa ional pe o mance indica o s, and b oade social pe o mance indica o s), hey ep esen he ou come o ou concep ual model. This leads o ou i nal hypo hesis. H9: Inno a i eness and capaci y o inno a e a e posi i ely ela ed o fi nancial pe o mance. Figu e 1. Concep ual model Reponsi e ma ke o ien a ion Inno a i eness Capaci y o inno a e P oac i e ma ke o ien a ion Financial pe o mance H8 H9 H9 H5 H2 H1 H3 H6 H4 H7 Bo u Mil elne , Jasmina Dlačić, Bo is Snoj, Aleksand a Selinšek: Impo ance o Inno a ion Resou ces o Ma ke O ien a ion – Financial Pe o mance Link: Media ing Role o P oac i e Ma ke O ien a ion 6 NAŠE GOSPODARSTVO / OUR ECONOMY Vol. 65 No. 4 / Decembe 2019 Me hodology Measu emen Ins umen De elopmen The measu emen ins umen o he e i ica ion o he empi ical model was de eloped in h ee phases. In he i s phase, i ems o he ques ionnai e ega ding PMO and RMO, inno a i eness and capaci y o inno a e we e conside ed and adop ed acco ding o he ele an li e a u e. Fo he measu e- men o PMO, we used he Na e e al. (2004) scale. RMO was measu ed using he wel e i ems adap ed om Na e and Sla e ’s (1990) 7-poin a ing scale. P e ious s udies indica ed some po en ial p oblems wi h cons uc alidi y; he e o e, some addi ional i ems we e added o ensu e a highe consis ency o he scale. In he inal ques ionnai e, ou i ems assessing he cus ome sa is ac ion measu emen (2), a e sales se ice, and cus ome sa is ac ion objec i es se ing we e used o measu ing cus ome o ien a ion. An addi ional ou i ems ela ed o compe i o esponse, sales- pe son compe i o in o ma ion sha ing, manage s discussing compe i o s a egies and a ge ing oppo uni ies o com- pe i i e ad an age we e used o assess compe i o o ien a- ion. I ems ela ed o sha ing in o ma ion among unc ions, unc ions con ibu ing o cus ome ’s alue, unc ional in- eg a ion o s a egy and in e unc ional in o ma ion we e used o e alua ing in e unc ional o ien a ion cons uc o ma ke o ien a ion. The scales o he measu emen o inno- a i eness and capaci y o inno a e we e de eloped using i ems om he scales o Hu ley and Hul (1998) and Calan- one, Ca usgil, and Zhao (2002). Following ha , in-dep h in e iews we e conduc ed wi h senio ma ke ing execu i es in se en een companies in Slo enia. The ques ionnai e was hen examined in he hi d phase by expe judges (academics in he ield o ma ke ing and inance) o asses o con en alidi y. Final ques ionnai e consis ed o measu emen scales o PMO (se en i ems), RMO ( i e i ems), inno a i eness ( i e i ems), and capaci y o inno a e ( wo i ems). All i ems we e measu ed on he 7-poin Like scale ( om 1 ‘s ongly disag ee’ o 7 ‘s ongly ag ee’). Financial pe o mance was inally measu ed on he 7-poin scale om ‘much wo se’ o ‘much be e ’ in com- pa ison wi h hei key compe i o s o e he pas h ee yea s. Ma ke and echnological u bulence we e ea ed as con ol a iables. They we e assessed on he 7-poin Like scale adop ed om Na e e al. (2004). Sampling F ame and Da a Collec ion In e e y company, a esponden om a ele an posi ion was iden i ied in o de o educe he sys ema ic e o . The endency was owa ds he in o man wi h mos knowledge abou he esea ch opic. Senio ma ke ing and inancial execu i es in he posi ion o CEO o a membe o he Boa d o Di ec o s seem o be gene ally eliable in hei e alua ions o o ganisa ional ac i i ies and pe o mance (e.g., Venka aman & Ramanujan, 1986). The ques ion- nai e was mailed o 3,000 andomly selec ed companies in Slo enia wi h mo e han 20 employees. In o al, 464 usable ques ionnai es we e ecei ed, ep esen ing a esponse a e o 15.4%. Analysis o esponses p o ed o be b oadly ep- esen a i e in e ms o indus y classi ica ion and company size. Non-Response Bias and Common Me hod Bias Non- esponse bias was es ed wi h he - es . We compa ed he mean alues o ea ly and la e esponden s. T- es esul s showed ha he e we e no s a is ically signi ican di e - ences be ween ea ly and la e esponden s. Since da a o dependen and independen a iables we e collec ed by he same me hod, we addi ionally es ed o common me hod bias wi h he Ha man one- ac o es (Podsako & O gan, 1986). The esul s o he ac o analysis showed a six- ac o solu ion accoun ing o 66.2% o he o al a iance, meaning ha he chance o common me hod bias is a he low, since a single ac o did no eme ge, and Fac o 