A customer-centric five actor model for sustainability and service innovation

Abstract

Service industries are increasingly unsustainable. Considering consumers as change agents, we show how service innovation may contribute to a service ecosystem that helps achieve emerging sustainability goals. To achieve sustainability the dyadic focus on value-co-creation is complemented with a broader stakeholder perspective, abandoning the shareholder-first-doctrine toward a collaborative stakeholder perspective, emphasizing profit, planet, and people. We propose a five-actor model and argue that one stakeholder - the consumer - is a central driver of sustainability. Consumers’ sustainability-focused behaviors drive the market for sustainable products and services, leading to sustainable firm and investor behavior. Beyond a conceptual model, our empirical study shows that innovations in social and environmental dimensions drive customer loyalty to the brands. Consumers aware of the consequences and risks associated with unsustainable consumption tend to consume more responsibly. Service firms integrating a stakeholder perspective into the design of their service systems perform better on the triple bottom line.