The role of inter-organisational capabilities in creating the lock-in effect in servitization

This paper aims to explicate the lock-in effect of servitization by examining the relationship between inter-organizational capabilities and repurchase intention. A Partial Least Square Structural Equation Modelling method is applied to a sample of 95 customers of service contracts to investigate the relationships between: (1) the degree of activity outsourced by the customer; (2) their perception of the inter-organizational capabilities between provider and customer; (3) the risk the customer perceives in contract repurchase; and (4) the customer’s intention to repurchase. Findings show inter-organizational capabilities positively mediate the relationship between the degree of activity outsourced by a customer and their perceived risk in repurchasing the contract, positively affecting their repurchase intention. The study provides empirical evidence of the role inter-organizational capabilities play in supporting customer repurchase intention. This research gives managers the knowledge to develop effective inter-organizational capabilities to increase the likelihood of repeated customer transactions over time.