What service transition? Rethinking established assumptions about manufacturers' service-led growth strategies

Christian Kowalkowski, Charlotta Windahl, Daniel Kindström, Heiko Gebauer

Research output: Contribution to journalArticleScientificpeer-review

137 Citations (Scopus)

Abstract

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.
Original languageEnglish
Peer-reviewed scientific journalIndustrial Marketing Management
Volume44
Issue number2
Pages (from-to)59-69
Number of pages11
ISSN0019-8501
DOIs
Publication statusPublished - 2015
MoE publication typeA1 Journal article - refereed

Keywords

  • 512 Business and Management
  • Service transition
  • Solutions
  • Manufacturing companies
  • Service infusion
  • Service strategy
  • Problematization methodology
  • Business, Markets and Societal Dynamics

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