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Customer participation risk management: conceptual model and managerial assessment tool

2020-03-16, Damali, Uzay, Secchi, Enrico, Tax, Steve, McCutcheon, David

Purpose: Customer Participation (CP) has received considerable interest in the service literature as a way to improve the customer experience and reduce service providers’ costs. While its benefits are not in question, there is a paucity of research on potential pitfalls. This paper provides a conceptual foundation to address this gap and develops a comprehensive model of the risks of customer participation in service delivery, integrating research from the marketing, operations and supply chain management, strategy, and information technology fields. Design/methodology/approach: The model is derived deductively by integrating insights from research in marketing, operations and supply chain management, strategy, and information technology. Findings: This paper identifies three categories of potential risks of CP (i.e., market, operational, and service network) and discusses ways that firms can mitigate these risks. Building on the model, it develops a CP risk assessment tool that managers can use when evaluating increases in CP. Research limitations/implications: The conceptual model proposed in this paper can serve as a robust basis for future research in customer participation, particularly in such areas as sharing economy services, service delivery networks, and experiential services. The risk assessment tool offers clear guidelines for managers who are considering an increase in customer participation in their service. Originality/value: This is the first attempt to conceptually define customer participation risk and develop a comprehensive model of its drivers and strategies to mitigate it. This paper develops a straightforward method for managers to evaluate CP risk.