New Service Development Process Research Articles

Enhancing new service development effectiveness: the role of customer participation and the moderating effects of empowerment and satisfaction

PurposeThe purpose of this paper is to investigate the role of Customer Participation (CP) in the effectiveness of New Service Development (NSD) by examining the moderating roles of Customer Empowerment (CE) and Customer Satisfaction (CS). The research reduces the risk of failure of the NSD process and/or improves the NSD processes used by companies through the consideration of the results in the practical dimension.Design/methodology/approachThis study investigates the effects of CP at different stages of NSD using a quantitative approach. Data were collected through an online survey questionnaire. Smart PLS was used to analyse the data collected from 509 newsreaders and users of the news agency’s application.FindingsThe model confirmed that CE has an impact on the effectiveness of NSD in the idea generation and commercialization stages, but not in the development stage. Empowerment and customer satisfaction did not influence the three stages of NSD indirectly but directly. The results show that CP, CS and CE do not always have a direct or indirect effect on the development of new services. Therefore, in order to design new service development projects, media news companies need to determine the level of user cooperation.Research limitations/implicationsThe lack of objective data, especially on company performance, forces researchers to use questionnaires to analyse NSD effectiveness. Another limitation is that newspaper users answered the questionnaires, which creates “common method variance.”Practical implicationsResearchers on NSD effectiveness must use questionnaires due to a lack of objective data, especially on company performance. Another limitation is “common method variance” from newspaper users answering questionnaires.Originality/valueThis paper is a response to a perceived need for an examination of how new service development can be successful and effective.

Simulation-Based Analytical Framework for M2M Autonomous Charging Infrastructure

While a computerized simulation can be useful to gather user inputs during the new service development (NSD) process, it requires the active involvement of users/customers and can be costly and time-consuming compared to other practices such as surveys, focus groups, and interviews. However, when the service is rendered in the machine-to-machine (M2M) environment, the NSD process can exploit a simulation platform to assess service alternatives without customer involvement. This article contributes to the NSD research by identifying the services in the M2M environment as the suitable application area where a simulation platform can be effectively and efficiently implemented for data collection and analysis. We consider the autonomous charging service to demonstrate how a simulation-based analytical framework can help developing a new service in the M2M environment. As the electric vehicle (EV) industry has been evolving tremendously over the past decade, it becomes necessary to undertake significant modernization and autonomy adoption in the future charging infrastructure. Since the currently deployed charging infrastructure has not been designed to service autonomous EVs (AEVs) in an unsupervised manner, service plans to upgrade this infrastructure need to be developed to serve AEVs without any human intervention. Numerical experiments demonstrate how the simulation platform helps analyze autonomous charging station alternatives, provides recommendations for operational decisions, and creates a potential value for stakeholders and businesses during the NSD process.

A hybrid decision making approach for new service development process of renewable energy investment

This study aims at evaluating new service development (NSD) process of renewable energy investments. A novel fuzzy hybrid multi-criteria decision-making model is then introduced. Firstly, selected criteria are weighted with a multi stepwise weight assessment ratio analysis (M-SWARA) methodology based on bipolar q-rung orthopair fuzzy sets (q-ROFSs) and golden cut. Secondly, balanced scorecard (BSC)-based project network for the NSD process of renewable energy investments is constructed. These alternatives are ranked by using the elimination and choice translating reality (ELECTRE) approach with bipolar q-ROFSs and golden cut. Afterwards, the Project Evaluation and Review Technique (PERT) diagram is developed by defining immediate predecessors based on the ranking results. Consequently, different paths are created to understand effective ways to generate NSD process. Our findings will show the crucial processes for the NSD process of renewable energy investments, and the PERT analysis will provide optimal paths to increase the performance of NSD process of the renewable energies. It is concluded that analysis is the most critical NSD process for clean energy investment projects. The findings indicate that the shortest path is defined as Path 2 with 48.6% of the total importance degree. On the other hand, the longest path is determined as Path 1 with 100%. Path 4 has the weakest importance with 65.2% in comparison to Path 3 with 83.4% with respect to the comparison same activity numbers. It is strongly recommended that both technical and financial aspects should be evaluated with necessary research while generating new products. This issue can have a positive contribution to the early solution of any potential problems.

