MARKET ORIENTATION, ALLIANCE ORIENTATION, AND BUSINESS PERFORMANCE IN THE ...

139 Pages·2013·2.62 MB·English

by  Grant Wilson

MARKET ORIENTATION, ALLIANCE ORIENTATION, AND BUSINESS
PERFORMANCE IN THE CANADIAN BIOTECHNOLOGY INDUSTRY

A Thesis Submitted to the College of
Graduate Studies and Research
In Partial Fulfillment of the Requirements
For the Degree of Master of Science
In the College of Pharmacy and Nutrition
Division of Pharmacy
University of Saskatchewan
Saskatoon

By

Grant Alexander Wilson

© Copyright Grant Alexander Wilson, April 2013. All rights reserved.
Permission

I hereby grant to University of Saskatchewan and/or its agents the non-exclusive license
to archive and make accessible, under the conditions specified below, my thesis, dissertation, or
project report in whole or in part in all forms of media, now or for the duration of my copyright
ownership. I retain all other ownership rights to the copyright of the thesis, dissertation or
project report. I also reserve the right to use in future works (such as articles or books) all or part
of this thesis, dissertation, or project report.
I hereby certify that, if appropriate, I have obtained and attached hereto a written
permission statement from the owner(s) of each third party copyrighted matter that is included in
my thesis, dissertation, or project report, allowing distribution as specified below. I certify that
the version I submitted is the same as that approved by my advisory committee.
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Abstract

There is a large body of research supporting the importance of market orientation in
determining performance. A growing body of research supports the notion that strategic alliance
management competencies positively influence performance. Few empirical investigations have
examined the importance of market orientation in the biotechnology industry, much less the
effect of alliance orientation on performance, or the combined effect of market and alliance
orientation on performance. This study explores these relationships among Canadian
biotechnology companies with medical/healthcare focuses. Of the 394 Canadian
medical/healthcare biotechnology companies identified, 81 usable responses were received,
yielding a response rate of 20.6 percent.
It was found that market orientation positively and significantly influenced business
performance, supporting the first hypothesis. Additionally, alliance orientation positively and
significantly influenced business performance, supporting the second hypothesis. However,
when market and alliance orientation were examined together, alliance orientation’s effect on
business performance remained positive and significant, but market orientation’s effect on
business performance became negative and non-significant. This prompted a further analysis
that investigated the presence of a mediation relationship. Market orientation was fully mediated
by alliance orientation in its relationship with business performance.
This study contributes academically by adding to market and alliance orientation research
and by the successful development of a biotechnology-specific performance instrument. This
study contributes to marketing and management strategy, as it outlines performance indicators
that enable high performance.
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Dedication
This Thesis is dedicated to my parents. To my father, a leader, entrepreneur, visionary,
mentor, and friend. To my mother, a nurturer, supporter, questioner, and friend. Your love,
encouragement, support, and positivity will forever be cherished and emulated.
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Acknowledgements
Many individuals have contributed to the research presented in this Thesis. I wish to
thank the following people:
My supervisor, Dr. Jason Perepelkin, for his advice, encouragement, guidance, support,
and teaching throughout my undergraduate and graduate studies. You continuously challenged
and encouraged me, allowing me to build an invaluable skill set. This Thesis should serve as a
testament of your outstanding academic and advisory abilities. Dr. Roy Dobson, for his support
and commitment throughout the academic process. Your experience, knowledge, and wisdom
are reflected in this Thesis. Dr. David Di Zhang, for his devotion, encouragement, and tireless
effort. You believed in me and never passed up an opportunity to compliment. I admire your
attention to detail and vast technical knowledge. Dr. Julian Vasilescu, for his support and ability
to share industry-specific knowledge that would have otherwise been unobtainable. My external
examiner, Dr. Eric Micheels for his interest and commitment. Mr. Marc-Antoine Vachon for
translating the English correspondence to French.
Canadian medical/healthcare biotechnology executives who made this Thesis possible by
completing the questionnaire. The College of Pharmacy and Nutrition, the administrative
personnel, my colleagues, and friends.
My mother and father for their love and support throughout my undergraduate studies,
graduate studies, and beyond.

