Exploring Open Innovation Dynamics: Service and Delivery Interplay in Circular Economy

The current business environment is witnessing significant changes due to changing customer preferences and an increasing desire for exclusive and experiential benchmarks. In light of these changes, it is crucial to analyze the convergence of open innovation (OI) in service and service delivery (SD) within the context of circular economy (CE) goals. The objective of this article is to examine the complex relationship between service innovation (SI) and service delivery innovation (SDI) while evaluating the preparedness of organizations to adopt CE practices. This article examines how innovative SD methods, viewed through the lens of service-dominant (S-D) logic, can develop dynamic capabilities to effectively address changing customer requirements. This, in turn, leads to enhanced satisfaction and customer loyalty. Based on survey data from a sample of 435 responses, this article examines the moderating role of SDI and its interplay with SI, and the integrated effect of both, using regression, structural equation modeling, and the Hayes Process model. The findings emphasize the significant impact of SDI, demonstrating its ability to both moderate and enhance the relationship between SI and the generation of value for consumers. It examines the need to place SDI separate from SI. This undertaking strengthens the collaboration of S-D logic with dynamic capabilities approach and enables the incorporation of OI paradigms with the requirements of CE practices. The main goal of this article is to direct the service sector toward a future that places a strong emphasis on value creation and sustainability.