The Effects of Dynamic Strategy and Updating Network Structure Towards Customer Participation Innovation Performance

Customer participation is an external knowledge source that could be used for enterprise innovation. However, extant studies on the effect of customer participation are inconsistent, casting doubt on what success factors affect customer participation innovation performance. With customers and employees increasingly forming enterprise’s collaborative team and their interaction of knowledge shaping a knowledge collaboration network, micro-individual factors become vital. Drawing on complex network and evolutionary game theory, this study explores the effects of dynamic strategy (cooperation choice) and updating network structure (network rewiring) towards customer participation innovation performance. Based on multiagent simulation method, a knowledge collaboration network model was built to characterize the process of customer’s interaction with employees, with statistical measures, i.e., average knowledge, knowledge increase rate, knowledge standard deviation rate of the customer, employee, and the total, respectively. Through the comparison and analysis of the effects of dynamic strategy and updating network structure, this study concludes the following: (1) the cooperation decades over time when the initial cooperation rate is less than half; (2) a higher cooperation rate benefits innovation; (3) dynamic strategy proceeds fixed strategy; however, when strategy is dynamic but is updated fast, innovation falls; (4) updating network structure is superior to fixed structure, and when team members could update their network ties fast, innovation gets higher level; and (5) however, when both strategy and network structure could be updated fast, innovation level performs better than other cases. Accordingly, innovation team managers need to give team members a chance to update connections and coordinate the updating frequency of strategy and structure properly.