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on how to assess the capability of organizations to successfully co-create values with consumers.
To date, most studies on co-creation are conceptual propositions or case studies identifying
motivators for consumer participation in new product development (e.g. Ostrom
et al
. 2010;
Volberda, Foss and Lyles 2010). Similarly, research in the context of tourism so far has yet to
understand how well destinations can identify and extract tourists' knowledge for tourism
innovation. Therefore, in order to provide a foundation for successful consumer co-creation in a
tourism context, the goal of this chapter is to conceptualize and assess the capacity of tourism
destinations to co-create value with the consumers.
Organizational capacity for co-creation
In the business literature, consumer participation and organizational design have been cited as
the two critical dimensions for the realization of co-creation. The level of consumer integration
in the tourism co-creation process depends on how tourism organizations empower tourists to
play a role in new product development. In other words, for tourism organizations, the success
of co-creation depends on their ability to identify, locate and empower tourists with the right
skills and characteristics, and turn them into collaborators. Tourism organizations need to
integrate tourists into the value creation process by interacting with them at multiple points
along the value chain. Indeed, Payne, Storbacka and Frow (2008) suggest that consumers need to
be strategically integrated at essentially every step along the product and/or service encounter.
This provides a series of encounters through which tourism organizations can identify and
extract information from tourists. The purposeful setup for learning from consumers not only
changes consumers' role, but also alters the relationship between organizations and consumers
and, ultimately, the product or service experience (Payne, Storbacka and Frow 2008). Thus,
from the dimension of consumer integration, the capacity for co-creation among tourism
organizations is represented by their ability to identify creative consumers and facilitate them to
become co-creators.
Another dimension of co-creation capacity is the capability to integrate the concept of
co-creation in the culture of organizations. It is often related with dynamic capability, which is
defi ned as fi rms' capability to integrate, build and reconfi gure internal and external competence
to address changing environments (Benner 2009) and absorptive capacity (Cohen and Levinthal
1990), which is the capability of the fi rms to value, assimilate and realize new ideas from external
sources. For tourism organizations, co-creation capacity is supported by their receptiveness
of relevant insights and ideas from consumers and ability to transform these ideas into successful
consumer-centric, co-created products and services. The goal of integrating consumer knowledge
is the development of new products and services and/or to signifi cantly improve current
ones (through increased effectiveness or effi ciency) to ultimately create a competitive advantage
(Volberda, Foss and Lyles 2010).
Payne, Storbacka and Frow (2008) suggest a conceptual framework of a process-based value
co-creation consisting of three components: customer value-creating processes (i.e. the processes,
resources and practices used by customers to manage their activities), supplier value-creating
processes (i.e. the processes, resources and practices used by the organization to manage their
activities and relationships with customers) and interaction processes (i.e. the processes of
interaction and exchange between customers and the organization, which can be in the form
of communication, use and service interactions). The framework represents an interconnected
set of processes with different encounters that occur as a result of their respective value-creating
processes. Further, it is suggested that customers engage in a learning process based on their
interactions with the organization and, similarly, the organization engages in a learning process,
