Jean-Paul Peronard* and Jacob Brix

Social Creativity in Service Networks:
A Conceptual Approach to Increased Value Creation

Jean-Paul Peronard* and Jacob Brix

Aarhus University,

Aarhus BSS,
Department of Business Development and Technology

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Birk Centerpark 15, DK-7400 Herning, Denmark

Phone: (+45) 87 16 47 00

*Corresponding author

Biographical notes:

Jean-Paul Peronard is an Associate Professor of Marketing and Business Innovation at Aarhus University, Denmark. His research interests are the cultural and social aspects of marketing and management, with a particular focus on culture, technology, and innovation. He has participated in several research projects on themes related to technology and innovation.

Jacob Brix isAssistant Professor of Innovation Management at Aarhus University. Heholds an industrial PhD in radical innovation management and a PhD in Business Communication.Jacob’s research encompasses the design and organization of the knowledge creation, diffusion, and depreciating processes that enable innovation to occur in established firms.

Abstract

We examinehow a creative environment can be designed and organized in a service network setting. The reason for delving into this line of research derives from the existing service network literature. Here scholars call for new theoretical perspectives concerning the creation of novel collaborative and value-generating initiatives. As response, we review the literature on social creativity and relate it to the service network literature. Our contribution is as follows: We establish that the creative capacity in a service network is dependent on four process factors: Temporality, inquisitivity, translation, and openness. We use the four process factors toconceptualize a framework that is prospected to enable business developers to design and organizefor social creativity in service networks. We assert that theproactive use of the framework can positively stimulate the creative settingin which service network actors seek to identify novel solutions or experiences for their customers. The purpose of the study is therefore to build theory on a systems level and not to test the theory in practice.

Keywords: Service Networks, Social Creativity, Business Development

INTRODUCTION

How can service network actors continuously create new collaborativeinitiatives that retain existing – and attract new customers?Multiple theoretical perspectives can be utilized to provide answers for such question.In this paperwe delve into the literature on social creativity to find inspiration. Our interest inthis particular theoreticallensstems from the research by e.g. Duysters, De Man and Wildeman (1999), Henneberg, Gruber Naudé(2012) and Tax et al., (2013). These scholars argue that service networksrepresent a unique type of inter-firm networkthat can benefit from the inclusion of social creativity in their search for creating new or better offerings to their customers. The arguments used by the scholars are essentially threefold. Increase in social creativity can lead to: 1) the creation of new market understandings, 2) the generation ofmore novel ideas, and 3) the identification of new service packages. According to Baruah and Paulus (2009) it is however not enough to introduce a concept such as creativity into a new contextual setting; we have to understand the new context and how to use social creativity in this context (see also Peronard and Brix, in press). We argue that the contextual setting of the service network is different from other types of collaborative networks, since one actor might not be aware that s/he is in a customer-perceived service network with another actor (Tax, McCutcheon Wilkinson, 2013). This means that not only is a joint business model to be created, it has to be done by identifying the firms being part of the service network and together with these firms define a common purpose and goal. Hence, the process of sharing customer and market information with the purpose of identifying novel opportunities is increasingly complex, since different types of knowledge are distributed among several network actors (Pinho et al., 2014; Morgan et al., 2007; Voss & Zomerdijk, 2007).Consequently, the purpose of this study is toconceptualize a theoretical framework based on social creativity that can assist service network members in strengthening the synergy between their businesses in the search of increased value and competitive advantage. To guide our study we seek to answer following process-related questions: What are the conditions that favor social creativity in service networks, how can these conditions be designed to stimulate a creative climate, and how can these conditions lead to the continuous business development for the service network members?

Our study of social creativity contributeswith three novel perspectives to the service network literature. First, we shift focus from individual-level creativity to system-level conditions. The system-level perspective is relevant since such a shift will help balancing not only the exchange behavior between network members as studied by Peronard and Brix (in press), but also the context in which the exchange behavior takes place. Second, our study focuses on the creative process and how the creative process can be supported;unlike the majority of the research conducted, we do not view creativity as a result of a process (see also Amabile, 1996; DeRue Rosso, 2009). Finally, our literature review determines that social creativity in a service network context is a process that is supported by four process-related factors: 1) openness, 2) inquisitivity, 3) temporality, and 4) translation.

