The influence of collaborative competence and service innovation on manufacturers’ competitive advantage

Purpose: While service innovation is an important issue for manufacturers, relatively little research lends empirical support to the perspective that service innovation enhanced by collaborative competence may impact the competitive advantage of original equipment manufacturing (OEM) suppliers. This study aims to advance a service-dominant logic by empirically investigating the linkage between collaborative competence, service innovation and competitive advantage for OEM suppliers. Design/methodology/approach: Surveys were completed by representatives of 142 Taiwanese OEM suppliers in the electronics industry. Findings: The results of path analysis suggest that information competence and coordination competence have positive effects on both exploitative service innovation and explorative service innovation. There only appears to be a significant relationship between joint innovation competence and explorative service innovation. Furthermore, two-pronged service innovations contribute to a supplier’s internal and external competitive advantage. Originality/value: The empirical findings have important research and practical implications that help elucidate the antecedents and outcomes of OEM suppliers’ service innovation.