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Journal of Business Research 69 (2016) 3008–3017

Contents lists available at ScienceDirect

Journal of Business Research

Actor engagement as a microfoundation for value co-creation


Kaj Storbacka a,⁎, Roderick J. Brodie a,1, Tilo Böhmann b,2, Paul P. Maglio c,3, Suvi Nenonen a,1
a
University of Auckland Business School, Private Bag 92019, Auckland, 1142, New Zealand
b
Universität Hamburg, Department of Informatics, Vogt-Koelln-Strasse 30, 20527 Hamburg, Germany
c
University of California, Merced, 5200 N. Lake Road, Merced, CA 95343, USA

a r t i c l e i n f o a b s t r a c t

Article history: The starting point for this research is that value co-creation is difficult to observe empirically, whereas actor en-
Received 1 August 2015 gagement is observable and thus more likely to be designable and manageable. Informed by the microfoundation
Received in revised form 1 January 2016 movement in strategic management, actor engagement is conceptualized as a microfoundation for value co-
Accepted 1 February 2016
creation within the context of a service ecosystem. Using a trans-disciplinary perspective, actors are viewed
Available online 8 April 2016
not only as humans, but also as machines and various combinations of humans and machines. Actor engagement
Keywords:
is defined as both the actor's disposition to engage, and the activity of engaging in an interactive process of re-
Micro-foundation source integration within a service ecosystem. This leads to identifying research issues for actors, engagement
Actor engagement platforms, actor disposition, engagement properties and resource integration patterns. We conclude by drawing
Service ecosystems implications based on the identified research issues.
Co-creation of value © 2016 Elsevier Inc. All rights reserved.

1. Introduction stakeholder management, innovation, ambidexterity, networks, organi-


zational capabilities, R&D capabilities, HR capabilities, and dynamic ca-
In their recent book, Lusch and Vargo (2014) explore perspectives pabilities (Felin et al., 2015). Apart from providing deeper theoretical
and possibilities for advancing service-dominant logic (SDL) to provide explanation, microfoundation research provides a bridge for empirical
the foundations for a general theory of markets and marketing. At the investigation, thus anchoring the more abstract macro concepts in strat-
core of this narrative is the notion of value co-creation, which involves egy and organizational theory.
generic actors integrating resources coordinated through service ex- As elaborated by Felin et al. (2015), microfoundations are funda-
change within actor-generated institutions nested and interlocked in mentally explanations on a lower analytical level, and do not necessarily
service ecosystems (Vargo and Lusch, 2015). From a theoretical per- relate to individuals. Thus while microfoundation research may include
spective, SDL concepts such as value co-creation constitute what is re- individuals as actors in a service ecosystem, the purpose of the research
ferred to in the strategic management and organizational theory is to provide theoretical and empirical explanation at a level of analysis
literature as macro constructs. Aligning with the microfoundational lower than that of the phenomenon itself. While the macro constructs
trend in strategic management and organizational theory (Felin, Foss, define the conceptual domain, Foss and Pederson (2014) warn that
and Ployhart, 2015) implies that advancing theoretical understanding “macro scholars too often work with firm-level constructs with often
about SDL requires more focus on the microfoundations that underpin unclear microfoundations, and proceed as if there are direct causal rela-
the macro constructs provided in the general theoretic perspective. tions between macro variables (e.g., arguments that capabilities cause
In the last decade, the microfoundation movement (e.g. Barney and performance), where, in fact, the real causal relations involve lower
Felin, 2013, Felin and Foss, 2005, Gavetti, 2005, Lippman and Rumult, level actions and interactions” (p. 3).
2003, Teece, 2007) has grown in momentum and has become a major This paper explores actor engagement as a microfoundation for
research stream in strategic management and organizational theory. value co-creation. Actor engagement is chosen based on a corpus lin-
This has led to microfoundational research about the role of routines, guistics analysis of over one hundred academic articles that examines
institutional logics, performance, absorptive capacity, firm R&D, the way the concept of engagement is used in theoretical discussion
about SDL (Fehrer, Smith, and Brodie, 2015). This analysis illustrates
⁎ Corresponding author. Tel.: +64 9 923 1528. that for value co-creation to occur, actors engage in service-for-service
E-mail addresses: k.storbacka@auckland.ac.nz (K. Storbacka), r.brodie@auckland.ac.nz exchange and in related interactions that lead to resource integration.
(R.J. Brodie), tilo.boehmann@uni-hamburg.de (T. Böhmann), pmaglio@ucmerced.edu Consequently, without actor engagement, no resource integration hap-
(P.P. Maglio), s.nenonen@auckland.ac.nz (S. Nenonen).
1
Tel.: +64 9 923 1528.
pens and no value can be co-created. However, whereas value co-
2
Tel.: +49 40 42 883 2299. creation is difficult to observe empirically, actor engagement and relat-
3
Tel.: +1 209 228 4400. ed resource integration is observable and thus more likely to be

http://dx.doi.org/10.1016/j.jbusres.2016.02.034
0148-2963/© 2016 Elsevier Inc. All rights reserved.
K. Storbacka et al. / Journal of Business Research 69 (2016) 3008–3017 3009

