Enhancing servitization by international consumer integration: the influence of open innovation and co-creation

Purpose Research demonstrates that servitization can achieve competitive advantages for firms; however, many firms are unable to achieve their target values due to various challenges. This study proposes a new model in which open innovation and co-creation are utilized to access consumer knowledge during the servitization process when developing customized services for international markets. Design/methodology/approach An online survey was used to collect the data from 150 manufacturing firms. The data were analyzed using the partial least squares (PLS) approach. Findings The results indicate that open innovation positively affects servitization strategy. Moreover, consumer co-creation moderates the impacts of servitization on firm performance. Practical implications This study confirms the significant role of open innovation and consumer integration in the servitization process, establishing that managers should effectively integrate different stakeholders from the service design stage (through open innovation) to the service delivery stage (through co-creation). Originality/value The paper's results prominently advance the present body of servitization literature by showing how the implementation of open innovation improves the servitization process, an issue that has been ignored in previous studies. Moreover, it seeks to resolve the inconsistent results on servitization's effect on performance by indicating the role of consumer co-creation in the servitization–performance link.