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Green Market Orientation and Market Capability Influence on

Competitiveness and Performance of Green SME Cultural Agency

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 International Review of Research in Emerging Markets and the Global Economy (IRREM)
An Online International (Double-Blind) Refereed Research Journal (ISSN: 2311-3200)
2020 Vol: 6 Issue: 1

Green Market Orientation and Market Capability Influence on

Competitiveness and Performance of Green SME Cultural Agency

Siribuppa U-tantada,
Business Administration Faculty,
Rajamangala University of Technology Phra Nakhon, Bangkok, Thailand.
E-mail: [email protected]
Maurice Yolles,
Centre for the Creation of Coherent Change & Knowledge (C4K) Liverpool John Moores University,
Liverpool, England.
E-mail: [email protected]
Ampon Shoosanuk,
Independent scholar.
E-mail: [email protected]
Bahaudin G. Mujtaba,
The H. Wayne Huizenga College of Business and Entrepreneurship,
Nova Southeastern University, Florida, USA.
E-mail: [email protected]@nova.edu
___________________________________________________________________________
Abstract
Interest here lies in saving the global digital developing system from increased pollution and
climate changes, highlighting the importance of policies, consumers, buyers, suppliers and
distributors, and being aware of environmental, social, economic, and ethical responsibilities.
Green market orientation and market capability work well in competitive environment. These
attributes influence stakeholder-based performance of green SME taken as cultural agencies
can be linked to the Sustainable Development Goals (SDGs). Using cultural agency theory, a
conceptual model of green marketing is produced. This explains how green marketing relates
to such notions as market capability, competitiveness and corporate performance.
___________________________________________________________________________
Key Words: Green SME cultural agency, cultural agency theory, green market orientation,
market capability, competitiveness, stakeholder-based corporate performance, the
sustainable development goals (SDGs)

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1. Introduction
Creating policies that enable climate change assessment can better protect communities,
businesses and natural assets (OECD, 2015). Businesses and stakeholders in their
environments can make a contribution to this (U-tantada, et al, 2019a; 2019b; 2019c). Here,
sustainable development can occur when corporate organizations grow by taking
responsibility toward society and globally through green: marketing, theory building, policy-
making, and strategy formulating (Bagdare, 2016). Adaptation for global survival in changing
complex environments during climate change needs better understanding in a relation to the
nature of strategic organizations and their behaviors. There is also a need to strengthen the
desire and capacity to make plans, carry out actions, and employ power both within
organizations and with other agencies (Dominici & Yolles, 2016; Yolles, 2006; 2016; 2018)
in a global market environment. Organizational structure has a positive and significant effect
on sustainable development and a green market has a positive and significant effect on green
enterprises and sustainable development in knowledge-based companies (Lotfi, et al., 2018).
Pollution prevention through operations, the minimizing of resource allocation, and selling
greener products is not enough to be sustainable business agencies (Küçükoğlu, 2018), but
green organizational culture with operations, management and marketing functions provide
opportunities for improved performance (Gupta & Kumar, 2013) because employees can be
engaged for environmentally conscious behaviors to obtain new ideas, and to cooperate more
effectively (Chen, 2011). The formation of strategies for organizational environmental
marketing is driven by internal rather than external forces, and through the resource-based
view of the business strategy in which a resource directly influences a corporation’s
capabilities such as new product development success (Baker & Sinkula, 2005). The
generation of an organizations’ external information as well as its responsiveness impact
positively on financial performance (Rodrigues & Carlos Pinho, 2012).
Cultural agency theory (CAT) as developed by Yolles (1999; 2006; 2018), provides
strategic attributes as part of its immanent processes. They are relevant to the maintenance of
viability and sustainable performance achievement. Focused small to medium sized
enterprises (SMEs) can and will be modeled as cultural agencies by adopting the self-evident
propositions that they are essentially autonomous (having self-directive processes) and are
living systems able to adapt and self-organize. Their processes of adaptation are oriented
towards viability (for survival), self-understanding of their behaviors, assessment and where
necessary a strengthening of their desires, making plans, carrying out actions, organizational
power, and communication and control process. In addition, adaptation needs an
understanding by an SME of its strategic attributes with respect to the environment. This can
be enhanced by evaluating its actions both qualitatively & quantitatively, and by empirically

