Although services are the main growth engine in modern economies, there is evidence that new service development practices are ineffective. In this exploratory study, we look at the organizational roles that participate in the different stages of service innovation. We expect to find multiple roles in the creation, development and deployment of innovation in services. We suggest that this fuzziness of the locus of innovation may explain some of the difficulties in service innovation.

We interviewed six senior executives in European service organizations about their recent major innovations. The data on twenty five innovations, support our main expectation that service innovation involves many organizational roles and typically aggregates more functions as the innovation process progresses. We find also that customers and customer facing functions are not central to innovation, that R&D and Business Development do not create but mostly develop innovations, and that top executives participate in the creation of new services and processes.