Customer involvement in co-development: problem-solving and decision-making in new product development

Purpose: Customers can participate in new product development (NPD) in many ways. Drawing on the knowledge-based view (KBV) and innovation literature, this study aims to contrast two main product development activity types, i.e. problem-solving and decision-making. It proposes customers play distinct roles if they get involved in these activities, which influence NPD outcomes differently. It also explores customer need specificity as a boundary condition for the above-mentioned relationships. Design/methodology/approach: The authors collected survey data from 308 managers in the innovation domain. Findings: Customer involvement in problem-solving and decision-making distinctively influences new product innovativeness and development speed. Customer need specificity interacts with the two co-development types differently to impact these NPD outcomes further. Research limitations/implications: This research extends the KBV and addresses the inconsistent findings in the literature regarding customer involvement as co-developers in innovation. It also provides novel insights into how knowledge characteristics like customer need specificity can direct co-developing activities to generate distinct NPD results. Practical implications: This paper offers practical implications for firms on how to involve customers in developing innovative new products while managing development speed. Originality/value: Prior research has yet to distinguish customer responsibilities related to co-development activities. This research fills this gap and offers novel insights that problem-solving and decision-making have opposite impacts on different NPD outcomes. This research demonstrates that finer knowledge about customer involvement responsibilities is needed for critical NPD outcomes.