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Duygu Seckin Halac

on 5 November 2013

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The Effects of Technology Orientation on Firm Performance
Duygu Seçkin Halaç

Construct of Technology Orientation
The main objective of this dissertation is to constitute and operationalize the multidimensional construct of technology orientation, and even to redefine technology-orientation if necessary.
Complementary aim is to investigate the effect of technology orientation on business and innovative performance.
Technology Orientation
Technology orientation is employing technical knowledge in order to build a new technical solution to answer and meet new needs of the users (Gatignon & Xuereb, 1997).
Technology orientation studies strongly keen on technology-push approach.
Current studies mostly handle technology orientation as a driver of new product innovation.
Technology Orientation
There are only 19 empirical studies that consisted of technology orientation as a variable.
None of them investigated TO solely.
Excluding Finland(4) & USA(2), 13 studies conducted in emerging economies: China(6), Turkey(3), Greece(1) & Portugal(1).
Except Rajala & Westerlund(2012), TO was considered as a single-dimensional construct.
The instrument of Gatignon&Xuereb(1997) was followed by 12 other studies.
Firm Performance
Firm Performance
TO & Performance
In 19 empirical studies; most studies chose innovative firm performance in the first place.
Then, financial and market performance was in consideration.
Construct of Firm Performance
Porter (1991): the degree of achieving the set targets at the end of a previously specified date.
Schendel & Hofer(1979): "the test of any strategy."
Strategy is about setting goals where performance is about in what extend to achieve them.
Innovative Performance
-Wang&Ahmed (2004)
-product, process, marketing, behavioral, strategic performance
Business Performance
-financial, manufacturing, market, marketing performance
Research Questions
- “Is technology orientation really a single dimensional construct?”
- “If it is a culture-based strategic orientation as mentioned in the current literature, then why does technology orientation only discussed in functional level instead of firm level?”
- “As a firm level and a culture based orientation why technology orientation is not be discussed individually and combined with other strategic orientation in all empirical studies?”
- “As a firm level culture based orientation has technology orientation direct effects on firm performance?”
Pilot Study
Scale Development
Survey method - close ended questions
Agreement type (1.strongly disagree-5.strongly agree)&quality type scales (1.much below average-5.much above average)
For adapted instruments: translation&back translation
For renewed instruments: unlearning-revised to measure at firm level instead of team level-; innovative performance-convert to performance scale from attitude scale
Questionnaire Design
A booklet format consisting of 4 pages in one sheet
A logo of Yasar University
A brief explanation about content & intend of the study, possible scientific contributions, a disclosure guarantee, contact information
Only necessary items included
Related variables were grouped: to provide a reader-friendly form; to put common sentence headings to the top to put shorter statements; to increase return rate
Sampling & Data Collection
Yasar University graduate students who are working for manufacturing firms located in Izmir were selected.
All graduate students who works for manufacturing firms located in Izmir were asked for to participate to the study voluntarily.
Voluntarily participated 58 graduate students were composed of the pilot study sample.
Final Field Study
Sampling & Data Collection
The population of the study was “manufacturing firms operating in Izmir” where the level of analysis was “individual firms.”
Izmir Ataturk Organized Industrial Zone (IAOSB) was selected as the sample. From the website of IAOSB, 250 firms out of 364 were randomly selected.
102 firms agreed to give appointment; 83 firms delivered usable forms.
23 firms from Tire Organized Industrial Zone, 28 firms from Kemalpasa Organized Industrial Zone and additional of 13 firms from IAOSB were also participated.
Participant Characteristics
147 firms participated
The average employee: 265
An average of 30 years of operations from the build up.
46% of 224 participants were women.
An average of 12 years of work experience
An average of 5,6 years experience at the current firm
56% of them white-collar worker including R&D specialists; 31% of them middle-level managers and 13% were high-level managers/firm owner/partner
54% of them work with R&D department in their organizations where 50% of them work with or in a direct connection with manufacturing department
Revised Instruments & Questionnaire
As to the pilot study results;
"Learning" was excluded as a whole from the form
One item from each of technological capability, top management capability and unlearning were excluded.
"Unlearning" was divided into two factors named "commitment to learning" & "commitment to change."
Some major revisions was made on performance criteria and and six extra items were included instead of eliminating some of the items.
Analysis & Findings
Exploratory Factor Analysis
Confirmatory Factor Analysis
Discussion & Conclusion
Survey method: the reliance of a perception-based & self-reporting measure
Sampling: a cautious interpretation would be necessary when it comes to generalization
Including only manufacturing firms in Izmir
Technology Orientation
...is supported to be discussed in a multi-dimensional construct.
...consists of top management capability, technological capability, commitment to learning & commitment to change.
...can be redefined as a culture-based firm level strategic orientation which is characterized by top management capability that leads the strategic direction, strong technological capability, as well as being dedicated to continuous learning, questioning all new information and change old routines if necessary.
Resource-based View
-the importance of internal strengths
-rare, valuable, hard to imitate, hard to substitute resources and capabilities
-top management capability& technological capability
Organizational Learning
-"new knowledge development" (Huber, 1991)
-single-loop&double-loop (Argyris&Schön, 1978)
Construct of Technology Orientation
-Technology orientation needs to be studied at firm level instead of functional level; in a multidimensional construct instead of a single construct.
-Technology orientation could be seen as complex combination of capabilities that are glued with learning and unlearning to put together all the assets of a firm and enable to deploy them in an efficient and effective way.
Research Model
Further Research
An expanded field research:
throughout Turkey
cross-cultural examination
in several organized industrial zones
comparison between organized industrial zones
During the literature review;
# of "Strategic orientations" references cited: 54
# of "Technology orientation" references cited: 118
# of "Performance" references cited: 25

Total # of references cited: 166
Participated firms’ declarations demonstrated that manufacturing firms might increase their business performances by paying attention to increasing their innovative performances.
In order to increase innovative performance, they need to have a clearly directed mission, vision and leadership skills; need to invest on strong R&D resources, practical and theoretical know-how, methods, physical devices/equipment and highly skilled human resources; need to be dedicated to learning, evaluate every bit of new information and shed the old way of doing things/procedures if the new ones are more suitable or the new ones are required to stay competitive.
(1) To constitute and operationalize a multidimensional TO construct,
(2) To examine TO solely.
(3) To constitute and operationalize a multidimensional innovative performance construct.
(4) To construct a scale of unlearning on firm level while current scales are on project team level.
(5) To provide a picture of how the dimensions of technology orientation and overall business and innovative performance criteria were in relation as a whole picture.
Scarce resources and their allocation
Difficulties of seeding cultural value systems
Gaps in current literature
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