An empirical study of SOEs' market orientation in transitional China

Using institutional theory, this paper investigates the antecedents and outcomes of market orientation in state-owned enterprises (SOEs) in transitional China. A survey of 274 SOEs demonstrates a strong positive relationship between market orientation and various measures of organizational performance. Additionally, market competitive pressure, formalized corporate governance, and less government control are found to promote market orientation of SOEs in the transitional period. These results support the views that market orientation leads to better performance and that institutional factors should be considered in studies of strategy in Chinese firms. Copyright Springer Science + Business Media, Inc. 2006