Abstract
Servitization is an emerging business model in a service-based economy. It is a bundle of a product and its essential services, with usage-based customer payment. For servitization to be profitable and scalable, the business model must translate into an efficient operating model, with pricing as a key parameter. Our research shows that large-scale servitization adoption has been constrained by the lack of agility and ineffective technology implementation. For instance, technologies like IoT, Analytics, and Artificial Intelligence are essential servitization components, enabling smart products to use feedback loops to monitor ongoing performance and usage. Servitization models are introduced through proof-of-concepts and pilots, yet operational scale is key to reach and sustain profitability.
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Kavanaugh, J., Ramachandran, S., Puri, R. (2023). Servitization in the Digital Era. In: Amit, R.K., Pawar, K.S., Sundarraj, R.P., Ratchev, S. (eds) Advances in Digital Manufacturing Systems. Springer, Singapore. https://doi.org/10.1007/978-981-19-7071-9_6
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