International Journal of Hospitality Management 32 (2013) 11–20

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International Journal of Hospitality Management

journal homepage: www.elsevier.com/locate/ijhosman

Co-production versus co-creation: A process based continuum in the hotel

service context
Prakash Chathoth a , Levent Altinay b , Robert James Harrington c , Fevzi Okumus d , Eric S.W. Chan e,∗
a
Department of Marketing,School of Business and Management, American University of Sharjah, Sharjah, United Arab Emirates
b
Oxford School of Hospitality Management, Oxford Brookes University, Oxford OX3 OBP, United Kingdom
c
School of Human Environmental Sciences, University of Arkansas, Fayetteville, AR 72701, United States
d
Rosen College of Hospitality Management, University of Central Florida, 9907 Universal Boulevard, Orlando, FL 32819, United States
e
School of Hotel and Tourism Management, The Hong Kong Polytechnic University, Hung Hom, Hong Kong

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

Keywords: This paper reviews the theoretical underpinnings of co-production and co-creation and discusses these
Co-production service production approaches in a hotel context. Based on a synthesis of the literature, we present a co-
Co-creation production to co-creation matrix and offer several propositions: (1) the co-production versus co-creation
Experience
concepts create a continuum rather than a dichotomy; (2) service innovation and the customisation of
Strategy
service production are conceived as lying somewhere between co-production and cocreation on this
Service dominant logic
Hotels continuum; and (3) the key factors that define a typology of service production types (co-production, ser-
vice innovation, customisation, and co-creation) include the primary value-creation driver and customer
involvement/dialogue type. We further discuss the benefits for hotels of moving from co-production to
co-creation on this continuum. As one of the first papers to discuss co-creation in hospitality, it con-
tributes to the field by providing specific theoretical and practical implications for how hotel companies
can move from co-production to co-creation.
© 2013 Elsevier Ltd. All rights reserved.

1. Introduction built on a platform of simultaneous production and consump-

Hospitality organisations have realised that their future survival
and growth depend upon creating and offering unique and memo-
rable positive experiences for their customers (Walls et al., 2011).
Consumer expectations from a shopping trip, restaurant meal, or
hotel stay are continuously changing, and hospitality organisations
strive to anticipate and respond to these expectations. However, the
ability to anticipate such changing expectations so that organisa-
tions can create and offer unique service and product experiences is
a challenging task that requires a systematic and strategic approach
to cooperating closely with customers (Vargo et al., 2008).
There are two key approaches in the literature – co-production
and co-creation – which could be adopted by organisations in
their attempts to respond to customer expectations. Co-production,
which emphasises a firm-centric view of customer involvement
during service production, is informed by the traditional view
referred to as ‘goods-dominant logic’. It is defined as an exchange
of products and services between customers and firms which is
∗ Corresponding author. Tel.: +852 3400 2163; fax: +852 2362 9362.
E-mail addresses: pchathot@vt.edu (P. Chathoth), laltinay@brookes.ac.uk
(L. Altinay), rharring@uark.edu (R.J. Harrington), fokumus@mail.ucf.edu
(F. Okumus), hmeric@inet.polyu.edu.hk (E.S.W. Chan).
tion. Inherent in this definition is an excessive focus on the firm’s
value creation activities with customers playing a passive role
(Prahalad and Ramaswamy, 2004a,b). It must be noted that the
goods-dominant logic emphasizes a production-oriented philoso-
phy, in which the service plays a secondary role. The literature (e.g.,
Kristensson et al., 2008; Lusch et al., 2007; Vargo and Lusch, 2004)
points to co-production as having the following characteristics: (1)
the firm as the centre of value creation, (2) ignores the importance
of reciprocity between the firm and consumers, and (3) ignores the
potential for the mutual dependence of the firm and the consumer
in service production.
The alternative view, co-creation, is informed by service-
dominant logic (S-D) and is seen as fundamental to the study of
value creation in service transactions (Lusch et al., 2007; Prahalad
and Ramaswamy, 2004a,b; Spohrer and Maglio, 2008). This logic
has been built on the premise that service forms the foundation
of value creation through which customers are intensely engaged
in every stage of the value creation process. At the crux of the S-
D logic lies co-creation, which is defined as the joint production
of value for both customers and firms alike through an interac-
tive process. The emphasis is on joint effort and collaboration
between the producer and the consumer in value creation activ-
ities. Reciprocity and mutuality are essential; firms and consumers
play balanced and interdependent roles in service production and

0278-4319/$ – see front matter © 2013 Elsevier Ltd. All rights reserved.
doi:10.1016/j.ijhm.2012.03.009
12 P. Chathoth et al. / International Journal of Hospitality Management 32 (2013) 11–20
the creation of value (Vargo et al., 2008). The critical role in
this process is to engage in a dialogue with and learning from
the customers (Matthing et al., 2004; Normann, 2001; Yen et al.,
2004). However, such a reciprocal and mutually beneficial rela-
tionship is difficult to achieve, as it requires the integration of
the resources, interests and expectations of service providers and
beneficiaries.
The existing research on value creation emphasises the need to
adopt a service-dominant logic, so that innovative products and
services can be offered that help to create memorable consumer
experiences (Grönroos, 2008; Lusch et al., 2007; Matthing et al.,
2004). Although these studies contribute to our understanding of
how different organisational practices could facilitate co-creation,
they provide only a partial view of how a co-creation approach
can be applied to service firms and in the hospitality field with
the exception of Shaw et al. (2011). Shaw et al. (2011) make a dis-
tinct contribution to the literature by suggesting that hotels need
to implement co-creation strategies with customers in order to be
able to innovate new products/services. However, questions that
still remain unexplored are: How should hospitality firms approach
co-creation given that they are at the co-production end of the spec-
trum? Can they move along a continuum and become co-creation
oriented? What are the benefits of adopting the co-creation based
approach? These questions are particularly relevant in a hotel firm
setting given that the characteristics of products and service vary
from one product type (rooms) to the other (food & beverage and
events).
Given these questions, this paper attempts to extend the litera-
ture in the hospitality research domain and highlight the benefits to
hotel organisations of moving from co-production to co-creation.
