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Handbook of Management Scales/Market acuity

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Market acuity (composite reliability = 0.83; AVE = 0.55)

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Description

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A set of new, multi-item measures are operationalized. The authors define and measure the salient infrastructural competencies – termed business-to-business seller competence (B2B-SC) – associated with the seller-side of Internet-enabled commerce. They find that the conceptual domain of B2B-SC comprises seven theoretically important dimensions: (1) technical skills, (2) change disposition, (3) conflict management, (4) market acuity, (5) coordinated logistics, (6) knowledge channels, and (7) fluid partnering.

Definition

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Market acuity denotes the ability of the seller to see the competitive environment clearly and to anticipate customers’ needs and wants.

Items

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  • Have a good understanding of competitors’ strengths and strategies. (0.72)
  • Foresee customers’ product or service needs. (0.82)
  • Understand target markets better than competitors. (0.69)
  • Able to sense shifting boundaries of industry. (0.74)

Source

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Comments

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Much efforts have been made by the authors in order to ensure that the new scales exhibit sufficient psychometric properties, which make them quite useful.

Market acuity (composite reliability = 0.77; average variance extracted = 0.52)

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Description

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The authors report a two-stage approach for the development and validation of new multi-item measurement scales reflecting a multidimensional construct called new service development competence. It is operationalized as a multidimensional construct reflected by five complementary dimensions: new service development process focus, market acuity, new service development strategy, new service development culture, and information technology experience.

Definition

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New service development competence reflects an organization’s expertise in deploying resources and routines, usually in combination, to achieve a desired new service outcome. Market acuity describes the ability of the service organization to see the competitive environment clearly and to anticipate and respond to customers’ evolving needs and wants.

Items

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  • Our service firm actively seeks out information about our company’s business environment. (0.484)
  • New offerings are designed based on information actively collected on evolving market shifts and customer demands for these offerings. (0.843)
  • Our service firm uses collected information to respond quickly to changes in the competitive environment. (.793)
  • Customers, both internal and external, are viewed as potential and valuable sources of new offering ideas and opportunities. (0.716)

Source

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Comments

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Much efforts have been made by the authors in order to ensure that the new scales exhibit sufficient psychometric properties, which make them quite useful. The mean value of the last item is 3.55 and therefore above the expected 3. It may therefore be reworded (e.g. "are often viewed" instead of "are viewed").

Market acuity (composite reliability = 0.80)

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Description

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The authors follow a two-phased approach to develop multi-item scales that measure dimensions of service orientation in the context of business-to-business e-commerce. Service orientation was conceptualized as a third-order construct comprised of five combinative service competency bundles: service climate; market focus; process management; human resource policy; and metrics and standards.

One of these five second-order dimensions, market focus, consists of three first-order dimensions: market acuity, relationship management, and new service development.

Definition

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The ability to understand the business environment, the market, the competition, the customer requirements, and to implement strategies to compete successfully.

Items

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  • Market information is used to implement strategies to compete effectively. (0.65)
  • We identify the drivers of value on the market/market segment. (0.70)
  • We understand our customers’ business needs better than our competitors do. (0.68)

Source

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Comments

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The third item was dropped due to low regression weight (or lower than remaining items) and due to redundancy.

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