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The Effect of Frontline Employee Co-creation on Service Innovation: Comparison of Manufacturing and Service Industries

18 citations0/0 files storedProcedia - Social and Behavioral Sciences

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Service and Product Innovation Customer Service Quality and Loyalty Innovative Approaches in Technology and Social Development

Abstract

The involvement of frontline employees is critical to successful service innovation. Frontline employees often know what their customers need as well as what types of services their firms offer. Service deliver is highly dependent on the actions of frontline employees, who are the focus of the current research. However, the understanding on the influences of co-creation with frontline employees on service innovation performance is insufficient. Therefore, the research model based on service-dominant logic and empowerment perspective was developed to investigate the effect of co-creation with frontline employees on the performance of service innovation. The results drawn from a survey of 149 IT firms and 103 finance firms suggest the followings. First, the frontline employee co-creation by two-way communication can facilitate frontline employees’ sentiment (i.e., motivation, commitment and satisfaction) for the implementation of new services in both the IT and financial industries. Second, for the IT industry, the frontline employees’ sentiment positively affects the financial performance and non-financial performance, except for the links of motivation–financial performance and commitment–non-financial performance. For the financial industry, the frontline employees’ sentiment positively affects the financial performance and non-financial performance, except for the commitment–financial performance. Third, the effects of satisfaction on financial and non-financial performance are stronger in the IT industry than the financial industry. The links of motivation–financial performance and commitment–non-financial performance are stronger in the financial industry than the IT industry. Finally, we offer some managerial and research implications for service innovation and frontline employee co-creation.

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References

1981Evaluating Structural Equation Models with Unobservable Variables and Measurement Error 1988Structural equation modeling in practice: A review and recommended two-step approach.2010Linking Empowering Leadership and Employee Creativity: The Influence of Psychological Empowerment, Intrinsic Motivation, and Creative Process Engagement 2004Co‐creating unique value with customers 2010Moving Forward and Making a Difference: Research Priorities for the Science of Service 2010Is Customer Participation in Value Creation a Double-Edged Sword? Evidence from Professional Financial Services Across Cultures 2007Co-production and customer loyalty in financial services 2002Intellectual capital ROI: a causal map of human capital antecedents and consequents

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2019Corporate responsibility for employees and service innovation performance in manufacturing transformation 2023Demystifying employee co-creation: optimism and pro-social behaviour as moderators 2022Public Private Partnerships Dynamics in Nigeria Power Sector: Service Failure Outcomes and Consumer Dissonance Behaviour

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