Service, services and products: rethinking operations strategy

Abstract

Purpose-This paper proposes a new approach to operations and supply strategy in the light of recent developments in the analysis of the respective roles of products and services in delivering benefits to customers. Design/methodology/approach-Reviews and synthesises concepts from operations management (OM), marketing, economics and related areas. Examples of product and service combinations are considered, drawing attention to the ways in which services may be distinguished from products. An institutional basis for defining services is favoured over IHIP. A corollary of this is how services are made tradable: the modularity theory of the firm is used to do this. The paper then outlines, considers and compares various approaches to the combination of products and services: "service-dominant logic", support services, product-service systems, systems integration, performance-based logistics, bundling and, finally, the notion of "the offering". Findings-It is found that the notion of the business model is useful as an integrating concept. This focuses on four areas: network structure, how transactions are made, how revenue models and incentives interact and how capabilities are accessed. Implications for future research in OM are considered. Research limitations/implications-Hitherto, operations strategy (OS) has concentrated on intra-firm capabilities, which is only part of one of the four areas identified. Therefore, an extensive agenda for research into inter-firm capabilities and the other three areas identified is presented. Originality/value-This is among the first papers in OM to break completely with IHIP as a basis for service definition and to work through the implications for OS. It is also the first to develop systematically an understanding of how the emerging concept of the business model can inform OM.

Inside service-intensive projects: Analyzing inbuilt tensions

“…Third, the qualities of products and services ad another puzzle; the previously mentioned are tangible and lasting, whereas the latter ones are abstract and perishable (Lovelock and Gummesson, 2004;Spring and Araujo, 2009). This is challenging from the perspective of the post-project technology/service development, as the most talented problem solvers are relocated to other projects after project handover.…”

Strategic sourcing with multi-stakeholders through value co-creation: An evidence from global health care company

“…In the process of value co-creation, resources, i.e. -people, systems, infrastructures and information‖ (Gronroos 2004), are exploited through a number of collaborative partnership processes in order to achieve the optimum benefit for the purchaser (Tuli et al 2007;Vargo and Lusch 2004;2008;Spring and Araujo 2009;Vargo 2011). Baines et al (2011) argue that in the process of co-creation, appropriate actions should be taken between suppliers and purchasers, such as locating the suppliers' facilities closer to the purchaser's operations as well as understanding, monitoring, conditioning and servicing of sophisticated technology systems and their use to ensure speed and effectiveness of their response to purchaser's needs while minimising their costs.…”

Servitization: Disentangling the Impact of Service Business Model Innovation on Manufacturing Firm Performance

“…Consequently, its innovative thrust in providing a variety of services related to its product offering has led to the development of an integrated product-service business model (Amit and Zott, 2001;Spring and Araujo, 2009). …”