SUMMARY
The influence diagram is a probabilistic model for presenting decision problems as a directed graph. In this study, the dynamic influence diagram and the interactive dynamic influence diagram are used to model the three parties to service innovation: customers, suppliers, and service enterprises. The models analyze the decisions of these dierent parties and describe the process by which service enterprises should consider their own innovation conditions as well as those of the other parties, that is, customers and suppliers. Moreover, during the process of service innovation, service enterprises should be in constant communication with customers and suppliers. After the customers and suppliers respond, service enterprises can modify their innovation decision-making, and improve service innovation quality and income.