1. MANAGEMENT AND NETWORK SKILLS OF TURKISH IT FOUNDERS: IMPACTS ON MARKET ORIENTATION Dilek Zamantılı Nayır – Carsten Baumgarth – MARMARA UNIVERSITY DEPARTMENT OF BUSINESS ADMINISTRATION İN GERMAN LANGUAGE Serdar Durmuşoğlu – UNIVERSITY OF DAYTON

2. Literature review Market orientation (MO) construct discussed frequently over the last decade – MO predictor of organizational outcomes such as innovative capacity, new product development and new product performance Market-oriented firms demonstrate high levels of competency in their ability to learn about customers, competition and identify opportunities in present and prospective markets.

3. What is MO? Takes current and future needs of customers as starting point for all business activities. Grönroos (1989) warned of a new type of shortsightedness caused by focusing exclusively on customers. What about other external stakeholders? What about internal stakeholders s.a. employees?

4. Understanding of MO Creating competitive advantage through a customer focused enterprise in which customer values are created Others: A business philosophy, i.e. internal to the firm - importance of internal stakeholders, s.a. the employees of a firm

5. MO and networks? Some say networks extremely important – particularly in the small business sector. Some others: Against such a strong focus on networking - literature overstates importance of networks. “Networks should not be overemphasized at the expense of SME fundamentals such as the strength of the product offering, adequate working capital and so on.”

6. Entrepreneurs and networks??? Traditionally: Individual entrepreneur = “an anarchist needing independence” – a “lone crusader taking on the world” Trait and personality models to develop a “typical” profile of the entrepreneur Failure of entrepreneurship scholars to develop a typical enrepreneurial profile suggests that Network Theory could be used. Network Theory (or Social Exchange Theory): Interdependent relationships, comprised of proactive social actors, are the appropriate organizational system for the entrepreneurial process

7. This paper Lies at interface of academic studies that have until now developed along parallel streams - market orientation, customer management, human resource management and networking skills. This paper aims at adopting a holistic approach and offers three contributions to the extant literature. 1.Effect of customer management skills on market orientation. 2.Relationship between networks and market orientation. 3.Influence of human resource management skills on market orientation.

8. Model Customer management skills Human resource management skills Networking skills Market orientation

9. H1: Customer management skills and market orientation Knowledge of customers’ needs Enhances ability to identify valuable business opportunities that meet these needs New product success, superior customer retention and superior growth and/or profitability Venture owners need to develop customer management skills. It is therefore hypothesized, that H1: Firms of venture founders with higher customer management skills have higher market orientation.

10. H2: Human resource management skills and market orientation Firm-specific capabilities can be sources of advantage MO can be considered organizational capability related to the organizational culture of a firm. Internal relationships:Motivation to provide services to external customers in a customer-oriented and service-minded way HRM skills lead to supportive climate and shape employee behaviour and attitudes HRM skills lead to increased worker output & efficiency, reduced absenteeism and general higher productivity– AND MO! H2: Firms of venture founders with higher human resource management skills have higher market orientation.

11. H3: Networking skills and market orientation Network: Set of high trust relationships which link together everyone in social group. Important for entrepreneurs – may be most significant source of knowledge for entrepreneurs Informal networks, f.i. relatives – often base of support for those starting a business. Formal networks: Abundant know how - information-sharing Gather relevant information - find external support and services - access external resources not available in-house - advertise the new company - look for business advice Managing a network is a skill that entrepreneurs need to possess. H3: Firms of venture founders with stronger networking skills show higher market orientation.

12. Empirical study Data collected through self-completion online questionnaire Turkish IT sector: Number of new ventures in the last decade; focus on one sector/country avoids confounding of results by market or sector specific factors. After elimination missings - 98 cases Median founding year: 2003 Average number of employees in the founding phase: 5.71 Average number of employees in the current situation: 27.77 IT sub-sectors (software: 70.9%; hardware: 48.7%; services: 75.3%).

13. Results

14. Conclusion and implications CM and HRM skills of IT venture founders help firms to become more market oriented. Data about customers and competitors - sharing this information across departments – using information to create customer value CM evident, but also HRM skills: Delegation of responsibilities, ability to motivate people and coordination in creating a market oriented corporate culture. Network skills - at least in this study - : Less important in achieving market orientation than assumed in earlier academic works.

15. What have we learned from this? Firm owners/managers should focus more on developing their human resource skills and incorporating employees in the firm’s market orientation efforts to a larger extent if a market oriented corporate culture is to be established. Limitations: Context, IT ventures (industry chosen), types of networks