Value co-creation through digital service capabilities: the role of human factors

Minna Saunila, Juhani Ukko, Tero Rantala
2018 Information Technology and People  
Purpose -The purpose of this paper is to explore the different human factor characteristics that are emphasized when co-creating value through digital service capabilities. Design/methodology/approach -Empirical data are gathered from two small companies that deliver digital services and products in business-to-business markets. Findings -The study highlights the role and importance of human factors as reflected in employees' customer orientation while delivering digital service capabilities.
more » ... ice capabilities. The role of human factors also changes during the digital service production process. Originality/value -Developing digital service capability is positively associated with value co-creation, but it requires new skills: firms need to evaluate their mechanisms for supporting continuous learning about the properties of digital technologies. To the authors' knowledge, this is the first study to focus on the role of human factors in in developing digital service capabilities. article is published under the Creative Commons Attribution (CC BY 4.0) licence. Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial and non-commercial purposes), subject to full attribution to the original publication and authors. The full terms of this licence may be seen at http://creativecommons.org/licences/by/4.0/legalcode 627 Digital service capabilities (Tsai et al., 2013) . Moreover, it is commonly recognized that digital business can be accessed with lower financial resources compared to traditional industry, which offers an avenue to a large number of small businesses. Access to the internet has increased substantially during the last decade, and the percent of operators who make purchases online has grown considerably, which emphasizes the need to study the value co-creation of digital services (Griffis et al., 2012). Williams et al. (2010) define digital services as services that are arranged through a digital transaction over internet. Although such service may include digital elements, not all elements or interactions are required to be digital. This makes human factors a crucial aspect of providing value through digital service capabilities. According to Skaggs and Youndt (2004) , human factors in business environments manifest as customer co-production, customer contact, service customization, etc. Human factors related to competence include, for example, knowledge, skills and abilities, whereas those related to behavior include, for example, control and coordination (Wright and Snell, 1991) . In line with the notion that value co-creation is important to enhancing business value, digital service providers need to unlock the value of their human factors to accelerate growth in a challenging marketplace. Regarding the small companies in digital service business, the role of human factors can be further emphasized. In the selection of service providers, the corporate image and reputation are emphasized, and they are also associated with the development of trust (Huang et al., 2015; Parasuraman et al., 2005) . Smaller companies have to work harder than large companies to gain trust, reputation and image, because large companies have usually already achieved these factors. Small businesses need to take advantage of their human factors, such as, knowledge, skills and abilities (Wright and Snell, 1991) , in order to gain trust, reputation and image. However, human factors in the context of digital services are an unexplored area, especially the extent to which they influence value co-creation from a company's perspective. By dividing digital service capabilities into service orientation, market orientation and customer orientation (e.g. Lynn et al., 2000; Eng, 2008; Oliveira and Roth, 2012) , the present study aims to explore the different human factor characteristics that are emphasized in the process of co-creating value. Empirical data are gathered from two small case study companies that deliver digital services and products in a business-to-business (B2B) setting. In B2B setting, the customers are familiar with the service provider, and the service provider has a lot of information about their customers. Further, the service providers in this study are not one-time suppliers but strive for long-term customer relationships. The lengthy cooperation enables the partners to share private information, decrease information asymmetries and facilitate the development of trust (Poppo et al., 2008) . The statements above justify the data collection from the representatives of the service provider, because they were considered to have enough knowledge and understanding about value co-creation in digital services. As a contribution, the study identifies not only the human factors that are crucial to value co-creation in a digital services context but also at which stage of the digital service production they are emphasized. The paper is structured as follows. Section 2 presents a review of prior research on value co-creation, digital service capabilities, and the role played by human factors. Section 3 describes the research methodology. Section 4 presents the different human factor characteristics that are emphasized when co-creating value through digital service capabilities. Section 5 presents a discussion of the findings, and Section 6 presents the conclusions, limitations and direction for future studies. 2. Literature review 2.1 Value creation and co-creation The term value can be classified into value-in-use and value-in-exchange, which reflect the different ways of thinking about value creation . The traditional view of ITP 32,3 ITP 32,3
doi:10.1108/itp-10-2016-0224 fatcat:ui76hh5dijdmzm677rlcmjxjze