Customer Involvement in New Service Development - Organizational Implications and Challenges

Course/Level: Master thesis, Strategic Marketing Management Authors: Daniel Andersson, Pontus Hjertqvist Thesis advisor: Jukka Hohenthal Title: Customer Involvement in New Service Development: Organizational Implications and Challenges Background: The nature of services is becoming technology-based, which implies that customers are becoming increasingly autonomous from the service firm. Understanding how to involve customers in the development process of such services as well as to recognize the challenges brought by customer involvement in this context should be seen as key issues for developing successful new services. Research questions: RQ1: How are customers involved in the development process of technology-based services? RQ2: How do challenges brought by customer involvement impede new service development? Purpose: The purpose of this thesis was to explore how an organization within the banking industry in Sweden involves its customers in the new service development process Methodology: A qualitative single embedded case study strategy, combining inductive and deductive reasoning. The empirical investigation was conducted using a triangulation of secondary data and primary data collected from semi-structured interviews. Conclusion: Customers are involved in three out of four of the fundamental phases in the development process. The findings acknowledged that a lack of formal routines and process of managing customer involvement impeded the organization to successfully involve customers in their new service development programs. As such, the findings suggests that organizations need to employ a new organizational design optimized for customer involvement in their NSD-programs, where current structures, processes, and mindsets need to be adjusted accordingly. Keywords: New service development, customer involvement, technology-based services, organizational challenges