The Role of Distinctive Organization Capability and Corporate Reputation in Formulating Co-Creation Strategy in the Age of Industry 4.0: Study on Indonesian Telecommunication Firms

Abstract

This paper aims to provide the effects of corporate reputation and distinctive organizational capability in formulating co-creation strategy for incumbent firm in facing industry resolution 4.0. A co-creation strategy is critical to sustain the business in anticipating new entries that convey the new business model. The study focuses on incumbent telecommunication companies since the telecommunication industry, while the incumbent has strong corporate reputation and organization capability. Those both capabilities is required to become a distinctive capability to provide strong core competence among others. This study is a quantitative study that was conducted with 35 firms were used as a sample in the study as exploring the model. The analytical approach and the solution technique used is the Smart Partial Least Square (SmartPLS). The results of the study demonstrated that corporate reputation and distinctive operational capability influence co-creation strategy, while corporate reputation has a bigger role than distinctive capability in building co-creation strategy. These findings have practical implications for the management of the telecommunications industry in Indonesia, as the development of a co-creation strategy requires to be based on the development of corporate reputation with the support of the development of distinctive operational capability. Further research can be explored by expanding the sample, industry and in other countries. The study can also expand into a longitudinal study as part of the digital transformational model.