Despite hospitality organisations giving strategic priority to creat-
ing and offering unique products and services over the last decade
(Walls et al., 2011), hospitality researchers have provided very
little in this area beyond understanding the expectations of dif-
ferent consumer groups by creating taxonomies of their service
experiences in general and in relation to particular hospitality
products and services (see Barsky and Nash, 2002; McIntosh and
Siggs, 2005; Oh et al., 2007). The customer-focused orientation
of hospitality firms has been largely based on the philosophy of
“adaptation of goods or products as if they were tailor made”,
which is contrary to the guiding principles of a co-creation based
approach, wherein “the process through which customers interact
with the company and generate their own experience” is at the
crux of the service orientation (Binkhorst and Den Dekker, 2009,
p. 313). Hence, there is a clear need to understand what are the
benefits for hotel organisations to adopt the S-D logic and move
to a reciprocal and mutually beneficial relationship through co-
creation. A few recent tourism studies have stressed the importance
of co-creation, but their primary focus has been on underscoring
the S-D logic in co-creating the visitor/tourism experience from a
holistic perspective (e.g., Binkhorst and Den Dekker, 2009; Shaw
et al., 2011). The adoption of a new service tradition means a
radical change for an organisation, involving the management of
dynamics both inside and outside the organisation, changes in
culture and philosophy, and the adaptation of organisational fac-
tors (e.g., leadership mindset, organisational structure, culture, and
communication processes) to changing circumstances (Okumus,
2003).
The paper will begin by reviewing the literature and analysing
the key themes/debates pertaining to co-creation. It then devel-
ops a process-based continuum which brings together the
co-production and co-creation frameworks to address specifically
how the service orientation in hotels could move along that con-
tinuum. Benefits in adopting co-creation in the hotel industry are
highlighted followed by conclusions and suggestions for practice
and further research.
2. Theory
2.1. The process of co-production
The term co-production has been used in the literature to reflect
the involvement of customers. The literature on service manage-
ment identifies “co-production” (Lovelock and Young, 1979; Mills,
1986) as an essential characteristic of a service firm. Scholars have
argued that customers and firms are involved in co-production
during the exchange mechanism (Bitner et al., 1997), and high-
light the simultaneous production and consumption characteristic
of services. In fact, co-production is used to refer to the “interactive
nature of services” (Yen et al., 2004). Yen et al. (2004, p. 9) point
out that “in service encounters characterised by high customer
participation (e.g., haircuts, medical consultations, education) cus-
tomers are usually physically present to receive the service and are
often called on to provide critical information that is necessary for
the effective delivery of the service”. However, researchers have
described this as a goods-dominant approach (Vargo and Lusch,
2006). Payne et al. (2008) refer to co-production as a firm-centric
view of customer involvement and provide five reasons why co-
production may not be appropriate: the emotional engagement
of customers through the advertising of services and products;
self-service in which customers benefit from labour input; cus-
tomers being part of the context in which the supplier offers a
service experience; customers self-selecting and using the pre-
scribed processes of the supplier; and suppliers and customers
collaborating and acting collectively to co-design products and ser-
vices.
These arguments are highly applicable to the hotel environ-
ment, which currently adopts a goods-dominant approach (Vargo
and Lusch, 2004) in which customers are essentially given very
little choice in defining the product/service elements of the bun-
dle. The producer predominantly predefines both the tangible and
intangible aspects of various product/service bundles within the
hotel service environment, before the customer becomes involved
in the process. Be it a pillow or a meal, the customer, for the most
part, is only a bystander in the production process even if the hotel
provides a variety, as in the case of pillow and food menus.
In an upmarket hotel, for instance, a customer is provided with
information pertaining to resources, defined a priori by the hotel
that can be used for customisation during the exchange process.
These resources, whether related to housekeeping, engineering,
food and beverages or concierge services, are clearly defined by the
hotel during the information sharing process. The customer then
chooses the best available option that comes closest to meeting
his/her need(s). Note that the customer would need to compro-
mise on the level of satisfaction derived from using a pillow if
a soft enough pillow is not available. The hotel provides pillows
on the bed and extra pillows in the closet for the guest to use.
In some respects, this could be regarded as signalling, as the firm
lets the customer know that the pillows available are of a given
type. If the customer is not satisfied with the pillow and he/she
assumes that what is provided represents the hotel’s ‘best avail-
able’ resources, the hotel loses the opportunity to find out about
the customer’s pillow-related idiosyncratic needs. When settling
for the ‘best available’ pillow that comes close to meeting his/her
needs, the customer may not provide complete information during
the exchange process. Even if such information were shared during
the exchange, it is not recorded because the pillow that was actu-
ally used by the customer becomes the proxy for the customer’s
pillow-related need (assuming that the hotel stores such informa-
tion in its database). Therefore, one may assume that such a priori
conceptualisation of service-related resources is not service orien-
tation per se; rather, it is an orientation that can be best described
as ‘suit your needs to what is available’.
 P. Chathoth et al. / International Journal of Hospitality Management 32 (2013) 11–20
Luxury hotels provide customers with customised products
and services. However, the level of service production may vary
depending on the level of sophistication that firms can achieve in
their service orientation. Note that the issue is not related to phys-
ical resources, i.e., the attributes of the tangible product, but to
certain customer-related idiosyncratic needs that are unmet during
co-production (i.e., these do not materialise during such interac-
tions due to the customer service orientation used by firms). Hence,
a number of specific questions arise.
• What are the key factors that define the difference between co-
production and co-creation approaches in a hotel setting?
• What are the benefits associated with these two approaches for
hotel organisations?
• Should these two approaches be conceived as dichotomous or on
a continuum?
These issues need to be addressed by researchers and practi-
tioners alike. Service providers may argue that these signals are
essential in getting the customer to conform to the standards of pro-
duction, given that information is a key input variable during this
process. Because firms’ resources are limited, as are the permuta-
tions and combinations of the available resources, firms could never
meet all the needs of all customers. Scholars have identified the
above process as a “firm-centric” view, with managers exhibiting
“product-centered thinking” (Prahalad and Ramaswamy, 2004b;
Vargo and Lusch, 2004, 2008a). The co-production approach offers
theoretical and practical implications. However, it tends to put
the firm at the centre of value creation and partly ignores the
importance of reciprocity between the firm and consumers and
their mutual dependence in service production. The co-creation
approach has been proposed to overcome some of the limitations
of the co-production approach.
2.2. The process of co-creation
In the service management literature, co-creation is described as
involving a high level of customer participation in customising the
product or service, which requires “collaboration with customers
for the purpose of innovation” (Kristensson et al., 2008, p. 475).
The co-creation process moves away from a firm-centric view of
customer orientation while emphasising customer interaction. The
contact between the customer and the firm is managed in such a
way as to encourage firms to co-create value with customers while
addressing customer-specific idiosyncratic needs.