designable and manageable. Hence, actor engagement plays a central formation mechanisms, which explains how an individual actor assim-
role as a microfoundation in aligning theory with practice and allowing ilates the contextual conditions into action; and (3) the micro–macro
for empirical investigation. mechanisms that they label transformational mechanisms, which aim
Building on this proposition, the research has two main objectives: to describe how a number of actors through their actions and interac-
(1) to develop a framework that conceptualizes actor engagement as a tions generate macro-level outcomes.
microfoundation of value co-creation within a service ecosystem, and Combining this idea with a more granular view of social mecha-
(2) to use this framework to identify research issues to guide future nisms, as proposed by Jepperson and Meyer (2011), would suggest
work. that the situational and the transformational mechanisms can be best
These objectives respond to the calls for research that address theory explained on a meso-level. This is congruent with Dopfer, Foster, and
construction to include mid-range theory, empirical research, and contin- Potts's (2004) argument that dynamic change can only be effectively
ued refinement of a trans-disciplinary lexicon for SDL (Brodie, Saren, and understood at the meso-level.
Pels, 2011). In the broadest sense, the contribution of the paper is the in- The logic of the Coleman bathtub, including the social mechanisms
troduction of microfoundations into theorizing about SDL, building in a and the macro–meso–micro levels of analysis constitute the corner-
trans-disciplinary way on the initial framing of microfoundations in the stones for generating a microfoundational view of value co-creation.
strategic management literature and from related framing in the manage- Lusch and Vargo (2014, p. 161) define service ecosystems as: “relatively
ment, information systems and service marketing literatures. The partic- self-contained, self-adjusting systems of resource-integrating actors
ular contributions are the research issues that can guide future work that are connected by shared institutional logics and mutual value crea-
toward theoretical and empirical understanding about SDL. The research tion through service exchange”. Fig. 1 portrays the primary macro–
provides a multi-level research approach that combines top-down theo- macro explanation (arrow 1) of SDL, which implies an outcome of
rizing framed by macro constructs of SDL, with bottom-up theorizing value co-creation based on service exchange within the context provid-
based on the microfoundation of actor engagement (Foss, 2009). ed by the institutional logic of a service ecosystem.
The next section provides an overview of the microfoundation However, the concept of being relatively self-contained implies that
movement and elaborates how actor engagement is an important a service ecosystem may be nested within or be part of a larger system.
microfoundation for value co-creation. The paper then proceeds by ex- Hence, service ecosystems are systems of systems in which the various
amining the conditions for actor engagement – that is, the actors and systems interact, and different levels of analysis can be applied: micro
the engagement platforms. The next section looks at actor engagement, (actor engagement), meso (sets of actors and their resources), and
by identifying the dispositions and the properties of actor engagement, macro (ecosystem and institutional logic). An alternative to the
followed by a section analyzing the emergence of various resource inte- macro–macro explanation is provided by exploring mechanisms at
gration patterns. These three sections identify research issues, pertinent play on the other levels of analysis.
particularly to focal actors in service ecosystems, defined as actors The institutional logic of a service ecosystem forms a context for actors
aiming at designing or managing actor engagement with the intent of to engage with their resources on engagement platforms (arrow 2). These
improving resource integration and value co-creation. In the final sec- situational mechanisms form the meso-level conditions for action
tion implications are drawn from the identified research issues. influencing the engaging actor (arrow 3), and, combined with the actor's
disposition to engage, they lead to engagement activities, that can be
2. The microfoundation movement and actor engagement characterized by observable engagement properties (action-formation
mechanisms - arrow 4). As many actors engage, various resource integra-
An important motivation for the microfoundation movement in tion patterns (arrow 5) emerge on the meso-level, which transforms ex-
strategic management is to make theory more relevant to managers tant resource configurations of the actors, leading to value co-creation
by anchoring the more abstract macro concepts. For example, in factors (arrow 6). Consequently, actor engagement (AE) is conceptualized as
like dynamic capabilities, or social capital, routines that are linked to both the disposition of actors to engage, and the activity of engaging in
firm-level performance are seen to be lacking in explanatory power an interactive process of resource integration within the institutional con-
and the “macro constructs and causal claims often stood on shaky text provided by a service ecosystem.
grounds” (Foss and Pederson, 2014 p. 3). Thus an important contribu- Next, the three mechanisms at play are explored: situational mech-
tion of the microfoundation movement is to “unpack collective concepts anisms (macro–meso–micro), action-formation mechanisms (micro–
to understand how individual-level factors impact organizations, how micro), and transformational mechanisms (micro–meso–macro).
the interaction of individuals leads to emergent, collective and
organization-level outcomes and performance, and how relations be- 3. Situational mechanisms: Conditions for actor engagement
tween macro variables are mediated by micro actions and interactions”
(Felin et al., 2015, p. 4). The movement recognizes that to understand The institutional logic of a specific service ecosystem is the founda-
collective phenomena we need to understand the constituent parts tion for the situational mechanisms forming the conditions for AE. For
that make it up: individuals and their social interaction. AE to happen there needs to be actors engaging and engagement plat-
The microfoundational approach provides a multi-level explanation forms that enable engagement.
portrayed by what is now commonly referred to as the Coleman ‘boat’
or ‘bathtub’. In his original work Coleman (1990) makes a distinction 3.1. The engaging actors and their resources
between the macro–macro level explanation where social facts lead to
social outcomes and the micro–micro level explanation where condi- The concept of resource-integrating actors highlights the idea of ge-
tions for action lead to observable actions. The ‘bathtub’ is created by neric actors that have ownership of, or access to resources. These actors
the links between the macro–micro explanation where the social facts can be viewed as open systems, “effectively depending on the resources
inform conditions for action, and micro–macro explanation where ob- of others to survive” (Vargo, Maglio, and Akaka, 2008, p. 149). The con-
servable actions inform social outcomes. sequence is that all actors are fundamentally engaged in similar ways in
Building on the idea of the Coleman bathtub, Hedström and resource integration processes. Hence, the previously strict roles of pro-
Swedberg (1998) introduce a typology of social mechanisms. They ducer vs. consumer or seller vs. buyer are fleeting, and actors can have
posit that there are three types of mechanisms at play: (1) the macro– many different roles. An actor-to-actor perspective effectively renders
micro mechanisms that they label situational mechanisms, which aim useless clearly specified and static actor roles. All actors have similar
to understand how macro-level-generated conditions or contexts affect processes of engagement and what is needed is a generic view of the
actors; (2) the micro–micro mechanisms that they label action- properties and patterns of AE. This leads to a departure from a dyadic
3010 K. Storbacka et al. / Journal of Business Research 69 (2016) 3008–3017

Fig. 1. The Coleman bathtub: Actor engagement explains value co-creation.

