How Collective Engagement Creates Competitive Advantage for Organizations

Abstract

We present a process model for the creation of competitive advantage for organizations via collective engagement. Using the strategy literature, we argue that collective engagement can serve as a strategic organizational mechanism by linking shared vision and service performance, thereby generating a unique value-creation capacity at the business level. We also propose that competitive intensity would be a strategic market indication by which management could enhance the effect of shared vision on collective engagement, and indirectly intensify service performance (through collective engagement). Furthermore, drawing on strategy literature concerning the creation of competitive advantage, we propose that this unique value-creation capability, embedded in collective engagement, generates competitive advantage; specifically, one that competing organizations that rely on committed or involved human capital will struggle to replicate. We empirically examine our process model for creating service outperformance through collective engagement by using a three-time-point method derived from five different sources (archival data, employees, managers, secret shoppers, and customers) in 198 retail-service branches. Our findings provide evidence that collective engagement, fueled by shared organizational vision, improves service quality and client satisfaction. This effect was found to be even stronger under a highly intense competitive market environment. Furthermore, as this conditional indirect effect of shared vision on service quality and customer satisfaction was solely generated through collective engagement rather than other mechanisms of human capital (i.e., commitment and involvement), it creates a competitive advantage for engagement-oriented organizations.