The moderating role of reward systems in the relationship between market orientation and new product performance in China

Extant studies concerning the relationship between market orientation and new product performance have produced inconclusive results. Drawing on the contingency theory, the authors argue that one reason for these mixed results may be the lack of an appropriate reward system within the new product development process. This study theoretically and empirically examines the moderating role of reward systems in the relationship between market orientation and new product performance. The authors conducted interviews and surveys in China. The moderating effects suggest that Chinese firms should simultaneously use both a high-level, long-term-oriented reward system and a low-level, risk-taking reward system in order to enhance the positive effects of market orientation on new product performance. The results provide a more refined understanding of how the interplay between marketing and human resource management influences the implementation of market orientation and new product innovation.