Customer Innovation Research Articles

Variety is the Spice of Innovation: Mediating Factors in the Service Idea Generation Process

To create a breakthrough service innovation, firms need to go beyond current customers' needs and tap into the needs of the future market. As marketing theory favours customer‐centric approaches, customer‐led ideation and co‐creation of innovation seem natural candidates for extracting the ‘sticky’ information nested in some of the most innovative customers' minds. Grounded in the service innovation literature, this paper extracts innovative service ideas from ordinary users (n = 388) in three different service domains and seeks to identify the salient characteristics of the most innovative customers. Past research shows that innovative users are more likely to be service defectors, frequently switching from firm to firm, and motivated by their predisposition to seek variety. Using a structural modelling strategy, variety seeking is tested as a mediating factor between the subjective knowledge level and the presence of high level unmet needs leading to the generation of innovative service ideas. The results show that variety seeking fully mediates the relationship between subjective knowledge and unmet needs. Several interpretations of the role of variety seeking on customers' behaviour are explored within the context of capturing innovative service ideas.

Co-creation and co-profiting in financial services

Co-creation can be useful to develop financial services relevant to customer needs. However, role of customers in financial innovation seems to be controversial. In this qualitative study we focus on: the characteristics of users who can qualify for co-creation, the process of co-creation, and profit-seeking customers. Our findings suggest that financial institutions tend to select customers who are more demanding and who have a possibility to cooperate (in retail markets), and those customers with whom they have longstanding and intertwined relationships (in corporate markets). Financial innovators differ in a way they cooperate with users. We proposed the typology of innovation and introduced the notion of co-profiting proved in the case of co-creation commercialised jointly; however, we did not find evidence of user-centred innovation commercialised by producer as well as user’s innovation commercialised jointly.

More is not always better: The impact of relationship functions on customer-perceived relationship value

Customer–supplier relationships have been promoted as a source of value for customers and as a way for suppliers to differentiate. Customer-perceived relationship value (i.e., a customer's overall assessment of the benefits and sacrifices of a given relationship with a supplier) is driven by relationship functions (i.e., the co\ tributions a supplier makes to a customer's value-creation processes). Earlier research categorizes relationship functions into two groups: direct, operation-related functions and indirect, change-related functions. This research finds that indirect functions have less impact than direct functions. Given the widely discussed advantages of supplier involvement in customer innovation, and the importance of information, access to market actors and motivation, this study analyzes why change-related functions have less of an impact than operation-related functions. The empirical results reveal that change-related relationship functions have a non-linear, inverted u-shaped impact on relationship value, and that the degree of customer innovativeness moderates this impact. Thus, while an analysis of all relationship functions is necessary, suppliers wishing to optimize business relationships should pay particular attention to customer innovativeness. The non-linear impact of change-related relationship functions gives rise to several interesting avenues for further research.

Making a face: Graphical illustrations of managerial stances toward customer creativity

Creative consumers – consumers who adapt, modify or transform a proprietary offering – represent an intriguing paradox for business. On the one hand they can be a black hole for future revenue, with breach of copyright and intellectual property, while on the other hand they represent a gold mine of ideas and business opportunities. This problem is central to business – business needs to both create and capture value; the problem is that creative consumers demand a shift in the mindsets and business models of how firms both create and capture value. We develop a typology of firms’ stances to creative consumers based upon their attitude and action towards customer innovation. We then consider the implications of the stances model for corporate strategy, and examine a three-step approach to dealing with creative consumers, namely, awareness, analysis and response.

The Bright Side and Dark Side of Embedded Ties in Business-to-Business Innovation

Although the number and importance of joint innovation projects between suppliers and their customers continue to rise, the literature has yet to resolve a key question: Do embedded ties with customers help or hurt supplier innovation? Drawing on both the tie strength and knowledge literatures, the authors theorize that embedded ties interact with supplier and customer innovation knowledge to influence supplier innovation. In a sample of 157 Dutch business-to-business innovation relationships, they observe that embedded ties weaken how much suppliers benefit from customer innovation knowledge because of worries about customer opportunism (the dark side of embedded ties). However, they uncover three moderating relationship and governance features that allow suppliers to overcome these dark-side effects and even increase innovation (the bright side of embedded ties). Finally, although the authors predicted a bright-side effect, they find that embedded ties neither help nor hinder the supplier to leverage its own innovation knowledge in the relationship.