Vargo and Lusch (2004, 2006, 2008b), using the S-D logic,
emphasise the importance of engaging the customer in a dialogue
during the co-creation process, which Ballantyne (2004) refers to
as a learning process. This approach underscores the importance of
the exchange process between firms and customers, with customer
experience as the primary focus, and value as a by-product of this
experience. Co-creation goes beyond the customisation of products
and services to meet customer needs: “The difference between ‘co-
creation’ and ‘customisation’ lies in the degree of involvement of
the customer; in general terms, the customer plays a less active
role in customisation than in co-creation” (Kristensson et al., 2008,
p. 475). It should be noted that the experiential component of the
product is essential for its actual value to be realised (Vargo and
Lusch, 2004). By this we mean that the customer’s engagement (and
experience) during the design/consumption process is an essential
component for the product’s actual value to be realised.
The involvement of the customer during co-creation is largely
related to the sharing of consumption experiences, which provides
a source of information for the firm to “reorganise its current port-
folio of products and services” (Kristensson et al., 2008, p. 476). Note
that value creation in customisation occurs during the production
13
process, whereas in co-creation it happens during the “consump-
tion, usage process” (Kristensson et al., 2008; Lusch et al., 2007;
Michel et al., 2008). Involving the customer can lead to the trans-
formation of the customer from a passive to an active partner. The
emphasis is on indulging in a dialogue with customers, rather than
just listening to them while using them as a productive resource
during the co-creation process (Plé and Cáceres, 2010).
Should co-creation be controlled by the service provider or by
the customer, or should it be a joint process? Friesen (2001) sug-
gests that neither the customer nor the service provider has control
of the co-creation process, but “they must cooperate to dialogue
successfully” (p. 30). He points out that active cooperation between
customers and firms is a difficult proposition due to the “diver-
gent goals of customers and companies. Customers typically seek
to minimise price paid; companies to maximise profits realised.”
Friesen (2001) further asserts that “co-creation calls for a win-win
dynamic” (p. 30) and firms should build trust in their relationship
with customers with an inclination towards sharing benefits with
customers instead of maximising them.
Identifying and meeting customer needs goes beyond providing
services that are defined a priori by the firm. This involves “co-
creation” (Prahalad and Ramaswamy, 2004a, p. 7), which enables
firms to create added value for the customer. An essential issue
in defining the co-creation of services is that providing the cus-
tomer with the leverage to participate or interact in the production
process is not co-creation. In such cases, according to Prahalad
and Ramaswamy (2004a, p. 8), “the firm is still in charge of the
overall orchestration of the experience.” In the example provided
previously pertaining to the pillow, co-creation constitutes how
the hotel is able to use customer-related information and experi-
ence in providing a pillow that meets customer-specific needs and
wants. This involves co-creation, which Prahalad and Ramaswamy
(2004a, p. 9) identify as the “unique value created” as it relates to the
customer’s “contextual experience” during the production of prod-
ucts/services. This is “dependent on the nature of involvement the
customer has had in co-creating value” with the service provider.
While defining the customer as a productive resource, these
scholars point out that, “in contributing information and effort in
the diagnosis of their ailments, patients of a healthcare organization
are part of the service production process”. Furthermore, they argue
that to create value during the exchange process . . . “What we need
to create is an experience environment within which individual
. . . consumers can create their own unique personalized experi-
ence”. In fact, “personalized co-creation reflects how the individual
chooses to interact with the experience environment that the firm
facilitates. It involves more than a company’s a la carte menu”
(Prahalad and Ramaswamy, 2004a, p. 10).
Friesen (2001) used the example of eBay to elucidate the co-
creation process, in which eBay’s contribution is the software and
process, and the seller’s contribution is the specific content. Like-
wise, security is co-created by both buyers and sellers through the
enforcement of a rating system that serves as a control mechanism
during co-creation. Note that there is involvement at both ends in
creating the experience environment, with customers playing an
active role in the process.
Based on Prahalad and Ramaswamy’s (2004a) conceptualisa-
tion, co-creation enables a firm to interact with the customer
to “co-shape” his/her expectations. The firm needs to have the
resources to fulfil the customer’s needs during the production-
delivery cycle. By doing so, “the consumer is being empowered
to co-construct a personalised experience around herself, with the
firm’s experience environment” (Prahalad and Ramaswamy, 2004a,
p. 12). The S-D logic supports this notion while emphasising the
decentralisation of “the power in controlling the brand and product
experience” (Collins and Murphy, 2009, p. 3). However, co-creation
does not mean that all customer needs will be met during the
14 P. Chathoth et al. / International Journal of Hospitality Management 32 (2013) 11–20
service delivery process. Although, providing the customer with
the opportunity to interact with the “experience environment of
the firm” (Prahalad and Ramaswamy, 2004a) is essential in creating
value. For this to happen, firms need to list the factors of production
– the materials, labour, and technology – to create transparency in
their product-service offerings and thereby allow customers the
opportunity to co-create. This concept is further exemplified in the
Nike example provided by Friesen (2001, p. 29). “When ordering
from nike.com, shoppers are given the option to type in up to eight
characters – initials or names – to be factory-stitched on to their
shoes.” Moreover, these shoes, which are co-created by the cus-
tomer and are therefore exclusive to them, are delivered to the
shopper’s doorstep, thereby creating unique value to the customer
(Friesen, 2001, p. 29).
There are two ways in which firms can collaborate with cus-
tomers in co-creation in the hotel context. The first pertains to
the value creation process “and leads to value-in-use” (Kristensson
et al., 2008, p. 476). For instance, Qbic Design Hotels offer rooms
of a futuristic style in which hotel guests can change the colour of
their room depending on their mood during the stay. The second
includes “shared inventiveness, co-design, or shared production”
(Lusch et al., 2007, p. 11). For instance, Starwood Hotels launched
their “virtual Aloft” in Second Life, in which visitors can visit the
virtual hotel and co-create the design of the real aloft in a virtual
setting. By getting the customers to co-create products and ser-
vices in “Second Life”, Starwood is able to use that information and
transfer it to their real-life Aloft brand, there by moving toward
experience co-creation.
