Listening in and Out: Listening To Customers and Employees To Strengthen An Integrated Market-Oriented System.

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Journal of Business Research 69 (2016) 35913599

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Journal of Business Research

Listening in and out: Listening to customers and employees to strengthen


an integrated market-oriented system
Kendra Reed a,, Jerry R. Goolsby b,1, Michelle K. Johnston a,2
a
b

Management, College of Business, Loyola University New Orleans, 6363 St. Charles Avenue, New Orleans, LA 70118, United States
Retired/Marketing, College of Business, Loyola University New Orleans, 6363 St. Charles Avenue, New Orleans, LA 70118, United States

a r t i c l e

i n f o

Article history:
Received 1 September 2014
Received in revised form 4 January 2016
Accepted 5 January 2016
Available online 19 January 2016
Keywords:
Market orientation
Listening to customers
Listening to employees
Organizational listening environment
Internal marketing orientation

a b s t r a c t
While volumes of research have been dedicated to listening to customers as part of a market-oriented strategy,
very little attention has been given to the mechanisms that disseminate the information internally to the
employees who need it to meet and exceed customer requirements. A multidisciplinary exploratory study was
initiated to investigate how an organization's listening environment facilitates both organizational and employee
outcomes. Building on theory from marketing, management, and communications, the impact employee beliefs
about the organization's listening environment was shown to relate to both the external market orientation and
the individual's performance and commitment to the organization. Focusing on a small number of representative
variable in lexicon theoretical linkages, a structural equation model was tested utilizing managerial data across a
wide range of management levels of a major retail organization, as a preliminary foray into a potential multiple
disciplinary research program.
2016 Published by Elsevier Inc.

Emanating from a multidisciplinary, rigorous, and comprehensive


research program, customer orientation is considered de rigueur for
organizational success. Unquestionable benets arise from developing
a culture focused on satisfying the organization's customers, including
increased customer satisfaction and loyalty, higher nancial performance, and improved new product creativity (cf. Baker & Sinkula,
1999; Im & Workman, 2004; Jaworski & Kohli, 1993; Jyoti & Sharma,
2012; Narver & Slater, 1990; Slater & Narver, 1995). Less studied and
certainly less publicized, the internal benets of having a marketoriented business strategy include increased employee commitment
(Jaworski & Kohli, 1993), satisfaction (Castro, Armario, & del Ro,
2005; Kennedy, Lassk, & Goolsby, 2002), and effectiveness (Brown,
Mowen, Donavan, & Licata, 2002). Methods for linking the company
externally to customers appear extensively in research, books, and university degree programs, but scant information exists about linking the
company's customer and market knowledge internally to employees.
While organizations spend vast resources collecting marketplace data,
little is known of how to disseminate this knowledge throughout the
organization. Often, failures occur not from lack of knowledge within
the organization but instead from that knowledge failing to reach

Note: This manuscript is original and is not under consideration or published


elsewhere.
Corresponding author. Tel.: +1 504 864 7020.
E-mail addresses: klreed@loyno.edu (K. Reed), goolsbyassoc@gmail.com
(J.R. Goolsby), mkjohnst@loyno.edu (M. Johnston).
1
Tel.:+1 504 319 1003.
2
Tel.:+1 504 864 7969.

http://dx.doi.org/10.1016/j.jbusres.2016.01.002
0148-2963/ 2016 Published by Elsevier Inc.

employees who need the information to satisfy customers (Lings,


1999; Harris & Ogbonna, 2000).
An ancillary tenet of customer orientation requires creating an
internal market orientation in which organizations use similar
relational approaches internally, as done with external customers
(Lings, 1999, 2004); the result being that employees are motivated to
focus outward by listening to customers and to use customer information inwardly to fuel employee discussions. Logically, a constructive
internal listening environment provides a necessary but not sufcient
platform for a strategic external market orientation (MO), as data
from external customers must be disseminated effectively to employees
throughout the organization.
Although undeniably a critical component in MO implementation,
only a paltry few studies empirically explore this listening inward strategic aspect. The research described herein, research crossing marketing, management, and business communication, seeks to explore how
an organization's internal listening environment (OLE) is empirically
linked to both employees' perceptions of the organization's MO and
individual employee outcomes of performance and commitment.
Grounded on a multidisciplinary foundation, including OLE from business communication, MO from marketing, and human resources and
employee effectiveness from management, this research lls a void in
the literature needed to understand organizational factors that drive
an effective market-oriented organizational strategy. These overlapping
research streams are integrated to create a testable theoretical model;
research hypotheses are developed to test important linkages in that
model, and a pilot empirical study using observations from a wide variety of managerial positions in a major retailer is examined to provide

