Customer Value Through Resource Integration: The Role of the Institutional Solution Space: An Abstract
In this paper, we elaborate service-dominant (S-D) logic’s concept of resource integration as a premise for customer value co-creation and service provision. Following S-D logic, resource integration that results in customer value is dependent on institutions and institutional arrangements. S-D logic’s fifth axiom states: “Value co-creation is coordinated through actor-generated institutions and institutional arrangements” (Vargo & Lusch, 2016, page 18). We report on three case study findings to offer contextualized explanations that seek to join current conceptualizations with solid explanatory power. These cases span from the digitalization of music industry, sustainable strategies in the real estate industry, and insights from an innovation lab for open innovations. The empirical renderings are utilized to help to explain the institutional arrangements that are at play. The results show that the potential boundaries of, how, and which resources can be utilized and integrated are to great extent related to the perceived available “solution space” (von Hippel, 2001) or “opportunity space” (Normann, 2001) offered by the institutional and practice-related boundaries of the context (Ridell, Röndell, & Sörhammar, 2012). By integrating the ideas of a solution space and opportunity space with the later rendering of institutional arrangements as denominator for value creation, we contribute to the current mid-range theory development of S-D logic as well as a better understanding of value co-creation in practice. The introduced concept of institutional solution space combines the idiosyncratic needs of actors with the perceived – i.e., institutional and socio-material-derived – opportunities associated with resources. Thus, it offers a bridge between the abstract concepts of resource integration, value-in-context, and institutional arrangements (Vargo & Lusch, 2016).