Entrepreneurial new service development strategies: identifying critical success factors

The quickly shifting nature of the business environment generates ambiguity in the market place and poses a significant risk for decisions that will be made in the future. Managers do not know which factors are really key ingredients for the innovation process and how to allocate their resources to improve the success of service projects. This article aims to develop a predictive model which identifies the critical factors that impact the success of New Service Development (NSD) and promotes the entrepreneurial ecosystems in hospitality. In‐depth, systematic interviews with hotel managers from all over Greece, based on questionnaires, were used to look into a total of 178 service projects. Factor and discriminant analysis were employed to evaluate the relative significance of the important factors of successful NSD and to determine whether new hotel services in Greece will succeed or fail. This research led to the creation of a prediction model that takes into account the unique qualities of services and can highlight the difference between new hotel services that are successful and those that aren't, which support managers to improve the NSD process, increase service performance and therefore enhance entrepreneurial ecosystems. The findings conclude that hotels offering more successful innovative services enhance specific ecosystem‐related value. In the context of tourism, which mainly contributes to the Greek economy, service innovation might bring a competitive advantage to all the entities involved increasing the collaboration among actors, the level of employment and hotels' competitive advantage.

Value cocreation in new service development: a process-based view of resource dependency

PurposeThis study aims to examine value cocreation in terms of interfirm collaborations between service firms, their business customers and business partners at different stages of a new service development (NSD) process.Design/methodology/approachThe study develops and tests hypotheses that examine the roles played by business customers and partners in NSD, assuming resource dependency of the focal firm during three NSD stages (ideation, development and deployment). Empirical data were collected from 200 NSD projects and structural equation modelling was used to test the hypotheses.FindingsThe results show that business customer collaboration has a positive effect on ideation performance and development performance, whereas business partner collaboration has a positive effect on deployment performance. These finding support the notion that the value cocreating roles of business customers and partners vary across NSD stages.Research limitations/implicationsFuture research should focus on how business partners can be actively involved in the NSD process and how the interests of different parties can be safeguarded. The use of longitudinal data will allow a better examination of the process dynamics.Practical implicationsThe study provides managerial implications for service managers in terms of acquiring and allocating resources needed from business customers and partners during different NSD stages.Originality/valueThe study contributes to the growing literature on value cocreation in NSD by empirically demonstrating the respective performance contributions of business customers and partners during different stages of NSD. Moreover, the results also shed light on interfirm collaboration mechanisms from the perspective of resource dependence theory.

A Hybrid Hesitant 2-Tuple IVSF Decision Making Approach to Analyze PERT-Based Critical Paths of New Service Development Process for Renewable Energy Investment Projects

The purpose of this study is to evaluate PERT-based critical paths of new service development (NSD) process for renewable energy investment projects. In this context, a novel three-stage model has been proposed. In the first stage, 10 different steps in NSD process are weighted by considering 2-tuple hesitant interval-valued Spherical fuzzy IVSF DEMATEL approach. In the second stage, 26 different critical paths for NSD process are identified. Moreover, the third stage includes the ranking the renewable energy alternatives by path scenarios with 2-tuple hesitant IVSF TOPSIS. The findings demonstrate that idea screening and the formation of cross-functional team are the most significant criteria for the NSD process of renewable energy investments. Additionally, while considering all activities of NSD process, it is concluded that solar energy is the most appropriate renewable energy alternative. This result is also similar for considering the longest path by activity number, the longest path by duration and the shortest path by activity number. However, it is also determined that geothermal energy is the most ideal type of renewable energy to invest in while considering the shortest path by duration. Therefore, it is obvious that investors should primarily give importance to generate new products for solar energy projects. In this way, it can be easier for them to provide efficiency in their investments. On the other hand, if there is time constraint or a positive result is expected from the project in a short time, geothermal energy is the most suitable renewable energy type to invest.