world view, as a systemic view necessitates the “emancipation from the considered as actors, and distinguishing interactions between pairs of
shackles of the dyad (and the myopia connected to this)” (Storbacka actors and among groups of actors help us to understand their roles
and Nenonen, 2011, p. 242). and relationships. In the not-too-distant future, vehicles can drive
Lusch and Vargo (2014) do not specifically define what an actor is, themselves, eliminating the human driver and possibly changing the
but use it as a general construct similar to the idea of ‘social actors’. nature of interactions with other vehicles and with the road network
Hence, actors can be humans or collections of humans, such as organiza- as well (e.g., Markoff, 2010). In the case of the human taxi driver, the
tions. The key is that they are involved in a “logic of human exchange technology of the automobile is under the direct control of the taxi driv-
systems” (ibid., p. 102). er, whereas in the case of the autonomous taxi, technology itself is in
However, limiting our view to human actors alone ignores the im- control, and this change has implications for the way the entire system
pact of technologies. Researchers on sociomateriality view the human works, as the technology can interact seamlessly with the technology of
and social dimension interwoven with the realm of the material, includ- other vehicles and the road network, potentially eliminating accidents
ing technologies (Cecez-Kecmanovic, Galliers, Henfridsson, Newell, and and other unanticipated problems.
Vidgen, 2014; Orlikowski and Scott, 2008). Adding technologies or ma- Glushko (2014) identifies seven contexts for designing service sys-
chines to the equation is imperative because of the fast pace of develop- tems involving advanced forms of interaction between human and
ment of smart machines in service interactions (Brynjolfsson and technology actors. Building on these, but using the vocabulary of this
McAfee, 2014). Advances in autonomous technologies provide increasing paper they are: (1) human-to-human, (2) technology-enhanced
opportunity for re-shaping actor-to-actor interaction, for instance, by human-to-human, (3) human-to-technology (e.g., self-service),
substituting human-based interaction with technology-to-technology in- (4) human-to-human or human-to-technology in multiple channels,
teraction (e.g., an automobile that autonomously alerts emergency ser- (5) human-to-multiple technologies (e.g., services used on multiple de-
vices) or new, more customized and contextual forms of human-to- vices), (6) technology-to-technology, and (7) context-aware human-
machine interactions (e.g., augmented reality). These advances build to-technology, meaning human-to-technology interactions supported
on developments in machine learning (Bishop, 2007; Kohavi and by location-based or other context-aware applications. Glushko's argu-
Provost, 1998), big data and advanced analytics (Brynjolfsson and ment is that encounters are becoming more information-intensive and
McAfee, 2012), robots in customer service (Stafford, MacDonald, that designers of service systems need to use new design elements
Jayawardena, Wegner, and Broadbent, 2014), computers-as-social- to leverage new opportunities for autonomous technologies and to
agents (Nass, Steuer, and Tauber, 1994; Schaumburg, 2001), machine- manage complexity. This view resonates with the work of Molina
to-machine communication (Chen and Lien, 2014), cognitive comput- (1999) who argues for the importance of sociotechnical alignment,
ing (Kelly and Hamm, 2013), and the role of avatars vs. algorithms in which sociotechnical constituencies, consisting of dynamic en-
(Bente, Rüggenberg, Krämer, and Eschenburg, 2008; Fox et al., 2014) sembles of technical constituents (e.g., machines, technologies)
in relation to automated online assistants. and social constituents (e.g. institutions, humans), “interact and
Consequently, actors need to be viewed not only as humans, but also shape each other in the course of the creation, production and diffu-
as machines/technologies, or collections of humans and machines/tech- sion of specific technologies” (p. 8).
nologies, including organizations. Earlier research (Maglio, Vargo, Drawing on this more nuanced view of the actor concept, we identi-
Caswell, and Spohrer, 2009; Spohrer, Maglio, Bailey, and Gruhl, 2007) fy three research issues relevant to a focal actor aiming at designing and
views service systems as comprised of entities interacting or engaging managing AE.
with one another to create value. These entities are collections or ar-
rangements of resources, including people, technology, information, 1. Volume and variety of actors. Ubiquitous autonomous technology
and organizations. For the present purpose, entities are identified as ac- has the potential to changes the volume and variety of actors avail-
tors, highlighting the action, interaction, and engagement required for able for engagement, as well as the number of connections between
effective resource integration and value creation. actors that engagement can build on. A focal actor needs to recognize
Technologies are human-created things that serve human purposes this changing context of engagement as possible opportunities for
(Arthur, 2009), including for instance, automobiles and computational enhancing engagement.
systems (the terms technologies and machines are used interchange- 2. Actor combinations. Viewing all ecosystem actors as able to interact,
ably). In the transportation service ecosystem of urban taxis, for exam- means that engagement applies to a much richer set of actor combi-
ple, the physical taxi (technology), the driver (human), the passenger nations, both in dyads (human-to-human (H2H); human-to-
(human), and other vehicles (human-technology entities) can be machine (H2M); machine-to-machine (M2M), in triads (humans-
K. Storbacka et al. / Journal of Business Research 69 (2016) 3008–3017 3011

