This study examines the relationship between corporate identity (CI), customer orientation (CO) and performance [market performance (MP) and financial performance (FP)]. It is anchored in the premise that that CI and CO are not just the domains of large organizations but are equally important to small and medium enterprises (SMEs), if not more.
Using literature review as the point of departure, the authors develop a conceptual model comprising five hypotheses. The first hypothesis examines the dimensionality of the CI construct. The second hypothesis examines the relationship between CI and performance (MP and FP). The third hypothesis examines the relationship between CI and CO. The fourth hypothesis examines the relationship between CO and performance (MP and FP). Finally, the fifth hypothesis examines the mediating role of CO in the CI and performance (MP and FP) relationship. We argue that the role of CI is overarching and it influences MP and FP directly and indirectly via CO. Corporate identity acts as a source of authenticity for the customers.
A mix of exploratory and descriptive research designs has been chosen. Survey as a data collection tool is employed to collect 102 sets of usable data from CEOs of SMEs; PLS-SEM has been chosen as the statistical tool for testing the hypotheses.
From the analysis of the given data set, it is inferred that CI is a second order construct with three distinct but related dimensions; CI has significant positive impact on performance (MP and FP) and customer orientation respectively; and that customer orientation partially mediates the relationship between CI- MP and fully between CI- FP.
The main contribution of this study is to establish the applicability of CI as performance (MP and FP) enabler in SMEs. This has been done by validating the newly developed measure of CI in SMEs and examining the direct and indirect role (via CO) of CI as MP enabler and indirect FP enabler in addition to assessing CI-CO linkage.
