Opening the black box of digital servitization in manufacturing SMEs

Abstract

This study examines how ambidextrous innovation and market orientation jointly shape digital servitisation and, through relational capabilities, customer lifetime value (CLV) in Vietnamese manufacturing small and medium-sized enterprises (SMEs). Survey data from 205 firms are analysed with partial least squares structural equation modelling using a two-stage hierarchical component model for digital servitisation, market orientation, inter-functional alignment, and customer participation in value co-creation. The results show that both exploitative and exploratory innovation are positively associated with digital servitisation, with exploratory innovation showing the stronger association. Market orientation strengthens these associations. Digital servitisation is also positively associated with inter-functional alignment and customer participation in value co-creation, which in turn are positively associated with CLV. The study conceptualises digital servitisation as an integrative dynamic capability that links upstream ambidextrous innovation and market orientation to downstream financial value in an emerging-economy SME context, and highlights relational mechanisms that open the “black box” between digital strategies and long-term customer value.

Keywords

Digital servitisation / Innovation ambidexterity / Customer lifetime value / Manufacturing SME

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