Firm Capabilities, Customer/Supplier Participation, and Firm Performance

Abstract

Recent developments in supply chain and customer relationship management call for firms in the value chain to work closely together. Value co-creation with the upstream (i.e. suppliers) and downstream (i.e., customers) partners has become a critical strategy for many successful companies in their effort to integrate value chain management to the center stage of enterprise management (Flint & Mentzer, 2006). A value co-creation strategy draws on expertise, knowledge, and resources from the customers and suppliers alike to enhance the firm's knowledge development and innovation process. Strategic implications of value co-creation have been recognized (Fang, 2008; Prahalad & Ramaswamy, 2004), and significant theoretical advances have been made (Blazevic & Lievens, 2008; Payne, Storbacka, & Frow, 2008). However, systematic research that explores the antecedents, conditions, and performance outcomes of value co-creation is still lacking, and therefore, many fundamental questions remain unanswered.