Woodruff and Flint (2006) defined value-in-use as a “phe-
nomenological experience perceived by a customer interacting
with products/services bundles in use situations” (p. 185). This con-
ceptualisation fits well with customer value as per the literature
given that it entails customer related perceptions of value during
the co-creation of product/service bundles in a hotel setting. As per
Etgar (2006), “as the consumer is the one who consumes and thus
experiences the use, he or she participates in the performance of
the value creation activities. Drawing upon the case study materi-
als from their research on innovations, Shaw et al. (2011) illustrate
the changing nature of co-creation processes and the importance
of customer as the key contributor to co-creation. These processes
require certain types of expertise and different forms of input from
the consumers including expertise, control, cultural and physical
capital, experiential and economic benefits and time. The diver-
sity of expertise and different forms of input leads to differences
taken by different hotel firms to the management of co-creation
and innovation processes. Therefore, the S-D logic suggests that
production and consumption are not two separate activities but
one continuous whole, and consumers are not recipients of a com-
pleted output but are involved in the whole value creation process”
(p. 128). It emerges from the above discussion that in a hotel service
environment, the production process needs be integrated with the
consumption process in dealing with customer related needs and
desires. The focus, therefore, should be on how the resources are
put to productive use to meet the product-service requirements of
the customers (Hunt, 2000; Vargo and Lusch, 2004).
3. Towards a co-production–co-creation continuum
3.1. Co-production versus co-creation
The earlier sections on co-production and co-creation have
outlined many of the key differences between these approaches.
Table 1 synthesises several key factors that separate co-production
from co-creation. Whilst the distinctions are made between co-
production and co-creation in order to highlight the underlying
principles of each approach separately, it is worthwhile to state that
in much of the literature they are seen as interrelated phenomenon
and less of distinctive processes.
(1) Co-production means that the customer participates in creat-
ing the core offering itself through shared inventiveness and
co-design, but co-creation is closely tied to usage, consump-
tion, value-in-use (i.e., value that occurs at the time of use,
consumption, or experience), and the premise that value can
be determined only by the customer (Lusch et al., 2007). For
instance, in the case of hotels, customers would be able to pro-
vide their inputs on what goes into a minibar in the room (as
opposed to the standardised minibar provided by most hotels)
and the type of bed and pillow (soft, medium or hard) they pre-
fer. Co-creation is about the process through which customers
interact with the company and generate their own experi-
ence, which is the basis for value and the future of innovation
(Prahalad and Ramaswamy, 2004a,b). It creates a unique per-
sonalised experience. In fact, Ter Borg (2003) argues that the
experience of co-creation itself can be a source of unique value
for each individual.
(2) In co-production, the role of the customer is relatively pas-
sive. For instance, hotel customers can assist the company
in the service-provision process via self-service (e.g., through
auto check-in machines), and by assisting the hotel front desk
employees in the administration of departure by returning a
completed express check-out form. These processes rely mainly
on the physical environment that is provided by the hotel. In
co-creation, customers are regarded as active partners in the
production process (Prahalad and Ramaswamy, 2000; Wind
and Rangaswamy, 2001). That is, customers have shifted their
role from being receivers of services and products to being co-
creators. In fact, some researchers have identified the notion
of the customer as an active rather than a passive recipient of
service (Payne et al., 2008; Xie et al., 2008). From the supplier’s
point of view, the role that the customer plays in the process
can be an important source of competitive advantage in terms
of the customer’s contribution as an operant resource (Vargo
and Lusch, 2008a).
(3) In co-production, in which the traditional customer’s participa-
tion is usually evident in the development of a firm’s product,
the key actors are the firm’s managers and employees, as the
tangible output (product) can be manufactured, standardised
and inventoried without the involvement of the customer. In
co-creation, however, customers play a more important role
in both the creation and the provision of a service, which
increases the benefit (value) to the customer (Prahalad and
Ramaswamy, 2000). As mentioned earlier, this customer role
can be an important source of competitive advantage; the cus-
tomer’s contribution serves as an operant resource defined as
people’s knowledge, skills, expertise, capacity, and time (Vargo
and Lusch, 2008a). In service industries, such as the hotel
industry, the production phase cannot be disconnected from
consumption activity (Lovelock and Wirtz, 2004). Thus, the role
of the customer in both co-production and co-creation is very
important, as it is impossible for a hotel to deliver a service to
a customer without his/her active participation.
(4) Co-production is firm-centric, whereas co-creation is
customer- and experience-centric. In co-production, the
service process is mainly triggered by a company’s own set of
resources and competencies. However, in co-creation, compa-
nies no longer portray their customers as mere purchasers of
products, but as partners in creating personalised experiences
that add value and pleasure to their daily lives. Their focus is
on the customer context and matching with the individual’s
 P. Chathoth et al. / International Journal of Hospitality Management 32 (2013) 11–20
Table 1
Comparing co-production with co-creation.
Co-production
(1) Value creation Extraction of economic value
Quality products and services
(2) Customers’ role Passive (rely on the physical environment provided)
Perceived as a resource
(3) Customers’ participation Mainly at the end of the value chain
Customers’ expectations Suit their needs to what is available
Key actors Managers and employees
(4) Focus Production and company centric
(5) Innovation Led by the firm
(6) Communication Listening to customers
Less transparent
Source: Dellande et al. (2004), Friesen (2001), Grönroos (2008), Lusch and Vargo (2006), Payne et al. (2008), Prahalad and Ramaswamy (2004a,b), Vargo and Lusch (2008a),
Xie et al. (2008).
living environment. Customers integrate their own resources
into the service process to make it complete.
(5) Firms generate innovation in co-production, whereas co-
creation suggests that customers and other stakeholders have
more control over the product, allowing them to “play” with a
company’s product through their imagination and creativity in
ways that were not intended by the product supplier. The oper-
ant resources from such people can help to generate new ideas
and knowledge in the value co-creation process. Sherry et al.
(2007) suggest that customers engage imaginatively, creatively
and constructively with the world around them, together with
the main co-creator of the consumption experience. Their role
as opinion leaders and trendsetters can contribute to the suc-
cess of new products in terms of functional characteristics and
market access.
(6) In terms of communication, co-production is less transpar-
ent. Co-creation is built on constant and intensive dialogue
with customers, operators, service and content providers
and a variety of other partners. The service-dominant logic
argues that value-creating resources are not only limited to a
firm; customers, suppliers, government, community, and other
stakeholders can also contribute to the creation of value, thus
a more open communication is essential in the value creation
process.
