Abstract

This study highlights the service-dominant logic perspective of a firm’s complex capability. The links between the functions of marketing strategies and distinctive capabilities indicate the importance of service management innovation, and emphasize the conceptualization of a service economy to verify the model. The model proposed in this study examines the relationships among market orientation, interaction orientation, innovativeness, innovative capacity, and performance, which includes customer performance and financial performance. This study presents empirical results from 225 larger-sized service firms in Taiwan. First, the organizational culture factors positively affecting innovative capacity include market orientation, interaction orientation and innovativeness. Innovative capacity in turn has a positive effect on performance. Secondly, ranked in order of effect on financial performance, these variables are innovative capacity, interaction orientation, market orientation and innovativeness. Finally, the mediating effects of customer performance partially increase the total effect of innovative capacity on financial performance.

Key words: Service-dominant logic, market orientation, interaction orientation, innovativeness, innovative capacity, performance.