Effect of Customer Participation on Service Outcomes: The Moderating Role of Participation Readiness

Prior empirical evidence on the role of customer participation (CP) on service outcomes is limited and inconsistent. The authors add new insights by investigating the boundary conditions of the CP-service outcome link. Using two experiments, the article examines the moderating effect of three CP readiness factors: ability, perceived benefits of participation, and role identification. The results show that when CP readiness is high, increasing CP enhances service outcomes including customer satisfaction and perceived service quality; however, when CP readiness is low, the effect of CP on service outcomes tapers off or becomes negative. The results highlight the contingent nature of CP's effect, demonstrate that CP could indeed be a double-edged sword, and provide managerial guidelines to enhance CP's benefits through appropriate targeting and service design.