AN EMPIRICAL INVESTIGATION OF THE LINK BETWEEN MARKET ORIENTATION AND BUSINESS PERFORMANCE IN NON-PROFIT SERVICE PROVIDERS

While researchers have explored the relationship between market orientation and firm performance in commercial organizations, such studies in non-profit organizations are scarce. This paper uses a structural equation model to show the impact of market orientation on the performance of non-profit organizations. To conduct the study, the authors employed the Kohli, Jaworski and Kumar (1993) market-orientation scale (MARKOR). Data for this study was collected by mail survey. One thousand market orientation surveys were sent to the executive directors of non-profit organizations across the U.S. One hundred forty-eight nonprofit agencies responded to the survey, representing 14.8% response rate. The performance criterion was based on the self-stated funding activities for the non-profit organizations collected in this sample. Results indicated that the Kohli, Jaworski and Kumar (1993) market-orientation scale provided a good measure of market orientation in non-profit organizations. The model of the relationship between market orientation and the performance of a non-profit organization supported the theory. The managerial implications are discussed for non-profit organizations. [PUBLICATION ABSTRACT]