The reinforcing effect of a firm's customer orientation and supply-base orientation on performance

•Understanding resource-based performance requires examining the complementarity of resources and capabilities.•The configuration of the underlying capabilities of customer orientation and supply-base orientation affects firm performance.•Both are fundamental elements in enabling firms to acquire and deploy resources in ways that reflect the business environment.•The nature of these types of strategic orientations may inhibit the imitation of the firm's competitive advantage.

Although the merits of maintaining strategic orientations such as customer orientation and supply-base orientation have been discussed in the literature, there is relatively little understanding of how these strategic orientations interrelate. Drawing on dynamic capability theory, this study examines how these strategic orientations, through the deployment of their underlying capabilities, are drivers of firm performance. Based on a cross-industry sample, the findings indicate that firm's customer orientation and supply-base orientation are complementary strategic assets that contribute to superior performance. The findings provide new insights regarding the interplay of different strategic orientations and the importance of capability deployment.