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Less attention has been paid, however, to which firms and especially which services firms collaborate for innovation with universities and benefit from such collaboration. Using data from an original survey, this paper explores what determines whether knowledge-intensive business services KIBS firms collaborate with universities and whether they consider this collaboration highly important for innovation.

We explore the relation between the knowledge base of KIBS firms and innovation collaboration with universities.

We find that KIBS firms providing highly unique services, which share a similarity in their approach to value creation with universities, consider them highly important for their innovation. Also, we find that technology-related KIBS firms, which share a high level of similarity in skill base with universities, both collaborate for innovation with universities and consider them highly important for their innovation. Managers and policymakers need to take into account the role of the knowledge base of KIBS firms, and thus formulate more tailored strategies to foster knowledge flows from university to industry effectively.

Published online 30 November Published in print 1 August However, users may print, download, or email articles for individual use. Hsing-Fen Lee Middlesex U. This body of literature has also helped to identify the key characteristics and types of KIBS. Moreover, informal conversations with KIBS professionals show that these activities are often approached in an ad hoc manner.

Yet, given the importance of KIBS, taking a more systematic approach to their design and management could improve the contribution of knowledge-intensive business service activities to our economy. This article proposes a framework for the design and management of KIBS engagements. It consists of a set of information to be gathered and questions to be asked by professionals responsible for establishing, monitoring, and managing KIBS engagements.

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Using this framework could help to establish more successful collaborations among KIBS providers, clients, and partners; it should also help to monitor the performance of a given KIBS engagement in terms of its collaborative processes, deliverables, and outcomes from the varied perspectives of participating parties. Although the framework accounts for these different and sometimes conflicting perspectives, it is intended to be used by KIBS provider firms whose success depends at least in part from their ability to manage collaborative relationships.

As the introductory quotation shows, Adam Smith distinguished between two types of values: value-in-exchange and value-in-use. Crudely, the former means the price one puts on a good being sold in the marketplace, whereas the latter refers to the perceived value of that good product or service as it is being used by someone in a given context and for a given purpose. These arguments do not rely on a perceived inherent difference between the nature of goods and services; rather, they are proposed as a new understanding of how our modern economies have functioned all along.

From this perspective, the rise of the service economy simply emphasizes the weaknesses in industrial-era theories of value. The concept of value co-creation is drawn from that of value-in-use; it states that value is always collaboratively created by interdependent actors in the market providers, clients, partners, etc.

At the core of this understanding is the view that value is not "added" by the producer, ready to be consumed by customers, but rather created collaboratively among actors Ramirez, A number of approaches for the design and management of service activities rely on the concept of value co-creation. However, these propositions are often based on illustrative or real-life examples of retail or otherwise business-to-customer B2C services e. Other propositions claim to be applicable to any type of business-to-business B2B service, without considering differences between, say, professional cleaning services and management consulting e.

Yet, one can identify varied service contexts Glushko, and levels of design and management e. Although these approaches can be very useful for transactional service interactions or those with limited collaboration, they do not address important characteristics of highly collaborative, organization-to-organization service engagements. Indeed, in this type of context, the boundary between front-end and back-end activities becomes blurred as actors across organizations jointly define and produce the service to be delivered.

Moreover, in particular when the deliverable requires complementary areas of expertise, relationships are not established in a dyadic manner provider and client , but in the form of a network: provider s , client s , third-party actor s , funding or regulatory organization s , etc.

These relationships are then typically organized as medium- or long-term projects, or as more stable engagements such as alliances. Organizing the moments and activities in which network actors interact in this type of context can facilitate resource and information sharing; however, a more strategic, inter-organizational perspective is needed for the initial establishment of these relationships and their monitoring from the perspective of all involved parties.

The type of highly collaborative, organization-to-organization service engagements described above are core to the service sector known as knowledge-intensive business services KIBS. KIBS have characteristics that distinguish them from other B2B services: they are knowledge-intensive in the sense that they rely on expert employees or provide knowledge-based solutions to their clients; clients are typically involved in the co-production of these solutions; and provider-client exchanges tend to be of a relational rather than transactional nature Bettencourt et al.

This body of literature often investigates the KIBS sector at the regional or national level, helping us to understand their importance in fostering innovation in industrialized economies. Firm-level studies of KIBS have also emphasized the importance of employees and clients in the co-production of knowledge-based service solutions Bettencourt et al. Issues of knowledge management have been a key focus at that level. The competencies needed by KIBS providers to successfully process such knowledge thus extend beyond the mere transfer of knowledge to their client; they encompass the ability to transform knowledge from tacit to codified and back, to generalize from customer cases and apply locally from previous generalized knowledge, as well as to associate varied types of knowledge or dissociate needed dimensions Gallouj, Despite these studies, however, much work remains to be done to support the design of KIBS at the inter- organizational level, thus to support the creation of successful KIBS engagements.

From this perspective, knowledge is given particular importance as a key operant r esource i. As such, the concept of value co-creation is in line with the core characteristics of KIBS. Yet, the way in which value co-creation actually happens in KIBS has not been extensively investigated as a basis for improving the management and design of that specific type of service. It is important to account for the particular context of KIBS because value co-creation processes, enablers, and inhibitors in the context of KIBS differ from those found in transactional services or those where collaboration is superficial Sarker et al.

This research addresses the conceptual gap between what we know about value co-creation and what we know about KIBS in current economies by presenting a framework derived from the understanding of value co-creation processes in the specific context of KIBS engagements. Indeed, the first case can be categorized as a T-KIBS because it concerned the development of a virtual computer environment for a municipality, whereas the second case falls into the P-KIBS category because it concerned the creation of a new curriculum for health care aides.

