Co-Production and Social Service Providers’ Performance: Parental Satisfaction with Childcare Markets: An Abstract

Abstract

Authors such as Brandsen and Pestoff (2006) assume that mechanisms of co-production are able to foster customer engagement in the service delivery process and subsequently improve organizational performance. Based on this idea, this paper investigates whether mechanisms of co-production correlate with social service providers’ organizational performance. Considering a classification of Pestoff (2012), we distinguish between economic (e.g., donations or payment of membership fees), political (e.g., improvement suggestions), and social (e.g., planning of social events) co-production of service providers and their customers. The basic populations considered are German citizens who have children in day care facilities. Parents represent indirect customers of childcare providers (Smith and Friedman 1994) because their children are the direct beneficiaries. The online survey that provides the data for this study yielded a sample of 843 parents. The study uses the generated data to validate a model that includes the perceived degree of co-production as an independent variable as well as person-organization (P-O) fit and the perceived level of information supplied to the parents (e.g., about daily routines) as mediators. We consider parental satisfaction as well as corporate image and loyalty intention as indicators of social service providers’ performance. We measured these latent constructs by means of reflective scales. In addition, we conceptualized organizational image as a reflective-reflective higher-order construct. The data resulting from the online survey was analyzed with SEM methodology. SEM results show that the perceived degree of social co-production at the organizational level has significant effects on the information-supply and P-O fit perceptions. Furthermore, social co-production has no significant direct effects on the considered indicators of performance. Mediation analysis reveals indirect effects of social co-production on all performance indicators. The level of economic participation has significant direct effects on corporate image and loyalty intention but no effect on the mediators. Interestingly, the effect of economic co-production on loyalty intention is negative. Political co-production has significant positive effects on P-O fit and the level of information supplied to the parents as well as a moderate effect on parental satisfaction. The empirical analysis reveals mediation effects of both assumed mediators on the relationship between political co-production and organizational performance. A multigroup analysis reveals no distinct differences in latent constructs’ mean values and path coefficients between the subsamples of public organizations’ clients and nonprofit organizations’ clients. This study demonstrates that co-production relates to organizational performance. Political and social co-production strengthens (mitigates) emotional attachment to the organization (information asymmetry between customers and service providers), which in turn improves perceived organizational performance. These findings suggest that social service providers should consider implementing participatory mechanisms of social and political co-production. However, because of the negative effect on customer loyalty, managerial decisions with regard to economic co-production have to be made with caution. The single-source bias as well as the considered survey design, per se, might have set limits to the internal validity of the present study. Future research could thus consider experimental designs, additional observable data (e.g., cost data), and other fields of activity (e.g., nursery homes or elementary schools). References Available Upon Request