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embracing feedback processes that can adjust its development cycle and influence other
involved agencies involved in its market environment affecting the sustainable development
goals (SDGs).
SME adaptability in a complex environment relates to its nature as a strategic organization
from which consequential behaviors arise. Strategic attributes are part of a set of immanent
processes, they are relevant to the ability of SME’s to maintain their viability, and contribute
to the sustenance of performance achievement. Viability is achieved through self-processes
that impact on SME behaviors, strengthen their desires, aid their making of plans, carrying
out actions using power, and undertaking communication and control process. They explore
strategic attributes in their organization and environment(s) by validating the influence of
attributes both qualitatively and quantitatively, and use feedbacks to adjust their development
cycle serving SDGs.
Modeling SMEs through Agency Theory can shed light on how customers and providers
are able to recursively create collective value during interaction in a market (Dominici &
Yolles, 2016). The market can be seen as an agency with autonomous development of its own
functional future, and where it can act as a forum for providers and customers (where each
can also be considered to function as an agency). The co-creation of values is driven by
environmental constructs and individual values in negotiations through dynamic processes of
multilateral communication occurring in “viable living systems,” and this can improve any
adaptive cycle that may develop (Dominici & Yolles 2016; Yolles, 2006).
Within three main dynamic systems (cultural, strategic/personality1 and operative) that
arise when SMEs are modelled through cultural agency: corporate performance is located in
its operative system and can be assessed, for instance, by using balanced scorecard (Sohn, et
al., 2003); strategy can be assessed by examining a balance between financial and non-
financial measures of SME’s activities; and within the cultural system knowledge can be
assessed through operative actions and communications. Corporate performance as a
balancing gauge covers: (1) financial performance, (2) customer performance, (3) internal
process performance, and (4) learning and growth performance (Sohn, et al., 2003). While the
ultimate goal of stakeholders can be assessed by the development of: sales (Avci, et al.,
2011), results (Soana, 2011), new customers (Williams & Naumann, 2011), employment rate
(Avci, et al., 2011; Jorgensen, 2008), customer satisfaction (Avci, et al., 2011; Turker, 2009),
customers' trust (Lau & Cobb, 2010), customer commendations (Morsing & Schultz, 2006)
and customers loyalty (Arnold, et al., 2011). This stakeholder-based corporate performance is
organization’s sustainability orientation assessment (Hansen & Schaltegger, 2017) relating to
climate change assessment that can better protect communities, businesses and natural assets

1
The strategic/personality system is a strategic system in which strategy is determined in part by
attributes that might normally be related to a corporate (normative) personality.

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globally. SME cultural agency and its stakeholders can also contribute to relative policies of
climate change assessment.
In accordance with world trends, identified through a literature lens, critical drivers for
corporate performance are: green market orientation, market capability, and competitiveness.
Since the strategic eco-SME cultural agency can limit resources that result its competitiveness
located in its operative system and easy adjustments to crises in its market environment. Its
knowledge of markets, value-added product and processes development, new technology,
collaboration in Research and Development (R&D), and supply chain (Jernström, et al.,
2017), are basic life-cycle improvements on the product design, product-service systems and
business models (Adams, et al., 2016; Hansen & Schaltegger, 2017) for bargain goods and
services as challenges lower people’s real income. Encountering problems, managing shifts,
and seizing product and service-related business opportunities involve considerations of
sustainability (Holmlund, et al., 2016) within the SME organization.
There is also an influential green market orientation that arises from its culture system,
with green values and norms. Green market orientation is disseminated into the SME strategic
system, and its operations and behaviors as a whole in its operative system. Where it has a
cycle of a comprehensive eco-competitive orientation, it has a beneficial advantage in that it
can change product design and enterprise culture and this can feed into an environmental
impact enterprise analysis, leading to an analysis of its competitive environment
(Moravcikova, et al., 2017).
In addition, there is market capability in the SME operative system that can empower its
goals that will (if it they are effectively implemented) impact on its operative behavior. Its
marketing processes are part of its business strategy and relates to the question of why
consumers buy a product or use a service. Marketing processes can add benefit or create
improved problem solutions able to convince potential consumers that they involve resources
that will deliver valued offerings in pursuit of ultimate goals. They are a better position to
serve new products that meet customers’ high expectations, and to adjust pricing that can
quickly respond to product process changes, can provide high-quality after-sales service, and
enable close working with distributors and retailers (Vorhies & Morgan, 2005) in current
market environment.
In consequence, the SME, when including the attributes of its substances, strategy or
variables capable of providing new resource-based opportunities, is aware of climate change.
This is facilitated through currently diverse changes in a global market environment, in order
to promote opportunities in economic, social and environmental development for all through
empirical data analysis at organizational level. In helping current issue resolutions relating
green driving factors for viability and sustainability of SMEs, then the purpose of an article is
to illustrate a proposed research model of the modeling SME through CAT, enabling

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development to be considered in terms of its environment, and linked to concepts like: green
market orientation, market capability, and competitiveness on corporate performance through
arisen theoretical framework and conceptual framework. Statistical propositions that arise
from research questions will be analyzed by using a structural equation modeling to test
research propositions. Relevant answers to the research objectives and questions will show
that there are statistically significant relationships between: green market orientations and
competitiveness; market capability and competitiveness; and competitiveness and cooperate
performance of SMEs.
This article is structured as follows: a literature review will be provided that considers
cultural agency theory, green market orientation, market capability, competitiveness,
corporate performance, green market orientation and competitiveness, market capability and
competitiveness, competitiveness and corporate performance, and green SMEs: green market
orientation, market capability, competitiveness, and corporate performance. Research
methodology will be provided including the quantitative research approach, research
instrument assessment and data analysis, and expected results. Limitations to the research will
also be considered. The conclusion provides an overall summary and recommendation.
2. Literature Review
2.1 Cultural Agency Theory
Cultural agency theory or CAT (Yolles, 1999; 2006; 2018) is a cybernetic living systems
paradigm that models complex adaptive systems focusing also on the social and cultural
dimensions. It is principally used to model organizational contexts that have at least
potentially stable cultures, explore predefined contexts, and be applicable to reflect those
contexts. It tends to be more stable in terms of personality testing and retesting, permanently
founded on the formation of beliefs in an unbiased manner supported by "sufficient"
evidences, placing on values. It can be used to model all durable agencies in order to explore
both its internal and external dynamics as diagnostic and analytic tool for the purpose of
examining the state, or locating problems or any combinations (attributes that include a
capacity for sustainability and adaptability) within the organization or a network of agencies’
environments that it is interacting in. Internal attributes include immanent dynamic "self"
processes that drive agency viable change. It acts as an effective tool to model SMEs as
cultural agencies, and be part of the issue solving process for sustainability (U-tantada, et al.,
2019b).
2.2 Green Market Orientation (GMO)
Green market orientation (GMO) is organizational culture with green values and norms to
be disseminated into the corporation strategy and its operation as a whole within the three
generic system of SME cultural agency. Green marketing principles are needed in the cycle of