(7) In co-production, some customer needs may not be met
because of the relatively low involvement of the customer
in the process. For instance, a hotel guest may or may not
decide to use the self check-in machine installed in a hotel
lobby. Thus, the value in use is not achieved. Co-creation also
faces challenges because customers frequently fail to optimise
their co-creative role despite the best efforts of some compa-
nies (Dellande et al., 2004). Customers’ unwillingness to share
information and content related to brands, products and ser-
vices can hinder the process of co-creation. However, it should
be noted that some customers may not prefer to share infor-
mation related to product-service consumption/experience. In
such instances, the customer’s choice of not sharing the infor-
mation is also an integral part of the co-creation process. It
should be noted that the availability of adequate communica-
tion in a multi-channel and multimedia perspective could also
influence the process. Advanced technology, the Internet, and
better customer education are some of the requirements for
enhancing the co-creative role of customers. For instance, the
15
Co-creation
Creation of unique personalized experiences
Active (provide input to service provider before, during, and after the service)
Information provider
Value creator
Repeated interactions and transactions across multiple channels
Serves as an operant resource
Co-create products and services with customers
Customers, managers and employees
Customer and experience centric
Engaging customers
High level of information processing
Co-innovate and co-design with customers
Learning from customers (opinion leaders and trendsetters) and the process
Ongoing dialogue with customers
Open and transparent communication
Internet is an ideal platform for soliciting users’ participation
in product innovation, people to obtain information, maintain
connections, develop relationships and eventually make a final
decision (Egger and Buhalis, 2008). For some people, the pro-
cess of researching and arranging holidays on the Internet is
already part of their experience (Litvin et al., 2008). The increas-
ing use of information technology is undoubtedly changing the
nature of customers’ input into the co-creation process in ways
that may influence their perception of the whole service expe-
rience. In addition, the co-creative role is likely to be further
enhanced by the increasing education of customers. In the co-
creation process, customers usually interact with one another
and with company employees to produce value. During the
process of collaboration and its contribution to the social and
cultural capital of the community, innovation may occur.
3.2. A co-production/co-creation matrix
Among the key differences between co-production and co-
creation are whether value creation is derived through a production
or consumption process (Kristensson et al., 2008; Payne et al.,
2008), whether the involvement and communication between the
firm and customer is predominantly firm- or customer-driven, and
whether that involvement/communication is sporadic or continu-
ous (Kristensson et al., 2008; Prahalad and Ramaswamy, 2004b).
Fig. 1 provides a matrix outlining these two key elements (value
creation and involvement/dialogue type) and the relationship to
co-production, customisation, service innovation and co-creation.
The value creation element relates to (1) participation by the con-
sumer in not only production but also the consumption stages, (2)
whether or not the role of customer context has been integrated,
and (3) the level that customer needs are met. The involvement
and dialogue type element relates to (1) whether or not innova-
tions are generated with on-going customer engagement, (2) the
passive or active role of the customer, and (3) the transparency of
communication as well as whether dialogue involves listening to
the customer, a sporadic dialogue or a continuous one.
Based on a review of the earlier literature, co-production and
co-creation are viewed as largely dichotomous approaches to
service production (Kristensson et al., 2008; Payne et al., 2008;
Prahalad and Ramaswamy, 2004b). However, we propose that
these service production approaches are on a continuum, with
co-production at one end and co-creation at the other. Service
16 P. Chathoth et al. / International Journal of Hospitality Management 32 (2013) 11–20
Customer-driven Co-creation
Customer-Firm:
Customisation Approach
Continuous
Involvement/Dialogue
Type
Firm-Customer:
Co-production Firm-driven
Sporadic
Approach Service Innovation
Production Consumption/
Process Usage
Process
Primary Value Creation
Fig. 1. Co-production to co-creation matrix.
production approaches, such as customisation and service inno-
vation, are proposed as being somewhere in the middle of this
continuum. Fig. 1 provides a representation of these four “ideal
types” of approaches to service production processes (i.e., co-
production, customisation, service innovation, and co-creation).
This study uses Doty et al.’s (1993) definition of a typology. The
term typology is used to describe a conceptually derived interre-
lated set of ideal types. An ideal type is “a theoretical construct
that can be used to represent a holistic configuration of organiza-
tional factors” (Doty et al., 1993, p. 1197). Further, the separation
of these ideal types is based on the two dimensions of value cre-
ation and involvement/dialogue type. These two dimensions are
also viewed as two continua in this study. The bottom portion
of the matrix in Fig. 1 is defined by the primary value creation
method and is a continuum ranging from predominately produc-
tion process-based value creation to predominately a consumption
or usage-based value creation. The left side of the matrix defines the
type of involvement and dialogue that the firm uses in the service
production process. Here again, this represents a continuum for the
involvement or dialogue type ranging from predominately sporadic
and firm-customer centric in nature to predominately continuous
and customer-firm centric.
For co-production and customer-derived customisation service
production, value creation is derived primarily through the pro-
duction process rather than the consumption process (Kristensson
et al., 2008; Michel et al., 2008). For firm-derived service innova-
tion and co-creation service production, value creation is derived
primarily through the consumption/usage process. The heart of
any service innovation process is the engagement of the customer
and allowing them to ‘play’ with the company’s product (Sherry
et al., 2007). The process of involving customers however requires
customers exploiting their certain types of skills as well as cul-
tural and physical capital (Shaw et al., 2011). Cultural capital here
refers to assets such as education and knowledge (acquired over a
period of time) that provide individuals (customers and employees)
the foundations of ‘social relation’ during the exchange mecha-
nism (including service system), (see Barker, 2004; Barrett, 1998;
Bourdieu, 1993). Shaw et al. (2011) illustrate the complexity of this
by drawing upon the examples of co-creation both with the IT sup-
plier (Apple) and co-creation with the consumer. When the case
study hotel company co-produced with Apple an in-room enter-
tainment system, in many instances it was regular customers who
primarily used the system because they possessed the necessary IT
skills and cultural capital.
This process also requires a greater focus on value-in-use for
both service innovation creation and co-creation. Whether this pro-
cess can be defined as firm-driven service innovation or co-creation
depends on the involvement/dialogue method. If the process is
defined by the firm as sporadic and intended to facilitate service
innovation, the final objective might be described as supplier value
creation (Payne et al., 2008), in which the emphasis is on engag-
ing the customer in an interactive process over a limited period
to allow for review and testing of potential service innovations.
In contrast, in the co-creation service production approach the
involvement/dialogue with customers is defined as continuous in
nature and the co-created innovation process focuses on customer-
derived and consumption-oriented value creation (Kristensson
et al., 2008).
