Customer-focused and service-focused orientation in organizational structures

Purpose – The paper aims to provide a better understanding of the interrelatedness of customer and service orientations in the organizational structures of capital goods manufacturing companies. Design/methodology/approach – A qualitative, multi-case research design was employed using 36 European capital goods manufacturing companies. Findings – This article explored four different patterns of how companies move from being product-focused to service-focused, and from having an organizational structure that is geographically focused to one that is customer-focused. The four patterns are termed as follows: emphasizing service orientation, service-focused organizational structure, emphasizing customer orientation, and customer-focused organizational structure. Research limitations/implications – Although the study is based on 36 case studies, the external validity (generalizability) of the findings could not be assessed accurately. Practical implications – The description of the four organizational approaches offers guidance for managers to restructure their companies towards service and customer orientations. Originality/value – The article links the relatively independent discussions of service and customer orientations in the context of organizational structures. The four patterns provide a better understanding of how capital goods manufacturers integrate increased customer and service focuses in their organizational structures.peerReviewe

ICT as a catalyst for service business orientation

Purpose – Information and communication technology (ICT) is a key enabler for new product- and process-oriented services. The article investigates how ICT can enable service differentiation and in doing so act as a catalyst for a service business orientation. Design/methodology/approach – A qualitative, multi-case research design with eight multinational goods manufacturers. Findings –Two distinct types of service-oriented differentiation are identified; services in support of the product (SSP), and services in support of the client’s actions (SSC). The study finds that SSC have the largest positive impact on firms’ service business orientation. Research limitations/implications – Western firms in a limited sample of industries are studied. Furthermore, the service business orientation construct does not include any measurements of service profitability or impact on overall competitive advantage. Practical implications – To various extend, successful firms are likely to pursue both SSP and SSC differentiation traits through ICT. The two options are interdependent and the framework presented helps managers to understand both key specificities and their interrelatedness. Originality/value – The study contributes to theory on service strategies by specifically focusing on the enabling role of ICT for new services and its effects on each of the three dimensions of the service business orientation construct.peerReviewe

Servitization and deservitization: Overview, concepts, and definitions

© 2016 Elsevier Inc. The topic of servitization has generated a considerable body of research and many conferences, as well as industry engagement. Yet, despite the extensive literature associated with this now-mature discipline, there is no broad-based consensus on the core concepts and definitions deployed by servitization scholars, and both terminology and usage often seem ambiguous. This paper examines challenges related to service growth strategies, as well as strategies involving deservitization or a retreat from service offerings. Showing that these strategies have been pursued for more than fifty years, clarification is sought here by framing the corresponding processes and proposing definitions for four core terms: servitization, service infusion, deservitization and service dilution. It becomes clear that in focusing on the organizational change entailed by these processes, future research must elucidate “softer” issues such as leadership and business logic

Rethinking established assumptions about manufacturers' service-led growth strategies

Both academics and practitioners emphasize the importance for product firms of implementing service-led growth strategies. The service transition concept is well established, namely a unidirectional repositioning along a product-service continuum—from basic, product-oriented services towards more customized, process-oriented ones—ultimately leading to the provision of solutions. We challenge this service transition assumption and develop alternative ones regarding how product firms should pursue service-led growth. Using ‘problematization methodology’, and drawing on findings from thirteen system suppliers, we identify three service-led growth trajectories: (1) becoming an availability provider, which is the focus of most transition literature; (2) becoming a performance provider, which resembles project-based sales and implies an even greater differentiation of what customers are offered; and, (3) becoming an ‘industrializer’, which is about standardizing previously customized solutions to promote repeatability and scalability. Based on our critical inquiry, we develop two alternative assumptions: (a) firms need to constantly balance business expansion and standardization activities; and (b) manage the co-existence of different system supplier roles. Finally, we consider the implications for implementing service-led growth strategies of the alternative assumptions.peerReviewe

Digital servitization business models in ecosystems:A theory of the firm

This study extends the discussion of digital servitization business models by adopting the perspective of the theory of the firm. We use four theories of the firm (industrial organization, the resource-based view, organizational identity, and the transaction cost approach) to understand digital servitization business models of firms in the context of ecosystems. Digitalization transforms the business models of solution providers and shapes their firm boundary decisions as they develop digital solutions across organizational boundaries within ecosystems such as harbors, mines, and airports. Thus, digitalization not only affects individual firms' business models but also requires the alignment of the business models of other firms within the ecosystem. Hence, business models in digital servitization should be viewed from an ecosystem perspective. Based on a rigorous literature review, we provide suggestions for future research on digital servitization business models within ecosystems

A bricolage perspective on service innovation

Service innovation is often viewed as a process of accessing the necessary resources, (re)combining them, and converting them into new services. The current knowledge on success factors for service innovation, such as formalized new service development (NSD) processes, predominantly comes from studying large firms with a relatively stable resource base. However, this neglect situations in which organizations face severe resource constraints. This paper argues that under such constraints, a formalized new service development process could be counter-productive and a bricolage perspective might better explain service innovation in resource-constrained environments. In this conceptual paper, we propose that four critical bricolage capabilities (addressing resource scarcity actively, making do with what is available, improvising when recombining resources, and networking with external partners) influence service innovation outcomes. Empirical illustrations from five organizations substantiate our conceptual development. Our discussion leads to a framework and four testable propositions that can guide further service research