to-(human & machine) (H2H&M); (human & machine)-to-(human to a longitudinal and relational view of how customers and firms inter-
& machine) (H&M2H&M), and in networks (many-humans-to- act or ‘touch’ each other in time and space; where firms aim at securing
human (MH2H); many-humans-to-machine(s) (mH2M). Of these a seamless multi-channel experience (van Bommel, Edelman, and
combinations, many can be seen as organizations. Hence, a human Ungerman, 2014).
may engage with a firm's technology (e.g., customer using internet In their investigation of value co-creation in the online and physical
banking), and a firm, using humans and technology, may engage shopping environment, Breidbach, Brodie, and Hollebeek (2014) sug-
with another firm's humans and technologies (a supplier engages gest that an engagement platform consists of multiple touch-points
with a buyer, involving both personal engagement between sales made up of a combination of virtual and physical interactions. Drawing
person and purchaser and integration of enterprise resource plan- on Sawhney, Verona, and Prandelli (2005) and Ramaswamy (2009),
ning software). A focal actor wishing to facilitate engagement in a they introduce the concept of touch-point to define how an engagement
service ecosystem needs to consider how various combinations sup- platform is employed. Breidbach et al. (2014) define an engagement
port its design objectives. platform as “physical or virtual touch points designed to provide struc-
3. Machines/technologies as actors. Engagement by, or with machines/ tural support for the exchange and integration of resources, and thereby
technology will differ from engagement by, or with people, which co-creation of value, between actors in a service system” (p. 594).
suggests that research ought to focus on how machines/technologies This research views engagement platforms as more than a set of
(typically autonomous computer algorithms) function as actors. And multiple touch-points and define engagement platforms as multi-
as it has been shown that machine interfaces can use controllable sided intermediaries that actors leverage to engage with other actors
models of the human face including related expressive dynamics to integrate resources. Latour (2005) makes a distinction between
(Sagar et al., 2014), a key question relates to the possibility of emo- intermediaries and mediators, where intermediaries are viewed as
tionally conditioned engagement of machines. facilitating the force of some other actor (more or less) without
transformation. Thus they do not engage in resource integration. Me-
3.2. Engagement platforms diators, on the other hand, are entities that multiply differences, in-
dicating that their outputs cannot be predicted by their inputs, as
The second condition for action relates to the platform on which en- the inputs are dependent on a process of resource integration. This
gagement happens. The term ‘platform’ has been used to describe man- difference is relevant when exploring and categorizing the roles of
agement phenomena such as individual products, product systems, engagement platforms, and we posit that engagement platforms al-
industry supply chains, markets, industries, and even constellations of ways assume the role of an intermediary; that is, they do not partic-
industries (Gawer, 2009). By consolidating results of major studies re- ipate in the engagement but facilitate it. Consequently, mediators are
garding platforms, Thomas, Autio, and Gann (2014) suggest a typology viewed as actors rather than as platforms.
of platforms: (1) platform as a set of organizational capabilities that en- Finally, there is considerable benefit from engagement-related net-
able superior performance, (2) platform as the stable center used for a work effects in which additional actors joining the platform strengthens
family of products, (3) platform as an intermediary between two or it, and in which joining the platform yields benefits related to the num-
more market participants, and (4) platform as a system or architecture ber other actors that have joined the platform (Katz and Shapiro, 1994,
that supports a collection of complementary technology assets. In this Thomas et al., 2014). Such yields or benefits can take three forms: rela-
research platforms are viewed as intermediaries of connections. tional, informational, or motivational benefits. Relational benefits refer
Within the strategy and marketing literature the concept of an to the ability to engage with other actors using the same engagement
engagement platform stems from Prahalad and Ramaswamy's platform. Informational benefits accrue through the data held by the
(2004) work on service innovation within experience environments. platform and the ability to generate customized information from this
Ramaswamy and Gouillart (2010) define engagement platforms as data. Motivational benefits stimulate engagement activity by actors on
purpose-built, ICT-enabled environments containing artifacts, inter- the platform, for instance, through gamification.
faces, processes and people; permitting organizations to co-create Drawing on the above discussion, we identify three issues related to
value with their customers. the significance and constitution of engagement platforms. These serve
The research by Frow, Nenonen, Payne, and Storbacka (2015) recog- as the basis for our agenda for research.
nizes that effective co-creation is dependent on a platform for actors to
engage. In contrast to Ramaswamy and Gouillart (2010), they identified 1. Platform modality. Engagement platforms – that is, environments
five types of both virtual (ICT enabled) and/or physical engagement containing artifacts, interfaces, processes and people – facilitate AE
platforms: “(1) digital applications, such as web sites that extend the by providing access to engagement opportunities. Through engage-
reach and speed of interactions with multiple and diverse actors; ment platforms, actors can engage with a focal firm (e.g., in the
(2) tools or products used on a recurring or continuous basis as a device course of a customer relationship) or with other actors (e.g., a com-
to connect actors (e.g., software companies providing software develop- munity of actors engaging around a specific subject of their interest).
er toolkits); (3) physical resources, where collaborators come together Consequently, the engagement platform can be provided by a focal
occasionally for mutual benefit, to share and enhance their knowledge firm (e.g., electronic banking platform enabling self-service), by
(e.g., retail formats such as Apple stores); (4) joint processes involving other actors (e.g., mobile phone when calling your bank), or even
multiple actors (e.g., P&G's ‘connect + develop’ innovation initiative); by the natural world (e.g., inspiring forest or beach setting when hav-
and (5) dedicated personnel groups, such as call center teams” (ibid, ing a walking meeting to brainstorm with colleagues). This provision
p. 472–473). is likely to have implications for the type of engagement facilitated by
These platform types can be used individually or in various combina- the platform: platforms provided by the focal actors tend to be more
tions over time. Brodie, Hollebeek, Juric, and Ilic (2011a) show that specific whereas other platforms may facilitate a broader range of en-
practicing managers use the concept of engagement in a variety of gagement. The platform provision is also an important factor for
ways to describe how firms interact with customers. Engagement is those actors that seek to influence or design the engagement in
used as a synonym for a firm's ‘go-to-market’ approach: that is, what their service ecosystem. It is expected that those service ecosystems
channels are used to interact with customers, how resource-intensive in which the dominant engagement platform is provided by other ac-
is the approach (ranging from on-line selling to strategic account man- tors are more immune to deliberate design efforts by a focal actor.
agement), and what is the process applied to generate exchange and in- 2. Roles of platforms vs. actors. When facilitating engagement, plat-
teractions both pre- and post-purchase. The management practice forms do not engage themselves but foster engagement between
literature also emphasizes the idea of customer journeys, which relates two or more actors. This helps to differentiate engagement platforms
3012 K. Storbacka et al. / Journal of Business Research 69 (2016) 3008–3017