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Table of Contents
Permission...............................................................................................................................................i
Abstract..................................................................................................................................................ii
Dedication.............................................................................................................................................iii
Acknowledgements...............................................................................................................................iv
Table of Contents....................................................................................................................................v
List of Tables........................................................................................................................................xi
List of Figures.....................................................................................................................................xiii
Chapter 1: Introduction...........................................................................................................................1
1.1 Biotechnology Market...............................................................................................................1
1.2 Biotechnology Managerial Skills...............................................................................................2
1.2.1 Market Orientation...........................................................................................................3
1.2.2 Alliance Orientation.........................................................................................................4
1.3 Marketing, Strategic Alliances, and Performance.....................................................................5
Chapter 2: Literature Review..................................................................................................................6
2.1 Market Orientation and Performance........................................................................................6
Hypothesis 1...........................................................................................................................10
2.2 Strategic Alliances and Performance.......................................................................................10
Hypothesis 2...........................................................................................................................13
2.3 Market Orientation, Alliance Orientation, and Business Performance...................................14
Hypothesis 3...........................................................................................................................14
2.4 Purpose of the Study................................................................................................................14
2.5 Implications of Study...............................................................................................................15
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Chapter 3: Methodology.......................................................................................................................16
3.1 Study Design............................................................................................................................16
3.2 Sample.....................................................................................................................................16
3.3 Questionnaire Development....................................................................................................18
3.3.1 Qualifying Question.......................................................................................................19
3.3.2 Market Orientation Instrument......................................................................................19
3.3.3 Alliance Orientation Instrument....................................................................................20
3.3.4 Business Performance Instrument.................................................................................22
3.3.5 Descriptive Items...........................................................................................................23
3.3.5.1 Descriptive items one, two, and three...............................................................23
3.3.5.2 Descriptive item four.........................................................................................24
3.3.5.3 Descriptive item five.........................................................................................25
3.3.5.4 Descriptive items six and seven........................................................................26
3.4 Questionnaire Distribution and Data Collection......................................................................26
3.5 Data Analyses..........................................................................................................................27
3.6 Ethical Considerations.............................................................................................................30
Chapter 4: Results.................................................................................................................................32
4.1 Response Rate..........................................................................................................................32
4.2 Demographic Results...............................................................................................................32
4.2.1 Response Language.......................................................................................................33
4.2.2 Method of Completion...................................................................................................33
4.2.3 Company Location.........................................................................................................33
4.2.4 Association Memberships..............................................................................................34
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4.2.5 Ownership Structure......................................................................................................35
4.2.6 CEO’s Education...........................................................................................................35
4.2.7 Company Age................................................................................................................36
4.2.8 Company Size................................................................................................................37
4.3 Instrument Results...................................................................................................................38
4.3.1 Market Orientation.........................................................................................................38
4.3.2 Alliance Orientation.......................................................................................................39
4.3.3 Business Performance....................................................................................................40
4.4 Analysis of Instruments...........................................................................................................41
4.4.1 Market Orientation.........................................................................................................41
4.4.1.1 MO reliability....................................................................................................42
4.4.1.2 MO factor analysis............................................................................................44
4.4.1.3 MO instrument conclusion................................................................................45
4.4.2 Alliance Orientation.......................................................................................................45
4.4.2.1 AO reliability.....................................................................................................46
4.4.2.2 AO factor analysis.............................................................................................47
4.5.2.4 AO instrument conclusion.................................................................................48
4.4.3 Business Performance....................................................................................................48
4.4.3.1 PERF reliability.................................................................................................48
4.4.3.2 PERF factor analysis.........................................................................................49
4.4.3.3 PERF instrument conclusion.............................................................................51
4.5 Non-response Bias...................................................................................................................51
4.6 Discriminant Validity..............................................................................................................51
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4.7 Descriptive Analyses...............................................................................................................52
4.7.1 Response Language.......................................................................................................52
4.7.2 Method of Completion...................................................................................................52
4.7.3 Science Park Location...................................................................................................53
4.7.4 Association Memberships..............................................................................................53
4.7.5 Ownership Structure......................................................................................................53
4.7.6 Educational Background................................................................................................54
4.7.7 Company Age................................................................................................................54
4.7.8 Company Size................................................................................................................54
4.7.9 Descriptive Analyses Conclusion..................................................................................55
4.8 Regression Analyses................................................................................................................55
4.8.1 Market Orientation and Business Performance.............................................................55
4.8.2 Alliance Orientation and Business Performance...........................................................56
4.8.3 Market Orientation, Alliance Orientation, and Business Performance.........................58
4.8.4 Market Orientation and Alliance Orientation................................................................59
4.9 Post-Hoc Analyses...................................................................................................................61
4.9.1 Market Orientation and Business Performance.............................................................61
4.9.2 Alliance Orientation and Business Performance...........................................................62
4.9.3 Market Orientation, Alliance Orientation, and Business Performance.........................64
4.9.4 Market Orientation and Alliance Orientation................................................................65
Chapter 5: Discussion...........................................................................................................................67
5.1 Responses.................................................................................................................................67
5.2 Demographics..........................................................................................................................67
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5.3 Reliability.................................................................................................................................68
5.4 Non-response Bias...................................................................................................................70
5.5 Descriptive Analyses...............................................................................................................70
5.5.1 Response Language.......................................................................................................70
5.5.2 Method of Completion...................................................................................................71
5.5.3 Science Park Location...................................................................................................71
5.5.4 Association Memberships..............................................................................................72
5.5.5 Ownership Structure......................................................................................................73
5.5.6 Educational Background................................................................................................74
5.5.7 Company Age................................................................................................................75
5.5.8 Company Size................................................................................................................75
5.6 Hypotheses...............................................................................................................................76
5.6.1 Hypothesis 1..................................................................................................................76
5.6.2 Hypothesis 2..................................................................................................................78
5.6.3 Hypothesis 3..................................................................................................................80
5.6.4 Post-Hoc Analyses.........................................................................................................83
Chapter 6: Limitations..........................................................................................................................85
Chapter 7: Conclusion & Future Directions.........................................................................................88
References.............................................................................................................................................91
Appendix A – English Questionnaire.................................................................................................102
Appendix B – French Questionnaire...................................................................................................108
Appendix C – Market Orientation (Adapted) – Narver and Slater (1990).........................................114
Appendix D – Alliance Orientation – Kandemir, Yaprak, Cavusgil (2006)......................................115
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