Enacting, Enabling, and Embracing Market Orientation : A study of Public–Private Dyads

Abstract: This thesis contributes to an increased understanding of how public–private dyads enact (“what”), enable (“how”), and embrace (“why”) market orientation. Drawing on a multi-year study of Swedish public transport, the thesis shows that the nature of the relationship between public and private organizations plays an important role in how market orientation is undertaken in dyadic practice.Through a longitudinal research approach, it was found that private providers’ involvement in market-oriented activities has increased, and that the dyadic actors are more frequently involved in disseminating activities such as meetings and informal contact. Providers’ increased role in the enactment of dyadic market orientation indicates a movement towards a more collaborative approach within the dyad. The collaborative approach adheres to organizational roles as partners where relational management is focused, and the market-oriented activities are characterized by participative decision-making and both formal and informal information sharing. Dyads where a closer interaction is not desired tend to rely on a coordinative approach where the formal arrangements (such as the contract) play a prominent enabling role in the management of market orientation. This aligns with the view of public providers as subcontractors and the public organization as a buyer with a dominating role in the market orientation of the dyad.The thesis shows that, in comparison to private providers, public organizations perceive the relationship to be characterized by a higher level of conflict, more conflicting goals, and a lower degree of trust and commitment. It is further suggested that such perceptions of relational dynamics stem from the view of unalignable public and private values such as profitability and social value. The difficulty in aligning values and bridging the raison d’être explains why the public organizations’ tendency to refrain from sharing control and responsibility largely persists despite an increase in collaborative efforts.