Developing and Validating a Multidimensional Scale for Nonprofit Market Orientation

This paper intends to develop a scale for market orientation of nonprofit organizations (NPOs). Scale items are generated by field interviews and pilot test. Statistical software packages like SPSS13.0 and LISREL8.7 are used to conduct exploratory factor analysis and confirmatory factor analysis on the questionnaires finished by top managers from NPOs. The final nonprofit market orientation (NMO) scale includes 5 dimensions, 17 measurement indicators with good reliability and validity. Meanwhile, the results of Structural Equation Modeling validate the long-held belief that market orientation is a critical success factor for performance in a new context of China's NPOs. Market orientation is a strategic choice for China's NPOs to improve their customer performance and financial performance. The proposed NMO scale in this study can be used as a diagnostic tool for NPOs to identity areas where specific improvements are needed. The antecedents and consequences of NMO, and the complex influencing mechanisms among them need to be explored further.