from actors in the service ecosystem: actors participate in the en- Another related question is: do machine actors have agency? In the
gagement activities whereas platforms do not. Furthermore, engage- context of sociomateriality, researchers view agency as not limited to
ment platforms do not modify or enhance the resources to be humans, but instead recognize that the material can also have agency,
integrated during the actor-to-actor engagement — they bring albeit of a different character. For example, Cecez-Kecmanovic et al.
these actors and their resources together. However, sometimes plat- (2014) refer to Leonardi (2012) who defines social/human agency as
forms may evolve to be fully-fledged actors in service ecosystems. “coordinated human intentionality” (p. 42) and of material agency as
For instance Skype has been a platform for many human-to-human “ways in which a technology's materiality acts” (ibid.), continuing to
engagements. When Skype is upgraded into Skype Translator, offer- say “material agency is activated as humans approach technology with
ing real-time translation, then this former platform becomes an actor particular intentions …” (ibid.). The key difference lies in the intention-
as it starts to modify (in this case by translating) the resources that ality which is constitutive for human agency and absent in material
are being integrated during the engagement. As the example illus- agency (Leonardi, 2012; Pickering, 2001). No matter how autonomous
trates, the sometimes ambiguous and fleeting distinction between or meaningful human-to-technology engagement becomes, responsi-
actors and platforms warrants more research. bility lies with system entities that can be governed and which have
3. Platforms and engagement-related network effects. As engagement rights (Maglio et al., 2009) — which includes both humans and
platforms are aggregators of actors, both direct and two-sided net- corporations.
work effects apply. Hence, an increase in the numbers of actors en- Most of engagement research in marketing either explicitly or
gaging will increase the value of the platform for the actors but also implicitly assumes that engagement is an actor-specific characteris-
make it possible for the actor managing the platform to generate re- tic, and discuss issues such as ‘willingness to engage’ as part of an
sources to further develop the platform. In the context of engage- actor's disposition. However, realizing that AE happens governed
ment, research focus should seek to understand the development by the institutional logic of a specific service ecosystem means that
of the relational, informational, and motivational benefits when ac- actors do not engage in a vacuum — quite the opposite. The concept
tors join or leave engagement platforms. of shared institutional logics includes values, norms and governing
principles that guide interactions between the actors in the system.
4. Action-formation mechanism: From disposition to action This is congruent with the ideas of how organizational fields influ-
ence actors. Phillips, Lawrence, and Hardy (2000) submit that orga-
The above-discussed conditions for action form the context in which nizational fields provide the rules and resources upon which
action-formation mechanisms are at work (the micro–micro explana- collaboration is constructed, and collaboration (which we interpret
tion). The individual actor has a range of possible dispositions for engage- as AE) provides a context for the on-going processes of structuration
ment, which lead to engagement activity, observable as engagement that build and sustain the organizational fields of the participating
properties. actors. Actors' engagement in terms of interfacing and exchanging
occurs within shared institutional logics, and simultaneously builds
4.1. Actor disposition and sustains such logics. This resonates with Barney and Felin
(2013) who highlight misconceptions related to microfoundational
Engagement is used in many different contexts and with various research, and argue that microfoundations are not psychology,
meanings. In an examination of the social science literature, Brodie, human resources, or micro-organizational behavior, nor do
Hollebeek, et al. (2011) reveal a broad range of contexts leading to a di- microfoundations deny the role of structure and institutions.
versity of context-laden definitions. Within marketing, Brodie, Consequently, engagement properties are not only results of actor-
Hollebeek, et al. (2011), for instance, define the conceptual domain of specific characteristics. The conceptual and physical context also deter-
customer engagement and develop five propositions concerning cus- mines why, when and how actors engage. Hence, the context in which
tomer engagement: (1) customer engagement “reflects a psychological AE occurs is central to our understanding of how actors engage in re-
state, which occurs by virtue of interactive customer experiences with a source integration activities. AE will be path-dependent in terms of
focal agent/object within specific service relationships”; (2) varying both the history and experience of the actor, and the routines related
states of customer engagement “occur within a dynamic, iterative pro- to the engagement. This view raises questions related to the application
cess of service relationships that cocreate value”; (3) customer engage- of practice theory (Schatzki, 2001) in understanding AE. Practices can be
ment plays a “central role within a nomological network of service defined as “more or less routinized actions, which are orchestrated by
relationships”; (4) engagement “is a multidimensional concept subject tools, know-how, images, physical space and an [actor] who is carrying
to a context- and/or stakeholder-specific expression of relevant cogni- out the practice” (Korkman, 2006, p. 27). According to Korkman,
tive, emotional, and behavioral dimensions”; and (5) customer engage- Storbacka, and Harald (2010), a practice-based approach could be cate-
ment “occurs within a specific set of situational conditions generating gorized as an anti-individualistic stance. A practice is neither deter-
differing customer engagement levels.” Based on the above discussion, mined by the actor, nor by context alone, but more specifically
these propositions cover both the conditions and the activities of happens in the integration of resource elements.
engagement. Based on the above discussion, and building on Chandler and Lusch
In a recent paper, Chandler and Lusch (2015) build on the work of (2015), actor disposition is defined as a capacity of an actor to appropri-
Brodie, Hollebeek, et al. (2011) and develop a framework to describe ate, reproduce, or potentially innovate upon connections in the current
the role of AE in service systems. They refer to AE generically, although time and place, in response to a specific past and/or toward a specific fu-
their examples are to do with customer engagement; and whereas they ture. This definition allows us to consider machines as having disposi-
acknowledge many-to-many engagement in networks, they particular- tions (Davenport, 2013), and supports the idea that the capacity of
ly do not consider machines/technologies as engaging actors. The actors to engage may be determined by the institutional context.
framework portrays engagement as based on the dispositions (internal) For a focal actor wanting to design AE, this definition implies the ne-
and connections (external) of actors. cessity both to assume a longitudinal perspective to actors relevant to
However, common to all of the conceptualizations in marketing is the designer (and so to understand both past, present and desired fu-
the notion that AE is an interactive co-creative process in which the tures of the actor), to systematically collect and process information ap-
actor's internal disposition is a central condition for engagement activi- plicable to the actor's interactions and development over time, and to
ty. Brodie, Hollebeek, et al. (2011) and Chandler and Lusch (2015) refer understand the institutional context that influence actors.
to the disposition as a psychological state (of humans), which does not We identify four specific issues for the research agenda, related to
fit our definition of actors. actors' disposition for engagement.
K. Storbacka et al. / Journal of Business Research 69 (2016) 3008–3017 3013

