Sustainable Value Proposition Design in a Product-Service System

Many companies have started to add services to their tangible products in order to defend themselves from increased competition from low-cost economies. Research regarding the transition towards product-service systems (PSS) and how the PSS providers' business models are affected exists, but there is a lack of research regarding how the suppliers to the PSS providers are affected by the transition towards PSS. Therefore, this thesis studies the situation for a supplier/partner to an OEM that has changed their business model to a PSS providing one. As the first step in a development of a new business model aims this thesis to provide guidelines for how to set up value propositions suitable for a supplier/partner in this new environment. When technologically complex products, such as aircraft engines, are provided through PSS offerings it is hard to translate customer needs into quality parameters, which makes it hard to sustain the value to customer over time. Therefore, how to keep the value offering sustainable over time is also investigated in this thesis. The aim of this study was to investigate how a sustainable value proposition can be designed for a product and technology supplier/partner to an OEM that offers PSS solutions. The research has been performed through studying relevant literature and collecting empirical data from a case company through semi-structured interviews and a workshop. The case company in this research is Volvo Aero Corporation (VAC). The empirical findings show that VAC wants to offer product-service bundled solution, which fit the whole spectra of PSS value propositions, to their partners/customers. To be able to deliver these different types of product-service bundled solutions different value propositions that suit the different kinds of PSS offerings are needed. Requirements that must be fulfilled to be able to offer and deliver the different types of value propositions exist in terms of securing sufficient information access, aligning the incentives of all actors involved and achieving an internal consensus of what is delivered

Trust Building in Supply Chains

Holistic supply chain collaboration has appeared to be difficult to implement in strategic alliances due to managers’ lack of understanding the dynamics of trust-building. Too much reliance on technology and too little understanding of the nature of collaborative trust have led to a situation where strategic alliances often fail to thrive. This lack of awareness can be additionally observed in the supply chain literature: the concept of trust is covered without a profound scientific accuracy or clarity. In fact, views on trust are conflicting heavily even within the supply chain discipline. “Trust may be the most overused and abused word in the alliance lexicon.” (Fawcett et al. 2012). This thesis aims to fix this gap of knowledge; it establishes a holistic model of trust-building and studies the phenomenon from the perspective of several different disciplines such as cognitive science, sociology, microeconomics and psychology to build a profound background for the topic. The aim is to merge the supply chain use of the concept ‘trust’ with the mainstream of its meaning in other disciplines such as in cognitive science. The factors resulting in trust are additionally studied with an empirical questionnaire (n=220) for Finnish logistics experts. The results suggest that trust building in supply chains is explained by the knowledge-based theory of trust rather than the calculus-based theory. Neither asset specific investments nor contracting seem to have a high explanatory power for explaining trust in supply chain context. However, the time spent in a particular supply chain collaboration, the efficient use of tacit knowledge, extensive information sharing, partner’s reputation and the efficiency & seamlessness of the collaboration explain the existence of trust in supply chain collaboration. The calculus-based view on trust with its emphasis on transaction cost economics (TCE) is, therefore, an outdated view on supply chain management. Additionally, trust can be seen as a capital built on the norm of reciprocity and cooperative interaction. Trust is more easily lost than formed since the reciprocity norm punishes heavily those who exploit their trustors. Trust capital is created in a temporal context and accumulated through an iterative process, which takes time and requires the parties to learn about each other, in other words, to gather knowledge. A higher amount of trust capital allows people to trade and negotiate better terms in the context of commerce and trade. These results imply that trust-building in supply chains should be supported by corporate level policies, which encourage the creation of interpersonal relationships and collective learning between organizations. This requires trust. The findings suggest that the formation and use of highly complex tacit knowledge in supply chains allow the companies to form sustainable competitive advantages. Forming affinity groups provides an efficient way to make supply chains flourish through the accumulation of tacit knowledge and thus to increase the innovation capabilities and competitive advantages of the supply chain alliances

Innovativeness and Innovation: Implications for the Renewable Materials Supply Chain

innovativeness, innovation, supply chain management, triple bottom line, corporate social responsibility, Agribusiness, Agricultural Finance, Demand and Price Analysis, Financial Economics, Q10, Q27, Q42, Q47,

Contextual impacts on industrial processes brought by the digital transformation of manufacturing: a systematic review

The digital transformation of manufacturing (a phenomenon also known as "Industry 4.0" or "Smart Manufacturing") is finding a growing interest both at practitioner and academic levels, but is still in its infancy and needs deeper investigation. Even though current and potential advantages of digital manufacturing are remarkable, in terms of improved efficiency, sustainability, customization, and flexibility, only a limited number of companies has already developed ad hoc strategies necessary to achieve a superior performance. Through a systematic review, this study aims at assessing the current state of the art of the academic literature regarding the paradigm shift occurring in the manufacturing settings, in order to provide definitions as well as point out recurring patterns and gaps to be addressed by future research. For the literature search, the most representative keywords, strict criteria, and classification schemes based on authoritative reference studies were used. The final sample of 156 primary publications was analyzed through a systematic coding process to identify theoretical and methodological approaches, together with other significant elements. This analysis allowed a mapping of the literature based on clusters of critical themes to synthesize the developments of different research streams and provide the most representative picture of its current state. Research areas, insights, and gaps resulting from this analysis contributed to create a schematic research agenda, which clearly indicates the space for future evolutions of the state of knowledge in this field