The involvement/dialogue type also separates co-production
from customer-driven customisation service production. It has
been argued that the difference between co-creation and cus-
tomisation can be defined by the degree of customer involvement
(Kristensson et al., 2008), but our conceptualisation of a continuum
proposes that the degree of involvement differentiates whether
or not customisation lies closer to the co-production end or co-
creation end. The defining factor separating customisation and
co-creation is more accurately defined by whether value creation
is predominately based on the process of production or consump-
tion (Kristensson et al., 2008; Lusch et al., 2007). Therefore, the
key area separating co-production and customisation is the type
of involvement/dialogue. By definition, customer involvement and
dialogue in co-production utilises a firm-customer, sporadic pro-
cess. The term firm-customer is used to highlight the firm-centric
view of customer involvement during service production (Payne
et al., 2008). This is an extension of the co-production process
that includes customer involvement but from the firm’s perspec-
tive. Unlike the involvement/dialogue process that characterises
the co-creation process, this involvement/dialogue is determined
to a large extent by the firm and is likely to be intermittent rather
than continuous. For example, in a hotel service environment, the
firm defines a honeymoon package from what it determines as the
requirements that would meet the needs and wants of a honey-
moon couple based on previous transactions. While defining the
package, the hotel’s customisation of the product-service bundle
to suit a honeymoon couple would be based on such previous
exchanges with the market, leading to a firm centric approach to
customisation. As suggested by Kristensson et al. (2008), a contin-
uous and customer-centric involvement and dialogue is needed for
customisation to occur. The term customer-driven customisation is
used to highlight the customer-centric approach that is necessary
for customising services (Kristensson et al., 2008).
Fig. 1 provides a clearer view of the key areas of separation based
on a review of the literature. It also helps to clarify two intermediate
service production processes: firm-driven service innovation and
customer-driven customisation. Because co-production and firm-
driven service innovations are more firm-centric in nature, these
two service production approaches are more transaction based,
resulting in a predominately ‘best available’ concept. Conversely,
customer-driven customisation and co-creation appear to be more
customer-centric, and are therefore further along the continuum
based on increasing degrees of customer involvement, dialogue,
and consumption-derived value.
3.3. A process-based continuum for co-production/co-creation
A core proposition of our argument is that even though
the co-production, service innovation, customisation and co-
creation approaches have key differences, they should be viewed
 P. Chathoth et al. / International Journal of Hospitality Management 32 (2013) 11–20
conceptually as representing a continuum rather than being
dichotomous or mutually exclusive. Prior to discussing the ben-
efits of moving along this continuum, it is important to elaborate
on the key arguments that differentiate the co-creation approach
from the co-production approach, based on the literature.
Specifically, co-creation can be viewed from a process-based
value creation perspective that involves the “relationship between
the provider and the customer as a longitudinal, dynamic, interac-
tive set of experiences and activities performed by the provider and
the customer, within a context, using tools and practices that are
partly overt and deliberate, and partly based on routine and uncon-
scious behaviour” (Payne et al., 2008, p. 85). Payne et al. (2008)
provide three main components that are at the crux of the process-
based value creation framework that differentiates co-production
from co-creation: (1) customer value-creating processes, (2) sup-
plier value-creating processes, and (3) encounter processes.
Customer and supplier value-creation and processes include the
“processes, resources and practices” which customers and suppli-
ers use to manage their activities, whereas “encounter processes”
include “the processes and practices of interaction and exchange
that take place within customer and supplier relationships” (Payne
et al., 2008, p. 85).
3.3.1. Customer value creation
In a traditional service system, the customer is used as a resource
during co-production (Abramovici and Bancel-Charensol, 2004). As
Abramovici and Bancel-Charensol (2004, p. 57) pointed out, “the
customer participates in the production process, either because
he is himself subject to transformations stemming from the pro-
duction system (customer as target), or because he participates
in the execution of certain tasks (customer as a production sys-
tem resource).” The role of customers as partial employees is
attributable to factors such as knowledge and labour during service
production (Hsieh et al., 2004; Kelley et al., 1990). This primary role
of customers appears to be similar in the service innovation liter-
ature, based on models that have been developed for new service
development (Ottenbacher and Harrington, 2010) and new service
testing (Meiren and Burger, 2010).
Note that the literature identifies information sharing as an
integral part of participation (Bancel-Charensol, 1999; Ennew and
Binks, 1999). Because customer participation during co-production
is influenced by the actions and resources that are supplied by
the customer (Rodie and Kleine, 2000), the outcome of service
transactions is dependent on the customer’s participatory role
during service production. To this extent, Yen et al. (2004, p. 9)
suggest that “customers need to share information with service
providers in order to ensure that their service needs are met”. In
fact, Normann (2001) and Payne et al. (2008, p. 86) pointed out that
value co-creation by the customer is dependent on the “amount of
information, knowledge, skills, and other operant resources that
they can access and use”. The customer’s ability to engage in the
process is dependent on the availability and utilisation of relevant
resources. The S-D logic focuses more on the process of value cre-
ation than the product itself, thereby emphasising “value-in-use”.
Payne et al. (2008) further emphasised that the customer value cre-
ation process should not be viewed from an engineering standpoint,
but from the viewpoint of “dynamic, interactive, non-linear and
often unconscious processes” (p. 86). Attention should be paid to
the customer and the activities that he/she undertakes such that
“the supplier’s offering fits within the customer’s overall activities”
(p. 87).
The differences between co-production and co-creation may
appear relatively dichotomous in terms of customer value cre-
ation, but in reality a hotel’s approach to value creation may
lie at any point on a continuum, depending on a variety of fac-
tors. For instance, for a given hotel the firm provides a variety of
17
services with differing levels of customer value creation. The cus-
tomer value creation of the hotel room itself may be very limited
(i.e., selection from the best possible approach by the guest), but
other services, such as catered events, and concierge services may
provide much more in the form of customer value creation. These
services allow the engagement of the customer to a much higher
degree (for instance, while designing the menu and room arrange-
ments or while designing the elements of a local dining or theatre
experience). Therefore, the range of services that is provided and
the approach used by the firm create its conceptual location on the
co-production/co-creation continuum.
3.3.2. Supplier value creation
In the co-creation approach, the service provider’s focus is on
how to engage the customer in an interactive process of value cre-
ation. The objective is to create a holistic value-creation framework
in which co-creation opportunities are reviewed and tested (Payne
et al., 2008): “By starting with the customer’s processes, a supplier
can design its own processes to align with those of its customers” (p.
