Optimal Design of Coproductive Services: Interaction and Work Allocation

In services, customers provide significant inputs into the production process. In particular, these inputs may be the customers themselves participating in the service delivery. Although many service firms have explored different ways of involving customers in their production process, there is no clear guideline for the design of such coproductive systems. In this paper, the author develops an analytical model of joint production between a service provider and a customer and characterize how a service firm should design its coproductive system. He shows that, as a task becomes more standard, it is desirable to decrease the degree of interaction between the provider and the customer by making their efforts more substitutable and to allocate most of the work to whoever is the most efficient. Conversely, as a task becomes less standard, it is optimal to increase interaction by making efforts more complementary and to balance the work allocation. This analysis gives rise to a service-process framework with three archetypes of coproductive services: collaborative services, service factories, and self-services. The author discusses the implications of our results for service process reengineering.