Lone wolf or social monkey? The role of marketing outsourcing in the development of second-order marketing competences

Marketing outsourcing has been increasing for decades due to its well-known benefits, even though the development of dynamic marketing capabilities can be severely damaged as a result. This study focuses on the conditions under which marketing outsourcing favors organizational learning. We found that the relationship between marketing outsourcing and second-order marketing competences resembles an inverted U curve. The first-order marketing competences and absorptive capacity positively moderate this relationship both individually and jointly, by shifting the U-curve to the right. Thus, any firm has an optimum level of beneficial outsourcing that depends on how skilled it is in the outsourced marketing function and its ability to assimilate and apply new knowledge. Our findings provide learning-related criteria for the outsourcing decision. Firms that will consider them can develop a knowledge-based competitive advantage while still enjoying the benefits of outsourcing. Against the common wisdom, we show that the development of new marketing capabilities is an equally challenging task for marketing functions with both low and high knowledge intensity.     

When to outsource the sales force for new products

Executives and researchers continue to seek factors that lead to new product success. While prior research has suggested that outsourcing the selling function can help make the innovation process leaner and limit future liability, outsourcing can also pose risks in terms of safeguarding both customer relationships and confidential innovation capabilities. Moreover, examining the effects of outsourcing has been identified as a key research priority in recent marketing literature. Thus, using privileged access to managers in the biochemical industry, we employed a multi-group analysis of 229 new products to investigate the effect of outsourcing the sales force on new product success. Our empirical results demonstrate that outsourcing the sales force moderates the relationship between new product superiority and customer meaningfulness such that the relationship is stronger when outsourcing is employed; however, outsourcing the sales force moderates the relationship between new product good value and customer meaningfulness such that it is weaker when outsourcing is employed. These findings suggest that outsourcing may serve as a signal of added risk for customers. Thus, the decision to outsource the sales force should be made based upon customer needs and the characteristics of the new product.     

Marketing capabilities: Antecedents and implications for B2B SME performance

The study provides a new perspective on SME marketing strategies in the B2B context. Using a resource-based view of the firm, the study develops a structural model linking marketing capabilities and marketing performance. A study of 367 SME Australian firms reveals that two key marketing capabilities, namely branding and innovation, have major performance outcomes in the SME B2B context. This is the first SME study to evaluate concurrently the contribution of innovation and branding marketing capabilities, with innovation capability the strongest determinant of SME performance. The study also finds market orientation and management capability act as enabling mechanisms for building marketing capabilities. Disaggregation tests indicate that the same findings apply to three size categories denoting micro firms (less than 20 staff), small firms (20-99 staff) and medium-sized firms (100-499 staff).     

Selling Value in Business Markets: Individual and Organizational Factors for Turning the Idea into Action

Modern business-to-business firms focus increasingly on understanding and selling value, as a strategic priority and to achieve marketing and sales excellence. Yet many companies struggle to implement their value orientation, without sufficient knowledge of how to translate it into sales practice. This study therefore examines value-based selling (VBS) as an implementation of value-based marketing at the sales force level. The proposed motivation–opportunity–ability framework integrates individual- and organizational-level antecedents, outcomes, and moderators in an attempt to explain the adoption and performance outcomes of VBS in business markets. Multilevel path modeling with cross-sectional survey data from 944 salespeople and managers in 43 sales organizations confirms the prediction that VBS enhances salespeople's performance, beyond that achieved with established selling approaches. However, firms need specific types of salespeople and dedicated organizational support for effective VBS implementation. A salesperson's learning orientation and networking competencies emerge as critical antecedents. Organizational value assessment tools can compensate for individual salespeople's lack of learning orientation; reference marketing efforts also strengthen the performance outcomes of VBS. Finally, VBS is most effective in organizational settings where perceived customers value demandingness is lower, enabling salespeople to use VBS as a proactive selling approach.     

Different knowledge,different benefits: toward a productivity perspective on knowledge sharing in organizations

We develop a differentiated productivity model of knowledge sharing in organizations proposing that different types of knowledge have different benefits for task units. In a study of 182 sales teams in a management consulting company, we find that sharing codified knowledge in the form of electronic documents saved time during the task, but did not improve work quality or signal competence to clients. In contrast, sharing personal advice improved work quality and signaled competence, but did not save time. Beyond the content of the knowledge, process costs in the form of document rework and lack of advisor effort negatively affected task outcomes. These findings dispute the claim that different types of knowledge are substitutes for each other, and provide a micro‐foundation for understanding why and how a firm's knowledge capabilities translate into performance of knowledge work. Copyright © 2007 John Wiley & Sons, Ltd.     

