Abstract:
An increasing number of recent studies have emphasised an important dimension of
market orientation. Previous research has explored the relationship between market
orientation (MO) and performance (P), revealing various integrated mechanisms.
However, the findings have been inconsistent, likely due to the neglect of the
mediating and moderating roles of innovation (I) and absorptive capacity (AC). To
address this gap directly, the current study examined the relationship between
market orientation and the performance of Small, Medium, and Micro Enterprises
(SMMEs), while also investigating the moderating effect of absorptive capacity on
this relationship. A quantitative approach was employed, utilizing a cross-sectional
survey method to gather data from conveniently sampled respondents. Reliability
was measured using Cronbach’s alpha, and Partial Least Square Structural Equation
Modelling (PLS-SEM) was applied for data analysis. The study's findings revealed a
significant positive relationship between market orientation and the performance of
SMMEs. While the mediating effect of innovation was found to be significant, the
moderating impact of absorptive capacity was deemed insignificant. Based on these
findings, recommendations were made for SMMEs to enhance their focus on market
orientation in order to improve their business outcomes