1 did no explain mos o he a iance. Cons uc Reliabili y and Validi y In o de o assu e con e gen and disc iminan alidi y and eliabili y o he measu es, he dimensionali y o he single cons uc s (PMO, RMO, inno a i eness, capaci y o inno a e, and inancial pe o mance) was i s assessed. Explo a o y ac o analysis (EFA) o RMO esul ed in a h ee- ac o solu ion consis ing o cus ome o ien a ion, compe i o o ien a ion and in e unc ional coo dina ion. Fou i ems we e omi ed since hey did no load signi ican - ly on hei unde lying ac o . Con i ma o y ac o analyses (CFA) o he RMO e ealed he same s uc u e. The measu emen model o RMO was i s concep ualised as a unidimensional s uc u e a he han as a mul i-dimension- al s uc u e. The indices o he h ee- ac o model we e be e , indica ing ha a h ee- ac o model is mo e alid. Composi e eliabili y indica o s and a e age a iance ex- ac ed we e as ollows: cus ome o ien a ion (CR=0.77; AVE=0.53), compe i o o ien a ion (CR=0.78; AVE=0.55) and in e unc ional coo dina ion (CR=0.79; AVE=0.56). In o de o gain as pa simonious a s uc u e as possible, RMO was modelled as a second o de cons uc and hen included in he measu emen and s uc u al model. The e- o e, single indica o s mean alues we e calcula ed o he second-o de indica o s. Final cons uc s en e ing he s uc u al model (as shown in Table 1) consis ed o h ee 7 indica o s o RMO, i e indica o s o PMO, h ee i ems o inno a i eness, wo i ems o capaci y o inno a e and h ee i ems o inancial pe o mance. Fac o loadings, componen eliabili y and a e age a iance ex ac ed o he inal measu emen model a e p esen ed in Table 1. The eliabili y coe icien o he scale anges om .64 o .92, which is highe ha he ecommended alue o 0.6. Con e gen alidi y was assessed wi h he a e age a iance ex ac ed coe icien . Acco ding o Fo nell and La cke (1981), con e gen alidi y is es ablished i he a iance ex ac ed alue exceeds .50 o a ac o . The CFA esul s show ha in all he cases, wi h he excep ion o RMO, his c i e ion was me . Also, all i ems loaded signi ican ly on hei ac o s and we e highe han .50. In he nex s ep, we es ed he disc iminan alidi y, o es ab- lish whe he he measu es o concep ually dis inc cons uc s di e . This was assessed wi h Fo nell and La cke ’s (1981) es o see i he a iance ex ac ed es ima es exceeded he squa e o he co ela ion be ween he ac o s making up each pai . The c i e ion was mee in all cases. Resul s The s uc u al model p o ides he basis o hypo heses es ing (Figu e 1). The ac ha he model i only he chi- squa e s a is ic indica ed disc epancies be ween he da a and he p oposed model (χ2=322.38 / d = 118; p < 0.05). Table 1. I ems, s anda dised loadings, CR, and AVE o bo h g oups Coe icien s λ (loadings) CR AVE RMO (second o de cons uc ) Cus ome o ien a ion 0.722 0.73 0.48Compe i o o ien a ion 0.710 In e unc ional o ien a ion 0.647 PMO We help ou cus ome s an icipa e de elopmen s in hei ma ke s. 0.731 0.84 0.52 We con inuously y o disco e addi ional needs o ou cus ome s o which hey a e unawa e. 0.790 We inno a e e en a he isk o making ou own p oduc s obsole e. 0.659 We wo k closely wi h lead use s who y o ecognise cus ome needs mon hs o e en yea s be o e he majo i y o he ma ke may ecognise hem. 0.699 We ex apola e key ends o gain insigh in o wha use s in a cu en ma ke will need in he u u e. 0.679 Inno a i eness Ou company is c ea i e in i s me hods o ope a ion. 0.851 0.90 0.74 Managemen ac i ely seeks inno a i e ideas. 0.917 In ou company, we a e e y open o inno a ions (e.g. ela ed o p oduc s o p ocesses). 0.820 Capaci y o inno a e Ou company is o en he i s o ma ke wi h new p oduc s and se ices. 0.838 0.76 0.61 Ou new p oduc in oduc ion has inc eased o e he las 5 yea s. 0.721 Financial pe o mance O e all p o i le els achie ed compa ed o compe i o s (EBIT). 0.882 0.92 0.79Re u n on in es men compa ed o compe i o s (ROI). 0.924 P o i ma gins compa ed o compe i o s. 0.855 Fi indices: Χ2/d. .=2.89, RMSEA=0.06, CFI=0.96, GFI=0.93; NNFI=0.95, PNFI=0.73 Con ol a iables Technological u bulences The echnology in ou ma ke s is changing apidly. 0.835 0.69 0.51 Technological changes p o ide big oppo uni ies in his ma ke . 0.739 A la ge numbe o new p oduc s in his ma ke ha e been made possible h ough echnological b eak h oughs. 