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K. Reed et al. / Journal of Business Research 69 (2016) 35913599

tentative support for the importance of MO theory's key underlying


propositions. Fig. 1 visually portrays the construct linkages tested
based on multidisciplinary theory. The results of this study advocate
attention to a listening culture in which employees perceive that the
organization effectively communicates and uses market information
impacts employee perceptions of the external MO posture and key
employee performance and attitudinal outcomes.
1. Listening in a market-oriented organization
With unrelenting pressure to meet performance goals, successful
companies aim to listen to customers' feedback to ensure that all
organization programs maximize the likelihood of a positive reaction
from the marketplace. The benets of a customer orientation are virtually unchallenged today. The term customer orientation is used to
varying levels of distinction with other similar terms, such as customer
mind-set (Kennedy et al., 2002), market orientation (Kohli & Jaworski,
1990), market oriented (Shapiro, 1988; Narver & Slater, 1990), customer focused (Homburg, Workman, & Jensen, 2000) and market driven
(Jaworski, Kohli, & Sahay, 2000). In the research, market orientation
or market oriented is used as an umbrella term capturing the notion
that organizational cultures focused on gathering, understanding, and
meeting needs of external customers facilitate greater organizational
success. Appendix A offers summary literature most relevant to key
constructs in this study.
Focused on exceeding requirements for customer satisfaction,
market-oriented rms rely on superior market intelligence to be used
throughout the organizational system to create holistically integrated
market-oriented actions (Narver & Slater, 1990). Importantly, the
market-oriented process begins by gathering customer chatter and,
once obtained, getting employees to rst listen and then translate
data into meaningful actions driving customer satisfaction. Marketoriented rms report superior business results in terms of innovation
(Hurley & Hult, 1998), learning and adaptation (Slater & Narver,
1995), market share (Baker & Sinkula, 1999), and protability
(e.g., Lengler, Sousa, & Marques, 2013; Shah & Dubey, 2013; Slater &
Narver, 2000). Still, sustaining customer attention and appetite
poses an exhausting and virtually insatiable challenge for competitive
organizations.
Organizations employing a market-oriented strategy reap advantages in not only the marketplace but also positive employee attitudes
and behaviors (Lings, 2004). The competitive success of a marketoriented rm invigorates employee pride, nurtures employee organizational commitment, and creates an esprit de corps that both permeates
the boundaries of the organization, infusing the internal organizational
culture and external market actions. Companies listening effectively
to customers' comments, compliments, and criticisms can obtain a
competitive advantage if, in turn, management creates an environment

that directs employees to use the market intelligence to take customerdriven actions that win sales and gain loyalty (Jaworski & Kohli, 1996;
Slater & Narver, 1995).
Clearly, the interaction between employees and customers is critical
to a successful market-oriented strategy (Lings & Greenley, 2005), and
emboldening employees to perform market-oriented behaviors
(Brown et al., 2002) creates linchpins for increasing customer loyalty
(Jaworski & Kohli, 1993; Larson & Sasser, 2000). With customer loyalty
mirrored in the level of employees commitment, Larson and Sasser
(2000) suggest, Highly satised employees exhibit a series of positive
behaviors which allow them to do a better job of delighting their
customers (p. 44). As a key part of MO strategy, the desire to satisfy
customers must be ingrained in the culture, so that employee attitudes
and behaviors align with the aim of creating superior competitive value
for the customer (Hartline & Ferrell, 1996). Unmistakably, leaving
to chance the internal management side of the MO equation naively
jeopardizes the full value of the MO strategy.
A cultural artifact under management control, the OLE can bolster
employeecustomer relationships because organizational effectiveness
depends on open and transparent internal communication (Bansal,
Mendelson, & Sharma, 2001; Lings, 2004; Lings & Greenley, 2005). As
stated succinctly by Jaworski and Kohli (1993), [the] greater the extent
to which individuals across departments are directly connected (or
networked), the more they are likely to exchange market intelligence
and respond to it in a connected fashion (p. 56). Empirical evidence
of this contention is provided by Conduit and Mavondo (2001), in
which internal communication and information sharing are shown to
drive internal customer and external market orientations. Lings and
Greenley (2005) highlighted the critical importance to future MO
research in linking employee needs with a company's MO, such that management should align market-driven needs with employee behaviors in a
mutually advantageous interaction. Thus, both inwardly and outwardly,
an MO strategy unies the organization and simultaneously increases
the likelihood of customer satisfaction and employee fulllment.
While the literature is replete with methods for listening to customers, much less is known about engendering a proper internal listening culture. That is, while much is written about applying resources to
listen externally (e.g., Hernon & Matthews, 2011), parallel processes
for listening to employees has escaped researchers' attention. Drawing
from the communications literature, specically the work of Brownell
(1994); Gilchrist and van Hoeven (1994); Jacob and Coghlan (2005);
and Johnston, Reed, and Lawrence (2011), OLE captures a critical aspect
of organizational performance and employee perceptions. Recent empirical research suggests the more employees believe the organization
listens to their feedback the more likely they are to commit to the
organization (Reed, Goolsby, & Johnston, 2014). Heretofore silent in
MO management theory, listening to employees yields a powerful
internal factor for implementing a holistic MO.