Global Innovators from Emerging Markets

There's never been a better time for innovators from emerging markets. Whether you're an agribusiness giant in Brazil, a software entrepreneur in Mumbai, or a contract manufacturer in Taiwan, the need-and opportunityfor emerging-market innovators has never been greater. Both macro- and microeconomic forces have conspired to make innovation a top-of-mind strategic aspiration for every export-minded BRIC executive. The schwerpunkt of global competitiveness is rapidly shifting away from low cost to as the organizing principle for success. From my on-the-ground observations of BRIC enterprises (and a few in Chile, Colombia, and Taiwan, as well), it's clear that the senior leadership of these companies wants innovation to be at the hard core of their business models. Two unambiguous structural shifts are driving this growing ambition. The fi rst is the rise of commodity and labor costs. As the emerging markets have grown, their raw materials and human resources have grown signifi - cantly more expensive. Delivering on the supplier promise has become much more diffi cult. Pincered between a slower-growth West and their own expansion imperatives, emerging-market fi rms are looking for new ways to create new value. Simple diversifi cation isn't enough; they need to innovate. The other structural shift comes from the demand side: customers and clients who once told emerging market fi rms to build to spec or conform to requirements at the lowest possible price-a.k.a. the China price-are now looking for novel value and new features, as well. Where Walmart once facilitated China's transformation into a low-cost manufacturer capable of delivering enormous quantities of good-enough products to its supply chain, the Hewlett-Packards, IBMs, Vodaphones, and Apples are now looking to partner with suppliers who can deliver provocative novelty as well as low-cost quality. And emerging-market fi rms are responding. Taiwan's HTC, for example, is an emerging-market innovator whose products neither look nor feel like me, too or me, three knock-offs of American or Japanese design. Indeed, a look at Samsung's or SK Telecom's product portfolio suggests that while South Korea may be an emerging market, its innovation efforts are world class. Of the two transformations, the demand-side shift is the most signifi cant because innovation isn't what innovators do, it's what customers and clients adopt. The conceptual revolution that is sweeping through emerging-market enterprises worldwide is the recognition that customersnot currency or human capital or technology-are their most important asset. The single variable most responsible for the acceleration of emerging-market innovation is the intensifying relationship of emerging-market fi rms with innovative customers and clients. To put it another way, Walmart and its customers demand a different kind of innovation than Accenture and its clients do. The gradual global broadening of the innovative customer portfolio has expanded both the need and the opportunity for emerging market entrepreneurs and enterprises alike to become more sensitive to innovation opportunism. Post-fi nancial crisis access to global capital, brains, digital networks, and markets has made that easier in 2011 than it was in 2001. The relative robustness of the BRIC economies has made them more attractive to institutions with money to lend or invest. Immigration-the relatively free fl ow of human capitalhas rivaled investment-the relatively free fl ow of fi nan-cial capital-as the critical enabler for innovation capability. …

A proposal for a structured approach for cross-company teamwork: a case study of involving the customer in service innovation

This paper outlines the results of a project aiming to develop and apply methods for service co-creation with customers, focusing on the early phases of service development. The project is collaboration between a manufacturing firm in the automotive industry, one of their B2B-customers (a transportation firm), as well as a university, all in Sweden. The research team selected and developed methods and work practices for problem analysis, idea generation, development and evaluation of services. Thus doing, methodological influence was taken from the area of engineering design. The proposed approaches were applied in a service development experiment mainly based on workshops. The experiment was followed up by an analysis of the resulting output, an interview series, and an evaluation by peers in focus groups. The goal of this article is to answer the following research questions: (1) What is the industrial applicability of co-creating services using a structured approach, e.g. what are the benefits and challenges? (2) What do the different actors contribute with using this approach, and what possible factors influence the nature and quality of the actors’ contributions? (3) Based on the answers to the questions above, what aspects should be considered to support situated planning and execution of future service co-creation projects? A central conclusion is that a structured approach is industrially applicable, but it is also evident that there is no completely universal recipe for service innovation. Addressing these insights, the paper also contributes with guidelines to support the situation-adapted set-up of future service co-creation projects.

On the Interaction and Integration of Cross Selling and Customer Relationship Management

In recent years, as innovative marketing methods, cross selling and customer relationship management (CRM) received a great deal of attention in enterprise circle. During post financial crisis era, more and more enterprises expect to promote management and technology level of CRM and cross selling, fulfill interaction and integration between cross selling and CRM, improve efficiency of cross selling, enhance profit of enterprises, achieve the goal of sustainable enterprises development.On the base of discussing definition, function, development condition and existing problems of CRM and cross selling, this paper proceed with new ideas of improving interaction and integration between cross selling and CRM, issuing the relationship between CRM and cross selling; the necessity of interaction and integration of cross selling and CRM; and the specific strategies of fulfilling interaction and integration between cross selling and CRM.