Evaluating service innovation and business performance in tourism: a multicriteria decision analysis approach

PurposeThe purpose of this study is to evaluate the effectiveness of the new service development (NSD) process in tourism. For this reason, factors influencing the process of service innovation in the hospitality sector were explored and correlated with business performance in the hospitality industry through a multicriteria decision analysis approach.Design/methodology/approachAn original multicriteria decision analysis approach is applied in order to estimate the efficiency of the NSD process. The approach follows the principles of ordinal regression analysis, using goal programming techniques. Collected data are based on in-depth structured and questionnaire-based interviews of 77 hotel managers in 147 new services in a representative sample of 99 hotels in Greece. Several financial ratios, covering different aspects of business performance, are used in order to evaluate the NSD process for three years after the services innovation had been launched.FindingsThese findings reveal the importance of financial liquidity and business efficiency for the hotel industry (i.e. the ability of a firm to use available resources in order to achieve specific sales goals). The aforementioned variables can determine how quickly and effectively assets are converted to cash. In general, the findings show the emphasis that should be given to customer needs, as well as to the effective management of a NSD project.Originality/valueFindings of this study may support hotel managers to make complex strategic decisions for future development. These findings have suggested that service innovation should be included as a strategic tool to assess differentiation effort in the hotel industry.

New Service Development Process Applied on Air Transport Industry

The air transport services is highly relevant to the global economy and has grown about six times the global GDP in recent years. Nevertheless, it has not been able to generate the desired profitability, due to high costs and the inability to deliver differentiated services to customers. This study aimed to identify what are the main activities in the new service development process (NSDP) for companies in the air transport industry. Several NSDP activities are identified in the literature, which make up a conceptual model. By conducting multiple case studies and comparing the results with the literature, ten of those activities are found to be recurrent in the air transport industry, as the analysis of the external environment and the analysis of the financial capacity of the company. A framework for new service development process on air transport industry is proposed.

Leveraging stakeholders’ knowledge in new service development: a dynamic approach

PurposeThis study aims to shed lights on the dynamics of involving and sharing knowledge with stakeholders in the process of new service development (NSD) over time.Design/methodology/approachThe paper is based on a paradigmatic case focused on the development of the digital MBA program by the School of Management of Politecnico di Milano. Primary and secondary data have been largely collected and analyzed, involving multiple stakeholders of the development process.FindingsThis study describes how several stakeholders have been involved during the phase of the NSD process, showing two variables that ruled their involvement: the level of control exerted by the School on the stakeholders and the level of flexibility of the stakeholders.Research limitations/implicationsThis research offers insights to the understanding of the dynamics of involving and sharing knowledge with multiple-stakeholders in NSD. From a theoretical perspective, it contributes to stakeholder theory linking it with the service management literature, highlighting the role of cyclical fluctuations in the involvement activities.Practical implicationsThis research offers insights to managers dealing with the development of new services, offering them a novel view on how various stakeholders may be involved over time, in different moment and in different ways, to properly enhance the development process thanks to their knowledge sharing.Originality/valueThis paper contributes to the service management literature emphasizing the role of multiple stakeholders while providing insights and suggestions to manage the complex relationships created by their involvement and their knowledge.

Cross-country differences in new service development

PurposeThe purpose of this paper is to test how national culture may help to explain cross-country differences in new service development (NSD) by comparing the impact of NSD success factors between Mexico and Sweden.Design/methodology/approachEight hypotheses based on prior literature on NSD and national culture were tested using covariance-based structural equation modeling and survey data from 210 Mexican and 173 Swedish firms.FindingsLaunch proficiency and customer interaction had a positive impact on NSD performance with no difference between the two cultures. NSD process formalization did not have clear positive impact on NSD performance but had a statistically significantly stronger impact in the structured culture (Mexico). Team empowerment affected NSD performance positively, but the difference between cultures was non-significant.Research limitations/implicationsThe impact of national culture depends on the type of NSD success factor. Some factors are unaffected by the cultural context, while factors congruent with the national culture enhance performance. Factors incongruent with national culture may even hurt NSD performance.Practical implicationsWhen choosing priorities in NSD improvement, managers need to consider the national culture environment.Originality/valuePaper directly tests how national culture moderates NSD performance using primary data. Findings suggest that the effects of NSD success factors are contingent on congruence with national culture.

Do Different Service Types Require Changes in NSD Processes at Industrial Manufacturers - An Empirical Examination of Personal and Digital Services

New service development (NSD) at industrial manufacturers and the corresponding process are topics of growing interest in research. However, it has not been clarified yet if the latter should be customised according to different service types. The scarce attention paid to classifying services in this context is surprising considering the increasing importance of personal next to digital services in the course of the emergence of the latter. We take a step towards closing this gap by empirically examining a potential moderating effect of these two service types on a capability-based NSD process. Since it has been established conceptually so far, its investigation in an abbreviated version constitutes a further element of our study. Based on an analysis of 197 NSD projects, we can support the sequence of that process, however, we cannot, contrary to our assumptions, find a moderating effect of the service types. This result implies that managers should focus on possessing the basic capabilities to successfully pass through the NSD process independent of the services developed.