Employee
Organizational
Commitment
Organizational
Listening
Environment

MarketOrientation

Employee
Performance

Fig. 1. Structural research model of the impact of listening environment on market orientation and employee outcomes.

K. Reed et al. / Journal of Business Research 69 (2016) 35913599

2. Listening environment and market orientation


In an MO rm, failure does not typically occur from lack of market
knowledge getting into the organization but instead from failure to
balance the voice of the customer with an internal culture that listens
to the employee voice (Grifn & Hauser, 1993). As external market data
penetrate the organizational information system, an internal process
must effectively communicate pertinent information to employees. Internally, experts must communicate across functional silos to create an integrated value-added response, a systematic process that logically requires
simultaneous listening to the external data and each other in the organization (Lings, 1999). Organizational learning occurs via these internal and
external feedback loops (Argyris, 1977; Senge, 1990), and the shared information morphs into a collectively integrated organizational response
to customers with modications or innovations. As do other researchers,
conceptualizing listening as an organizational attribute captures the extent employees ascribe a positive value to the organizational responsiveness to employee input (Gilchrist & van Hoeven, 1994; Reed et al., 2014),
a critical attribute of an organizational communication climate that helps
create a common understanding among work group members (Brownell,
1994). In other words, in an MO rm, OLE reects the extent to which the
organization listens to the voice of the employee, as well as voice of the
customer. Based on the literature supporting the need for a positive OLE
in rms employing an MO, we offer Hypothesis 1.
Hypothesis 1. Employee perceptions of the organizational listening
environment will positively impact employee perceptions of the rm's
market orientation.

3. Listening environment and employee commitment


Building on the theme of a positive OLE facilitating MO, we shift to
the relationship between the OLE and employee outcomes. A plethora
of studies seek to uncover antecedents that positively impact employee
commitment to organizations, not only in terms of positive affect but
also in terms of the loyalty needed to continue membership and focus
toward achieving organizational goals (Mathieu & Zajac, 1990;
Mowday, 1998). Although complex, theorists and researchers assert
that managers who communicate effectively can impact the psychological state of employees; yet the precise communication processes
through which communication enhances the attitudinal commitment
of organizational members remains unclear (cf. Haas & Arnold, 1995).
Recent research on listening within the work environment show a
positive OLE drives employee organizational commitment (Johnston
et al., 2011). By listening to each other, workers create a shared understanding of work, while sharing and coagulation of information facilitates employee commitment (van Vuuren, de Jong, & Seydel, 2007).
Strong listening environments are characterized by a concern for
the individual employee and his or her values, needs, and goals
(Brownell, 1994, p. 3). Helms and Haynes (1992) asserted, Listening
to employees and colleagues has advantages beyond the information
being imparted, since listening to another individual indicates their
opinion is valued and respected (p. 18). OLE provides an important social context for gleaning information from the organizational setting,
and through a discursive relationship, drives employeeorganizational
commitment. Based on strong theory and preliminary empirical results,
we propose Hypothesis 2.
Hypothesis 2. Organizational listening environment will positively
directly impact employee organizational commitment.

3593

because an OLE facilitates an organizational learning culture in which


market knowledge builds and motivates employee performance needed
for organizational results (Brownell, 2008). Active listening and
communication are essential for successful business relationships to be
built and maintained (Brunner, 2008, p. 77). Enhancing employee and
customer relations can help improve company performance, both organizationally and individually (Bentley, 2000; Brunner, 2008). By listening
to each other within the organization, employees can better identify gaps
in the organizational actions and subsequently adapt behaviors to be better aligned with market-oriented goals (Brownell, 2008). Through this
process, listening can help organizational members build an esprit de
corps that facilitates the accomplishment of organizational action plans
(Brownell, 2008) and drives proactive market-driven responses that
enable a competitive advantage by translating customer requirements
into organizational actions (Brunner, 2008; Plati, 2005). Organizational
success depends on the degree to which employees listen and participate
in conversations (Brunner, 2008) because employees engaged at work
with a clear understanding of the organizational strategy and culture
focus interactions on meeting organizational goals.
Despite the compelling theoretical linkage, only a few recent studies
provide empirical support of a positive relationship between an OLE and
employee performance (Michael, 2012). Papa and Tracy (1988) reported that perceived communicator listening ability inuenced employee
performance using new technology. Asree, Zain, and Razalli's (2010)
empirical study demonstrated that employees who believed their organization culture valued and rewarded listening also rated organizational
responsiveness to customers high. Additionally, the results of the study
by Wei, Frankwick, and Nguyen (2012) revealed that employee perceptions of an organization's internal responsiveness to employee input
positively impacted new product performance and external responsiveness to the market. Based on compelling theory and scant but strong
empirical evidence, we offer Hypothesis 3.
Hypothesis 3. Organizational listening environment will directly
impact employee performance.
5. Market orientation mediation of listening environment and
employee outcomes
Although rare, empirical research documents that market-oriented
organizational strategies yield direct effects on employee outcomes
that are independent of the OLE. For example, pioneering research of
MO strategy, Kohli and Jaworski's (1990) study revealed a marketorientated business strategy fostered a sense of employee pride in
belonging to an organization that takes care of customer needs, and in
turn, this pride lead to both employee job satisfaction and organizational
commitment. Ruekert's (1992) empirical study conrmed Kohli and
Jaworski's (1990) nding that employee perceptions of an organization's
MO positively impact employee commitment.
Ann effective MO implementation requires a holistic strategy with
foci not only on customer satisfaction but also employee commitment
to performing customer-satisfying behaviors (e.g., Reukert, 1992; Kohli
& Jaworski, 1990). MO actions require a customer mind-set in the
employee (Kennedy et al., 2002), to the extent employees may be
the critical determinant of the effective implementation of customerfocused strategies (Piercy, Harris, & Lane, 2002, p.269). Creating an
internal MO culture, of which listening is a key driver, can facilitate
employee commitment to customer delight and loyalty (Castro et al.,
2005). That is, the OLE should both directly impact organizational
commitment and complement MO, which should also directly
effect commitment. Succinctly, we offer the following mediation
hypothesis.