The study was guided by key concepts of value co-creation identified in extant literature, but refined their understanding by identifying causal processes of value co-creation from data.

The framework for the design and management of KIBS engagements presented in the following section was derived from the results of this research. Specifically, this research followed the explanation-building strategy of case study research, where tentative hypotheses generated from data in a single case can are revised through their application to successive cases Yin, In each case study, key stakeholders in the provider and client organizations were interviewed; meetings were also observed and project documentation was reviewed.

Data were first coded using inductive grounded theory coding procedures Charmaz, These categories, representing mechanisms of value co-creation processes, were then related into a conceptual framework of value co-creation, the first part of the design framework. This step was achieved through the identification of the properties of each category i. In order to guide the analysis of future KIBS engagements, the second part of the design framework focuses on the relationship between each pair of components, and between each causal process, to identify the design-oriented questions that this relationship suggested.

In other words, given the way in which mechanisms and overall processes are related, which questions should be asked in order to successfully design relationships for KIBS engagements? The framework is composed of two dimensions: descriptive and analytical. The descriptive dimension concerns the individual mechanisms that make the value co-creation processes evolve: developing high-level interests, perceiving benefits, creating value propositions, organizing resources, articulating deliverables, and valuing. These mechanisms become elements about which information needs be gathered by a KIBS professional wanting to establish, monitor, or improve a new or existing KIBS engagement.

The analytical dimension concerns the relationships between each pair of mechanisms e. This dimension consists of a series of questions to be asked about the engagement, whose answers should be derived from the information previously gathered. Moreover, two key processes of value co-creation were identified through the study: aligning and integrating. The process of aligning connects the direct mechanisms developing high-level interests , perceiving benefits , creating value propositions , organizing resources , and articulating deliverables.


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All of these individual mechanisms need to be aligned in order for actors to commit to a service engagement. Each individual mechanism is itself a process, but what is key to value co-creation is how each one aligns with the others. A breakdown in any individual mechanism can cause a breakdown in the overall process of aligning. As, for example, actors realize that more resources are needed, or change their high-level interests, or give greater or lesser importance to the benefits they perceive, the alignment between mechanisms needs to be re-negotiated or re-established.

Aligning is then a dynamic, continuous process throughout the service engagement. Commitment needs to happen for a service engagement to truly begin, but it frequently needs to be re-affirmed during the engagement as situations and actors change. The process of integrating connects the individual mechanisms of developing high-level interests , perceiving benefits , articulating deliverables , valuing , and organizing resources.

In an ideal scenario, these mechanisms are linked in a way that leads to a positive determination of value by actors. Moreover, integration is not a monolithic process. Each actor integrates only aspects of deliverables and outcomes that are perceived to be of interest. In some cases, it may be the outcomes of the engagement process — for example stronger relationships — rather than deliverables that are integrated. If the importance of these outcomes is high enough for the actor, it may still result in the perception that value has been created through the service engagement.

Table 1 summarizes the elements about which information should be gathered in relation to each process. As stated in the table, information needs to be gathered about each actor taking part in the engagement. Indeed, the KIBS providers in the cases studied typically focused on issues of alignment with their client, sometimes at the expense of other actors such as third-party collaborators; this approach reduced commitments in time and other resources that negatively impacted deliverables and outcomes.

Table 2 shows the questions that should be asked to increase alignment and support integration. The lack of explicitly defined and agreed-upon indicators was another typical issue in the cases studied, leading to sometimes surprising and often lower perceptions of value by clients than anticipated. These findings are supported by other empirical research on the same topic.

Knowledge Management Strategies

The information to gather and the questions to ask about resources to organize should be understood as encompassing both operant e. However, the framework proposed in this research lies at the strategic level of establishing and monitoring KIBS engagements, not at the level of daily knowledge-management activities. Using this framework at the onset of an engagement could help KIBS professionals to ensure the commitment of clients and partners, and to put in place the elements needed for them to derive value from the engagement.

The framework can also be used during an engagement to monitor the situation and take corrective actions if needed. Indeed, ensuring that each party comes out of an engagement with a positive perception of the value hence created is important not only for that particular engagement, but for their long-term willingness to collaborate.

This article has described a practical framework for KIBS professionals, tailored to their particular concerns. Indeed, it focuses on the processes and outcomes of value co-creation that are paramount to successful long-term relationships with clients and partners. As such, it is squarely aimed at addressing KIBS characteristics rather than transactional services or those leading to a superficial type of collaboration among parties.

Moreover, this framework can help to establish and manage KIBS engagements in a more systematic and comprehensive manner than what is typically being done in KIBS contexts. Finally, it focuses on the strategic dimension of relationships i. It can thus be used as a complement to process-based approaches such as service blueprinting Bitner et al.

Current research is underway to integrate the results of all existing empirical studies on value co-creation in KIBS engagement in order to strengthen and refine the framework presented in this article, as well as to broaden its scope of applicability. Another fruitful avenue for research would focus on the development of computer-supported tools to help gather and analyze information relevant to value co-creation and to visualize the results of analysis.

Finally, further research should further investigate the interplay between value co-creation processes and knowledge-management processes in KIBS. Bettencourt, L. California Management Review , 44 4 : Bitner, M. California Management Review , 50 3 : Bullinger, H. International Journal of Production Economics , 85 3 : Charmaz, K. Thousand Oaks, CA: Sage. Chesbrough, H.

Which Knowledge-Intensive Business Services Firms Collaborate for Innovation with Universities?

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