Local food supply chain: a case of rural food processing firms and catering business in Finland

The subject of this paper is the integration of food production and processing, distribution, and consumption on local markets in rural areas. We approach this integration from the point of view of an alternative food supply chain, a local food system as an example. The data were gathered through semistructured interviews with 12 entrepreneurs and 9 representatives of institutional food service units and restaurants in Eastern Finland

Intangibles, Global Networks & Corporate Social Responsibility

Network organisations emphasise the importance of corporate and product intangible assets. In global competition, the managerial economics of intangibles imposes new network policies of corporate social responsibility, dominated by global social issues such as economic sustainability, eco-responsibility, worker protection and so on.Intangible Assets; Network; Global Competition; Corporate Social Responsibility DOI:http://dx.doi.org/10.4468/2010.2.02brondoni

The Wheel of Business Model Reinvention: How to Reshape Your Business Model and Organizational Fitness to Leapfrog Competitors

In today's rapidly changing business landscapes, new sources of sustainable competitive advantage can often only be attained from business model reinvention, based on disruptive innovation and not incremental change or continuous improvement. Extant literature indicates that business models and their reinvention have recently been the focus of scholarly investigations in the field of strategic management, especially focusing on the search for new bases of building strategic competitive advantage, not only to outperform competitors but to especially leapfrog them into new areas of competitive advantage. While the available results indicate that progress is being made on clarifying the nature and key dimensions of business models, relatively little guidance of how to reshape business models and its organizational fitness dimensions have emerged. This article presents a systemic framework for business model reinvention, illustrates its key dimensions, and proposes a systemic operationalization process. Moreover, it provides a tool that helps organizations to evaluate both existing and proposed new business models.

Sustainable supply chain management needs sustainable logistics services. The strategic role played by logistics service providers

Purpose – The purpose of this research is to examine the concept of sustainable service co-creation in triadic business relationships in logistics and supply chain management. More companies seek to develop sustainable solutions that would not be sustainable exclusively for themselves but for the supply chain they belong to. In doing that – especially when dealing with services – they may need the external support from logistics service providers (LSPs). This paper aims to explore the innovative initiatives undertaken by LSPs in triadic relationship management with their customers and suppliers while co-creating sustainable services along the supply chain. Design/methodology/approach – To investigate the research question, a systematic literature review and empirical exploratory investigation through case study will be conducted adopting the qualitative methodology, to explore trends and evolving paradigms. Findings – A literature review conducted in this paper enriches existing literature through an integration of sustainability in a viable system approach and logistics service provision, in particular, it investigates the ways in which sustainability is achieved. It is assumed that the triadic relationship among an LSP and its customers and suppliers requires significant modifications in collaboration and an innovative approach in operating procedures. Research limitations/implications – This paper is an exploratory study and limited in its scope to an example of a relationship that focuses mainly on three actors: the supplier, the LSP and the customer. However, it could be extended in terms of numbers of case studies investigated. Practical implications – The implications arising from the literature and the empirical research offer a range of current sustainable practices in the services sector. This could be a starting point for other research and company activities. Originality/value – There is little research that addresses the issue of sustainability and logistics service providers simultaneously, hence the present paper is meant to fill the gap by providing a foundation which actors of different supply chains could use as a benchmark. This study gives evidence of how logistics services may contribute to sustainable development. Key words – sustainable supply chain management, logistics service providers, viable system approach, co-creation, business relationship managemen

Strategies for sustainable socio-economic development and mechanisms their implementation in the global dimension

The authors of the book have come to the conclusion that it is necessary to effectively use modern approaches to developing and implementation strategies of sustainable socio-economic development in order to increase efficiency and competitiveness of economic entities. Basic research focuses on economic diagnostics of socio-economic potential and financial results of economic entities, transition period in the economy of individual countries and ensuring their competitiveness, assessment of educational processes and knowledge management. The research results have been implemented in the different models and strategies of supply and logistics management, development of non-profit organizations, competitiveness of tourism and transport, financing strategies for small and medium-sized enterprises, cross-border cooperation. The results of the study can be used in decision-making at the level the economic entities in different areas of activity and organizational-legal forms of ownership, ministries and departments that promote of development the economic entities on the basis of models and strategies for sustainable socio-economic development. The results can also be used by students and young scientists in modern concepts and mechanisms for management of sustainable socio-economic development of economic entities in the condition of global economic transformations and challenges