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a comprehensive eco-competitive beneficial advantage by changing in product design,

enterprise culture, and environmental impact analysis of enterprises, and ends with the
analysis of the competitive environment (Moravcikova, et al., 2017). Papadas, Avlonitis, &
Carrigan study’s (2017) the latest scale development of green marketing orientation construct,
within three dimensions are strategic green marketing orientation, tactical green marketing
orientation and internal green marketing orientation (Papadas, et al., 2017, p. 240). Its
operational definitions (Papadas, et al., 2017) are (1) strategic green marketing is the extent to
which organizations integrate the orientation environmental imperative in strategic marketing
decisions; (2) tactical green marketing is the extent to which organizations embody
orientation environmental values in tactical marketing decisions; and (3) internal green
marketing is the level of assimilation of corporate environmental orientation values by all
internal stakeholders.
In brief study above is based on three dimensions of green market orientation attribute. (1)
Strategic green marketing orientation (SGM) refers to long-term, top management actions and
policies specifically focusing on corporate environmental strategy (Banerjee, 2002), external
environmental stakeholders (Polonsky, 1995) as integration of green values into corporate
strategy (Banerjee, 2002) and stakeholder integration for economic, social and environmental
performance (Aguinis, 2011). (2) Tactical green marketing orientation (TGM) involves short-
term actions that transform the traditional marketing mix into a greener one (Pujari, et al.,
2003), promotion tools (Kilbourne, et al., 2002), actions in the supply chain (Zhu & Sarkis,
2004), and pricing policies (Chen, 2001) through their online communication to capture new
and strategic audiences (Kotler, 2011). Lastly, (3) internal green marketing orientation (IGM)
refers to internal corporate culture with green values to guide the corporation and employees
(e.g. trainings, awareness activities) as marketing its mission to consumers (Wells, et al.,
2015).
Green marketing principles and the competitive market position of companies could help
the Automotive Industry Union to present requirements to the government and create
incentives for the alternative vehicle market, and companies’ strategy (Moravcikova, et al.,
2017). Environmentally responsible Toyota, seeking to achieve environmental goals until the
period to 2050, obtains multiple benefits such as cost reduction (due to the lower resource
consumption), profit increase (from recycling and residuals reuse), production process
enhancement (cleaner and more efficient technologies), corporate image upgrading, brand
awareness and value as well as performance (Simãoab & Lisboaac, 2017). A green market
orientation influences both internal green practice and supplier green monitoring that are
advantageous to superior environmental performance. As research’s finding was suggested
that green market orientation can improve firm performance (Li, et al., 2018).

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2.3 Market Capability (MKC)

Market capability (MKC) is the processes planned on value propositions to target
customers, and it involves resources that deliver value offerings in pursuit of the following
ultimate goals: “better position; meeting customers’ high expectations; responding quickly to
any competitive environmental changes; high-quality after-sales service; responding to
competitor’s action well; and working closely with distributors and retailers” (Vorhies &
Morgan, 2005).
There are four means by which market capability can be promoted (Leonard-Barton,
1992): (1) the accumulated employee knowledge and skills e.g. technical knowledge, training,
and long experiences; (2) the knowledge embedded in technical systems e.g. databases,
formal procedures, routine skills, and computer systems (Nelson & Winter, 2009); (3) the
management systems are relating creating and controlling knowledge; (4) values and norms
interpreted to be capabilities are applicable into effective functions. Market capability
represents: (1) knowledge and skills that marketing employees have, to enable them to
understand and satisfy customer changes on value creation for superior performance (Day,
1994); (2) market and customer information management e.g. gathering, distributing and
exploiting are applicable information from customers (Ahmed, et al., 2014); and (3)
customers’ income generation, channel management, and communications and business
strategy implementation (Day, 1994; Vorhies & Morgan, 2005). Based on their marketing
mix strategies intended to enhance competitive advantage (Vorhies & Morgan, 2005) because
knowledge-based capabilities, innovative products and services promote successful brand and
strong brand names in foreign markets (Kotabe, et al., 2002).
Vorhies and Harker (2000) categorized MKC into six areas: (1) marketing research, (2)
pricing, (3) product development, (4) management of the firm’s distribution channels, (5)
promotion, and (6) marketing management. Then, Zou, et al. (2003) categorized MKC into
four features to reach customer’s demand in the export market: (1) pricing capability is using
pricing skills to respond to competitors’ actions and customer changes, and to communicate
pricing information to customers; (2) product development capability is ability to manage
new product development process and develop new products; (3) marketing communication
capability is effectively marketing communication programs; (4) distribution capability is to
provide superior support and good long-term relationships to export distributors.
The notion of MKC, relevant to market environment, provides a detailed understanding of
SMEs and the extant marketing literature. MKC is used to further measure these marketing
capabilities based on Zou, et al. (2003) and developed by Murray, et al. (2011). There are
three dimensions: (1) pricing capability (PCC) is defined as the extent to which export
ventures can use pricing skills to respond to competitors’ actions and customer changes, and
communicate pricing information to customers; (2) product development capability (PDC) is

