An Empirical Investigation of the Effect of Customer Orientation on the Business Performance of French Firms: A Firm-Level Analysis of Direct and Moderation Effects

Abstract

Is customer orientation a driver of better firm performance? To answer this question, we examine the impact of customer orientation on the business performance of more than 7,500 French firms. Our findings show that customer orientation significantly improves business performance, as measured by the logarithm of the profit per employee and the logarithm of EBITDA (earnings before interest, taxes and depreciation) per employee. Additionally, there is an indirect impact that varies according to the market environment. The findings imply that the positive influence of customer orientation on firm profitability per employee and EBITDA per employee increases in growing, highly competitive and uncertain markets.