4. Listening environment and employee performance


Communications scholar Brunner (2008) encourages research that
gleans the role of listening in building healthy work environments,

Hypothesis 4. Employee beliefs about the strength of the organization's


market orientation will partially mediate the impact of the organizational listening environment on employee commitment.

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K. Reed et al. / Journal of Business Research 69 (2016) 35913599

Similar to commitment, a direct impact of MO on employee


performance has been hypothesized and tested, although a complex entanglement of cause and effect exists (Piercy et al., 2002). Turning the
market-oriented focus to internal organizational practices places people
at the center of the organizational success as drivers of desired organizational and customer outcomes (Ahmed & Raq, 2003). While admonitions abound that in market-oriented organizations creating and
aligning internal relationships is necessary to improve the performance
of the company and its employees (Ahmed & Raq, 2003, p. 1179), scant
research answers the call to untangle to relationship between employee's
organizational experience and performance level (Ahmed & Raq, 2003).
In a rare study linking MO to performance, Jyoti and Sharma (2012) created a performance index that included, and found direct linkage between
MO and employee performance. Likewise, Brown et al.'s (2002) empirical
results provide evidence that not only employee's MO-related beliefs
inuences employee performance but also these MO beliefs partially
mediated the relationship between employee personality traits and
self-rated performance. However, relying on personality traits to facilitate
a customer mind-set needed in a market-oriented organization leaves
management little latitude for action beyond ring and hiring.
Alternatively, OLE offers a malleable characteristic of internal culture
that drives a holistic market-orientated strategy (Brownell, 1994;
Gilchrist & van Hoeven, 1994; Jacobs & Coghlan, 2005). A potential mediation situation arises in which MO directly impacts employee performance and MO perceptions. Therefore, we offer the following hypothesis.
Hypothesis 5. Employee beliefs about the strength of the organization's
market orientation will partially mediate the impact of the organizational listening environment on employee performance.

6. Methods
A global retailer hosting a company leadership conference in the
United States, the sample allowed for a single corporate-level communication environment with inter-location variance, a range of management
status, and a stable industry context in which listening to customers
clearly drives organization's success. Surveys were completed by 101
conference participants. Demographics validate the desired diversity,
including 43% female and 52% male; 60% were Caucasian, 28% were
African American, 3% were Hispanic, and 2% were other, and ages ranging from 25 to 61 years, with a mean and median near 40. Further analysis
revealed diversity across job characteristics with titles grouped as 15%
store managers, 9% co-managers, 35% assistant manager, and 25% specialty area managers. With respect to length of tenure, years in current jobs
ranged from 2 months to 30 years with a mean of 9 years and a median
slightly lower than 8 years. The signicantly long tenure of the respondents reinforces the sustainability of the organization's management
workforce and, assumedly, corporation's strategy and culture.
Based on the research objectives and sample characteristics (Byrne,
2013; Davik, 2013; Gefen, Straub, & Rigdon, 2011; Gefen, Straub, &
Boudreau, 2000), hypotheses were tested using structural equation
modeling (SEM). Additionally, bootstrapping analysis was utilized for
mediation analysis due to the small sample size and desire to reduce
the effects of random sampling error (Kenny, 2014; Shrout & Bolger,
2002). Following the two-step SEM approach (Anderson & Gerbing,
1988) using AMOS V22.0.0 software, a conrmatory factor analysis
(CFA) assessed the psychometric properties of the latent constructs
because CFA allows an evaluation of t of measured items to latent theoretical constructs, recognizing measurement error in the observed
measures (Gefen, Straub, & Rigdon, 2011; Schreiber, Nora, Stage,
Barlow, & King, 2006). The results showed the reliability and validity
of the measurement model being satisfactory for further structural analysis. Thus, we performed a structural model analyses to evaluate the direct, indirect, and total effects between employees' perceptions of the

