Abstract
Higher market complexity and increasing competition are forcing traditional manufacturers to rethink their traditional business strategy. New growth potential and lucrative margins in the service business tempt companies to extend their traditional products business by services and so, change their position in the product-service continuum. But, which position should be selected? What does influence this decision? And, which implications does the new position have for the organization? This contribution tries to answer these questions by describing existing strategies for the development of the service business in manufacturing companies. First, environmental factors are specified that influence the decision on a service strategy. Second, four different service strategies along the product-service-continuum and their organizational implications are described in detail. The chapter ends with some conclusions on the implications for managers.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Similar content being viewed by others
References
Aldrich, H. (1979). Organisations and environments. Englewood Cliffs, New Jersey: Prentice Hall.
Anderson, E., Fornell, C., & Rust, R. (1997). Customer satisfaction, productivity, and profitability: Differences between goods and services. Management Science, 16(2), 129–145.
Andrews, K. (1996). The concept of corporate strategy. In H. Mintzberg & J. B. Quinn (Eds.), The strategy process: Concepts, contexts, cases (pp. 47–55). New Jersey: Prentice Hall.
Davies, A. (2004). Moving base into high-value integrated solutions: A value stream approach. Industrial and Corporate Change, 13(5), 727–756.
Dess, G., & Beard, D. (1984). Dimensions of organizational task environments. Administrative Science Quarterly, 29(1), 52–73.
Duncan, R. (1972). Characteristics of organizational environments and perceived environmental uncertainty. Administrative Science Quarterly, 17(3), 313–327.
Fischer, T. (2012). A service perspective on value creation strategies. Dissertation, University St.Gallen.
Fischer, T., Gebauer, H., Gregory, M., Ren G., & Fleisch, E. (2010). Exploitation or exploration in service business development?: Insights from a dynamic capabilities perspective. Journal of Service Management, 21(5), 591–624.
Gebauer, H. (2008). Identifying service strategies in product manufacturing companies by exploring environment–strategy configurations. Industrial Marketing Management, 37(3), 278–291.
Gebauer, H., Fleisch, E., & Friedli, T. (2005). Overcoming the service paradox in manufacturing companies. European Management Journal, 23(19), 14–26.
Janiszewski, C., & Lichtenstein, D. R. (1999). A range theory account of price perception. The Journal of Consumer Research, 25(4), 353–368.
Jaworski, B., & Kohli, A. (1993). Market orientation: Antecedents and consequences. Journal of Marketing, 57(3), 53–70.
Kastalli, I., & Van Looy, B. (2013). Servitization: Disentangling the impact of service business model innovation on manufacturing firm performance. Journal of Operations Management, 31(4), 169–180.
Kohli, A., & Jaworski, B. (1990). Market orientation: The construct, research propositions, and managerial implications. The Journal of Marketing, 52(2), 1–18.
Kotler, P. (1994). Marketing management—anaylsis, planning, implementation and control (8th ed.). New Jersey: Prentice-Hall.
Lay, G., Schroeter, M., & Biege, S. (2009). Service-based business concepts: A typology for business-to-business markets. European Management Journal, 27(6), 442–455.
Martin, C., & Horne, D. (1992). Restructuring towards a service orientation: The strategic challenges. International Journal of Service Industry Management, 3(1), 25–38.
Mathieu, V. (2001). Service strategies within the manufacturing sector: Benefits, costs and partnership. International Journal of Service Industry Management, 12(5), 451–475.
Matthyssens, P., & Vandenbempt, K. (2010). Service addition as business market strategy: Identification of transition trajectories. Journal of Service Management, 21(5), 693–714.
Miller, D. (1987). The structural and environmental correlates of business strategy. Strategic Management Journal, 8(1), 55–76.
Mintzberg, H. (1979). The structuring of organization: A synthesis of the research. Englewood Cliffs, New Jersey: Prentice Hall.
Neu, W., & Brown, S. (2005). Forming successful business-to-business services in goods-dominant firms. Journal of Service Research, 8(1), 3–17.
Oliva, R., & Kallenberg, R. (2003). Managing the transition from products to services. International Journal of Service Industry Management, 14(2), 160–172.
Sawhney, M., Balasubramanian, S., & Krishnan, V. (2004). Creating growth with services. MIT Sloan Management Review, 45(2), 34–43.
Slater, S., & Narver, J. (1994). Does competitive environment moderate the market orientation performance relationship. Journal of Marketing, 58(1), 46–55.
Vandermeve, S., & Rada, J. (1988). Servitization of business: Adding value by adding services. European Management Journal, 6(4), 314–324.
Wise, R., & Baumgartner, P. (1999). Go downstream: The new imperative in manufacturing. Harvard Business Review, 77(5), 133–141.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2014 Springer International Publishing Switzerland
About this chapter
Cite this chapter
Ebeling, J., Friedli, T., Fleisch, E., Gebauer, H. (2014). Strategies for Developing the Service Business in Manufacturing Companies. In: Lay, G. (eds) Servitization in Industry. Springer, Cham. https://doi.org/10.1007/978-3-319-06935-7_14
Download citation
DOI: https://doi.org/10.1007/978-3-319-06935-7_14
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-319-06934-0
Online ISBN: 978-3-319-06935-7
eBook Packages: EngineeringEngineering (R0)