Research On The Customer Participation In Customerization

Traditional operations strategy isolates customers from value creation and is losing its utility today. Co-creating value with customers is the future of competition. Customerization is the strategy for such a value co-creation system, and is the next revolution in mass customization. Customer participating the value co-creation is an important feature of customerization. However, the study on customerization is in its early stage, mainly in the concept development, while the study on customer participation scatters in different areas, with few studies exploring the influence of customer participation in customerization. This dissertation is an attempt towards this direction. The purpose of this research is to study the mechanism and the strategic impacts of the value co-creation with customers on firm's competitive advantage in customerization.Based on the data collected in multi-industry, and using multi-method approach of empirical study, mainly including filed study, interviews, large-scale survey, multivariate statistical analysis and structural equation modeling, this dissertation studied the forcast-driven and customer-order-driven production, the congruence of functional strategies and customer strategies, as well as the impacts of co-creation on firm's competitive advantages. Based on the analysis, this research makes the contributions in the following aspects.The research provides a framework to illustrate the different operational logic of customer-order-driven production and forecast-driven production. The empirical results demonstrate that firms adopting different operations strategies may lead to significantly different finished stock level. The study reveals that customer-order-driven production is a more promising way that can overcome the drawbacks of forecast-driven production, and is corresponding to the phenomena of customer participation.This study demonstrated the significant association between product proliferation strategy and fast response strategy. Both strategies impact significantly on firm's performance, however, on different aspects. Fast response time helps increase sales in a short term while companies with more product proliferation benefit higher growth rate in a long term. Moreover, this study provides an empirical examination into the order-to-delivery time structure and finds that order processing time is independent from producing time. Reducing order processing time can significantly shorten order-to-delivery time while reducing cycle time may significantly compress production time. More product families significantly increase order process time while production stage may contain more product proliferation.This study found that both functional strategies coordination and customer interaction significantly associate with each other. Firms with aligned customer strategy and functional strategies can achieve significantly better competitive advantages in cost, speed, flexibility and service.This study presented a customer participative chain model that facilitates a systematic analysis of a co-creation system. The model separates the co-creation process into three stages, containing nine co-creating activities, and supported by different co-creation methods. These interactive activities together with different methods and tools facilitate firms turning customer competence into the unique competitive advantages.The research results indicated that customer participation of co-creation system can significantly increase firm's customerization capability which is significantly different from those generated from traditionally isolated value creation system. Further, this study evidenced that with higher customerization capability, firms have significantly higher flexibility and faster response, thus forming a new source of competence.The results of empirical analysis also provided three sets of tested measurement scales, including the co-creation activity, the customerization capability and the service priority.The results of this research help guide companies to breakthrough the traditionally isolated way of value creation. Moreover, the research reveals the association and mutual mechanism between customerization and customer participating value co-creation. The results deepen the understanding of value co-creation system by providing the empirical evidences and tested principles, and enable practitioners to find new ways to create sustainable competitive advantages by providing tested theories, methods and tools.