88). The fact that the interaction with suppliers varies based on the
product-service bundle in a hotel setting suggests that firms would
need to move along the continuum to ensure that the customer’s
needs are met. The engagement with suppliers will vary based on
what level of needs and wants of the customer are being met dur-
ing the production/consumption process. In some instances, there
is a high level of co-creation (e.g., a wedding – supplier involve-
ment is at the higher end). In other instances, such as a hotel stay,
the suppliers are not as much involved even though hotels could
customize the service attributes of the product-service bundle.
To this end, technological applications have provided firms with
a platform to engage with suppliers and customers alike. Accord-
ing to Payne et al. (2008), service providers need to constantly
seek opportunities to co-create with customers using technologi-
cal solutions. The emphasis should be on customer experiences and
processes so that effective organisational learning takes place dur-
ing the process. Information technology platforms should be used
as a support device, “with systems built around customer processes
and experiences rather than products” (p. 90). Therefore, in accor-
dance with this conception of supplier value creation, the ability of a
hotel firm to move along the co-production/co-creation continuum
is dependent on its ability to successfully integrate IT platforms in
ways that facilitate organisational learning to enhance customer
experiences and co-create services.
3.3.3. The encounter process
Payne et al. (2008) referred to the encounter process as “touch-
points” and “contacts”. For hotel firms, the key contact points are
likely to be those that are commonly referred to as ‘moments of
truth’ in hospitality settings. Three forms of encounters exist dur-
ing value creation – communication encounters, usage encounters,
and service encounters – which may be initiated by the customer,
the company, or both. Communication encounters relate to activi-
ties that connect with customers, whereas usage encounters refer
to “customer practices in using a product or service and include the
services which support such usage”. Service encounters “comprise
customer interactions with customer service personnel or service
applications (e.g., via a contact centre)” (p. 90).
The interaction between the organisation and the customer
during co-creation gives rise to certain questions about the pro-
cesses involved. These questions pertain to “who will be involved,
what’s the purpose of involvement, where does it occur, how much
involvement, and for how long” (Roser et al., 2009, pp. 16–17). The
first question pertains to the type of customer, whereas the sec-
ond relates to the specific purpose behind co-creation. The third
and fourth questions pertain to the place and level of involve-
ment respectively, and the fifth question relates to the duration of
18 P. Chathoth et al. / International Journal of Hospitality Management 32 (2013) 11–20
involvement, i.e., whether it is project based or for a longer period
of time. The answers to these questions help to determine the con-
ceptual placement on the proposed continuum. For instance, if the
duration of involvement by the customer is for a limited period, the
approach used and the placement may be more closely defined as
service innovation rather than co-creation.
Based on this analysis, for hotels using co-creation concepts
as a process or to move along the co-production/co-creation
continuum, value creation maximization is dependent on (1) cus-
tomer participation, (2) supplier-customer engagement to assess
customer processes and create an interactive process of value cre-
ation, and (3) establishing key communication, usage and service
encounter touchpoints. Therefore, the process at the co-production
end of the continuum might utilize the traditional hotel technique
of reviewing guest comment cards and reacting after the guest
encounter in traditional or innovative ways to address these spo-
radic customer communications in a production-type response to
create a “best fit” to future guest needs (i.e., Shaw et al., 2011).
Shaw et al. (2011) provide additional “co-creation” examples
that move along the continuum to firm-driven innovation and
customer-driven customisation. For instance, the creation of an
in-room entertainment system was co-produced by the hotel com-
pany working with the IT supplier (Apple). Elements of co-creation
took place to refine the system through an iterative trial and
error process with regular customers who held the required user
skills and consumer capital to facilitate the “co-created” entertain-
ment process. These user skills and consumer capital are important
customer characteristics to allow sufficient contributions by con-
sumers to the co-creation process (Lusch et al., 2007; Shaw et al.,
2011). While the entertainment system example demonstrates
active dialogue and supplier–consumer communication during the
innovation development and testing process, once completed, it
more accurately represents an example of firm-driven service
innovation based on the sporadic dialogue type and focus on
the consumption/usage nature of the process outcomes. In this
example, if the communication was devised to be continuous and
provisions for the entertainment system to be continuously refined
or adaptable to specific consumer likes or dislikes were in place, the
concept would fall within the co-creation process as defined by this
manuscript and supported to earlier studies using S-D logic (Payne
et al., 2008; Yen et al., 2004).
Other hotel examples such as multi-sensory dining experiences
and personalised hotel services based on individual guest histo-
ries, current guest stay interactions, and on-going feedback provide
strong potential for successful co-creation processes. While there
are many benefits of moving along the co-creation continuum, the
study by Shaw et al. (2011) points out the limitation of complete
co-creation where staff and management should be mindful of
maintaining elements of surprise that provide that ‘wow factor’
in hotel service experiences for the guest. These potential benefits
are discussed below.
3.4. Benefits of moving along the co-production/co-creation
continuum
Co-production and co-creation represent different ends of a
continuum. Lying somewhere between these ends are firm-driven
service innovation and customer-driven customisation. As hotel
firms move along the continuum from co-production to other ser-
vice production approaches, there appear to be several potential
benefits. These benefits are applicable not only to hotels, but also
to other types of service firms. First, the innovation literature iden-
tifies many benefits of engaging in the innovation process, whether
defined as new-to-the-world or incremental service innovations
(Griffin, 1997). In the hotel field, scholars have suggested that hotel
services represent a good exemplar of how firms can benefit from
service innovations. The hotel industry is described as a dynamic
environment in which consumers demand excellent service from
skilled personnel, functional facilities (e.g., computer systems), and
aesthetic facilities (e.g., the ambience of the hotel) (Ottenbacher
and Harrington, 2010). Based on the concept of moving along a con-
tinuum from service innovation, to customisation, to co-creation,
the service innovation location seems to be the point of entry for
hotels and other service firms to realise additional benefits. A key
reason for these benefits is that from a customer perspective, the
hotel market is made up of easily substitutable service offerings.
Movement towards the co-creation end of the continuum appears
likely to increase a hotel’s ability to differentiate itself in a compet-
itive environment (Victorino et al., 2005).
When discussing the benefits, it is important to note the rela-
tionship between these benefits and the resource-based view (RBV)
of implementing barriers to imitation and competitive advantage.
Although many traditional hotel resources (e.g., physical attributes)
for creating product-services are readily available in the market-
place, the outcomes or benefits associated with co-creation in
particular are likely to create barriers to imitation. Therefore, while
benefits proposed for the service production approaches of firm-
driven service innovation, customer-driven customisation and
co-creation are likely to be present at some level in co-production
approaches, the approaches moving towards co-creation and the
co-creation approach are likely to achieve heightened levels of
these barriers to imitation that ultimately are proposed to lead to
competitive advantage.