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defined as corporations’ ability to manage new product development process and develop
new products for the export market; and (3) marketing communication capability (MCC) is
defined as the extent to which export ventures can effectively manage marketing
communication programs and use marketing skills to reach customers in the export market
(Zou, et al., 2003).
Thus, within an operative system of the strategic SME cultural agency, market capability
is taken as a combination of assets relating to human, market, policy, rules/regulations, and
the organization, that are employed in its external and internal marketing-related areas. After
dealing with its environment, in return, imperatives from market environment can adjust its
behaviors in the operative system of the organization as a cycle of self-development.
2.4 Competitiveness (CPT)
Competitiveness (CPT) is a concept across different levels and disciplines such as
comparativeness or price competitiveness, strategy, operations, resource-based view, and
management perspective, as well as historical and socio-cultural perspective (Rodríguez &
Luque, 2016) as driving force in the market (Ameen, et al., 2015) is defined in accordance
with different levels and areas.
Porter (1990) defined competitiveness as the ability of a firm to successfully compete in a
given business environment. While Koufteros (1995) defined competitive capabilities as a set
of organization’s capacity to satisfy customers including price offered, product quality,
product line breadth, order fill rate, order cycle time, order and shipment information, and
frequency of delivery. Tracey, et al. (1999) provided the measurement index of
competitiveness as price offered (POF), quality of products (QLP), product line breadth
(PLB), and delivery capability (DLC). Quality of products (QLP), product line breadth (PLB),
and delivery capability (DLC) could pass value index of the structural equation modeling:
lisrel technique (U-tantada, et al, 2019c). Its original measurement items of variables include
price offered, quality of products, product line breadth (variety), order fill rate, order cycle
time, order shipment information, and frequency of delivery which are drawn from Cooper, et
al. (1992); Holcomb (1994) and Koufteros (1995).
Thus, in the operative system of the strategic SME, there is competitiveness as its
successful potential within the organization and its environment. After dealing with its
environment, in return, feedback imperatives direct adjustments to its behaviors in the
operative system as a cycle of self-development of SME cultural agency.
2.5 Corporate Performance (CPP)
Fair measurement covers stakeholder’s ultimate goals, viability, and sustainability-based
assessment which is a way of assessing the results of corporate actions within a given period
or the results of conducting business relating to quantitative and qualitative approaches
determined by internal and external factors (Buller & McEvoy, 2012; U-tantada, et al.,

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2019c). Corporate performance (Sohn, et al., 2003) is defined as balanced scorecard (BSC)
measures, a balance between financial and non-financial measures. According to their four
operational definitions (Sohn, et al., 2003): financial performance (FNP) is defined as
company’s financial achievement level, a part of the whole system of a company, in order to
sustain survival by employing strategies, to maximize opportunities for profit and minimize
risk, in accordance with achievement level e.g. revenue growth, investment, profitability,
asset utilization, and unit cost. Customer performance (CTP) is defined as a company’s
customer achievement level to maintain its position by carrying out searches for market
opportunities, new trends, and responding to market and customer’ demand, in accordance
with achievement level e.g. customer profitability, customer acquisition, customer retention,
customer satisfaction, and market share. Internal process performance (IPP) is defined as
company’s internal process achievement level, operational efficiency involving with key
changes in technology, organizational structure, and operational method to be able to
maintain competitive power in all fields, in accordance with achievement level e.g.
product/service development, market identification, customer management and environment.
And, learning and growth performance (LGP) is defined as company’s learning and growth
achievement level and higher knowledge and intangible assets. They arise from the interests
of the key stakeholders (shareholders, customers and employees), in accordance with
achievement level e.g. skills, knowledge sharing, IT infrastructure, IT applications and
organizational culture.
Thus, in the operative system of the strategic SME, corporate performance measures can
be assessed using mentioned balanced scorecard (BSC) measures, and sustainable -based
gauges of the business activities ascertained. When dealing with environment, in return,
imperatives from environment can adjust its behaviors in the operative system of the
organization as a cycle of self-development.
2.6 Green Market Orientation (GMO) and Competitiveness (CPT)
Green marketing orientation leads to an ecological path, the environment protection and a
competitive strategy relating to corporate attractiveness, competitiveness rivalry, and the
competitive position to force profitability (Porter & Kramer, 2006).
Wu and Lin (2016) revealed that corporate image of 1,287 organic farms certified and
registered in Taiwan, through green marketing strategies, improves business performance.
Moreover, a statistically significant relationship was found between green marketing and its
overall competitiveness. To cope with the environmental pressures (Moravcikova, et al.,
2017), green marketing can increase the value of products and a competitive edge of green
marketing mix strategy that influences on green image (Rahmawati & Hadiwidjojo, 2014).
A firm’s green performance and external green collaboration act as mediator variables
between internal green practices and firm competitiveness. They influence firm

