This research paper reviews the concept of servitization, Product-service system and examines the development process of servitization from service operations thinking. It also provides XXX as case study to analyse the transformation challenges and try to answer challenge questions based on Nudurupati question frameworks (Nudurupati et al,2015). Finally, it proposes the suggestions on how XXX achieve necessary actions to make the changes.
a. Define the key terms Product-Service System, Servitization, Value in Exchange and Value in Use.
PSS is product and service combined together in a system to provide consumer with the value added benefits in order to improve the company’s competitive advantages (Bains and lightfoot,2014) and deliver required functionality in an environmental-friendly way(Tukker, 2006). It is a strategy which transforms business concerns from selling products to deliver a system of product and services. It focus on how to satisfy customer’s need and providing company with close relation to users and identify new market changes by feedback from customers(Ana, et al, 2011).
In regarding to servitization’s definition, it is a concept which includes the transformational process from a product-focus business model to a service and product-focus approach. It involves reallocation of the company’s resources (Baines, Lightfoot, Benedettini, & Kay, 2009), redefinition of the goals or mission of the company and reshape the value system (Kindström & Kowalkowski, 2014). Servitization is also defined as the innovation of strategy in company’s resource and processes from selling products to an integrated product and service which deliver value in use. Thus, PSS is a special case of servitization (Kao et al, 20).It is suggested that performance measurement should change business strategy and design to provide value-in-use (Ostrom et al, 2010). The value in use refers to consumer’s beneficial outcomes or company’s efficiency and effective performance results through business activities (Neely et al, 2005). However, most of customer measures such as responsiveness, on-time service, and consumer satisfaction are concerned with value in exchange not value in use (Bititci et al., 2012). In result, the performance measurement become to emphasis on value in use through life. The PSS strategic principle is based on value in exchange of product ownership and responsibility.
b. Provide a short literature review of the development of Service Operations thinking through to the concept of Servitization. Ensure that you include a minimum of ten references. Sources before 1999 should only be included if absolutely seminal.
c. Identify a company of your own choosing. Introduce their operations by detailing:
i. Who their main customers are,
ii. The main products and services,
iii. The main order winners and order qualifiers.
d. Consider the work of Nudurupati et al (2015). Apply the Eight Questions framework to your chosen company, providing answers to at least four of the eight questions, with a view to enhancing the quality of their operations.
e. How will the company achieve the necessary change?
Reference list
Ana Paula B Barquet, Vitor P. Cunha, Maicon G. Oliveira (2011) Business model elements for product-service system. Functional thinking for value creation,ISBN: 978-3-642-19688-1.
Baines, T. and Lightfoot, H.W. (2014), “Servitisation of the manufacturing firm: exploring the operations practices and technologies that deliver advanced services”, International Journal of Operations and Production Management, Vol. 34 No. 1, pp. 2-35.
D. Kindström, C. Kowalkowski Service innovation in product-centric firms: A multidimensional business model perspective
Journal of Business & Industrial Marketing, 29 (2) (2014), pp. 96-111
Hung-An Kao, Rendar Yang, Chun-Tai Yen, Yu-Shiang Hung, Che-Wen Lai (2020) MANUFACTURING SERVITIZATION PROGRESS IDENTIFICATION AND EVALUATION FOR CAPABILITY AND MATURITY, Innovative DigiTech-Enabled Applications & Services Institute (IDEAS)
T.S. Baines, H.W. Lightfoot, O. Benedettini, J.M. Kay(2009) The servitization of manufacturing: A review of literature and reflection on future challenges, Journal of Manufacturing Technology Management, 20 (5) (2009), pp. 547-567
Tukker, A., Tischner, U.: New Business for Old Europe. Greenleaf Publishing (2006)
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