Conflict by Design and Why Institutions Matter in Service Design: A Case of a German Creative Agency in China

This paper set out to advance our understanding of how to improve service design and service provider-customer relationships in business-to-business (B2B) environments. Drawing on the theoretical lenses of service design and institutional theory, we investigate how and why problems occur in B2B relationships between service co-creating actors in the professional service sector and propose how these problems can be avoided. The study takes place in an international setting and employs an in-depth single embedded case study of a relationship between a German creative agency and a German industrial client operating in China. Our work chronicles how the relationship between the agency and the client developed overtime eventually resulting in a breakdown. The findings captured in a framework highlight an array of contributing factors beyond the differences in adherence to Service-Dominant logic (S-D logic). Propositions are made on how a more stable and robust agency-client relationship can be built and the dark side of B2B relationships defeated.