The impact of customer relationship management capability on innovation and performance advantages: testing a mediated model

Customer relationship management (CRM) and innovation are widely considered to be valuable capabilities associated with competitive advantage. However, there is a lack of research demonstrating how they work together to produce performance advantages. This research investigates the mediating role of innovation between CRM and performance. The authors examine the direct impact of both CRM and innovation on firm performance. Moreover, they investigate the role of innovation as a mediating mechanism to explain the effect of CRM on performance. The authors use structural equation modelling to test the relationships among these constructs. The results support the direct impact of CRM and innovation on performance. Also, the findings indicate that the indirect effect of CRM on firm performance through innovation is significant. These results reinforce the view that developing close relationships with customers enhances a firm's ability to innovate.

Integrating Customers in Product Innovation: Lessons from Industrial Development Contractors and In‐House Contractors in Rapidly Changing Customer Markets

Successful product innovation has increasingly been recognized as an outcome of integrating customers into the new product development (NPD) process. In this paper, we explore customer integration by investigating the continual consideration of customer contributions throughout the product innovation process. Through a comparison of the customer integration practices by development contractors with those of in‐house developers, we find that the iterative and adaptive innovation process structures of the development contractors facilitate the realization of the full customer contribution potential throughout the product innovation process. We also find additional support for the incorporation of open innovation into an organization's NPD activities. Our findings are based on in‐depth case studies of the NPD activities of in‐house developers and product development contractors.

A Conceptual Model of Customer Innovation Centric

Customer innovation centric is not only an important perspective on value-creation, but also a new strategy discipline that IT software companies in Jordan should embrace if they are pursue to enlargement successfully. Furthermore, customer experience, customers’ community, customer knowledge, and customer innovation are influential variables for improving organizational learning from customer. In order to study this impact, the author uses cognitive fit theory to develop a model that describes how these variables will affect the success of organizational learning process to enhance products and/or services development, quality, and internal process improvement.

Structural analysis of TQM and its impact on customer satisfaction and innovation

The purpose of this study is to examine the impacts of TQM practices on customer satisfaction and innovation performance in the Malaysian manufacturing and service sectors. A questionnaire survey was conducted to 241 firms and hypotheses were verified using a structural analysis. The results reveal that the adoption of TQM practices can have a positive impact on customer satisfaction and innovation performance in Malaysia. This paper offers some imperative insights to assist the management team when comes to the restructuring of their TQM practices, thus making sure that the practices adopted are able to enhance both the innovation level and customer satisfaction within their firms.

Sustainable development using the sustainability balanced score card: the case of Tata Motors, India

There is growing interest within businesses to improve the sustainability of operations, which is, balancing short term goals of turnover and profit with long term goals in social and environmental performance. The 'balanced score card' (BSC) (Kaplan and Norton, 1996) is a strategy-centred performance-measurement tool that enables firms to align their operations to their business strategies. The conventional BSC includes four perspectives: financial, customer, internal process and learning and innovation but excludes two important long term perspectives: environmental and social. Dyllick and associates (1992) have shown that appropriate strategy for the management of environmental and social aspects is lacking. This lacuna can be addressed if the BSC also covers the environmental and social perspectives, enabling firms to evolve relevant strategy. Using the concepts of BSC and sustainability BSC (SBSC), this paper extends the conventional BSC of a firm to include social and environmental factors, invoking Tata Motors Ltd. as a case study.

RFID acceptance amongst customers: a cross-cultural framework based on Hofstede

Cultural variations across countries are considered a major factor affecting customers' readiness to adopt, willingness to use, or evaluation of technology. Relevant contributions from marketing studies, computer science and international business are integrated into the literature of cross-cultural management and technology acceptance, and a conceptual model is developed. Drawing on a broader research project on RFID aimed at supporting intelligent business networking and innovative customer services, the development of the framework is informed by the authors' work in the preparation of a RFID based application at several established grocery retailers for short life products in Ireland and in Greece. From the findings of our exploratory study it emerges that low individualism and high uncertainty avoidance are conducive to greater customers' acceptance of new service technologies. Managerial implications and directions for future research are discussed.