A capabilities-based service development process for industrial manufacturers

Despite years of research regarding service innovation, there is no generally recognised model for the process of new service development (NSD). Focusing on industrial manufacturers, we create a new approach based on the participating actors' resources and capabilities. After determining general characteristics of the NSD process, we deduce corresponding requirements conducting a literature review. We find that during NSD, the supplier has to develop, next to the service elements the client receives afterwards, resources and capabilities which are required for the later delivery and hence closely linked. To learn about its necessary resources and capabilities and to match them with those of the customer the firm needs to consider organisational antecedents, communicative and collaborative skills as well as the processing and integration of new knowledge during all innovation stages. Besides, it has to assess the clients' cooperation willingness to gain knowledge about the customers' resources and capabilities from the beginning.

A capabilities-based service development process for industrial manufacturers

Despite years of research regarding service innovation, there is no generally recognised model for the process of new service development (NSD). Focusing on industrial manufacturers, we create a new approach based on the participating actors' resources and capabilities. After determining general characteristics of the NSD process, we deduce corresponding requirements conducting a literature review. We find that during NSD, the supplier has to develop, next to the service elements the client receives afterwards, resources and capabilities which are required for the later delivery and hence closely linked. To learn about its necessary resources and capabilities and to match them with those of the customer the firm needs to consider organisational antecedents, communicative and collaborative skills as well as the processing and integration of new knowledge during all innovation stages. Besides, it has to assess the clients' cooperation willingness to gain knowledge about the customers' resources and capabilities from the beginning.

EXPLORING NEW SERVICE PORTFOLIO MANAGEMENT

Most research on the management of innovation portfolios has focused on new product portfolios, whereas the management of new service portfolios has not been researched correspondingly. This paper addresses this literature gap by exploring portfolio management of New Service Development (NSD) activities empirically. The paper applies a qualitative research design, where data was collected in 52 in-depth interviews with managers and employees involved with NSD. The study finds that the portfolio management activities and processes were carried out in parallel with the NSD process, and that the most important stakeholders in the NSD portfolio management organization were top managers not involved in the daily NSD operations. Findings reveal that the firms used a great variety of criteria when making portfolio decisions. However, contrary to prescriptions based on new product development research, the decision process exposed for NSD was to a limited degree assisted by explicit portfolio management tools. We explicate our findings in five propositions.

The Role of User Involvement in the Framing Stage of Service Innovation Projects

As a consequence of the growing importance of services in contemporary economies, and the shift to a service-dominant logic in marketing, new service development (NSD) is unarguably important for a large majority of firms. However, developing new services remains a difficult task and the majority of NSD projects eventually fail. Therefore an urgent need exists to further improve the NSD process. In this article, we focus on improving the NSD process by better understanding the role of user involvement in the innovation framing stage. In this article, our aim is to develop a comprehensive conceptual framework investigating user involvement in the framing stage of service innovation projects by synthetizing key literature. Based on the literature, we observe that (1) the intensity of user involvement in innovation framing is positively correlated with the perceived technological uncertainty; (2) collaboration between user and firm in innovation framing is more intensive in case of continuous involvement than in discrete involvement; (3) collaboration between user and firm in innovation framing is stronger in business to business setting than in business to user setting; (4) user involvement appears to positively affect the degree of acceptance of the proposal, the degree of implementation of the associated NSD project and innovation speed, and finally (5) the degree of user involvement has an inverted-U shaped relationship with the effectiveness of innovation framing.