Enhancing organizational sensemaking: An examination of the interactive effects of sales capabilities and marketing dashboards

Current marketing research highlights the direct effects of marketing resources on firm performance. Few studies, however, examine how such resources interact with one another and contribute to the strategic actions, such as sensemaking. In this study, we investigate how sales capabilities and performance monitoring via marketing dashboards influence a firm's sensemaking. The results from our study suggest that sales capability and the use of marketing dashboards not only contribute directly, but also have an interactive effect, highlighting the importance of integrating both sales and marketing operations. Further, we find evidence that sensemaking influences cost control and enhances customer relationship performance, suggesting that sensemaking has the potential to simultaneously impact both cost efficiency and growth.     

Interfacing and customer-facing: Sales and marketing selling centers

Organizations are turning to the collective knowledge of selling teams in order to manage increasingly complex customers and solutions. One specific cross-functional unit that organizations are commonly using when selling to business-to-business customers is a team of sales and marketing personnel. While the interface between sales and marketing has received attention in the literature, which notes the inherent advantages and challenges of incorporating both roles on a team, opportunities remain to examine sales and marketing selling centers (SMSCs): instances where sales and marketing jointly and directly interact on a relatively temporary basis in customer-facing situations. The authors utilize a discovery-oriented, theories-in-use inquiry to better understand customer-facing SMSC processes, facilitators, and outcomes. Based on insights captured from 29 in-depth interviews with informants who each served on SMSCs in both sales and marketing roles, this study extends sales research by providing a dual perspective of those working on SMSCs, thus enhancing the utility of such malleable selling teams.     

‘It's almost like taking the sales out of selling’—Towards a conceptualization of value-based selling in business markets

While the creation of superior customer value is regarded as fundamental to a firm's long-term survival and growth, little is known about the effective implementation of a firm's value orientation at sales force level. As the sales force plays a pivotal role in implementing marketing strategies, this study adopts a discovery oriented approach and conceptualizes value-based selling as an effective sales approach in business markets. Based on in-depth interviews with sales managers in a variety of industries, we identify and portray three salient dimensions of value-based selling, namely (1) understanding the customer's business model, (2) crafting the value proposition, and (3) communicating customer value. The selling behavior entails a mutual orientation and focuses on the value-in-use potential of the offering for the customer's business profits. We argue that value-based selling is a unique concept that differs from the established selling approaches and propose a conceptual model linking value-based selling to performance outcomes. To further advance our knowledge about the effective implementation of a firm's value orientation, we identify future research avenues embracing qualitative and quantitative research methodologies.     

Leveraging supplier capabilities: The role of locus of capability deployment

This study adds to the resource‐based view by studying how client firms may gain performance benefits from supplier IT capabilities in market‐based arrangements where the supplier's IT capabilities are readily available to multiple client firms. I argue that the locus of supplier capability deployment, i.e. whether supplier capabilities are deployed at the client (in‐sourcing) or supplier (outsourcing), has implications for client firm performance. The findings show that in‐sourcing leads to complementary effects between supplier IT capabilities and client operational capabilities. In contrast, clients with weaker operational capabilities benefit from outsourcing the respective activity to the supplier, and may even be able to reduce their capability disadvantage through outsourcing. The data on 964 U.S. credit unions contracting with 22 technology solution providers is archival. Copyright © 2012 John Wiley & Sons, Ltd.     

The Significance of the New Venture's First Sale: The Impact of Founders' Capabilities and Proactive Sales Orientation