1. Disposition of machine actors. What seems evident is that the dispo- (p. 5), and AE “is based on actors' present-day connections as comprised
sition to engage needs to be extended beyond the psychological and of other actors and the social roles that affiliate them with these actors”
emotional state of humans to cover also increasingly autonomous (p. 5). Temporal properties are a key ingredient, as engagement varies
technologies with conditioned agency. Cognitive computing and pre- in terms of the duration (Füller, 2010), including one-off engagement,
scriptive analytics will mean that technological systems (such as recurring engagement, and continuous engagement. Duration differ-
computer systems and robots governed by advanced algorithms) ences have important implications for designing the activity in terms
will play a much bigger role in service ecosystems. Such technologies of engaging actors and use of channels. One-off engagement may typi-
will be able to integrate and synthesize multiple heterogeneous cally occur in a single channel, whereas continuous engagement may
streams of information, learning and changing as they receive new profit from multiple channels supporting continued interaction. Addi-
information; based for instance on new users, new interactions, or tional considerations relate to frequency, regularity, recency and con-
new contexts of inquiry or activity, making human-to-machine en- currence, where everything happens in parallel not sequentially.
gagement more contextual and more meaningful. Deeper under- Relational properties are also a key issue because actors' level of en-
standing is, however, necessarily related to how the disposition of gagement varies, from providing comments and suggestions, participat-
technologies to engage can be programmed and controlled. ing in specific forms of co-creation, to becoming involved in self-service
2. Actor intentionality. As noted, we are not suggesting that technolo- and outsourcing activity. In online learning environments, Milligan,
gies are equivalent to human actors for all purposes. Technologies Littlejohn, and Margaryan (2013) have identified that participants are
do not have intentions and do not have agency in and of themselves. active, passive or lurkers (‘lurkers’ are defined as those who are actively
However, modern technologies have ever increasing capabilities for following a course but not actively engaging with other learners).
autonomy and for engaging human actors and other technologies Based on the discussion above, engagement properties are defined
in service interactions. Given that autonomous systems have a dispo- as observable engagement activities. We identify four issues relating
sition to engage, can we suppose that they will have conditioned in- to engagement properties.
tentionality in the future (cf. Maglio, Matlock, Gould, Koons, and
Campbell, 2002)? Is it necessary to suppose such intentionality for ef- 1. Co-production vs. value-in-use activities. Building on Ranjan and
fective human-to-technology engagement? Read's (2014) categorization, we suggest that the engagement activ-
3. Disposition vs. engagement properties. Further research is needed in ity can be divided into co-production activities, in which actors en-
order to explore how the disposition and the temporal and relational gage in, for instance, co-design, co-development, co-production, co-
characteristics of an actor relate to the motives for engagement (mon- promotion (cf., Frow et al., 2015) of products; and value-in-use activ-
etary, personal fulfillment, access to resources), levels and intensity of ities, in which actors engage in value-creating activities utilizing
engagement expected, type of engagement (cognitive, emotional, or other actors' resources, without these actors being actively present.
behavioral), and an actor's valence (negative or positive). 2. Relational properties. An actor's engagement is determined by its
4. Engagement practices. To fully understand AE, more research is present-day connections in the service ecosystem, and the social
needed on how shared institutional logics, including values, norms and institutional roles assigned to it. The relational properties of an
and governing principles guide interactions between the actors in a actor can be determined by analyzing the types of relationships the
service ecosystem. It seems obvious that shared institutional logics actor has within the service ecosystem: how many relationships
lead to engagement practices that become routine or in other situa- the actor has; how many of these relationships can be classified as
tions create inertia. For example a customer may engage on many primary contacts; how central the market actor's position is within
different levels and driven by internal dispositions in a holiday travel the ecosystem; and what the actor's relative power position is.
setting, whereas engagement in self-servicing transactions in a retail 3. Informational properties. Engagement varies in terms of information.
bank setting is routinized and influenced by contextual elements ex- Issues to be considered include whether the actor is trying to influ-
ternal to the actor. ence, is open to influence, or trying to mobilize support or access to
resources.
4.2. Engagement properties 4. Temporal properties. Engagement varies in terms of duration, regu-
larity and frequency. Hence, engagement may be momentary or on-
All approaches within marketing related to how customer engage- going. The recency of an engagement is likely to be connected to the
ment is conceptualized, view engagement as something longitudinally impact that the engagement has on the actor. The concurrence of AE
and conceptually broader and more complex than exchange transac- implies both that many actors engage simultaneously and that one
tions. Van Doorn et al. (2010), for instance, argue that engagement is be- actor may engage with many actors simultaneously. AE is dynamic
havioral by nature, and their interest lies in understanding how various and iterative in nature, and thus the temporal properties extend
motivational drivers lead to behavioral manifestations toward brands the spatial, contextual, relational and informational properties.
and firms, beyond purchase transactions. They identify five dimensions
of customer engagement behavior: valence, form, scope, nature of im- 5. Transformational mechanisms: Resource integration patterns
pact and customer goals. Building on Van Doorn et al. (2010); Verhoef,
Reinartz, and Krafft (2010) develop a conceptual model covering the an- The changing set of actors with various dispositions, the multitude of
tecedents, impediments, and firm consequences of customer engage- engagement platforms and the engagement properties resulting from
ment. Verleye, Gemmel, and Rangarajan (2014) use the behavioral various activities constitute the elements of evolving resource integra-
view to investigate how customer engagement behaviors can be man- tion patterns, defined as a distinct combination of these elements.
aged to secure long-term profitability. Jaakkola and Alexander (2014) The meso-level transformational mechanisms play a key role in the
expand the behavioral view into multi-stakeholder service systems, micro–meso–macro explanation that links the micro-level process of
and identify four types of customer engagement behaviors based on in- AE with the macro-level co-creation of value. The key mechanisms at
formational properties: augmenting, co-developing, influencing and play are processes of resource integration. Peters (this issue) argues
mobilizing behaviors. They also identify the drivers and value outcomes that there are two types of processes: resource integration based on
of these behaviors. summative or aggregative relations between resources (homopathic re-
According to Chandler and Lusch (2015), an actor's external connec- source integration), and resource integration based on emergent rela-
tions are characterized by temporal contexts. Hence, AE “is based on ac- tions between resources (heteropathic resource integration). This is
tors' present-day connections that have emerged from past service similar to Barney and Felin (2013), who submit that the way lower
experiences and are oriented toward future service experiences” level factors aggregate to higher levels can be viewed as additive or
3014 K. Storbacka et al. / Journal of Business Research 69 (2016) 3008–3017

