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Measuring firms' market orientation using textual analysis of 10-K filings.

Andreou, P. and Harris, T. and Philip, D. (2020) 'Measuring firms' market orientation using textual analysis of 10-K filings.', British journal of management., 31 (4). pp. 8725-895.


Market‐oriented firms are committed to understanding their customers’ evolving expectations and meeting their needs, while outwitting competitors, to achieve a sustainable competitive advantage and improve performance. This paper develops a measure for market orientation based on textual analysis of 10‐K filings. It utilizes a bag‐of‐words method to identify relevant information from the management's disclosure that underpins the corporate traits measured by the MKTOR scale, a renowned survey instrument for measuring market orientation. Unlike previous studies that rely extensively on small‐scale survey data to estimate market orientation, this novel method leverages instead on the use of big public archival data. We empirically establish strong construct validity for the measures of market orientation and its components, namely customer orientation and competitor orientation. Furthermore, our analyses demonstrate that firms’ performance is positively affected by market orientation and that this relationship is more pronounced in competitive environments. We contribute to the literature by developing an elegant measure of market orientation, which allows for conducting large‐scale longitudinal analyses of its antecedents and consequences.

Item Type:Article
Full text:(AM) Accepted Manuscript
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Publisher statement:This is the accepted version of the following article: Andreou, P., Harris, T. & Philip, D. (2020). Measuring firms' market orientation using textual analysis of 10-K filings. British Journal of Management 31(4): 872-895 which has been published in final form at This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for self-archiving.
Date accepted:29 November 2019
Date deposited:04 December 2019
Date of first online publication:27 January 2020
Date first made open access:27 January 2022

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