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competitiveness positively. In other words, internal green practices and external green
collaboration have positive impacts on green performance, which in turn enhance firm
competitiveness (Yang, et al., 2013).
In consequence, a proposition 1 is set: green market orientation has a positive and direct
influence on competitiveness.
2.7 Market Capability (MKC) and Competitiveness (CPT)
Marketing capabilities, related to achieving and sustaining competitiveness in the
marketing strategy (Vorhies & Morgan, 2005), arise from market-orientation employee
resources (Greenley, et al., 2005) for products and services (Day, 1994). This enables the
delivery of superior customer value, which in turn strengthens customer relationship to a
corporation (Day & Moorman, 2010). MKC as the intangible assets employed as a resource
(Ejrami, et al., 2016), for sustainable competitiveness, economic growth and development,
stems from: (1) their scarcity, (2) their relative immobility, and (3) the difficulty for
competitors to understand and imitate firm’s service and product innovations (Reed & De
Fillippi, 1990).
There is a positive linkage between marketing capability and competitiveness. Marketing
capabilities are the most important driver of performance, followed by industry forces,
specifically, competitive rivalry, and power of suppliers, and market orientation (Takata,
2016). It also affects competitive advantage of the importer company, while marketing
capability impacts on performance and competitive advantage might impact on the
performance of importation companies (Ejrami, et al., 2016). In addition, competitiveness
(specifically, low-cost advantage and differentiation advantage) has an important mediating
role in the relationship between marketing capabilities and export performance (Tan & Sousa,
2015).
Thus, a proposition 2 is set: market capability has a positive and direct influence on
competitiveness.
2.8 Competitiveness (CPT) and Corporate Performance (CPP)
A global knowledge economy, work organization and human resources management are
determinant elements of competitiveness (Child & McGrath, 2001). They affect the way of
enterprises that undertakes innovation while public policy development of SMEs is applicable
(Carvalho & Costa, 2014) into exporting for growth.
There is an influence of competitiveness on corporate performance (Lii & Kuo, 2016),
this stemming from characteristics such as price, quality, design, marketing, and management
(O’Farrell, et al., 1992). Kaur, et al. (2017) found that a flexible systems strategy of SMEs
remains competitive and delivers high performance. Intra-and inter-organizational practices
impact business process management, and supply chain collaboration, so business process

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management improves empirically both organizational performance and collaborative

activities (Pradabwong, et al., 2017).
Thus, a proposition 3 is set: competitiveness has a positive and direct influence on
corporate performance.
2.9 Green SMEs: Green Market Orientation, Market Capability, Competitiveness, and
Corporate Performance
SMEs can be synthesized as non-isolated intelligent organization (U-tantada, et al.,
2019a; 2019b; 2019c). This is because they are participant in processes of knowledge
management as intangible assets that contribute to value creation process of the organization.
They are the richest asset of ideas and practices involving trust and mutual confidence
through transparency, communication, and ethical and lawful behaviors in part of intellectual
capital of an intelligent SME. The intelligent organization is defined as an organization that is
self-aware and strategic in nature, and uses knowledge to invest in continual reflection, self-
evaluation, and self-assessment, and is ideally organic (Yolles, 2006). It is able to understand
and deal with its own pathologies (conditions of ill-health) that require the use of intelligent
processes, the ability of an individual or group actor to distinguish attributes of cultural
knowledge, to efficiently and effectively discriminate, relate, manipulate and apply that
knowledge in a variety of environments, and to operate viably, maintaining sustainable
operations (Yolles, 2006).
In business strategy, returns arising from sustainable strategic advantage are resource
based (Barney, 1991). They are also subject to knowledge management processes within the
frame of morality and ethics, promoting co-value creations for stakeholders (Yolles, 2006).
These have positive associations between SME strategy and performance. The model offered
in Figure 1 explains the attributes of green marketing discussed above with the SME. To do
this a superstructure has been formulated from the literature review, which sits inside the
substructure of the SME modelled through cultural agency theory (Yolles, 1999; 2006; 2018).
This model is capable of underpinning an empirical analysis with deep qualitative
comprehension. Through the theoretical lens, data collection and refinement and
interrelationship of categories of information from theoretical documents like books and
articles relating to cultural agency theory and worldwide supportive empirical findings. Four
various concepts are designed for constant comparison of data with emerge categories of
different groups to maximize the similarities and the differences of information, in order to
build up a new conceptual device. Modelling the SME as a cultural agency with its global
market environment can yield important variables that can result in a new conceptual
framework (as will be shown in figure 2). This is in accordance with concepts that will be
being tested and measured quantitatively (Creswell, 2014) through Structural Equation
Modeling (SEM) (as will be shown in figure 3).

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Figure 1: Green Market Orientation, Market Capability, Competitiveness, and Corporate
Performance Functionaries in Green SME Cultural Agency (Prepared By Authors)

Figure 1 adopts a substructure that defines a living system through its operative and
figurative process intelligences that connect the operative, figurative and cultural systems
together (Guo, et al., 2016; Yolles, 2006). It also supports a superstructure, the details of
which are built into the CAT model showing the dynamics of green market orientation,
market capability, competitiveness, and corporate performance attributes with a green SME
cultural agency. Three-system generic model of the green SME cultural agency, explains the
relationship between self-processes. The powerful dynamic model permits value co-creations
for all stakeholders. It consists of (1) a cultural system; (2) a normative personality system;
and (3) an operative system. They are linked together by a reflection cycle of dynamically
intelligence networks of processes, called “figurative intelligence” and “operative
intelligence” to determine ‘its efficacy’ for its viability.
The networks of processes are developed through the cooperation of various departments
and individuals to "interpret" cultural attributes like green market orientation (Papadas, et al.,
2017) e.g. (1) strategic green marketing orientation (low-carbon technologies for production
processes, environmental policy for selecting partners, and R & D programs); (2) tactical
green marketing orientation (usage of e-commerce, digital communication methods, and a
paperless policy); and (3) internal green marketing orientation (environmental behaviors
rewarded, employee training on green marketing strategy, and using eco-friendly
products/services), when integrated into values, norms, beliefs and meaning connected to
knowledge in “the cultural system” (Guo, et al., 2016; Yolles, 2006). Green market