Table 1
Conrmatory factor analysis: maximum likelihood dimensions, standardized loadings,
item means and standard deviations, and goodness of t summary by factor.
Factor
Mean Standard
loading
deviation

Dimensions
Employee performance
Employee organizational commitment
EC1
EC2
EC3
EC4
Market orientation
CO1
CO2
CO3
CO4
Organization listening environment
LE1
LE2
LE3
LE4
Goodness of t summary
CFI = .98
2(51, N = 101) = 61.86, p = .142
RMSEA =.046 with 90% condence
interval (.000, .083) and PCLOSE = .53

EEPerf
EECmt

4.05
4.44

.68
.55

n/a
.86

4.24

.49

.77

4.13

.62

.92

.86
.81
.75
.74
MO
.76
.65
.56
.79
OLE
.81
.87
.90
.87

OLE on employee beliefs about the organization's MO and employee


commitment and performance.
6.1. Conrmatory factory analysis of the measurement model
The four-factor model includes the OLE, employee MO beliefs,
employee organizational commitment, and employee performance.
The following scales were used in the study. Each item was measured
on a 5-point Likert-type scale ranging from strongly disagree to
strongly agree.
6.1.1. Organizational internal listening environment
OLE was measured using four items from the team listening environment (TLE) scale developed by Johnston et al. (2011). Items included
The people in my team pay attention to me, The people in my team
listen to what I have to say, The people in my team genuinely want
to hear my point of view, and The people in my team understand me.
6.1.2. External market orientation
MO was measured using four items from the organizational customer outcome scale developed by Homburg, Workman, and Jensen (2002).
These items began with the root statement, Relative to your competitors, how has your organization, (over the last 3 years) performed
with respect to: and concluded with phrases relating to market
response. The four items included Achieving customer satisfaction,
Providing value for customers, Attaining desired growth, and Keeping current customers. Narver and Slater (1990) and Jaworski and
Kohli (1996) have employed similar measures of employee perception
of an organization's MO. The measure focused on current customer
orientation, and thus, the scale did not include original scale items
(Homburg et al., 2002) about market share or new products. Variations
Table 2
Correlations among the variables in structural equation modeling analysis.
Variable
1
2
3
4

Employee performance
Employee organizational
commitment
Organizational market orientation
Organizational listening environment

Note: N = 101.
p b .01.

EEPerf
EECmt
MO
OLE

.27

.11
.37

.34
.42

.41

K. Reed et al. / Journal of Business Research 69 (2016) 35913599

of Homburg's (Homburg & Pesser, 2000; Homburg et al., 2002) scale


have been used successfully in prior research exploring the complexity
of the market orientation phenomena to capture employee perceptions
of how well the company meets the needs of the customers/markets
(Maignan, Gonzalez-Padron, Hult, & Ferrell, 2011).
6.1.3. Organizational commitment
Employees' organizational commitment was measured using four
items from the Organizational Commitment Questionnaire (Mowday,
Steers, & Porter, 1979). The four items included I am proud to tell
others that I am part of this organization, I am extremely glad that I
chose this organization, I talk-up my organization to my friends as a
great organization for which to work, and For me, my organization
is the best of all possible organizations for which to work.
6.1.4. Performance
Employee performance was measured using a single item, How
would you rate your own work performance? The response was
captured on a scale of 1 being poor, 3 being meets expectations, and 5
being exceeds expectations. Self-reported employee performance have
been used and accepted with validity in the Journal of Business Research
and other journal of equally esteemed reputation (e.g., Ellinger et al.,
2013).
Conrmatory factor analysis (CFA) was performed for the three
latent variables (Brown & Moore, 2012; Hu & Bentler, 1999), with the
input being the data le. For each latent variable one indicator variable
was xed to zero based on that variable being most strongly correlated
with other indicators (Byrne, 2013). The results provided sufcient support for the measurement model. The three-factor model included 12
items and produced a non-signicant chi-square, 2(51, N = 101) =
61.86, p = .142, as well as acceptable other model t indicators CFI =
.987 and RMSEA = .046 with 90% condence (.000, .083) and PCLOSE =
.536 (Hu & Bentler, 1999; Kenny, 2014; Schreiber et al., 2006). Checking
for convergent validity, the average variance extracted (AVE) for each
factor should be N .5, indicating adequate convergence (Fornell &
Larcker, 1981; Gallagher, Ting, & Palmer, 2008). Both employee commitment and OLE met these criteria, but the MO scale was just slightly
below the standard at .48. Factor reliabilities of the scales were investigated using Cronbach's alpha, following Nunnally and Bernstein's
(1994) and Churchill's (1979) suggestion to seek Cronbach's alphas in
the .70 range being sufcient for basic research, and all factor loadings
were positive and statistically signicant. See Table 1 for a summary of
the CFA.

