A social exchange theory perspective on efficacy, co-creation and successful new service development

PurposeThe aim of this study is to examine the relationships among hotel employees' creative self-efficacy, co-creation and new service development moderated by collective efficacy in the context of social exchange theory (SET).Design/methodology/approachData were collected by using questionnaire from the frontline employees working in hotels in Pakistan. A total of 220 employees participated in the survey. Structural equation modeling has been used.FindingsResults show that employees' creative self-efficacy enhances co-creation and helps in new services development. Moreover, collective efficacy moderates the relationship between individual employees' creative self-efficacy and co-creation.Practical implicationsHotel managers should focus on building employees' self-efficacy beliefs to enhance their motivation and performance in new service development. Moreover, they should establish platforms for co-creation with customers, involving them in idea generation, feedback and testing, to ensure new services meet customer needs and increase their adoption.Originality/valueEarlier literature has examined the co-creation and new service development from various perspectives, largely ignoring the social exchange theory. This is the pioneering study that examines these relationships through the lens of social exchange theory. Moreover, most of the literature has analyzed the co-creation separately, i.e. either employees' co-creation or customers' co-creation. To understand the phenomenon of co-creation in depth it is believed that co-creation should be analyzed from both these aspects. Therefore, this study examined this phenomenon by including employees' as well as customers' co-creation for better understanding. Moreover, the group influence is examined in explaining the new service development through collective efficacy. Therefore, this study is unique in explaining the co-creation and new service development from various angles.