Customer-Oriented Innovation and Firm Performance

41 Pages Posted: 20 Nov 2012 Last revised: 25 Sep 2014

Date Written: November 19, 2013


The service-dominant logic of marketing suggests that customer-oriented innovation should be an essential focus for any firm; however, there is limited literature on the relative impact of customer-oriented innovation on firm performance in comparison with other dimensions of innovation. We integrate the service-dominant logic of marketing with the resource-based view of strategy to examine the relative importance of customer-oriented innovation on firm performance. By analyzing data from 765 managers from 52 business units of 19 large U.S. corporations, we find that customer-oriented innovation and offering-oriented innovation are both significantly associated with firm performance, while operations-oriented innovation is not. We discuss the implications of our findings for the service-dominant logic of marketing, resource-based view of strategy and measurement of innovation.

Keywords: Business Innovation, customer value, innovation radar, innovation measurement, validation

Suggested Citation

Chen, Jiyao and Sawhney, Mohanbir and Neubaum, Donald O., Customer-Oriented Innovation and Firm Performance (November 19, 2013). Available at SSRN: or

Jiyao Chen (Contact Author)

Oregon State University ( email )

Corvallis, OR 97331
United States
5417376338 (Phone)

Mohanbir Sawhney

Northwestern University - Kellogg School of Management ( email )

2001 Sheridan Road
Evanston, IL 60208
United States

Donald O. Neubaum

Oregon State University ( email )

Bexell Hall 200
Corvallis, OR 97331
United States

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