Managerial perceptions of co-creation

Today, firms have shifted from solely creating innovations through internal R&D activities to an approach that incorporates external inputs (i.e. Christensen et al., 2005; Rigby and Zook, 2002). This shift is captured by the term ¿open innovation¿, which suggests that firms use both internal and external ideas to advance innovations by placing these ideas at the same level of importance (Chesbrough, 2006). Regarding the inflows and outflows of these ideas to the company, open innovation can be classified in three core processes (Enkel et al., 2009): (1) inside-out process, (2) outside-in process, and (3) coupled process or co-creation. The inside-out process consists in making profits by transferring the company¿s ideas, knowledge and technology to the market (Enkel et al., 2009). This process is based on internal sourcing, and therefore is usually run by the R&D department of the company. However, research on external sourcing started to gain attention in the open innovation literature when companies realized that getting ideas and knowledge from the market would enable them to both improve their efficiency by achieving scale economies and access to the innovations that they could not generate on their own (West and Bogers, 2013). Specifically, since Chesbrough (2003) called for research on external sourcing of ideas and knowledge, the inside-out process has lost out in favour of the outside-in process (Chesbrough and Crowther, 2006; Enkel et al., 2009). The outside-in process consists of enhancing the company¿s knowledge base by integrating the ideas of suppliers, users, consumers, universities, organisations, and other stakeholders (Enkel et al., 2009). However, academics have focused on studying organisations as the main external source of innovation. Thus, there is a need to investigate further individuals (i.e. users or consumers) as an external source of innovation (West et al., 2006; West and Bogers, 2013). This need has started to be covered by two streams of literature. The first stream of research contemplates the case in which the firm does not interact with the users (i.e. von Hippel, 2007). In such a case, these users generate innovations on their own, based on their personal knowledge and exclusively for their own benefit (Bogers et al., 2010). The second stream of literature encompasses the event in which the firm interacts and collaborates with consumers in the generation of innovations (i.e. Prahalad and Ramaswamy, 2004). When generating these innovations, the firm and consumers engage in the coupled process or co-creation (West and Bogers, 2013). The coupled process or co-creation consists of combining the inside-out process with the outside-in process, to develop and commercialise innovations through alliances, cooperation and joint ventures between the firm and consumers (Enkel et al., 2009). As this coupled process encompasses the previous two processes, co-creation is the core process of open innovation that entails the broadest combination of internal and external ideas and knowledge, by means of which the firm and consumers generate innovations in an interactive way (Chesbrough et al., 2006).