Date of Publication :31st July 2023

Abstract: Does customer involvement lead to greater innovation in service firms? Customers usually are at the center of the service encounter and are familiar with the context of the service (Alam and Perry, 2002). Does this familiarity lead to greater idea generation resulting in increased innovation for service based companies? Services make up a preponderant of new businesses that are formed. With the globalization of service industries and the rapid changes in technology there is growing pressure being put on companies to be more innovative and continually improve their market offerings (Menor, 2000; Sundbo, RUC, and Gallouj, 1998). A review of research has highlighted a dearth of information in new service development. Most product development research focuses on goods as opposed to services (Alam and Perry, 2002). This study addresses the gap in new service development literature and focus on the benefits of customer involvement, as co-producers, on innovation in service firms. Due to the intimate involvement of the customer within a service encounter, the customer’s input in the service innovation process may prove to be more beneficial than in tangible products (Normann, 1991). The primary goal of this paper is to review the literature and existing empirical studies in new product development and derive research propositions that can be tested in future studies.

Reference :