Elsevier

Journal of Business Research

Volume 84, March 2018, Pages 196-205
Journal of Business Research

What is co-creation? An interactional creation framework and its implications for value creation

https://doi.org/10.1016/j.jbusres.2017.11.027Get rights and content

Abstract

The “co-creation” label has proliferated over the past decade. With little consensus on what “co-creation” is, we offer a novel, unifying perspective by anchoring its theorization in creation through interactions. We develop a definition of co-creation as enactment of interactional creation across interactive system-environments (afforded by interactive platforms) entailing agencing engagements and structuring organizations. Interactional creation is enacted by means of interactions of “agencial assemblages”, while agencing engagements and structuring organizations enable and constrain interactions. Interactive platforms, i.e., instantiations of agencial assemblages, are composed of heterogeneous relations of artifacts, processes, interfaces, and persons. Aided by digitalized technologies, interactive platforms afford a multiplicity of interactive system-environments that connect creational interactions with how experienced outcomes emerge from their underlying resourced capabilities. We apply our definitional framework to the practice of value creation as a co-creation, cutting across conventional “production”, “exchange”, and “use” activities. In doing so, we introduce the concept of value-in-interactional creation. We conclude by providing a summary of our conceptualization, explanation of terms in definition, and illustration in practice, while emphasizing the main contributions of our framework and its research implications.

Introduction

The “co-creation” label has proliferated, being associated and invoked with many diverse topics and application areas, including design and development of new goods and services (e.g., Füller and Matzler, 2007, Hoyer et al., 2010, Mahr et al., 2014, Matthing et al., 2004, Nambisan, 2009, Sanders and Stappers, 2008, Sawhney et al., 2005), collaboration with users as innovators (e.g., Bogers et al., 2010, von Hippel, 2005), efforts of users in customizing products to their needs (e.g. Franke and Piller, 2004, Syam and Pazgal, 2013), prosumption (e.g., Xie, Bagozzi, & Troye, 2008), co-production (e.g., Bendapudi and Leone, 2003, Etgar, 2008, Ramirez, 1999), participatory roles of consumers, communities, and crowds (e.g., Cova and Dalli, 2009, Ind et al., 2012, Kozinets et al., 2008), retailing (Andreu, Sánchez, & Mele, 2010), knowledge, learning and solutioning within business networks (e.g., Hakanen, 2014, Komulainen, 2014), multi-firm partnerships (e.g., Ceccagnoli et al., 2012, Grover and Kohli, 2012), open business models (e.g., Chesbrough, 2013), and service exchange and service systems (Ballantyne and Varey, 2008, Grönroos, 2012, Grönroos and Voima, 2013, Lusch and Vargo, 2006, Lusch and Vargo, 2014, Payne et al., 2008, Spohrer and Maglio, 2008, Vargo and Lusch, 2004).

Despite this diversity, however, there is surprisingly little consensus on what “co-creation” is. Its definition, as evinced from recent multiple reviews (Alves et al., 2016, Galvagno and Dalli, 2014, Mustak et al., 2013, Ranjan and Read, 2014, Saarijärvi et al., 2013, Zwass, 2010), remains elusive despite exponential growth in use of the term in the literature. Moreover, as MacInnis (2011), p. 152) notes, “Turning to the literature is useful, but it can stymie identification by inclining us to understand something in terms of established ideas.”

The purpose of this paper is to develop a fresh novel conceptualization of “co-creation”. We seek to ground our inquiry in the enactment of creation through interactions. This goes beyond two or more human actors coming together in activities. Rather, as we discuss, it entails a multiplicity of interactive system-environments among persons and material entities (e.g., devices), afforded by technological platforms enhanced by digital technologies. Following the MacInnis (2011) typology of conceptual contributions, our approach can be seen as one of envisioning, i.e., providing a new perspective. Envisioning “makes us aware of what we have been missing and why it is important” and can “reveal what new questions can be addressed” (MacInnis, 2011, p.138). In discussing the complex nature of value co-creation in theory and practice, Saarijärvi, Kannan, and Kuusela (Saarijärvi et al., 2013, p. 8) call for more clarification in theorizing the connection of “value” with “co” and “creation”, instead of only merely “stating” that value is co-created. A large body of papers have gone on to use the term “value co-creation” without purposefully defining “co-creation”, while simultaneously introducing another term “value” that diverts attention away from the very act of “creation” among actors, to instead debating value-in-use (vs. value-in-exchange) and whether “value” is created or always “co” created (Grönroos and Gummerus, 2014, Vargo and Lusch, 2016). This has led to percolation of distinctions in the literature between “co-production” and “value-in-use” in classificatory approaches of explication. For instance, in their review of the value co-creation literature, Ranjan and Read (2014) classify 149 papers thus: 71 consider “co-production” only, 46 consider “value-in-use” only, and 32 consider both, leading them to posit “value co-creation” as a third-order construct with two dimensions each, viz., co-production and value-in-use.

