The Effect of Market Orientation Activities on Performance of Microfinance Institutions: Empirical Evidence from Yemen
The Effect of Market Orientation Activities on Performance of Microfinance Institutions: Empirical Evidence from Yemen

Summary/Abstract: This paper provides the empirical evidence of the effect of market orientation activities of intelligence generation, intelligence dissemination and responsiveness on the performance of Microfinance Institutions (MFIs) in Yemen. A survey questionnaire distributed to 166 branch managers of MFIs across Yemen utilizing a self-administered method from which 125 sets of questionnaires were successfully collected and used for the analysis. The measurement model and structural model analyses were obtained using the partial least square structural equation Modeling, SmartPLS 3.0. The results proved that market orientation activities are central to the performance of MFIs, although only two out of three components of market orientation activities are found significant. They only showed the significant effect of the intelligence dissemination and responsiveness on MFIs performance, whereas, the effect of intelligence generation on MFIs performance could not be confirmed. The findings of the study are valuable for policy makers, MFIs managers, practitioners and academicians who have the interests in the development of the microfinance sector.

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