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orientation encourages internal green practice and supplier management (Li, et al., 2018)
through these information dissemination into “personality or strategic system” and made it
into goals, ideologies, and self-schemas under the network of process of “figurative
intelligence” in order to continuously provide relevant and timely goods or services for its
life-long consumers in “the operative system,” under “operative intelligence” network of
process. In “the operative system” of the green SME structure delivers behavioral potential,
power through decisions, empowerment to perform certain types of operative behaviors
within agency and communications that are specifically related to meaningful themes
(referred to as life-world: Schutz & Luckmann, 1974) in the global market environment
(Yolles, 1999; 2006; 2018).
Within the operative system, there is a market capability represented as a green marketing
driver for an export market. It can empower the ultimate goals by stakeholders to be
manifested operatively, for example: to communicate pricing structures and levels to
customers; use pricing skills to respond to changes; respond to competitors’ pricing tactics;
manage new product development systems; develop new products; manage new products;
launch new products; develop new products to exploit R&D investment; use marketing
communication skills and processes; manage marketing communication programs; and use
marketing communications (Morgan, et al., 2009; Zou, et al., 2003). Moreover,
competitiveness is a driving force of green SMEs’ goods and services in the market.
Competitiveness is able to, for instance, project exactly shipping dates; provide on-time
delivery; work with each customer to develop a delivery schedule; satisfy customers with the
frequency of delivery; deliver on time; satisfy customers with level of completeness for
shipments; reduce customers’ backorders; offer high quality, reliable, and durable products;
compete with competitors based on quality; alter product offerings to meet client needs; and
respond well to demand for ‘new’ features and changing preferences (Cooper, et al., 1992;
Koufteros, 1995; Holcomb, 1994; Tracey, et al., 1999).
Green market orientation, market capability, and competitiveness attributes have strong
impacts on corporate performance in the operative system of the green SME cultural agency.
This means that the three influential attributes of the green SME can increase the ultimate
goal performance of stakeholders in such areas as: customer satisfaction; customer retention;
customer acquisition; market share; customer profitability; profitability; revenue growth;
investment; asset utilization; unit cost; customer management; environment; operation
process; market identification; product/service development; skills; knowledge sharing; IT
infrastructure; organizational culture; and IT applications (Sohn, et al., 2003).
To understand how the SME agency maintains its dynamics in the global market
environment while embracing viability and sustainability, it needs to be realized that these
inter-relationships link to “social and competitiveness intelligences.” Social/Competitiveness

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intelligence feedback from the environment can create imperatives for changes in “the
operative system,” “the strategic system,” and “the cultural system” through the feedback of
intelligence networks of processes. In return, potential imperatives arise from the environment
for adjustments of market capability, competitiveness, and corporate performance in the
operative system. The adjustment imperative information is to be disseminated into the
strategic/personality system for revising its previous ideology, ethics, strategies, goals,
imagery, and self-schema on green market orientation for being connected to new knowledge
adjustment of green market orientation in the cultural system of the green SME.
3. Research Methodology
The green SME agency model, with its market environment, yields important variable or
construct linkages that can be tested and measured quantitatively. Quantitative research
empirical results provide a purely statistical perspective, and for this the model is likely to be
appropriate. A sound theoretical explanation arising from the organizational theory provides a
strong rationale to underpin the empirical model. The empirical model inferentially validates
the qualitative model, thereby sharpening the circle. A conceptual model will be formulated
as a conceptual framework of hypotheses that can be tested using given statistical procedures.
The intended research outcome will be a refined framework to improve their substance,
which is developed from a careful, consistent documentation of actual practice and the
subsequent discovery of relationships between actual practice and performance. A new
arrangement of a new conceptual framework consists of relationships among four strategic
attributes arisen from CAT illustrated in figure 2.
Figure 2: A New Conceptual Framework (Prepared by Author)

Greenmarket
orientation
Corporate
Competitiveness
performance
M arket
capability

The model will be examined empirically through the Structural Equation Modeling
(SEM) approach for each of the strategic attributes indicative of SME agency performance.
The three propositions indicated earlier are as: (Proposition 1) green market orientation has a
positive and direct influence on competitiveness; (Proposition 2) market capability has a
positive and direct influence on competitiveness; (Proposition 3) competitiveness has a
positive and direct influence on corporate performance. These are represented in figure 3.

