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.