3595

Table 3
Results of structural model analysis: direct effect of listening environment on market
orientation.
Parameter

Direct effects model

Structural path
H1: OLE MO

Standardized coefcients
.47

Variance
R2 = .22

Note: N = 101.
p b .01.

Correlations among the latent variables used in the subsequent


structural equation modeling analysis are presented in Table 2. Notably,
no statistically signicant correlation exists between MO and employee
performance. Statistical and practical implications of this relationship
are discussed in the results section and discussion sections.
7. Results
A three-step process was employed to test the hypothesized direct
and mediation effects of the proposed structural model, including the
bootstrapping approach for mediation testing of a structural model
used by Ledermann and Macho (2009) and Zhao, Kong, and Wang
(2012).
Step 1: Model t. The nalized structural model is depicted in Fig. 2,
including factor loading, path coefcients and variance explained in
endogenous variables. The structural model included 12 items and
produced a non-signicant chi-square, 2(61, N = 101) = 75.59,
p = .099, as well as acceptable other model t indicators CFI =
.978 and RMSEA = .049 with 90% condence intervals (.000, .082)
and PCLOSE = .497 (Hu & Bentler, 1999; Kenny, 2014; Schreiber
et al., 2006). Thus, the data can be judged to be a good t to the theoretical model.
Step 2: Direct effects. The standardize path coefcients were compared for the direct effects between OLE and employee outcome between (1) the non-mediated or direct model and (2) the mediation
model (see Tables 3 and 4). Following the procedures in Singh,
Goolsby, and Rhoads (1994), a change from a statistically signicant
to non-signicant direct path coefcient suggests a full mediation,
whereas a decrease in size but still signicant standardized path
coefcient indicates partial mediation. The direct path between
OLE and employee commitment dropped from .466 to .359 and
remained signicant at the p b .01 level. The path between OLE

Fig. 2. Finalized structural model (N = 101) of the impact of listening environment on customer orientation and employee outcomes.

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K. Reed et al. / Journal of Business Research 69 (2016) 35913599

Table 4
Results of structural model analysis: direct effects model of listening environment on employee outcomes and mediation model of market orientation.
Parameter

Direct effects model

Mediation, direct effects

Structural path
H2: OLE EECmt
H4: OLE MOEECmt
H3: OLE EEPerf
H5: OLE MO EEPerf
Goodness of t summary:
CFI = .978
2(61, N = 101) = 75.59, p = .099
RMSEA = .049 with 90% condence interval
(.000, .082) and PCLOSE .497

Standardized coefcients
.47

Variance
R2 = .22

.39

R2 = .22

Mediation, indirect
effect

Standardized coefcients

Variance

Signicance (p-value)

.36

R2 = .13

p = .05

.41

R2 = .17

p = .51

Note: N = 101.
p b .01, p b .05.

and employee performance did not decrease but slightly increased,


while remaining signicant.
Step 3: Mediation testing. AMOS software was utilized to perform
the bootstrapping analysis with 2000 samples, bias-corrected 95%
condence intervals, and indirect, direct, and total estimates of
path coefcients (Hu & Wang, 2010; Mallinckrodt, Abraham, Wei,
& Russell, 2006). The two-tailed signicance of the indirect effects
of OLE via MO on both employee commitment and employee performance was examined. The indirect effect between OLE and employee commitment was statistically signicant (p b .05), supporting
mediation effect as proposed in Hypothesis 4. However, the indirect
effect between OLE and employee performance was not statistically
signicant (p = .50), offering no evidence for the mediating effect
proposed in Hypothesis 5. The indirect effect was further examined
for employee commitment. With a standardized effect of .076 for
OLE and employee commitment and a 95% condence interval (.01
to .34), the bootstrapping provided support for the mediation
model as predicted in Hypothesis 5 (see Table 5).
8. Discussion
The advent of sophisticated customer management systems, compared to 20 years ago, inundate companies with market data, so much
so that what were whimpers of data have become tidal waves of often
confusing and conicting information. Successful implementation of a
market-oriented strategy requires the complex coordination of multiple
elements that aim both outward and inward for the organization
(Brown et al., 2002; Lings, 2004). While the vast majority of work has
been focused on the outward listening done by organizations, this study
focuses on the parallel inward management practice of creating a positive
OLE. With communication clearly being recognized as critical to MO
(Bansal et al., 2001; Lings & Greenley, 2005), this study parcels out listening as impacting employee commitment and performance, just as listening inuences customer loyalty and purchases. Explicitly integrating
listening can both enhance Lings (2004) internal marketing framework
with impactful management action already evident in external marketoriented activities, as well as provide a response to Ahmed and Raq's
(2003) call for communication strategies and actions that promote internal marketing practices that parallel external marketing efforts.