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Figure 3: The Structural Equation Modeling of the Influence of Green Market Orientation,
Market Capability on Competitiveness and Corporate Performance (Prepared by Author)

SGM
FNP
TGM GMO

IGM CTP
CPT CPP
PCC IPP

PDC MKC
QLP PLB DLC LGP
MCC

In order to explain the effect of exogenous variables (green marketing orientation and
market capability) on endogenous variables (competitiveness and corporate performance),
each arrow in the above framework infers causal relationships within SEM and its
propositions for measuring this model, where SEM is a Lisrel computer program model
building tool for hypothesis testing (Hair, et al., 2014).
3.1 The Quantitative Research Approach
The purposes of this research will examine: (1) to study the influence of green market
orientation and market capability on competitiveness, (2) to study the influence of
competitiveness on corporate performance; and (3) to validate the casual relationship of green
market orientation and market capability on competiveness and corporate performance of
SMEs with empirical data. Serving three research questions are: (1) is there an influence of
green market orientation and market capability on competitiveness?; (2) is there an influence
of competitiveness on corporate performance?; and (3) are there causal relationships of green
market orientation and market capability on competiveness and corporate performance of
SMEs with empirical data?.
A questionnaire will used to collect data which will be analyzed by the structural equation
modeling (SEM). Probability sampling method: simple random sampling (case selected using
SPSS program) is used to select samples, in accordance with restrictions that are population
of a study, variables, and statistical analysis. The sample size must be at least 195 (15 times x
13 observed variables), calculated by SEM estimation method (Golob, 2003). Research
instrument (questionnaire) is divide into 5 parts: (1) demographic data; (2) green market
orientation is adapted from Papadas, et al. (2017); market capability, based on original
measurement items of market capability is adapted from Vorhies and Morgan (2005), Zou, et
al. (2003), and developed by Murray, et al. (2011); (3) competitiveness, based on original
measurement items of competitiveness of Cooper, et al. (1992), Holcomb (1994) and

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2020 Vol: 6 Issue: 1

Koufteros (1995) which was developed by Tracey, et al. (1999) and U-tantada, et al. (2019c);
and finally, (5) corporate performance is adapted from Sohn. et al. (2003). Five-point Likert
type scale, anchored from strongly disagree (1) to strongly agree (5), is used to measure all
items.
3.2 Research Instrument Assessment and Data Analysis
Research instrument assessment will show the degree of passing values (Hair, et al.,
2014): (1) Content validity and reliability analysis’ results of market capability in SMEs
operative system are product development, pricing, and marketing communication capability
dimensions with the pilot group and samples. Validity of content’s Item-Objective
Congruence Index (IOC) is between 0.50 and 1.00, measured by three-five experts’ judge.
Reliability of questionnaire, Cronbach’s alpha of each item category of variables is above 0.7;
their corrected-item total correlations (CITC) are above 0.3. (2) Assumption test’s result of
structural equation modeling validity: (2.1) Normal distribution assessment should be
normally distributed; (2.2) Homoscedasticity should provide non-pattern to the residuals
plotted; and (2.3) Linearity should have a simple scatter plot of the relationship between
exogenous and endogenous variable linear. (3) Construct validity in its measurement model
using Confirmatory Factor Analysis should show the passing values: Convergent Validity –
average variance extracted (AVE) should be greater than 0.5, construct reliability (CR) should
be greater than 0.7; and standardize factor loading of all dimensions should be greater than
0.5. The developed measurement model fit is acceptable. The estimation of maximum
likelihood method involves interactions of passing value index. They are relative chi-square
(2/df) should be lower than 2.00 ,p–value should be higher than .05, goodness of fit index
(GFI) should be higher than 0.9, adjusted goodness of fit index (AGFI) should be higher than
0.9, and root mean square error of approximation (RMSEA) should be lower than 0.05 (Hair,
et al., 2014).
3.3 Expected Results
Under the umbrella of the grounded theory, CAT is applied into SME agency for a
creation of SME cultural agency. Arisen variables within the conceptual framework set under
problem statement of the research outlined the nature of the research, focusing on its
corporate performance. Independent variables which effect competitiveness and its
performance in current changing situations for promoting SDGs. Research objectives and
questions will be expected results that represent the capacity of small to medium-sized
enterprises (SMEs) in order to sustainably survive in the global market place, the digital
global developing system with currently increased pollution and climate changes. In addition,
a number of variables and their relationships of SME cultural agency which is under CAT,
can contribute to this.

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4. Limitation
The proposed model will be limited and applied through empirical research studies. Its
results will visualize in the practical context across manufacturing and service sectors is in
more depth on improvement of green market orientation, market capability, competitiveness,
and SME cultural agencies’ performance in the reference model. It will not be generalizable
as whole industries due to different factors (e.g. policies, financial system, customers,
markets, suppliers, different regulations and others) will affect organizations. It will happen in
the period of study, so the findings will not representative of all times. Targeted respondents
will be based on demographics, experts of green market orientation, market capability,
competitiveness, and corporate performance in the SME context in complex markets that are
aware on climate changes to map respondents’ capabilities to personalized survey questions.
These result that self-rating response bias may impact on the validity of questionnaires
interpreted differently by respondents.
5. Conclusion and Recommendation
This article aims at presenting a proposed research model of the modeling SME through
CAT, enabling development linked to concepts like: green market orientation, market
capability, and competitiveness on corporate performance through arisen theoretical
framework and conceptual framework. It proposes new knowledge on deep (i.e.,
cultural/cognitive) and specific qualitative explanations are provided (using CAT) for the
selected important attributes green market orientation, market capability, competitiveness,
and corporate performance in the conceptual framework created under the CAT modeling
SMEs in a changing uncertain and perhaps crisis environment using principles of complex
adaptive systems. The qualitative explanations are (a) empirically supported, and (b) provide
specific influences and relationships for the strategic attributes for SMEs that can further
contribute to the qualitative model (the new theoretical framework). The attributes and their
relationships built into the CAT model validated through empirical research and literature act
as knowledge management for sharing with academic scholars and Ph. D. students
worldwide.
Acknowledgment: The authors would like to give special thanks to the editor, the reviewer for their
supportive comments and corrections that helped improve content of the article; and also to
Rajamangala University of Technology Phra Nakhon.
E.g. Questionaire items for measuring exogenious and endogenious varibles
(1) Green market orientation (Papadas, et al., 2017)
Strategic green marketing orientation: SGM (α=.94, AVE=.62)
SGM1. Your company invests in low-carbon technologies for production processes.
SGM2. Your company uses specific environmental policy for selecting partners.
SGM3. Your company invests in R & D programs in order to create environmentally
friendly products/services.
SGM4. Your company makes efforts to use renewable energy sources for