Initial sale success in the market with a new product is a critical milestone for a new venture. Failure at the introduction stage of a new product could have lethal consequences for the venture. In the present study, the authors investigate the role of a new venture company's first successful sale in the venture's future commercial success. The authors develop and test a model of the impact of the founders' entrepreneurial and commercial capabilities and proactive sales orientation on the significance of the first sale and sales growth of a new venture. Using survey data and partial least squares estimation, the results reveal that the founders' commercial capabilities have a positive effect on proactive sales orientation, while their entrepreneurial capabilities positively moderate the effect of commercial capabilities. Further, the results reveal that a proactive sales orientation positively affects the significance of the first sale and that value‐based selling approach positively moderates the effect of proactive sales orientation. Finally, the results reveal that the significance of the first sale is positively related to sales growth. Thus, the authors conclude that combining the founders' commercial and entrepreneurial capabilities strengthens proactive sales orientation and that, in turn, a proactive sales orientation particularly increases the significance of the first sale when new venture companies practice value‐based selling. Research has convincingly demonstrated proactive selling behavior to be one of the most powerful predictors of sales performance. Value‐based selling is a sales approach to identify, quantify, communicate, and verify value of a new product to the customer. Our findings suggest that founders who possess both strong commercial and entrepreneurial capabilities engage considerably more in proactive sales practice as compared with founders that only possess strong commercial capabilities. Hence, rather than hiring specific sales expertise, founders should develop their proactive, value‐selling capabilities.     

Integrating information technology and marketing: An examination of the drivers and outcomes of e-Marketing capability

This research examines the performance implications of integrating information technology with marketing capabilities and other firm-level resources. Specifically, this study introduces and empirically tests a model that conceptualizes e-Marketing as the integration of complementary technology, business and human resources that, when combined, positively influence firm performance. The results from a survey of 522 Belgian firms highlight the importance of how market and technology orientation leads to e-Marketing capability and that this capability is shown to positively influence firm performance by improving customer retention and satisfaction. The results suggest that researchers and practitioners should pay special attention to the complementary resources that are needed to successfully implement IT-enabled marketing initiatives and that an emphasis on the technology alone may not be sufficient.     

Strategic Suppliers' Technical Contributions to New Product Advantage: Substitution and Configuration Options

Current theory lacks clarity on how different kinds of resources contribute to new product advantage, or how firms can combine different resources to achieve a new product advantage. While several studies have identified different firm‐specific resources that influence new product advantage, comparatively little research has explored the contribution of strategic supplier resources. Combining resource‐based and relational perspectives, this study develops a theoretical model investigating how a strategic supplier's technical capabilities impact focal firm new product advantage and how firms combine different resources to gain this advantage. The model is tested using detailed survey data collected from 153 interorganizational new product development projects in the United Kingdom within which a strategic supplier had been extensively involved. Empirical results support our research hypotheses. First, supplier technical performance is shown to have a significant positive impact on new product advantage. Next, we show that while supplier technical capabilities have a positive influence on supplier technical performance, the a priori nature of the supplier's task moderates the relationship. Finally, our data support our hypotheses related to the positive relationship between relationship‐specific absorptive capacity and new product advantage, and the proposed negative moderation of supplier technical capabilities on this relationship. Based upon these findings, we encourage managers to recognize that strategic suppliers' with greater technical capabilities perform better regardless of the degree of creativity required by their task; but that strategic suppliers with lower technical capabilities may partially compensate (substitute) for their lack of technical capabilities, if they are able to respond to high problem‐solving task requirements. Furthermore, we suggest that the firm's development of relationship‐specific absorptive capacity is much more important when a strategic supplier is less technically capable. A buying firm's relationship‐specific absorptive capacity can, according to our data, substitute for low supplier technical capabilities. On the other hand, where the supplier has strong technical capabilities, investments in relationship‐specific absorptive capacity have no effect on new product advantage. Our findings reinforce recent calls for research on how firms can combine different resources and capabilities to achieve superior performance.     

The Effect of Sales Force Adoption on New Product Selling Performance

Although several studies have suggested that the sales force is a major contributing factor to new product success, few studies have focused on new product adoption by the sales force, particularly with respect to its relationship with selling performance. The present article presents empirical evidence on the impact of sales force adoption on selling performance. We defined sales force adoption as the combination of the degree to which salespeople accept and internalize the goals of the new product (i.e., commitment) and the extent to which they work hard to achieve those goals (i.e., effort). It was hypothesized that the impact of sales force adoption on selling performance will be contingent on supervisory factors (sales controls, internal marketing of the new product, training, trust, and supervisor's field attention), and market volatility. Therefore, this article also provides evidence of the conditions under which sales force adoption of a new product is more or less effective in engendering successful selling performance. The hypothesized relationships were tested with data provided by 97 high technology firms from The Netherlands. The results show that sales force adoption is positively related to selling performance. This finding suggests that salespeople who simultaneously exhibit commitment and effort will achieve higher levels of new product selling performance. Outcome based control, internal marketing and market volatility are also positively related to new product selling performance. The effect of sales force adoption on selling performance is stronger where outcome based control is used and where the firm provides information on the background of the new product to salespeople through internal marketing. Training and field attention weaken the adoption‐performance linkage. These findings may indicate that salespeople in The Netherlands interpret training as “micromanaging” and field attention as “looking over their shoulder.” We conclude with implications of our study for research and managerial practice.     

