Chris Raddats

Resource configurations for services success in manufacturing companies

Purpose – The purpose of this paper is to investigate which resources and capabilities are most important to enable large manufacturers undergoing servitization to develop and deliver successful services. Design/methodology/approach – A survey of 155 UK-based manufacturers provided the basis for the study. Data analysis was undertaken using confirmatory factor analysis and multiple regression. Findings – In total, five constructs (“resource configurations”) which enable the development and delivery of successful services and a construct to measure services performance (“Success of Services”) were developed from the literature. A measurement model based on these constructs was empirically tested and verified. Two resource configurations; “Leaders and Services Personnel” and “Services Methods and Tools” were found to make a unique and statistically significant contribution to “Success of Services.” Research limitations/implications – The study highlights the importance of corporates leaders and service empl...

Motivations for servitization: the impact of product complexity

Purpose – The purpose of this paper is to identify the commonalities and differences in manufacturers’ motivations to servitise. Design/methodology/approach – UK study based on interviews with 40 managers in 25 companies in 12 sectors. Using the concept of product complexity, sectors were grouped using the Complex Products and Systems (CoPS) typology: non-complex products, complex products and systems. Findings – Motivations to servitise were categorised as competitive, demand based (i.e. derived from the customer) or economic. Motivations to servitise vary according to product complexity, although cost savings and improved service quality appear important demand-based motivations for all manufacturers. Non-complex product manufacturers also focus on services to help product differentiation. For CoPS manufacturers, both risk reduction and developing a new revenue stream were important motivations. For uniquely complex product manufacturers, stabilising revenue and increased profitability were strong motivations. For uniquely systems manufacturers, customers sought business transformation, whilst new service business models were also identified. Research limitations/implications – Using the CoPS typology, this study delineates motivations to servitise by sector. The findings show varying motivations to servitise as product complexity increases, although some motivational commonality existed across all groups. Manufacturers may have products of differing complexity within their portfolio. To overcome this limitation the unit of analysis was the strategic business unit. Practical implications – Managers can reflect on and benchmark their motivation for, and opportunities from, servitisation, by considering product complexity. Originality/value – The first study to categorise servitisation motivations by product complexity. Identifying that some customers of systems manufacturers seek business transformation through outsourcing.

Interactively developed capabilities: evidence from dyadic servitization relationships

Purpose – The paper challenges the focal firm perspective of much resource/capability research, identifying how a dyadic perspective facilitates identification of capabilities required for servitization. Design/methodology/approach – Exploratory study consisting of seven dyadic relationships in five sectors. Findings – An additional dimension of capabilities should be recognised; whether they are developed independently or interactively (with another actor). The following examples of interactively developed capabilities are identified: knowledge development, where partners interactively communicate to understand capabilities; service enablement, manufacturers work with suppliers and customers to support delivery of new services; service development, partners interact to optimise performance of existing services; risk management, customers work with manufacturers to manage risks of product acquisition/operation. Six propositions were developed to articulate these findings. Research implications/limitations – Interactively developed capabilities are created when two or more actors interact to create value. Interactively developed capabilities do not just reside within one firm and, therefore, cannot be a source of competitive advantage for one firm alone. Many of the capabilities required for servitization are interactive, yet have received little research attention. The study does not provide an exhaustive list of interactively developed capabilities, but demonstrates their existence in manufacturer/supplier and manufacturer/customer dyads. Practical implications – Manufacturers need to understand how to develop capabilities interactively to create competitive advantage and value and identify other actors with whom these capabilities can be developed. Originality/value – Previous research has focused on relational capabilities within a focal firm. This study extends existing theories to include interactively developed capabilities. The paper proposes that interactivity is a key dimension of actors’ complementary capabilities.

Creating multi-vendor solutions: the resources and capabilities required.

Purpose – The purpose of this paper is to investigate the resources and capabilities required by manufacturers to develop and deliver multi-vendor solutions. Design/methodology/approach – A multi-case design comprising six UK-based manufacturers: two from each of the aerospace/defence, information technology and telecommunications sectors. Findings – Manufacturers can be characterized by their propensity to include products from other vendors in their solutions; single vendor solution providers (SVSPs) focus on solutions comprising their own products, while multi-vendor solution providers (MVSPs) fully embrace products from other manufacturers. Three capabilities were identified which distinguish MVSPs from SVSPs given the complexity of multi-vendor solutions (expertise specifying the solution, engineers trained in implementing/supporting the solution, partnerships with component suppliers of the solution). These capabilities are underpinned by both technical capability and impartiality in solution specif...

Identifying Tensions in the Servitized Value Chain

OVERVIEW: Servitization is recognized as an opportunity for manufacturing firms to harvest additional value by accessing new sources of revenue and expanding their reach up and down the value chain. It is a network activity, as it involves not just the servitizing firm but actors across the firm’s ecosystem. Most studies argue that servitization creates value for all network actors. However, service innovation activities may also result in the firm appropriating value from other actors, creating tensions in the network. Those tensions can undermine servitization efforts and destroy value for all participants. To avoid this outcome, firms must anticipate and manage tensions to create cooperative relationships with value chain partners. Through a series of semi-structured interviews with key actors at servitizing firms and their customers and intermediaries, we identified specific types and sources of tensions in the servitization process and explored how they might be mitigated or managed.

Strategic B2B customer experience management: the importance of outcomes-based measures

Purpose The purpose of this paper is to critique the adequacy of efforts to capture the complexities of customer experience in a business-to-business (B2B) context using input–output measures. The paper introduces a strategic customer experience management framework to capture the complexity of B2B service interactions and discusses the value of outcomes-based measurement. Design/methodology/approach This is a theoretical paper that reviews extant literature related to B2B customer experience and asks fresh questions regarding B2B customer experience at a more strategic network level. Findings The paper offers a reconceptualisation of B2B customer experience, proposes a strategic customer experience management framework and outlines a future research agenda. Research limitations/implications This paper is conceptual and seeks to raise questions surrounding the under-examined area of B2B customer experience. As a consequence, it has inevitable limitations resulting from the lack of empirical evidence to support the reconceptualisation. Practical implications Existing measures of customer experience are problematic when applied in a B2B (services) context. Rather than adopting input- and output-based measures, widely used in a business-to-consumer (B2C) context, a B2B context requires a more strategic approach to capturing and managing customer experience. Focussing on strategically important issues should generate opportunities for value co-creation and are more likely to involve outcomes-based measures. Social implications Improving the understanding of customer experience in a B2B context should allow organisations to design better services and consequently enhance the experiences of their employees, their customers and other connected actors. Originality/value This paper critiques the current approach to measuring customer experience in a B2B context, drawing on contemporary ideas of value-in-use, outcomes-based measures and “Big Data” to offer potential solutions to the measurement problems identified.

Overcoming the Challenges of Servitisation: Aligning Responses to Service Strategy

Manufacturers face a number of challenges in implementing servitisation. This chapter on ‘servitisation practices’ explores how to overcome these challenges by aligning responses to different service strategies. A service strategy and challenge road map is presented, which includes four challenges: (1) interpret the market environment, (2) reorientate from products to services, (3) undertake a structural reorganisation and (4) develop service-related operational processes. Responses to these challenges are presented in line with four service strategies, based on increasing ‘enthusiasm’ for services (Conservative, Pragmatist, Restrained Enthusiast, Enthusiast). Manufacturers need to respond sequentially to the specific challenges they face when following a particular service strategy.