0.722 Technological de elopmen s in his ma ke a e a he mino . (R) 0.726 Ma ke u bulences In his ma ke , cus ome s’ p e e ences change qui e a bi o e ime. 0.557 0.79 0.56 Cus ome s in his ma ke a e e y ecep i e o new-p oduc ideas. 0.845 Fi indices: Χ2/d. .=8.96, RMSEA=0.02, CFI=0.99, GFI=0.99; NNFI=0.99, PNFI=0.52 Bo u Mil elne , Jasmina Dlačić, Bo is Snoj, Aleksand a Selinšek: Impo ance o Inno a ion Resou ces o Ma ke O ien a ion – Financial Pe o mance Link: Media ing Role o P oac i e Ma ke O ien a ion 8 NAŠE GOSPODARSTVO / OUR ECONOMY Vol. 65 No. 4 / Decembe 2019 Howe e , o he global i s a is ics sugges ed an adequa e i o he model. The RMSEA index o he model was 0.06, which sugges ed a easonable i . O he i indices we e in he app op ia e in e als and highe han 0.90 (Figu e 1), sugges ing ha he da a i s he model. Di ec Impac s As expec ed, he ela ionship be ween RMO and PMO was s ong and posi i e (γ=0.79; p<0.01), which p o ides ull suppo o H1. As in p e ious s udies, he di ec impac o RMO on inno a i eness was posi i e and s a is ically signi ican (γ=0.45; p<0.01), meaning ha we can suppo H2. The same also holds ue o he ela ionship be ween PMO and inno a i eness al hough he ela ionship was weake (γ=.023; p<0.01), which gi es suppo o H3. H5 was no suppo ed since he ela ionship be ween RMO and capaci y o inno a e was no s a is ically signi ican . As H6 p edic ed, PMO, on he o he hand, s ongly and signi ican - ly in luences capaci y o inno a e (γ=0.58; p<0.01). H8 was also ully suppo ed since inno a i eness and capaci y o inno a e a e posi i ely ela ed (γ=0.38; p<0.01). Despi e he non-signi ican di ec ela ionship be ween inno a i eness and inancial pe o mance, and he posi i e and signi ican ela ionship be ween capaci y o inno a e and inancial pe - o mance (β=0.028; p<0.01), we can gi e suppo o H9, since he e exis s a posi i e indi ec ela ionship be ween inno a i eness and inancial pe o mance (β=0.12; p<0.01). Indi ec Impac s Indi ec impac s we e es ed wi h a p ocedu e p oposed by Ba on and Kenny (1986). The e o e, a se ies o media ion es s we e employed. The signi icance o indi ec e ec s was assessed wi h boo s apping, ollowing he p ocedu e o P eache and Hayes (2008). As can be obse ed in Table 2, PMO media es he ela ionship be ween RMO and in- no a i eness (γ=0.58; p<0.10). Despi e he ac ha his ela ionship was signi ican a a less con en ional le el o signi icance (p<0.10), we ga e suppo o H4. Also, hypo hesis H7 was suppo ed since he indi ec e ec o RMO on capaci y o inno a e h ough PMO was s ong and s a is ically signi ican (γ=0.70; p<0.01). This ela ionship, oge he wi h he RMO and PMO ela ionship, was one o he s onges in he s uc u al model. O he indi ec ela ion- ships p esen ed in Table 2 we e weake bu also s a is ically signi ican . Con ol Va iables Two addi ional con ol a iables we e included (ma ke and echnological u bulence) in o de o assess whe he hey ha e any signi ican impac on PMO, inno a i eness, capaci y o inno a e and inancial pe o mance. The con ol a iables did no in luence inno a i eness, capaci y o inno a e and inancial pe o mance. Also, ma ke u bulence did no in luence RMO, bu he e was signi ican in luence o echnological u bulence on RMO (β=0.16; p<0.01). Discussion In ecen yea s ma ke o ien a ion, pe o mance esea ch has included a p oac i e ma ke o ien a ion dimension and has acknowledged he ac ha esea ching his ela ion- ship ma ke o ien a ion should be concei ed hand-in-hand Table 2. Di ec , indi ec impac s and global i indices o he model Di ec impac Indi ec impac To al impac RMO - PMO 0.792 p<0.01 n.a. n.a. 0.792 p<0.01 RMO - INNOV 0.453 p<0.01 0.179 p<.10 0.631 p<0.01 PMO - INNOV 0.226 p<0.10 n.a. n.a. 0.226 p<0.10 RMO - CINNOV -0.091 n.s. 0.702 p<.01 0.611 p<0.01 PMO-CINNOV 0.579 p<0.01 0.087 p<.10 0.666 p<0.01 INNOV - CINNOV 0.386 p<0.01 n.a. n.a. 0.386 p<0.01 INNOV - PERF 0.045 n.s. 0.123 p<.01 0.168 p<0.01 CINNOV - PERF 0.319 p<0.01 n.a. n.a. 0.319 p<0.01 RMO - PERF n.a. n.a. 0.223 p<.01 0.223 p<0.01 PMO - PERF n.a. n.a. 0.223 p<.01 0.223 p<0.01 Fi indices: Χ2/d. .=2.74, RMSEA=0.06, CFI=0.95, GFI=0.93; NNFI=0.94, PNFI=0.72 No es: RMO – Responsi e ma ke o ien a ion; PMO – p oac i e ma ke o ien a ion, INNOV – inno a i eness; CINNOV – capaci y o inno a e; PERF – inancial pe o mance