Free-to-fee transformation of industrial services

Industrial firms venturing into services is a common phenomenon in B2B markets. However, companies are often unable to monetize many such services, thus incurring high costs of service provision without benefiting from revenue generation in return. To address this critical but little-studied problem, we investigate how industrial firms can transform existing free services into for-fee offerings. Employing a theories-in-use approach, we explore leading global firms via a cross-section of B2B industries, including automotive, maritime, material handling, medical equipment, mining and construction tools, and petrochemicals. Contingent on the empirics, we precisely characterize and define free industrial services. Based on the internal and external challenges that firms face in free-to-fee (F2F) transformations, we develop a typology classifying free services into four distinct categories: Front-runners, Tugs of War, In-house Shackles, and Dead Ends. For each category, we provide empirical illustrations and identify critical actions and activities that firms deploy to successfully implement F2F transformations along the dimensions of structures, processes, people, and rewards. Thus, we offer guidance on how to overcome both external and internal challenges. Our findings demonstrate that F2F transformations of industrial services are not isolated marketing, sales, or pricing activities but require a concerted effort among all organizational functions involved.</p

Drivers and outcomes of salespersons' value opportunity recognition competence in solution selling

In B2B markets, firms seek to provide customer solutions instead of merely selling goods or services. As boundary-spanners, salespeople are pivotal for implementing this strategic shift. Yet, extant literature provides limited insights into salesperson's resources and competencies required for customer solutions, particularly in the early phases of solution selling. This research focuses on salesperson's value opportunity recognition competence (VOR), which is a central requirement for salespeople to be able to navigate the early phases of solution selling. Analyzing large-scale, multi-level data of 799 salespeople and their respective sales managers in 29 sales organizations, the authors investigate the role of different salesperson resources and work environment characteristics for strengthening their VOR. The authors find that salespeople need both customer and technical knowledge, but customer knowledge is more important. Salespeople also can substitute individual technical knowledge with strong internal relations, but strong customer relations are no substitute for individual knowledge about customers' business models and processes. Formalization turned out to be a double-edged sword in the context of VOR development, while transformational leadership has positive effects only. The findings bear concrete implications for improving the selection, training, and work environment of solution salespeople

Customer Interaction and Innovation in Hybrid Offerings:Investigating Moderation and Mediation Effects for Goods and Services Innovation

Hybrid offerings are bundles of goods and services offerings provided by the same firm. Bundling value offerings affects how firms innovate, interact with customers, and customize their goods and services. However, it remains unclear how customer interaction might drive the innovation performance of various bundled components. Therefore, this study investigates the effects of customer interactions and service customization on both goods and services innovations in a hybrid offering context, using a unique data set of 146 information technology and manufacturing firms. Customer interaction appears beneficial to both goods and services innovation in a hybrid offerings context, but service customization has different direct effects on goods versus services innovation. As a potential mediator, customer knowledge mobilization resources exert different effects on the goods and services elements of hybrid offerings. Furthermore, for high-interaction customers, medium levels of technical modularity lead to most favorable innovation outcomes for services innovation. The results thus suggest that providers of hybrid offerings should foster customer interactions, to drive the innovation performance of the good and service components, while still making sure to implement service customization strategies. These findings have notable implications for service innovation research

Investigating customer value in global business markets: Commentary essay

This commentary reflects on Blocker's cross-cultural investigation of relationship value in business markets, published in this issue, and identifies several research avenues. From a theoretical point of view, researchers should develop and test hypotheses grounded in both conceptual frameworks and extant literature to expand knowledge of how national cultures-as well as other country-specific variables-affect customer value perceptions in business markets. From a methodological point of view, ongoing research should establish cross-cultural measurement equivalence on the basis of procedures specifically designed to support formative customer value models. Finally, this commentary highlights several key insights related to models of customer value in international business markets.Customer value Relationship value Formative and reflective value models Cross-country measurement equivalence

Relationship Value in Business Market: The Construct and its Dimension

In recent years, the concept of relationship value has attracted increasing attention among marketing researchers and practitioners alike. Despite a growing body of literature in this area, no generally accepted conceptualization of relationship value has emerged from the marketing literature. The present paper investigates the theoretical foundations of relationship value and identifies seven underlying dimensions. It is suggested that relationship value should be conceptualized as a formative, multi-dimensional, higher-order construct. This conceptualization is tested using data from a cross-sectional survey among some 200 purchasing managers from manufacturing companies. The scale development process is presented and directions for future research are discussed

Complex and Strategic Decision-Making in Organizations: Implications for Personal Selling and Sales Management

This article seeks to understand complex or strategic decision making and suggest personal selling and sales management strategies to enable organizations to effectively sell in complex decision-making environments. To understand complex and strategic decision making, we conducted an in-depth examination of the manufacturing location selection decision-making process of five organizations. We propose sales management guidelines and directions for future theoretical investigations based on the decision-making processes. Specifically, implications for sales force selling complex and strategic products and services (e.g., location and technology platforms) are addressed. The results suggest an adaptation of national or key accounts may be the best sales strategy for selling products and services that entail complex and strategic decision making