Table 5
Results of bootstrapping mediation analysis: market orientation as a mediator between
IMO-listening environment and employee commitment.
Parameter
H4: OLE MO EECmt
a

Estimates

95% CI (lower, upper)

.076a

(0.01, 0.34)

Empirical 95% condence interval does not overlap with zero.

While the results of this study suggest a signicant mediated relationship between OLE and employee commitment via employee marketoriented beliefs, the same was not true for employee performance. Nevertheless, OLE did have a direct impact on employee performance, further
highlighting its importance. Only future research in a broader research
context can clarify why this relationship did not materialize, as in other
research (e.g., Jyoti & Sharma, 2012; Ahmed & Raq, 2003). Additionally,
while our study clearly lacks generalizability, given the infantile nature of
the OLE as a managerial construct, the highly controlled nature of our
study provides assurance and encouragement to those who have worked
cross-disciplines toward understanding listening as a resounding component of the organizational internal climate (e.g., Brownell, 1994; Gilchrist
& van Hoeven, 1994).

8.1. Managerial implications


While for more than 50 years researchers have contended that
listening is a valuable interpersonal skill for managing employees
and customers effectively Flynn, Valikoski, & Grau, 2008; Rogers &
Rothelisberger, 1952), heretofore only minimal empirical research has
tested the theoretical notion that the OLE positively impacts organizational
strategies and employee outcomes. The results of this study and convincing theory suggest that building a culture that values listening internally
among employees could be a powerful management intervention to implement MO. Treating employees as customers (Berry, 1981) does not
imply that employees are customers but rather elevates listening as an important factor in building a culture conducive to success. Thus, managers
may consider taking the challenge to balance listening inward and outward, with a culture that listens both the voice of the customer (Grifn &
Hauser, 1993) with the voice of the employee. Specically, rather than
spending resources on hit or miss employee training listening skills
(Anton & Perkins, 1997; Conduit & Mavondo, 2001), market-oriented
managers who listen with equal fervor to employees as customers can create a more sustainable OLE that fosters parallel external behaviors.
Listening may provide a competitive advantage by engaging
employee commitment to organizational strategies (Reed et al., 2014)
and market-oriented behaviors, not only of individuals but also the
collective outcomes, much in the same way listening to customers can
increase customer loyalty and organizational results. For example,
with market information received, internal experts must communicate
with each other, which logically requires listening, in order for organizations to respond with integrated value-created responses to customers
(Lings, 1999). Moorman (1995) refers to marketing information as an
organization's current and future stakeholder data that transcends all
functional personnel, and the organizational learning occurring via
this employeeemployee feedback loop (Argyris, 1977; Senge, 1990)
fuels innovation. Conduit and Mavondo (2001) provided additional
empirical evidence that internal communication, information sharing,

K. Reed et al. / Journal of Business Research 69 (2016) 35913599

and management support all help build an effectively integrated


market-oriented strategy and culture.

8.2. Future research


This interdisciplinary study suggests opportunities for researchers to
advance knowledge of the OLE construct in the realm of listening from
business communication, internal MO from marketing, and employee
effectiveness from management. While academicians often admonish
executives on the advantages of removing silos in organizations,
scholars have been slow to take their own advice. The increasingly
microscopic focus arising from the proliferation of journals has forced
researchers into smaller and smaller subject matter niches, while the
major contributions may lie in cross-disciplinary unication of knowledge. Tackling major problems, such as marketplace competitiveness,
from a divergent set of perspectives, bolsters the value that the academy
takes to professionals and universities at a time when budgets are being
threatened. Perhaps we need to listen both outward and inward, too.
We encourage our fellow researchers to listen to the colleagues
down the hall and on the other oors, or maybe in other buildings, to
tackle some interesting questions that transcend academic silos.
Organizational listening offers one such topic requiring communications, management, and marketing expertise, portraying employees as
information conduits in and out of the organization. Larson and Sasser
(2000) reported a positive correlation between employee and customer
satisfaction, and future research could explore the degree to which
listening explains this relationship. In the management literature, future
research could expand the study of training employees to listen to
customers (Anton & Perkins, 1997) to compare the direct and indirect impact of training employees versus strengthening the OLE in an MO rm.
IMO theory already implies organizations listen to employees via formal
and informal informational generation (Lings & Greenley, 2005), and future research could help formalize the inclusion of listening in and out
behaviors. Employees in organizations that create an internal culture of
listening are more likely to commit to the organization's purpose (Reed
et al., 2014).

3597

Maignan et al. (2011) recommend a strategic model for studying


market orientation that broadens the scope to stakeholders, including not only customers and employees but also shareholders, suppliers, regulators, and local communities. Considering both the
breath-depth dilemma clearly faced in performing interdisciplinary
research and aim of Maignan et al.'s (2011) model, future research
should explore both the richness of individual stakeholders and the
dynamics of a multifaceted shareholder orientation, thus, appealing
both macro and micro-level organizational researchers. As researchers continue to unravel the compelling intricacies of the market orientation construct, future researchers should take the time to
develop a nomological network that clearly denes and differentiating traditional/actual market orientation from evolving variations
and sub-components. In the mean time, current researchers must
beware of diluting the meaning of the market orientation construct
and scattering research to no avail. Our study offers some guidance
and hope for those seeking to broaden the eld of knowledge that
is useful to practitioners, as well as members of the academy.

