Abstract
Customization of services comprises the activities and results of a customer-specific adaptation of a provider’s value-creation processes according to customers’ requirements. As customized service offerings are supposed to better meet specific customers’ needs, they should generate a higher willingness to pay and/or higher customer loyalty. However, customization also typically leads to increased costs, incurred from the customer-induced changes or adjustments in the specification, production and delivery of a service. With respect to this tradeoff, this paper examines how the degree of customization of business-to-business (B2B) services can be measured and how the degree of customization affects the generation of competitive advantages and firm performance. Using data from a large-scale quantitative study, the paper identifies three dimensions of customization of B2B services and shows the consequences of different degrees of customization on customer perceived value, cost-efficiency and thus firm performance.
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