complex. Additive aggregation would imply simple accumulation of the other in order to achieve a high degree of configurational fit. This reso-
effects generated by individual actors, whereas complex aggregation nates with the idea that there may be some generic patterns that are
implies that results are surprising and unforeseen as a result of actor in- preferred due to their potentiality (see Parmar, Mackenzie, Cohn, and
terdependence and inter-actor influence. Complex aggregation can be Gann (2014) for a discussion on similar innovation patterns).
seen as the explanation for emergence and could, hence, explain phe- Based on the above discussion, we identify four research issues relat-
nomena such as service ecosystem emergence. ed to engagement patterns.
Hence, heteropathic resource integration can be viewed as a mecha-
nism for emergence in which new properties (e.g. entities, structures, 1. Evaluation of effective resource integration patterns. As digital trans-
totalities, concepts, qualities, capacities, textures, mechanisms, etc.) formation influences actors, engagement properties and platforms, it
are generated (Peters, — this issue). drives innovation of novel forms of engagement. Research can ad-
Arthur (2014) suggests that emergence in complex systems relates vance the design of new patterns or identify novel ones designed
to the development of patterns on a meso-level. As a result of collective by others. However, resource integration patterns will need to be
actions of many actors various development trajectories converge into a evaluated rigorously for effectiveness, and this implies the need for
pattern that enables innovation. Taking a focal actor stance: attempting the development of ways to assess effectiveness.
to identify effective resource integration patterns, and using such pat- 2. Trade-offs between patterns. In each given situation, multiple re-
terns for designing effective AE processes will become a central mana- source integration patterns might be applicable and equifinal from
gerial task (acknowledging that AE cannot be designed entirely, as an effectiveness point of view. Selecting an alternative requires un-
some aspects will be emergent). derstanding the trade-offs of making such a choice. Trade-offs can re-
Patterns have been proposed in computer science, architecture, and late to the type of actor, the properties, and/or the benefits of an
other areas (Alexander et al., 1977; Gamma, Helm, Johnson, and engagement platform. Research should seek to elucidate trade-offs
Vlissides, 1994) as facilitators for the construction of new information to support actors in making informed choices between alternative
systems or buildings that can be adapted and recombined in the design patterns.
process. Patterns encapsulate solutions to recurring design problems, 3. Generic resource integration patterns. An important research area
and capture a recurring problem and its context, an abstracted solution relates to the identification of potential generic resource integration
for specific instances of such problems, and the consequences of apply- patterns, which would be ecosystem indifferent. Such patterns
ing this solution: that is, results and trade-offs (Gamma et al., 1994). have for instance been identified in the use of data for business
Thus, these patterns describe recurring opportunities for engaging ac- model innovation (Parmar et al., 2014.). Such patterns are likely to
tors in resource integration, and solutions for engaging the actors be organized around some common themes, such as open innova-
given such opportunities. Moreover, a resource integration pattern ex- tion, mobilizing support, or self-service, and are likely to be overlap-
plicates the consequences of applying the pattern by illustrating the ping in terms of content. Generic patterns have the potential to be
benefits and trade-offs for the engagement of actors. particularly helpful for managers looking for ideas for business
Henfridsson, Mathiassen, and Svahn (2014) argue that patterns development.
should inform our ‘architectural understanding’ of fast-paced digital in- 4. Choreography of resource integration. Engagement platforms can con-
novation. Thinking about architecture as a network of adaptable pat- nect actors within and across different environments, such as digital
terns captures the inherent adaptability of software-based systems. spaces, physical places, as well as with processes and activities. Under-
This complements the traditional view of (service) architecture as a hi- standing and designing the temporal, spatial and contextual configura-
erarchy of components that allows adaptation through recombination tion of patterns as a choreography is a key architectural aspect of
and change of individual modules (Dörbecker, Harms, and Böhmann, engagement.
2013; Ulrich, 1995; Voss and Hsuan, 2009). Patterns are thus an essen-
tial concept for understanding the design of complex service systems 6. Discussion
and the emergence of service ecosystems.
The network-of-patterns architectural frame also informs under- This section summarizes the identified research issues and discusses
standing of complex forms of AE that combine and link multiple pat- the contributions of the research, and as well, highlights how this re-
terns. Such a network of resource integration patterns may be search informs managerial practice.
expressed as ‘choreography’. In the design of technical service systems,
a choreography defines how different parties interact in digital business 6.1. Implications for research
processes, without assuming that one of these parties controls the pro-
cess (Peltz, 2003). The choreography of resource integration patterns This research aims to provide a more managerially-oriented frame-
explicates the network of temporal, spatial or other relationships be- work for understanding, and ultimately designing value co-creation with-
tween two or more engagement patterns, thus defining architectural in service ecosystems. The argument is that, whereas value co-creation is
pathways that connect multiple instances and environments of abstract and difficult to observe empirically, AE is observable and thus
engagement. more likely to be designable and manageable. Hence, the purpose is to de-
Whether designed or emergent, patterns capture effective engage- velop a framework that conceptualizes AE as a microfoundation for value
ment processes that achieve the kind of effects that participating actors co-creation within a service ecosystem, and to use this framework to
are expecting. Over time it is likely that certain patterns will be more ef- identify research issues. The multi-level research approach combines
fective than others. Hence, it can be argued that the patterns can be an- top-down theorizing framed by macro constructs of SDL, with bottom-
alyzed by building on configuration theory (Meyer, Tsui, and Hinings, up theorizing based on the microfoundation of AE.
1993; Miller, 1996; Vorhies and Morgan, 2003). Hence, elements of A microfoundational approach is fundamentally a question of choos-
the four categories – actors, platforms, actor dispositions and engage- ing a lower analytical level. Using the logic of Coleman's (1990) bathtub,
ment properties – interact if the value of one element depends on the albeit adding a meso level of analysis and combining this with Hedström
presence of another element. They reinforce each other if the value of and Swedberg's (1998) typology of social mechanisms, the situational,
one element is increased by the presence of another element, and action-formation, and transformational mechanisms related to AE are
they are independent if the value of an element is independent of the elaborated. Five areas for further research are identified: the engaging
presence of another element (Siggelkow, 2002). Equifinality of configu- actor, engagement platforms, actor disposition, engagement properties
rations indicates that several configurations may be equally effective and resource integration patterns. Based on a broad literature review
(Doty, Glick, and Huber, 1993), as long as the elements reinforce each and logical argumentation a number of research issues are documented,
K. Storbacka et al. / Journal of Business Research 69 (2016) 3008–3017 3015