Assumptions and limitations

We conceptualize the theoretical framework based on thee overall assumptions about organizations and network interactions. First, we assert that a service network is a social system constituted by the members perceived by the customers. Consequently, we study the conditions for social creativity and how the members of the social system can enable and stimulate collective creativity relevant for their defined purpose and goal in the service network. Hence, we adhere to Watson’s (2007) understanding of creative processes in social units,which reflects the idea that the collective of actors together constructs creativity. Our second assumption is that service networks can be regarded as horizontal, integrated organizations within the realm of both the public and private domain (see also Tax et al., 2013; Stewart, Lohoar Higgins, 2011). This means that there is no overall authority holding power over the collective. Instead, the governance structure is a result of the interaction between actors, which makes the service network equivalent to a loosely coupled system (e.g. Weick Orton, 1990; Peronard Brix (in press)). The third assumption concerns the unit of analysis and provides the foundation on which our framework is built. This paper adopts Drazin, Glynn and Kazanjian’s (1999) unit of analysis as the process of engagement in creative acts, which uses a sensemaking approach. This means that not the outcome but the continual attempt to participate in creative activity is the focus of this study. Consequently, in this approach, creativity unfolds on a system level,which has come to be associated with the social aspect of creativity (Montuori and Purser, 1997) and it is shaped by interpretation processes that represent something more – a shared cognitive map - than the sum of each individual interpretations. This suggests that meaning – embedded within the service network – is the result of convergence among actors’ interpretation rather than detectable through information exchange between and among the actors(e.g. Daft and Weick, 1984).

The study will proceed as follows. First, we clarify the context of a service network and the need for creativity to evolve and develop. Second, we review the literature on social creativityin order to identify the theoretical building blocks.Third, we conceptualize the social creativity framework by relating it to the service network context. Finally, we discuss the paper’s implications and direct attention towards future research.

LITERATURE REVIEW

Before we review the literature on service networks and social creativity,it is imperative that we explicitly define the two important constructs of the study.

Service network: A definition and clarification

Advances in service marketing place service networks– defined as “two or more organizations that, in the eyes of the customer, are responsible for the provision of a connected overall service experience” (Tax, McCutcheon Wilkinson, 2013, p. 455) – on the forefront of the service research agenda as a new and promising concept (Ostrom et al., 2010). With this customer-centric definition, it is clear that service networks may exist whether business managers welcome it or not. The choice facing managers of businesses in a service network is thus whether they want to respond well or poorly to customers. Or put more precisely, canmultiple service providers linkup to deliver complementary customer value through a creative constellation of their individual service offers (van Riel et al., 2013)?However, the definition together with the fact that research on service networks is still in its early stages (Morgan et al. 2007) leaves it rather unclear how exactly service providers can deriveadvantage fromcustomers’ desire for an extended service encounter (van Riel et al., 2013).While Tax et al. (2013) argue that identifying and coordinating the services needed to fulfill customer expectations are at the center of such endeavor, they do not account for how this is going to be operationalized. Arguably,rather than applying psychology of individual creativity, deliveringcustomer experiencethrough service constellation depends on activating the social creativity among network actors (van Riel et al., 2013). Consequently, there is a need for establishing a social space where combining the creative effort to solve a complex problem can emerge and develop for the benefit of the collective network of independent service providers rather for the single actors (e.g. van Riel et al., 2013). In this regard, service networks are essential about service innovation, and social creativity is in particular relevant as adriver for designingthe constellation of service offeringsthatin a new and more collective, complete and satisfying way offers customer solutions. However, this may be difficult to achieve due to the complexity of tasks as it involves employees and managers from different businesses.These people have to be able to interpret the customers’ needs and desires from different service perspectives, then gather, selectand synthesize potentially relevant information and turn it into a joint and viable business model(e.g. Tax et al., 2013; Pinho et al., 2014; Morgan et al., 2007; Voss and Zomerdijk, 2007).

Social creativity: A definition

Creativity may be defined as the production of novel and useful ideas (Amabile, 1988). Consequently, social creativity occurs “when individuals work together to achieve a common goal by having individuals working collaboratively to generate novel and useful ideas” (Paulus, 2000). However, novelty is not discovered, but rather created as “social interactions between individuals trigger new interpretations and new discoveries of distant analogies that the individuals involved could not have generated by thinking alone” (Parjanen, 2012, p. 113). One of the pioneersin social creativity was Georg Simmel (1858-1918).He argued that people have a creative consciousness that allows for flexibility and freedom and helps form a shared social life(see Ritzer, 1996). Social creativity is therefore the interchange between cultural and social aspectson the one hand and the individuals’ mental capacities on the other (see also Rudowicz, 2003; Csikszentmihalyi, 1999; Harvey 2014). A similar emphasis on the link between social life and the individual is emphasized by Castoriadis (1987). He argues that creativity has an inseparable relationshipwiththe shared social life of society and the radical imagination of the individual’s psyche – a phenomenon he refers to as“social imaginary” (1987). The key focal point of social creativity is thus the multilayer connection between the individuals and the context in which they live and work (see also the section: Improving social creativity in service networks).

The four building blocks of social creativity in service networks

In this section, we will review the literature on social creativity to identify the building blocks of the theoretical construct, which we use in the conceptualization of ourframework. The four theoretical building blocks we identify are: Openness, inquisitivity, translation,andtemporality. First, we start by discussing the importance of openness in service networks.