Service Design as an Approach to Implement the Value Cocreation Perspective in New Service Development

Although new service development (NSD) studies have contributed to developing systematic approaches to service innovation, their product-oriented and provider-centric perspectives are limited in embracing a value cocreation concept. We investigate how Service Design, as a human-centered and creative approach to service innovation, can reframe NSD processes to implement value cocreation. Multiple case studies on Service Design projects indicate that design-centric approaches can contribute to the whole NSD process in a way that connects organizations’ managerial practices to value cocreation, in that (1) contextual and holistic understandings of user experiences can inform value propositions that better fit users’ value-in-use, (2) codesign with creative supporting tools can facilitate value cocreation by helping users better apply their own resources, (3) prototyping can optimize firms’ resource and process configuration to facilitate users’ engagement with the service, (4) aligning system actors to the user experience can organize and mobilize them to better support users’ value creation, and (5) user-centered approaches and methods can help organizational staff build long-term capability for supporting users’ value creation. Based on the link between Service Design, NSD, and value cocreation, we propose a conceptual NSD model, geared toward value cocreation.

Towards a framework for New Service Development Practices

Different frameworks for New Service Development (NSD) practices have been suggested by prior conceptual research. We have assessed three frameworks frequently referred to in extant research, and exposed how these three cover different dimensions of NSD practices. By exploring the practices of NSD empirically, this paper continues the ongoing discussion of what the relevant aggregated dimensions of NSD practices are. The detailed practices identified by interviewing 25 employees, all with key roles in relation to NSD in five large Scandinavian service firms, about their NSD practices, are clustered into three aggregated overarching dimensions of NSD practices: 1) identifying needs, 2) assuring support and 3) dividing work. The findings suggest that the NSD process is the prime focus of NSD practices and that different resources are integral parts. The findings provide both managerial implications and implications for further research.

Overcoming the challenges that hinder new service development by manufacturers with diverse services strategies

This paper explores the new service development (NSD) challenges that manufacturers face in undertaking servitization initiatives and their attempts to overcome these challenges. Prior work identifies some generic NSD challenges and manufacturers' responses to them. However, understanding how such responses relate to the manufacturer's services strategy remains under-explored. Recent research suggests that manufacturers adopt diverse service strategies and this diversity provides the context for our study. Four case studies are undertaken in large UK-based manufacturers with services strategies differing with respect to the importance of services within their portfolios of offerings. We identify several NSD process challenges facing manufacturers and discuss how the case organisations seek to respond to them. Different degrees of product-logic drive NSD for each of the cases, suggesting manufacturers risk losing key product advantages if they try to 'break free' from their product heritage. However, this can limit the role that services ultimately play in a manufacturing business, potentially putting it at risk from other actors' radical service innovations. Responses to challenges differ depending on the services strategy adopted. The more enthusiastic organisations have to overcome more challenges than those demonstrating lower levels of enthusiasm. The study offers a more nuanced understanding of how manufacturers can overcome key NSD challenges to create new services. Based on the study, seven propositions are presented regarding NSD by manufacturing organisations.

Use of Social Media for New Service Development by Finnish Event and Festival Organizers

This article explores how event and festival (EF) managers use social media in new service development (NSD), in what phases of NSD consumers are involved, and in what way the customer contributions are used in order to influence the different phases of service development. The empirical data for the study were collected by electronic survey from Finnish cultural and sports EF organizers, and complemented with phone interviews. The study revealed that Finnish EFs use the most common social media tools in everyday operations, particularly for marketing purposes. They have recognized the possibilities to use social media in NSD and have also acknowledged the benefits customer involvement in NSD can bring. Most commonly, customers are involved in the first and final stages of the NSD process. Constraints for web-based NSD was also found. This study brings information about the possibilities of social media in NSD in EF context that may help the organizers and developers to plan and develop the management strategies. Results also show that in the future there may be demand for additional training for EF organizers related to the usage of social media. This study also has limitations. The response rate was rather low, and larger samples should be used in the future. It would also be useful to interview diverse EFs using social media in NSD purposes in the future. The study was conducted only in Finland and thus the results cannot be internationally generalized.

Customer involvement in a new service development process: the case of “Feelgood in Lapland”

The aim of this study is to examine the ability of a company to utilize customer involvement, benefits derived from it, and the challenges faced in the process of involving customers to participate in new service development (NSD) in different stages of the NSD process by adopting a case study approach. The findings show that a company gained several benefits by involving customers. The company also had the willingness to involve customers in NSD but diverse challenges and other operational development projects affected the realization. The study shows several practical implications that are related to customer involvement in diverse phases of NSD, bringing concrete benefits for a company. Nevertheless, cooperation with external research organizations is almost indispensable for small enterprises.