Abstract
Involving customers in the development of new products and services helps firms understand customer needs, increasing the likelihood of meeting those needs and expectations. Although a large body of literature addresses the implications of customer involvement for project performance, the results of previous research are somewhat inconsistent. This paper explores this issue by examining the differing impact of customer involvement on the development of new products and new services. We propose that the role of customer involvement differs for these two types of innovations, with involvement in the early stages more important for products and involvement in the launch stage more important for services. Our results, based on a comprehensive dataset on customer involvement in innovation, are consistent with such a pattern, suggesting that more attention should be paid to the conditional benefits of customer involvement in different types of solution development.
Highlights
In a complex and very fast-changing business environment, it is imperative for firms to identify, absorb, and integrate knowledge from external sources (Cohen and Levinthal, 1990)
We argued that involvement in the launch phase is more important, because services are more malleable throughout the life cycle, and early-stage involvement even has the potential to lead to over-customisation, and because interaction with the customer is a very natural part of launching a service
One interesting avenue of future research which is implied by these results is to study customer involvement using a more detailed breakdown of firm focus
Summary
In a complex and very fast-changing business environment, it is imperative for firms to identify, absorb, and integrate knowledge from external sources (Cohen and Levinthal, 1990). One approach to doing that, recently highlighted by a number of studies, is customer involvement in the innovation process. Customer involvement in the development of new products and services has been recognized. This is an Open Access article published by World Scientific Publishing Company. Firms can benefit in many ways from involving customers in the innovation process, including cost reduction, speed to market, quality of products and services, improved performance in the development of new products and services (Chang and Taylor, 2016), and improved product outcomes (Al-Zu’bi and Tsinopoulos, 2012; Mahr et al, 2014)
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