Openness: Uncertainty and access acceptance

According to Senge (1990), openness is a characteristic of the relationships people have with each other. It concerns the situation where people are willing to suspend certainty and let individual thinking influence the mutual relationship. Such a kind of relationship is essential for acquiring the needed “synergy of many” in the creative process (Benkler, 2006)and thusfor learning to take place (Senge, 1990). The metaphor of openness signals the forward process of social creativity as well as embraces the ever-changing, and sometime chaotic, social and cultural life in a more complex way. In fact, openness has been found to support the search processes related to complex problem solving in creative systems because of the unbounded and unstructured nature of the problem space (Johnson, 2006). In our literature search, we identified three central aspects of openness that affect network creativity: Tolerance for divergence, accessibility, and externalization.

The first aspect of openness in connection with creativity is the collective tolerance foractor idiosyncrasy. This involves the value ofdivergent thinking as opposed to the norm of following closed prescriptions (Silvia et al., 2008; McCrae, 1987; Amabile, 1995; Senge 1990).Here, individuals are allowed to be reflective in the creative processwithoutpeer pressure (Amabile, 1996) and demand to find a single best solution, which is the opposite of critically examining for the best, correct solution (Senge, 1990). In fact, studies show that people’s creativity increases with their perception of freedom to choose how to go about accomplishing a given task (Amabile, Conti, Coon, Lazenby Herron, 1996), and that formalized control (either disproportionate or unsuitable) may hamper collective creativity (Bonner, Ruekert Walker, 2002). In addition, studies show that for social creativity to develop there must be toleranceofdoubt (Hampden-Turner, 1999; Locke, Golden-Biddle & Feldman, 2008), ambiguity(Zenasni, Besancon Lubart, 2008), and even failure (Schön, 1983) as this providesan opportunity to reflect and learn (Fischer et al., 1998; Brix, 2015).

Second, formalization in the shape of control has been found to be a hindrance to network creativity.Studies show that decentralized networkswhere actors have easy access to each other aremore likely to foster creativity (Leenders, van Engelen Kratzer, 2003) and a better creative integration of ideas (Amason, Thompson, Hochwarter Harrison, 1995). In particular relations to heterogeneous others are rated as more creative (Perry-Smith, 2006). These findings correspond well with the theory of structural holes suggesting that the linkage of unconnected actorsin a network may enhance creativity-related processes (Burt, 2009). According to Burt (2004),the relationships between individuals that cut across structural holesare particularly important for the quality of the network creativity. Consequently, what matters for creativity to unfold in the network is bridging relationships in such a way that contradictory and different information and interpretations in one part of the network are brought to the knowledge of other parts of the network. Enabling one part of the network to speak freely about an idea to another part may spur the opportunityto catalyze new discoveries that, in turn, add value to the original idea, which may not be revolutionary in the first place, as even the most trivial idea for some can constitutea valuable insight for others in the network (Burt, 2004). It follows that the central element in the creative network process is no longer the source of a good idea, but rather the value produced throughout the entire network by the collectivemolding of the original idea, regardless of its initiator.

Finally, the degree of openness,and hence level of social creativity,is affected by the development of boundary objects – defined as objects that “both inhabit several intersecting social worlds … and satisfy the informational requirements of each of them […] and is a key process in developing and maintaining coherence across intersecting social worlds” (Star and Griesemer, 1989, p. 393; Freeman, 2009). According to Fisher and Giaccardi (2007), this is part of an “externalization” process that supports the interplay of creative contributions by making themental efforts of individuals more concrete and accessible for both personal and social reflection, e.g. in the shape of texts, documents, etc. It appears that, as the creative process develops, the externalization processes gradually change the boundary objects from abstract to more concrete and thereby arguably reduce openness. For instance, Zhang, Gloor and Grippa (2013) found that, over time, team members inmore creative projects become increasinglyfocused onthe message content. The focus shifts from openness to more disciplined (Csikszentmihalyi, 1996) as actors try to be more effective and convincing in the creative process. Consequently, the externalization process will gradually hamper creativity, and only if novel associations are provided can the creative process regain new energy and generate new solutions.The above discussion on openness leads to the following three propositions:

Proposition 1: Tolerance for divergence is associated withincreased creativityduring opportunity identification and development in service networks.

Proposition 2: Higher accessibility of heterogeneous actors is associated with increased creativity during opportunity identification and development in service networks.

Proposition 3: Externalization processes hamper free association and narrow the creative contribution in service networks.

Inquisitivity: Prompting reflected inquiry

Contrary to the general assumption thatsocial creativity needs harmony, comfort, and friendliness to flourish, there is empirical evidence suggesting thatconfrontation isa driver for improving social creativity (e.g. Amabile Kramer, 2012). For instance, oppositionmay stimulate solution discovery for problem solving (Mucchi-Faina, Maass & Volpato, 1991). In some situations,it has been suggested thatthreats will facilitate innovative ideas (Shepard, 1967), and even fear has been found to advance creativity (De Dreu, Baas Nijstad, 2008). Indeed,some evidence indicates thatidea generation increases during times of organizational decline (Mone, McKinley Barker, 1998), which amplifies research suggesting that urgency or external competition may increase creativity (Amabile, 1996).