Further, two methods of creating these barriers relate directly
to the co-creation process: asymmetric information (Barney, 1991)
and causal ambiguity (Reed and DeFillippi, 1990). Asymmetric
information exists when competitors have difficulty in obtaining
information on areas of expertise in the marketplace. Such situ-
ations are considered barriers to imitation in the literature, but
they are minimised in practice due to high employee turnover, the
seemingly transparent nature of the service process and customers’
perceptions of readily substitutable offerings. Causal ambiguity
has similar properties to asymmetric information, but stems from
concepts such as tacitness, complexity and human asset speci-
ficity. Tacitness is defined as know-how that is achieved through
experience and a learning-by-doing approach. Complexity arises
from increases in the number and heterogeneity of technologies,
organisational routines and experiences in the organisational envi-
ronment. Human asset specificity is the specific deployment of
a firm’s resources to obtaining and developing human resources
with specific knowledge and capabilities. Therefore, all three of
these elements should create higher ambiguity in relationships
and ultimately heighten the barriers to imitation by industry com-
petitors. Given the intangible and process-related nature of hotel
services, it stands to reason that these concepts are particularly
important in heightening barriers to imitation in hotel operations.
These concepts from the management literature are reflected in the
services-marketing or service-centred dominant logic concept, in
which the focus is shifted toward an on-going exchange of knowl-
edge, skills and processes leading to co-creation with the consumer
(Vargo and Lusch, 2004, 2008b).
Melancon et al. (2010) provide support for the synergistic effects
of combinations of operant knowledge resources as a foundation for
developing a competitive advantage in service organisations. Their
findings support the dynamic capabilities approach that is inher-
ent in the RBV and more recently in the service-centric dominant
logic or co-creation concept. This concept is related to the basic
co-creation proposition that greater knowledge garnered before,
during and after the co-creation process will provide more adap-
tive competence to address the changing needs of customers (Lusch
et al., 2007). For instance, frontline employees in a hotel setting
are likely to achieve greater competencies in meeting customer
 P. Chathoth et al. / International Journal of Hospitality Management 32 (2013) 11–20
needs at the consumption stage. Higher levels of the hotel hierar-
chy are likely to achieve dynamic competencies that integrate this
new knowledge into coaching and mentoring skills, service inno-
vations, customer-driven customisation abilities, training efforts
and other service-oriented capabilities (e.g., Melancon et al., 2010;
Ottenbacher and Harrington, 2010).
These tacit capabilities are also likely to provide benefits from
the customers’ perspective. Melancon et al. (2010) found that the
synergistic conversion of knowledge (customer, firm and indus-
try) into value, following the service-centric concept, enables a
unique market position that enhances performance. As with other
service innovation situations, this enhanced performance is likely
to result in improved customer loyalty, sales of other hotel ser-
vices, increased customer satisfaction, unique positive experiences
and overall enhanced profitability (Ottenbacher and Harrington,
2010). Increased customer satisfaction and loyalty through co-
creation can lead to higher switching costs (including search costs),
as defined by Jackson (1985), and a lower likelihood of customers
switching service providers/brands (deduced from Bowen and
Chen, 2001, using the premise that switching is related to customer
satisfaction).
4. Conclusions
This paper has reviewed the literature and analysed the key
themes/debates pertaining to co-creation and co-production. Pre-
vious studies appear to treat these approaches to production as
two absolute philosophies without considering that a firm might
adopt an amalgamated approach. This paper suggests that there is
a continuum from co-production to co-creation. Firms may stand
anywhere on this continuum and could move between these two
ends, depending on the industry sector, the life-cycle of opera-
tions and the type of production – product versus service. More
importantly, there may be variations within a hotel organisation
regarding their co-creation orientation, depending on management
levels and functional levels. Furthermore, the paper summarises
the benefits to adopting co-creation and moving along the proposed
continuum in the hotel industry.
Of the conclusions that emerge from the foregoing discussion,
the most significant is that the co-creation end of the continuum
appears to be an antecedent of competitive advantage in today’s
dynamic world with changing consumer expectations and needs.
Firms will thus benefit if they move toward the co-creation end of
the continuum, which requires the adoption of an organisation-
wide, service-dominant philosophy. A key contribution of this
paper is the consideration of co-creation as a strategic perspective
for the hotel industry, which has not been the case for previous
research in the hospitality or co-creation literatures.
This paper has demonstrated that our understanding of co-
creation will remain partial if research continues to focus on
single aspects of management practice. Different organisational
strategies and practices, namely adopting a stronger market ori-
entation, leadership and the facilitation of organisational learning,
are inter-dependent; they act upon and influence each other in the
co-creation process and ultimately in the creation of value for con-
sumers. However, creating synergies between different activities
requires effective configuration and the management of organ-
isational resources, including human capital and competences.
Informed by the resource-based view, we have identified the key
competences and resources of a hospitality organisation – creation
of a service-oriented culture and mechanisms to facilitate organi-
sational learning – that could be exploited for value creation.
This paper has outlined the current state of knowledge in the
co-production and co-creation literature. However, it is in no way
exhaustive and points to various avenues for future research. First,
19
research should explore the process of co-production and co-
creation from a strategic perspective and evaluate the influence
of different organisational variables, including resource develop-
ment, leadership, learning and the strategic orientations of firms
(entrepreneurial, market and technology) on the process of co-
creation. Second, future research could empirically explore the
potential challenges and constraints associated with reorienting
hospitality organisations and intra-firm service offerings from co-
production to co-creation. This process would enable a cross-sector
analysis and offer interesting insights into the current state of
the hospitality industry in terms of the adoption of a service-
dominant logic. Third, future research could also explore how value
co-destruction occurs. Specifically, it should explore the effect of: (1)
failures in knowledge management and organisational learning, (2)
lack of leadership support and commitment to service co-creation,
and (3) lack of organisational competences and resources. Another
promising area for future research is the use of technology by hospi-
tality organisations in the co-creation of services. This appears to be
a key area given that technological advancements and a service effi-
ciency agenda require the adoption of technology for the efficient
production and delivery of services in the hospitality industry.
Acknowledgment
The authors would like to acknowledge the support of the Hong
Kong Polytechnic University (Project Reference: 1-ZV3T) and thank
the participating hotels for their input and feedback on this project.
The constructive comments of the anonymous reviewers are also
acknowledged with gratitude.
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