Customer Participation in Digital Transformation, Value
Co-Creation and Firm Performance: An Empirical Study in China
Information Communication & Technology Industry

Abstract

The role of customer participation is an important area in service marketing research. Increasingly more enterprises encourage customers to participate in the service production and delivery processes, stimulate customers to share innovative
ideas, and promote a greater role for customers through participation. Although some research has acknowledged the importance of customer participation in creating knowledge and value for enterprises, it has ignored the uncertainty and
the complexity that customer participation may bring. Most scholars study customer participation only in a broad sense without examining how to effectively manage customer participation. To address this existing research deficiency, this study uses service-oriented logic, digital transformation theory, value co-creation theory, and corporate performance theory to examine how enterprises can promote customer
participation in the process of digital transformation, co-create corporate value with customers, improve and influence the company's digital transformation maturity, and
thus promote the company's performance growth (including environmental, economic, and relationship performance). Specifically, this study makes the following major contributions:
1. Based on the behaviour of customers participating in digital transformation, customer participation is divided into four dimensions (information and knowledge exchange, business collaboration, co-leading, and cost-effectiveness) to understand the process of value co-creation, and to some extent, resolve the inconsistent views of customer participation in existing research. Most extant studies explore customer participation as a whole; such integrated research results in the loss of customer participation’s rich connotation and leads to differing opinions about the impact of
customer participation.
2. Based on the theory of digital transformation and the theory of digital maturity model, this study primarily examines how to effectively guide and manage customers from the perspective of an operational management model and strategy. The existing research on value co-creation largely focuses on how external
environmental factors influence value co-creation among enterprises. These factors are difficult for enterprises to control and control.
3. This study focuses on the co-creation results of traditional enterprise customers and Internet enterprise customers in the process of digital transformation, analyses and compares the different concerns of traditional enterprise customers
and Internet enterprise customers on the value co-creation process, and provides effective and positive aid for future strategic planning regarding these two types of customers.
The information communication technology industry in China is taken as this study’s research object; five representative enterprises are selected. First, 10 traditional enterprise customers, Internet enterprise customers, and industry experts
are interviewed in-depth, and the questionnaire is collected. Second, 506 matching questionnaires for traditional enterprise customers and Internet enterprise customers were collected.
Using structural equation modelling, this study examines the relationship between digital transformation and corporate value co-creation, as well as the intermediate role of digital maturity on digital transformation and corporate value
co-creation. The empirical results support most of the assumptions, as follows:
1. Customer participation in digital transformation has a significantly positive impact on value co-creation (economic, innovation, and relationship value).
2. Value co-creation (economic, innovation, and relationship value) has a significantly positive impact on firm performance.
3. Digital transformation maturity has a significant moderating effect on the influence of value co-creation on firm performance.
4. Value co-creation has a mediating effect on the relationship between customer participation in digital transformation and firm performance.