In contrast, our envisioning approach to conceptualizing co-creation brings a novel, unifying perspective to what co-creation is, by anchoring its theorization in interactive system-environments whose heterogeneous relations can be configured anywhere in the “value creational system”, i.e., regardless of whether it concerns activities of “producing”, “exchanging”, or “using” goods and services. In doing so, we explicitly distinguish the concept of co-creation from the site of its application in the activity system, i.e., production, exchange, or use of goods and services.

The rest of the paper is organized as follows. In the next section, we seek to first conceptualize the enactment of creation through interactions by grounding it in recent theoretical perspectives on the interplay of agency and structure (Cochoy, 2014). We draw on the masterworks of Deleuze (Deleuze, 1990, Deleuze, 1994, Deleuze and Guattari, 1987) that discuss processes of creation, to the body of work of Callon (Callon, 1986, Callon, 1987, Callon, 2008, Callon, 2016, Callon and Law, 1995) that builds on the Deleuzian notion of “agencement”, i.e., assemblage system-environments with capacities of interaction (DeLanda, 2006, DeLanda, 2016). This theorization then leads to a conceptualization of interactive platforms as affording a multiplicity of interactive system-environments through which interactional creation occurs. We then draw on theoretical roots in the interplay of agency and structure to discuss the sociomaterial practice of interactional creation enacted across agencing engagements and structuring organizations. Sociomaterial perspectives have been gaining traction with the practice turn in business research (Feldman and Orlikowski, 2011, Orlikowski and Scott, 2015, Orlikowski and Scott, 2008). Our discussion helps situate the managerial relevance of our conceptualization in connecting interactive platforms with enterprise practices of value creation.

Subsequently, in section three, we apply our conceptualization to enterprise value creation practices. Drawing on the work of Prahalad and Ramaswamy, 2000, Prahalad and Ramaswamy, 2003, Prahalad and Ramaswamy, 2004a, Prahalad and Ramaswamy, 2004b, we distinguish different roles of actors in interactive platforms. In doing so, we reveal our conceptualization as transcending the conventional value chain based roles of actors on the one hand (e.g., firms and customers), and its immanent application to any site of value creational interactions on the other hand (e.g., whether in assembling production, exchange, or use of goods and services). We shed new light on “value co-creation” by introducing the concept of “value-in-interactional creation” that follows from our conceptualization of co-creation as enactment of interactional creation. This is in contrast to “value-in-exchange” and “value-in-use” in the “value co-creation” literature, which stem from production, exchange, and consumption activities associated with goods and services, rather than interactional creation. Section four concludes the paper with some key research and managerial implications.

Section snippets

Conceptualization

Our envisioning approach to conceptualization plays an important role along the discovery-justification continuum (Yadav, 2010), which characterizes the knowledge development process (Hanson, 1958). Following MacInnis (2011), envisioning encompasses contributions that add to the process of discovery by identifying something new, and requires a beginner's mind that is conducive to identification. A “critical avenue for cultivating a beginner's mind stems from immersion in the phenomenon of

Interactive platforms as a locus of value creation

Prahalad and Ramaswamy (2004a) proposed a new frame of reference for value creation as a co-creation, noting that: “The use of interactions as a basis for co-creation is at the crux of our emerging reality.” Their starting premise (p.15) was that “value is co-created”, with two additional premises of “co-creation experiences are the basis of value”, and “the individual is central to the co-creation experience”. Although they did not theorize co-creation as a function of interactive platforms,

Conclusion

In this paper, we have provided a fresh ontological basis of co-creation as enactment of interactional creation across interactive system-environments (afforded by interactive platforms) entailing agencing engagements and structuring organizations. Table 1 provides a summary of our conceptualization, explanation of terms in definition, and illustration in practice.

While traditionally, one has started with activities of actors, the new reality of interactional value creation that is upon us

Acknowledgements

There were no organizations that funded this research.

Venkat Ramaswamy ([email protected]) is Hallman Fellow of Electronic Business and Professor of Marketing at the Ross School of Business, University of Michigan, Ann Arbor, USA. He is a globally recognized thought leader, idea practitioner, and eclectic scholar with wide-ranging interests in innovation, strategy, marketing, branding, IT, operations, and the human side of the organization.

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    Venkat Ramaswamy ([email protected]) is Hallman Fellow of Electronic Business and Professor of Marketing at the Ross School of Business, University of Michigan, Ann Arbor, USA. He is a globally recognized thought leader, idea practitioner, and eclectic scholar with wide-ranging interests in innovation, strategy, marketing, branding, IT, operations, and the human side of the organization.

    Kerimcan Ozcan ([email protected]) is Assistant Professor of Marketing, Marywood University, School of Business and Global Innovation.

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