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products/services.
SGM5. Your company has created a separate department/unit specializing in
environmental issues for organization.
SGM6. Your company participates in environmental business networks.
SGM7. Your company engages in dialogue with stakeholders about environmental aspect
of organization.
SGM8. Your company implements market research to detect green needs in the
marketplace.
SGM9. Among other target markets, your company also targets to environmentally-
conscious consumers.
Tactical green marketing orientation: TGM (α=.78, AVE=.53)
TGM1. Your company encourages the use of e-commerce, because it is more eco-friendly.
TGM2. Your company prefers digital communication methods for promoting our
products/services, because it is more eco-friendly.
TGM3. Your company applies a paperless policy in procurement where possible.
TGM4. Your company uses recycled or reusable materials in products/services.
TGM5. Your company absorbs the extra cost of an environmental product/service.
Internal green marketing orientation: IGM (α=.92, AVE=.61)
IGM1. Your company’s exemplar environmental behavior is acknowledged and rewarded.
IGM2. Your company’s environmental activities by candidates are a bonus in recruitment
process.
IGM3. Your company has created internal environmental prize competitions that promote
eco-friendly behavior.
IGM4. Your company forms environmental committees for implementing internal audits
of environmental performance.
IGM5. Your company organizes presentations for employees to inform them about green
marketing strategy.
IGM6. Your company encourages employees to use eco-friendly products/services.
(2) Marketing capability (MKC) (Vorhies & Morgan, 2005; Zou, et al., 2003; and
developed by Murray, et al., 2011)
Pricing capability: PCC (CR=.80, AVE=.56)
MKC1. Your company responds quickly to competitors’ pricing tactics.
MKC2. Your company uses pricing skills to respond quickly to any customer change.
MKC3. Your company communicates pricing structures and levels quickly to customers.
Product development capability: PDC (CR=.87, AVE=.73)
PDC1. Your company manages new products for export well.
PDC2. Your company develops new products for export to exploit R&D investment.
PDC3. Your company speedily develops and launches new products for export.
PDC4. Your company manages overall new product development systems for export
market well.
PDC5. Your company successfully launches new products for exports.
Marketing communication capability: MCC (CR=.93, AVE=.81)
MCC1. Your company skillfully uses marketing communications.
MCC2. Your company uses marketing communication skills and processes well.
MCC3. Your company effectively manages marketing communication programs.
(3) Competitiveness (CPT) (Cooper, et al., 1992; Holcomb, 1994; and Koufteros, 1995
which was developed by Tracey, et al., 1999; U-tantada, et al., 2019c)
Quality of Product: QLP (CITC> 0.5, α = 0.859)
QLP1. Your company is able to compete, based on quality.
QLP2. Your company offers products highly reliable.
QLP3. Your company offers products very durable.
QLP4. Your company offers high quality products to customers.

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Product line breadth: PLB (CITC> 0.5, α = 0.843)

PLB1. Your company responds well to changing customer preferences regarding products.
PLB2. Your company responds well to changing customer preferences regarding
accompanying services.
PLB3. Your company alters product offerings to meet client needs.
PLB4. Your company responds well to customer demand for ‘new’ features.
Delivery capacity: DLC (CITC> 0.5, α = 0.792)
DLC1. Your company frequency of customer backorders is low.
DLC2. Your company customers are satisfied with level of completeness for routine
shipments.
DLC3. Your company orders are delivered on time, as defined by the customer.
DLC4. Your company provides on-time delivery of customer orders.
DLC5. Your company supply accurate is projected shipping dates.
DLC6. Your company customers are pleased with the frequency of delivery.
DLC7. Your company works with each customer to develop a delivery schedule
acceptable.
(4) Corporate performance (CPP) (when compared with key competitors) (Sohn, et al.,
2003)
Financial performance: FNP (CITC> 0.5, α = 0.783)
FNP1. Your company achieves revenue growth.
FNP2. Your company achieves investment.
FNP3. Your company achieves profitability.
FNP4. Your company achieves asset utilization.
FNP5. Your company achieves unit cost.
Customer performance: CTP (CITC> 0.5, α = 0.758)
CTP1. Your company achieves customer profitability.
CTP2. Your company achieves customer acquisition.
CTP3. Your company achieves customer retention.
CTP4. Your company achieves customer satisfaction.
CTP5. Your company achieves market share.
Internal process performance: IPP (CITC> 0.5, α = 0.805)
IPP1. Your company achieves product/service development.
IPP2. Your company achieves market identification.
IPP3. Your company achieves customer management.
IPP4. Your company achieves operation process.
IPP5. Your company achieves environment.
Learning and growth performance: LGP (CITC> 0.5, α = 0.799)
LGP1. Your company achieves skills.
LGP2. Your company achieves knowledge sharing.
LGP3. Your company achieves IT infrastructure.
LGP4. Your company achieves IT applications.
LGP5. Your company achieves organizational culture.
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