Towards Sustainable Value Creation in The Beauty Service Ecosystem: Connecting Tensions and Systemic Sustainability Outcomes

Purpose: The beauty industry, like most other industries, face sustainability challenges related to the transition towards a more sustainable service economy. The sustainability challenges have been described as wicked problems where a multidisciplinary and co-creating approach is needed, in order to create sustainable service ecosystems (Field et al., 2021). Furthermore, these challenges entail inherent contradictions, giving rise to tensions (e.g., Smith and Lewis, 2011; Hahn et al., 2015). Previous literature has identified generic organizational tensions (Smith and Lewis, 2011) whereof some particular for corporate sustainability (Hahn et al., 2015). However, there still exists a need to better understand, from a descriptive point of view, industry specific tensions and how they are managed, but particularly, from an instrumental standpoint, the relation between these tensions and the systemic sustainability outcomes they generate (Hahn et al., 2018). By taking a service view on corporate sustainability tensions as arising from multiple resource integrating actors in a service ecosystem (Vargo and Lusch, 2011), we aim to further such an understanding. The research fields on corporate sustainability tensions and sustainable service tend both have a distinct system view in common (e.g., Hahn et al., 2015; Field et al., 2021). As sustainability issues tend to be highly complex and intricate in nature, varying in temporal and spatial dimensions and spanning organizational boundaries, the systems imprint allows for a broader view and recognizing interconnections. Therefore, in this paper, we adopt a service ecosystem view to gain a deeper understanding of the tension in the beauty industry, how they are managed, and the corporate sustainability outcomes they give rise to. Study design/Methodology/Approach: The study adopts a qualitative methodology based on 24 in-depth interviews with several key informants in the beauty service ecosystem, later analyzed using an abductive approach. The collected data was triangulated with those derived from participatory observations and the analysis of secondary data. Furthermore, we have used the system dynamics literature and techniques to iterate a conceptual model based on these tensions, providing a visual overview of the interconnections of the corporate sustainability tensions in the beauty industry, and the resulting sustainability outcomes. Findings:The study suggests the need for a multi-actor perspective when considering sustainability outcomes in the beauty sector. Moreover, resource interaction and integration are strictly connected to the institutional context in which it develops, and the efforts of the different actors usually results in new institutional and critical arrangements, but in this specific context tensions could arise that has to be addressed. Additionally, the modeling process resulted in a number of propositions, that provide implications for practice to facilitate better and more effective organization towards sustainable service provision, as well as for further research on sustainable service ecosystems. Implications: By taking a service ecosystems perspective on sustainability tensions, it becomes evident that there is a need to move beyond the strict managerial orientation that has previously dominated the tension-literature. As the tensions and their links to sustainability outcomes is the result of multiple resource integrating actors spanning multiple levels of aggregation in the service ecosystem, the way of addressing them also must be able to surpass the micro-level. 201 Originality/Value:This paper both theoretical and managerial implications for better understanding the dynamics at play in the beauty service ecosystem, and the tensions linked to sustainability outcomes. In the meeting between institutional work conducted by different actors there are opportunities for the creation of new potential resources that could be integrated to co- create value (Vargo and Lusch, 2011) but also difficulties to overcome. Furthermore, we provide new insights on how different institutional arrangements could be seen as opportunities for change and new occurrences for resourcerness (Koskela-Huotari and Vargo, 2016). References: Field, Joy M., et al. “Service research priorities: designing sustainable service ecosystems.” Journal of Service Research24.4 (2021): 462-479. Hahn, T., Pinkse, J., Preuss, L., & Figge, F. (2015). Tensions in corporate sustainability: Towards an integrative framework. Journal of business ethics, 127, 297-316. Smith, W. K., & Lewis, M. W. (2011). Toward a theory of paradox: A dynamic equilibrium model of organizing. Academy of management Review, 36(2), 381-403. Vargo, S. L., & Lusch, R. F. (2011). It’s all B2B... and beyond: Toward a systems perspective of the market. Industrial marketing management, 40(2), 181-187. Keywords:Sustainable value creation, service ecosystem, tensions, system dynamics, sustainability outcomes