Effect of User Involvement in Supply Chain Cloud Innovation

Cloud innovation has become increasingly important to supply chain innovation and performance. User involvement is a crucial part of cloud innovation. However, the effect of user involvement in supply chain cloud innovation has not been thoroughly studied, particularly its effect on product cost and optimal price. In this paper, the authors attempted to bridge this major gap in the literature. The authors reviewed the relevant literature to define cloud innovation and user involvement in supply chain cloud innovation. Then the authors developed a game model based on the Bertrand model. Analysis of the model showed that user involvement affects product cost and optimal pricing in an interesting way. The authors also presented a real-life example of how user innovation takes place at Tailg electric vehicle company.