title: A Conceptualisation and Empirical Validation of Internal Customer Perceived Value (ICPV)
Creators: name: Lo Iacono, Joseph
Publisher: name: Griffith University
Year: 2017
Subjects: subject: Internal customer perceived value
subject: Empirical validation

description: The notion of value creation has emerged through what is known as service-dominant logic. This ideology clearly identifies a multiple stakeholder approach to value creation with various actors, or resource integrators within the value creation process (Vargo &amp; Lusch, 2004). Through application of service dominant logic in the context of the firm, key resource integrators and subsequent value beneficiaries, within the value creation process, are the firm and its customers (Vargo &amp; Lusch, 2008). Nevertheless, it is important to acknowledge that there are two different customer groups operating within the firm’s value creation space; that is, external customers and internal customers (i.e., employees). External customers have received a considerable amount of research attention with respect to value creation (e.g., France et al., 2015; Yi &amp; Gong, 2013), but very little is known about the processes that lead internal customers to benefit from the value creation process. On this basis, this study addresses this paucity in the value creation literature by investigating the mechanisms facilitating value creation for the internal customer, which subsequently results in the proposal of the Model of Value Creation: An Internal Customer Perspective. Conceptualisation and subsequent development of the Model of Value Creation: An Internal Customer Perspective is based on a comprehensive review of extant literature. For instance, Sweeney and Soutar’s (2001) PERVAL framework provides a basis for understanding perceived value in the internal customer domain; namely, Internal Customer Perceived Value, comprising four dimensions (i.e., monetary, functional, emotional and social value). To understand the value stimuli, or sources of value operating within the firm’s internal environment influencing Internal Customer Perceived Value, this study draws on structuration theory and social exchange theory. In particular, structuration theory (Giddens, 1984) informs the socio-structural elements (i.e., material resources, resources of authority, procedural rules and moral rules) and social exchange theory (Homans, 1958) reinforces the social exchange elements (i.e., internal-internal stakeholder exchanges and internal-external stakeholder exchanges), which act as sources of value for the internal customer. Moreover, Herzberg et al.’s (1959) and Wolf’s (1970) theories of need fulfilment provide the foundations to understand the internal customer’s meaningful response to value stimuli, which is instrumental in influencing Internal Customer Perceived Value. Finally, Helkkula et al.’s (2012) VALEX model is used to consider the manner in which temporal influences (represented by tenure and employment status) are likely to produce differential effects in this model. Following a sequential research planning process, data were collected from internal customers via an online, self-administered survey instrument. In total, 618 completed surveys provided the basis for empirical analysis. Through application of Partial Least Squares, relationships proposed in the Model of Value Creation: An Internal Customer Perspective were assessed. Results show empirical support for some relationships in this model. Specifically, the findings indicate that the internal customer derives more value from material resources, moral rules and internal-internal stakeholder exchanges than resources of authority, procedural rules and internal-external stakeholder exchanges. In addition, differential effects were found in relation to employment status (part-time versus full-time employees), but not on the basis of tenure (i.e., length of employment). The findings of this research provide significant value to both practitioners and academics alike. From a practical perspective, this research provides astute managers with the foundations for enhanced individual and organisational performance through due consideration being given to the impact that the firm’s social-structural and social-exchange elements have on its internal participants. From a theoretical perspective, this study is the first of its kind to conceptualise and operationalise the multi-dimensional construct, Internal Customer Perceived Value, and to test antecedent relationships from a value-in-social context perspective. As a result, this research provides a solid platform for future research investigation in this important field.