Market orientation,marketing capabilities,and firm performance

Drawing on traditional resource‐based theory and its recent dynamic capabilities theory extensions, we examine both the possession of a market orientation and the marketing capabilities through which resources are deployed into the marketplace as drivers of firm performance in a cross‐industry sample. Our findings indicate that market orientation and marketing capabilities are complementary assets that contribute to superior firm performance. We also find that market orientation has a direct effect on firms' return on assets (ROA), and that marketing capabilities directly impact both ROA and perceived firm performance. Copyright © 2009 John Wiley & Sons, Ltd.     

When using knowledge can hurt performance: the value of organizational capabilities in a management consulting company

This paper explores the possibility that utilizing the firm's knowledge resources to complete important tasks can backfire and undermine competitive performance. Drawing on organizational capabilities and knowledge‐sharing research, we develop a situated performance view that holds that the value of obtaining and using knowledge within a firm depends on the task situation. Using a data set of 182 sales proposals for client work in a management consulting company, we show that sales teams that had varying needs to learn and differentiate themselves from competitors derived different levels of value from obtaining and using electronic documents and advice from colleagues. Highly experienced teams were more likely than inexperienced teams to lose the sales bids if they utilized such knowledge. Teams that had a high need to differentiate themselves from competitors also had a lower chance of winning if they utilized electronic documents. There were situations, however, where teams performed better if they utilized the firm's knowledge resources. These results suggest that competitive performance depends not on how much firms know but on how they use what they know. Copyright © 2004 John Wiley & Sons, Ltd.     

Global Outsourcing Relationships and Innovation: A Conceptual Framework and Research Propositions

Increasing globalization and the rapid growth of information technologies, including the Internet, have resulted in drastic changes in international activities of companies. Once limited to manufactured goods, currently, global outsourcing encompasses a wide variety of knowledge‐based services, such as accounting, financial services, taxation, customer service, information technology, engineering drawings, human resources, research and development (R&D), data processing, and sales. The domain of outsourcing knowledge‐based services is the focus of this paper. Moving beyond the inevitability of global outsourcing, this research takes the perspective of the outsourcer and focuses on managing its transition to providers in the context of innovation. In addition to delivering projected cost benefits to outsourcers, effective transition management can facilitate the generation of innovations. This research attempts to extend the current academic research on global outsourcing in three ways: (1) It offers a framework for understanding the transition process in outsourcing and its relationship to innovation; (2) it takes a broader perspective of outsourcing, including globalization, knowledge‐based services, and core activities of the firm; and (3) using a parsimonious set of theoretical concepts based on control theory, it develops several research propositions to clarify the linkages between variables. Based on our theorizing, outsourcing top management should ask two questions when planning outsourcing of knowledge‐based services to generate innovations in a globalized world. These two questions are: (1) How close is the task to our core competence? And (2) how much tacit knowledge is involved in doing the outsourced task? Next, managers must identify global providers and then spend considerable thought in operational execution of the transition of the task for that is the only time that both complete teams will work together. For tasks that are close to core competence, rigid‐explicit behavioral controls should be put in place; however, for tasks that have high tacit knowledge content, high norms‐based relational control would be more effective. These different types of controls would lead to different innovation outcomes. Rigid‐explicit behavioral controls would produce incremental innovation while relational norms‐based controls would encourage radical innovation.     

Beyond the retention—acquisition trade-off: Capabilities of ambidextrous sales organizations

Sales organizations aim to grow their firms' business by acquiring new customers while retaining their existing ones. Although customer acquisition and retention are complementary processes, they involve different sales process capabilities that often compete for investments. However, firms that succeed in effectively combining these capabilities are “ambidextrous” and will enjoy superior growth and profits. Although developing ambidexterity is a fundamental sales management task, it has received little attention in research. Based on the Motivation-Opportunity-Ability framework we identify a set of organizational sales capabilities that can help sales organizations' joint management of acquisition and retention capabilities, and explain their influence drawing on Job Demands-Resources (JD-R) theory. Survey and time-lagged archival performance data from 174 firms provide an empirical test of the conceptual model and hypotheses developed. Results confirm that incentive management, cross functional cooperation, and the interaction of cross functional cooperation and sales training capabilities are positively correlated with sales organization ambidexterity. In addition, we find a positive correlation of customer prioritization on ambidextrous selling. Results confirm that firms with high levels and aligned acquisition and retention capabilities enjoy superior organic growth. However, contrary to expectation, increases in profit growth are only accomplished if acquisition capabilities are high.     

