From Product to Service Business: Productization of Product-Oriented, Use-Oriented, and Result-Oriented Business

Abstract

Companies considering a shift from manufacturing and selling physical products to selling services face several questions on service structure and repeatability. The current and potential offerings should be compared in the light of commercial and technical portfolio. The commercial offering visible to the customer needs to be productized and linked to the technical structure for services, including the needed processes and resources. From the financial viewpoint, the cost of delivering the offering should be known to be able to set a profitable price. Productization through a common product structure that acknowledges the commercial and technical views could be used as a tool to clarify the current and potential offerings and transform them into systematic and repeatable form that is comparable. The present study provides an example of using this kind of product structure to model a physical product offered as part of product-oriented, use-oriented, and result-oriented product-service systems. The presented product structure logic enables companies to clarify the offering, describe the processes and resources needed for delivering the offering, and evaluate its profitability.

Productization of Industrial Side Streams into By-Products—Case: Fiber Sludge from Pulp and Paper Industry

“…As productization deals with the commercial and technical aspects of the products, the product structure should acknowledge them [48]. The commercial side of the product structure consists of items that can be sold to the customer, such as product families, configurable products and sales items, and thus all variable features and functions that the customer can choose should be seen on the commercial side as separate items [49]. By examining the commercial portfolio, it is possible to see where the company's sales turnover comes from.…”

Productization and Product Structure: Extending The Perspective to Software Business

“…The product structure considerations are also linked to productization (Hannila, Tolonen, Harkonen, & Haapasalo, 2019;Lahtinen et al, 2019;Mustonen, Harkonen, & Haapasalo, 2019). From the software perspective, productization has been viewed as an emerging research area (Mathur, 2006) where the discussion links to areas such as software product management (Helferich, Schmid, & Herzwurm, 2006), delivering of standardized software products (Parry, Jones, Rowley, & Kupiec-Teahan, 2012;Vlaanderen, Brinkkemper, & van de Weerd, 2012), and software product value demonstration (Feller, Finnegan, Fitzgerald, & Hayes, 2008).…”