Explain the assumptions underlying the different business orientations that firms can follow. What implications do these assumptions have for the situations when these orientations will be effective and/or ineffective?
In the first part of the question, you should first explain (briefly) what a ‘business
orientation’ refers to or means. There is no single set definition but it generally refers to the dominant approach that a firm takes to all its operations. Second, you should list the various business orientations that firms can have, which are production-oriented firm, product-oriented firm, selling-oriented firm and marketing-oriented (or market-driven) firm. Thirdly you then move on to explain what each business orientation implies and what assumptions it makes about the product, service and consumers (perhaps with examples of companies for each).
In the second part of the question, a statement concerning the context in which an orientation may or may not be adopted would be required. By ‘context’ one means the external and internal, referring respectively to the level of development of the market/country (external to the firm) and also to the stage in the evolution of the firm (internal).
For example, with reference to the external context, in the early stages of economic development, societies generally need products at a low price. The production orientation provides an excellent means by which to achieve this goal.
As consumers grow richer and want greater quality and choice, then a product orientation works better. And so on.
If in your answer you can appeal to a specific country or industry example(s) you should be rewarded. The car/auto industry is a natural starting point and follows to a large degree the pattern outlined above.
However, other examples abound. Microsoft begins as very much a ‘product’ oriented company that has had to evolve into a ‘marketing’ oriented company, whereas Apple has always been – since it initially adopted the Graphical User Interface (GUI) over command functions – a user-driven/marketing oriented firm.