In Search of Innovation and Customer‐related Performance Superiority: The Role of Market Orientation,Marketing Capability,and Innovation Capability Interactions

Understanding the mechanisms through which firms realize the value of their market‐based knowledge resources such as market orientation is a central interest of innovation scholars and practitioners. The current study contends that realizing the performance impact of market orientation depends on know‐how deployment processes and their complementarities in functional areas such as marketing and innovation that co‐align with market orientation. More specifically, this study addresses two research questions: (1) to what extent can market orientation be transformed into customer‐ and innovation‐related performance outcomes via marketing and innovation capabilities; and (2) does the complementarity between marketing capability and innovation capability enhance customer‐ and innovation‐related performance outcomes? Drawing upon the resource‐based view and capability theory of the firm, a model is developed that integrates market orientation, marketing capability, innovation capability, and customer‐ and innovation‐related performance. The validity of the model is tested based on a sample of 163 manufacturing and services firms. In answer to the first research question, the findings show that market orientation significantly contributes to customer‐ and innovation‐related performance outcomes via marketing and innovation capabilities. This finding is important in that market‐based knowledge resources should be configured with the deployment of marketing and innovation capabilities to ensure better performance. In answer to the second research question, the findings indicate that market orientation works through the complementarity between marketing and innovation capabilities to influence customer‐related performance but not innovation‐related performance. Managers are advised to have a balanced approach to managing the deployment of capabilities. If they seek to achieve superiority in customer‐related performance, marketing capability, innovation capability, and their complementarity are essential for attracting, satisfying, building relationships with, and retaining customers. On the other hand, this complementarity would be considerably less important if firms placed greater emphasis on achieving superiority in innovation‐related performance. In contrast to many existing studies, this study is the first to model the roles of both innovation capability and marketing capability in mediating the relationship between market orientation and specific performance outcomes (i.e., innovation‐ and customer‐related outcomes).     

Advancing social media driven sales research: Establishing conceptual foundations for B-to-B social selling

Business markets are facing major changes due to an increasing digitalization trend and consequent changes in buying behaviors. Practitioners and academics alike have started to emphasize social selling as a novel way to tackle these emerging opportunities and challenges at the sales force level. Since research in this area remains embryonic and fragmented, we adopt a discovery-oriented research approach and conceptualize social selling and its key facets based on a systematic literature review and a field study involving thought leading social selling professionals. The findings indicate a need to extend the research focus from social media usage into a concept which comprehends social selling as a broader application of digital marketing principles at the individual salesperson level. Social selling leverages social and digital channels for understanding, connecting with, and engaging influencers, prospects and existing customers at relevant customer purchasing journey touchpoints for building valuable business relationships. We relate the construct to other close selling approaches and explicate its organizational strategy components as well as performance outcomes. The findings advance current understanding of the role of sales in contemporary business markets and have implications for sales and marketing theory and practice.     

The impact of outsourcing new technologies on integrative capabilities and performance

Outsourcing plays an important role for firms adopting new technologies. Although outsourcing provides access to a new technology, it does not guarantee that a firm can subsequently integrate the technology with existing business processes and leverage it in the marketplace. This distinction, however, has rarely been made in the literature. In the context of business process enhancing technologies, this study builds on the resource‐based and knowledge‐based views to study the impact of outsourcing on firms' subsequent performance in the market and their integrative capabilities, that is, a firm's capacity to use and assimilate a new technology with its business processes and build upon it. The study argues that greater reliance on outsourcing may reduce a firm's learning by doing, internal investment, and tacit knowledge applications, thereby impeding a firm's integrative capabilities and performance in the market. The study uses survey and archival data on banks' outsourcing strategies for Internet adoption to test for the performance consequences of outsourcing, which are found to be negative. However, the findings also show that outsourcing is less detrimental for firms with experience in prior related technology. Copyright © 2009 John Wiley & Sons, Ltd.