Customer Involvement On The Performance Of New Service Development

With increasing globalization of the economy and service, service business increasinglybecomes the key industry to raise the national economic benefit and enhance the social economiccompetitiveness. However, relatively complex external environment and the increasingly fiercemarket competition makes the service business realize even more that merely relying on theinternal limited resources has been difficult to meet the rapidly changing market demands. Servicebusiness must seek for the new development path, in order to get the sustainable competitiveadvantages.As an important component of service innovation, new service development (NSD) has beena significant means for service business to gain the continuous innovation. But the innovation andmanagement literature indicates that more than 40% of new service development fails, someindustries even reach above 50%. The main reason is that the company insufficiently grasps andutilizes the outside environment, especially the customer information. Consequently, in order tocorrectly guide service enterprise to gain valid customer resources, the study on the impacts ofcustomer involvement on NSD will be the urgent need for the survival and development of theservice business.This paper selects the Knowledge-intensive Business Service (KIBS) as the empirical object,and obtains data samples by sampling survey, tests the conceptual model with Structural EquationModel (SEM) to illustrate the influence of customer involvement on NSD, furthermore, analysesthe management strategy of customer involvement in NSD according to each factor. First, thispaper introduces the research background of customer involvement in NSD and the relatedconcepts and basic theories of NSD and customer involvement, and then analyzes the influence ofcustomer involvement on NSD and NSD performance, so that it confirms the determinants ofcustomer involvement in NSD. Secondly, based on the theoretical research, the theoretical modeland research hypotheses are proposed. In accordance with the characteristics of the empiricalobject and combined with the structural equation model analysis method, the paper makes anempirical analysis of the proposed model with SPSS and AMOS software, including scale design,data quality analysis and structure equation analysis, thus verifies the theoretical model and getsthe research conclusion. What’s more, the customer elements which influence the NSD aredefined. Finally, combined with the theoretical analysis and empirical study results, somemanagement advices of customer involvement in NSD are presented. There are two aspects mentioned on the perspective of service enterprise: organization internal elements andorganization to customer elements. These results provide some valuable theoretical basis for thedomestic service business to implement new service development effectively. At last, this paperdiscusses the limitation and the insufficiency of the study and also proposes the prospect ofresearch to look forward to the further development of this field.Combined with the theoretical analysis and empirical research results, this paper definesthree key influencing factors of NSD performance: cognitive ability, behavior intention, andcustomer contact, in addition, testifies the mediating role of customer knowledge acquisition.Based on the conclusion, some managerial implications both on the enterprise level and customerlevel are provided.