9. Conclusion
Despite the limitations, the results of this study provide initial
evidence for only previously theorized ideas, including (1) listening to
employees can be studied as an important organizational culture characteristic, paralleling the studies on listening to customers; (2) by
listening in, managers can positively inuence perceptions of an
organization's MO that, in turn, inuence higher organizational commitment; and (3) a positive OLE can directly inuence employee performance. Through superior market knowledge and marketplace
responses, creating a positive OLE can build synergistic employeeemployee and employeecustomer connectedness and effective customer
solutions needed for sustainable organizational success. Often underappreciated and easily overlooked, even discounted, creating a work environment in which listening to employees holds equal value to listening
to customers can ignite a contagious need to satisfying customers that,
in turn, creates a hunger for more listening.

Appendix A
Summary of literature most relevant to key constructs.
Key construct

Primary disciplines

Prototypical research

Marketing
Marketing
Marketing
Marketing
Marketing
Marketing
Marketing
Marketing
Marketing
Marketing
Marketing
Marketing
Management and marketing
Marketing
Marketing
Marketing
Marketing
Marketing
Management and Marketing
Marketing
Marketing

Kohli and Jaworski


Narver and Slater
Ruekerta
Jaworski and Kohli
Kohli, Jaworski, and Kamara
Gifn and Hausser
Slater and Narver
Slater and Narver
Cadogan and Diamantopoulosa
Anton and Perkins
Hurley and Hult
Baker and Sinkula
Slater and Narver
Homburg, Workman, and Jensen
Jaworski, Kohli, and Sahay
Lafferty and Hulta
Homburg, Workman, and Jensen
Kennedy, Goolsby, and Arnoulda
Narver, Slater, and MacLachlana
Kirca, Jayachandran, and Beardena
Van Raaij and Stoelhorsta

Contribution

Market orientation
1990
1990
1992
1993
1993
1993
1994
1995
1995
1997
1998
1999
2000
2000
2000
2001
2002
2003
2004
2005
2008

Construct development
Protability
Organizational strategy
Antecedents/consequences
Scale development
Customer voice
Organizational competition
Construct development
Construct development
Customer voice
Innovation
Organizational results
Protability
Customer focus
Market driven
Organizational competition
Account management
Customer orientation
Innovation
Antecedents/consequences
Construct development
(continued on next page)

3598

K. Reed et al. / Journal of Business Research 69 (2016) 35913599

Appendix
A (continued)
(continued)
Key construct

Primary disciplines

Prototypical research

Management and Marketing


Management

Jyoti and Sharma


Shah and Dubey

2012
2013

Customer mind-set
Organizational results

Contribution

Management and Marketing


Management and Marketing
Management and Marketing
Management and Marketing
Management
Management and Marketing
Management and Marketing
Management and Marketing
Management and Marketing
Management and Marketing
Marketing
Management and Marketing
Management
Management and Marketing
Management
Management

Singh, Goolsby, and Rhoads


Piercy
Lings
Harris and Ogbonna
Bansal, Mendelson, and Sharma
Conduit and Mandovob
Brown, Mowen, Donavan, and Licata
Piercy, Harris, and Landb
Kennedy, Lassk, and Goolsby
Ahmed and Raq
Donavan, Brown, and Mowen
Lingsb
Lings and Greenley
Castro, Armario, and del Rio
Lings and Greenley
Wei, Frankwick, Nguyen

1994
1995
1999
2000
2001
2001
2002
2002
2002
2003
2004
2004
2005
2005
2010
2012

Employee burnout
Employee management
Construct development
Internal culture
Employee behaviors
Culture
Employee performance
Employee behaviors
Customer mind-set
Management behaviors
Employee behaviors
Construct development
Scale development
Employee behaviors
Employee behaviors
Employee behaviors

Management and Marketing

Maignan, Gonzalez-Padron, Hult, and Ferrell

2011

Multiple stakeholders

Management and Psychology


Communication
Communication
Management and Marketing
Management and Psychology
Management
Communication
Communication

Helms and Haynes


Brownell
Gilchrist and Van Hoeven
Larson and Sasser
Jacobs and Coghlan
Brownell
Johnston, Reed, and Lawrence
Reed, Goolsby, and Johnston

1992
1994
1994
2000
2005
2008
2011
2014

Organizational listening
Listening environments
Listening organizations
Employee trust
Organizational listening
Organizational results
Group listening scale
Employee behaviors

Internal market orientation

Stakeholder orientation
Organizational listening environment

a
b

Not included in current manuscript for parsimony.


Journal of Business Research article.

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