which are summarized in Table 1. The research issues are broad and in- co-creation. The effectiveness of patterns is likely to vary between con-
tegrative in scope and do not relate directly to any specific research con- texts, indicating the need for a deeper understanding of the relationship
texts. It is, however, beyond the scope of this paper to develop specific between potentially generic patterns and the service ecosystem under
research questions around the research issues. analysis. The research suggests that actor engagement may lead to
In addition to the identified research issues, the paper makes four both homeopathic (summative) and heteropathic (emergent) resource
particular contributions to SDL and especially to the literature on cus- integration patterns (Peters, this issue). As actors engage in resource in-
tomer engagement. First, it explicates and expands the notion of an tegrating activities the outcomes on a macro level cannot be fully de-
‘actor’ by deliberately looking beyond humans or collections of humans signed, planned or controlled. Heteropathic resource integration
as actors. Actors are defined as humans, machines/technologies and generates new and sometimes surprising properties (e.g., entities,
various collections of humans and machines/technologies, including or- structures, concepts, qualities, capacities) in the service ecosystem.
ganizations. The diversity of actors means that there will also be diver- Thus heteropathic resource integration can be viewed as a mechanism
sity in the ways actors offer value and seek value, and in how mutual for emergence, implying that not only is actor engagement a
value creation shapes an ecosystem. This expansion is very relevant as microfoundation for value co-creation, but it is also a microfoundation
increasingly we see technology-enabled engagement opportunities oc- for service ecosystem emergence. Hence, to understand service ecosys-
curring in many contexts. tem or market dynamics more research is needed related to actor
Second, the research expands the conceptual research on customer engagement.
engagement (Brodie, Hollebeek, et al., 2011; Chandler and Lusch,
2015; Van Doorn et al., 2010) to create a deeper understanding of the 6.2. Implications for managerial practice
nature of the interface between generic actors in a service ecosystem.
In doing so, it suggests fundamental changes in the discussion on en- The findings of our paper contain important suggestions for practi-
gagement. With the expanded view of actors, the conception of disposi- tioners. First, it provides guidance for a focal firm wanting to design
tions to engage needs to be extended beyond the psychological and co-creation strategies, by delineating the elements of resource integra-
emotional state of humans to cover increasingly autonomous technolo- tion patterns that can be influenced. Some of these elements are more
gies with conditioned agency. Consequently, actor disposition is defined likely to be designable. It is, for instance, likely that engagement
as a capacity of an actor to appropriate, reproduce, or potentially inno- platforms can be designed to incentivize certain actors to contribute
vate upon connections in the current time and place, in response to a their resources and enable service-for-service exchange. Moreover, un-
specific past and/or toward a specific future. Furthermore, the discus- derstanding the dispositions of actors will enable firms to plan for en-
sion on engagement needs to cover not only the dispositions to engage gagement properties that support their design goals. A particularly
but also the engagement properties, defined as observable engagement important field for exploration is to systematically gather data about
activities. Subsequently, actor engagement is re-conceptualized as both all of the elements of engagement patterns. This data would form the
the disposition of actors to engage, and the activity of engaging in an in- input for more advanced analytics aimed at finding effective patterns
teractive process of resource integration within the institutional context which may enable firms to move from predictive modeling to prescrip-
provided by a service ecosystem. tive modeling and inform managerial decision-making toward higher
Third, this research is one of the first within SDL that defines an en- value creation (Davenport, 2013).
gagement platform: a multi-sided intermediary that actors leverage to Second, the fast pace of digitalization is driving innovation of novel
integrate resources. This definition aims at highlighting the difference forms of engagement involving increasingly smart machines. Advances
between an actor and a platform: platforms are passive intermediaries, in autonomous technologies provide interesting prospects for substitut-
whereas actors (by definition) are active and have dispositions to en- ing human-based interaction with machine-to-machine interaction or
gage. Engagement platforms do not modify or enhance the resources more customized and contextual forms of human-to-machine interac-
to be integrated during the AE — they bring actors and their resources tions. It is paramount for managers to embrace these opportunities
together. A platform that takes an active stance needs – based on our and explore the ways to use them for enhanced value creation.
definitions above – to be viewed as an actor that engages in resource in- Third, we suggest that managers need to focus more on understand-
tegration. Most research on platforms, with the exception of Frow et al. ing the new dynamics of markets. As discussed in the paper, service eco-
(2015), does not provide clear definitions of what an engagement plat- systems are partly designed and partly emergent. Hence, market
form is, and typically describes them as being both intermediaries and development cannot be ‘designed’ by a focal actor — all design efforts
mediators, using Latour's (2005) definition (see, e.g., Ramaswamy and must allow for emergence. Viewing markets as plastic (Nenonen et al.,
Ozcan, 2015). 2014) highlights the role of non-predictive strategy (Wiltbank, Dew,
Finally, the resource integrations patterns, which we define as dis- Read, and Sarasvathy, 2006), which gives less attention to planning
tinct combinations of actors, engagement platforms, actor dispositions while emphasizing experimentation and learning. Based on the re-
and engagement properties, provide the fundamental structure for a search presented in this paper, heteropathic resource integration pat-
focal firm wanting to better understand and manage effective value terns are the mechanisms that explain and drive emergence. Thus,

Table 1
Research issues: actor engagement as a microfoundation of value co-creation.

Engaging actor Engagement platform Actor disposition Engagement Resource integration


property pattern

Definition Humans, machines/technologies A multi-sided intermediary A capacity of an actor to appropriate, Observable engagement A distinct combination of
and various collections of that actors leverage to reproduce, or potentially innovate activity actors, engagement
humans and engage with other actors to upon connections in the current time platforms, actor dispositions
machines/technologies, integrate resources and place, in response to a specific and engagement properties
including organizations past and/or toward a specific future
Research • Volume and variety of actors • Platform modality • Disposition of machine actors • Co-production vs. • Evaluation of effective
issues • Actor combinations • Roles of platforms vs. • Actor intentionality value-in-use activities patterns
• Machines/technologies as actors • Disposition vs. Engagement • Relational properties • Trade-offs between
actors • Platforms and properties • Informational properties patterns
engagement-related • Engagement practices • Temporal properties • Generic patterns
network effects • Choreography of patterns
3016 K. Storbacka et al. / Journal of Business Research 69 (2016) 3008–3017

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