The Case Study on the Performance between SCM Adopted Textile․Fashion Firms and Unadopted Firms in a Viewpoint of BSC

SCM as the important marketing strategy enhance the firm's efficiency and compatibility in global market environment such as global outsourcing. Firms adopted SCM realized the need to evaluate precisely the performance of SCM. In spite of importance of SCM, there was not much intention and research to measure SCM performance in textile fashion industry. Therefore, the purpose of this case study was to measure performance of supply chain management in textile fashion business using BSC(Balanced Score Card) to measure not only financial perspective but also non-financial perspectives such as customer perspective, internal business perspectives, financial perspective, and innovation & learning perspective. The questionnaire developed by the reviews of the literature was adopted for this study. The results of this study showed that SCM performance was enhanced from the point of customer perspective(cost, quality, time, service), financial perspective(cash cycle time, inventory turn over, inventory obsolescence, return on asset, return on investment, capacity utilization), and innovation & learning perspective(cost for human resource management, service for human resources). But there was same performance level regarding internal business perspective(lead time, cost for manufacturing process, product quality control, productive flexibility for time, quantity, and variety). Therefore, we should keep close relationship and two way communication among supply chain members to promote better SCM performance.

Drupa 2008: Siegwerk focuses on innovation and individual customer solutions

Drupa 2008: Siegwerk focuses on innovation and individual customer solutions

Customer-Driven Innovation

OVERVIEW:Involving customers in the innovation process entails a host of new concerns, concepts and managerial decisions. Transitioning from older models of no or low customer involvement requires attention to the different types of customer innovation, organizational mission and organizational structure. This article provides a typology for customer innovation, describes how to involve customers in the innovation process, and offers guidelines for shifting organizational structure and emphasis toward customer-driven innovation in order to enable continual, sustainable innovation.

Knowledge‐based capabilities and their impact on performance: a best practice management evaluation

PurposeIt is widely acknowledged that customer relationship management (CRM), market orientation, organizational learning and innovation are the most critical knowledge‐based capabilities required to achieve superior performance. The purpose of this paper is to identify management practices that are necessary to develop these capabilities.Design/methodology/approachThe findings of this paper are based on the analysis of a number of best practice case studies that have been published on many subjects, including, for example, strategic marketing, relationship marketing and knowledge management.FindingsSuccessful companies are configurations of management practices that enable the development of knowledge‐based capabilities. This paper identifies the factors that give a firm superior knowledge‐based capabilities.Practical implicationsThe paper provides managers with some insights into how to develop better knowledge‐based capabilities.Originality/valueThe paper highlights a set of attitudes and practices that are necessary for firm success in today's competitive environment.

An analytical framework for improving the strategical impact of customer collaboration in innovation

Information gathered through customer collaboration has an improving importance in innovation strategies. The objective of this study is to enhance the impact of customer information in a variety of innovation fields by implementing the 'best fit' customer relationship strategy in a small company. The investigation of the alternative innovation determinants and customer relation strategies has led in defining a new framework for the selection and progress of the customer relation strategy with the focus of innovation. A combination of the Analytical Hierarchical Processing (AHP) and Delphi methods is used in designing the decision framework, which is evaluated by a case study run on five small companies representing design-based and food industries. It is observed that small companies are enthusiastic in applying innovations in various fields but are not yet aware of the importance of customer collaboration. Besides, innovation strategies are differentiated by the age and business focus of the company. This paper will be stimulating for the small companies in designating innovation strategies.

Research on the Correlation Effect of Innovation Activities on Innovators and Customers ˜ Using the IC Package and Testing Industries as an Example

In the competitive global market, firms have to keep profit from innovation activities. A firm makes profits by offering products or services at a lower cost than its competitors or by offering differentiated products at premium prices that more than compensate for the extra cost of differentiation. The IC Package and Testing technology industries were the first high technological industry to build in Taiwan. The Package and Testing industries in Taiwan adopted competitive innovation activities to become stronger. In our study, we want to know how innovation activities influence a firm operating in the IC Package and Testing industries. Our study used a questionnaire and Likert five‐point scale to survey the innovation activities, customer and feedback in innovation performance in the IC Package and Testing industry. The wafer level chip size packing technology in our study indicates the innovation activities. Because we need to compare the difference between the wafer level chip size packing technology and wire bonding technology to recognize innovation and how the innovator and customer were influenced. Our conclusions are described below: (1) When the innovator adopts innovation activities that can be maintained using experiments and knowledge, using machine and decision variables more quickly will produce success; (2) Innovators should adopt innovation activities that focus on customers that use knowledge and experimentation, training time and cost. If an innovation forces customers to spend much time and cost to learn new technology or applications, the innovation will not be adopted; (3) Innovators that create innovation performance higher than his customers must also consider the impact upon their customers. We have to remind innovator to focus on why their customers have a different level of evolution in the same innovation activities.