Paolo Gaiardelli

Performance measurement of the after-sales service network-Evidence from the automotive industry

The after-sales activities are nowadays acknowledged as a relevant source of revenue, profit and competitive advantage in most manufacturing industries. Top and middle management, therefore, should focus on the definition of a structured business performance measurement system for the after-sales business. In addition, since many actors are involved along the after-sale service supply chain, an integrated and multi-attribute set of measures needs to be designed consistently at every level of the supply chain. Nonetheless, little attention was devoted by scientific and managerial literature to this topic. The paper aims at filling this gap, and proposes an integrated framework for the after-sales network performance measurement, and provides an empirical application to two automotive case companies and their official service network. The cases show that performance measurement systems of different supply chain actors should be aligned in order to achieve strategic consistency. In particular, the performance of different actors at the process level of the framework concurs in determining the after-sales service overall performance towards the final customer. In addition, linkages at other levels (mainly the business and activity ones) may be needed or helpful in ensuring consistency between strategic and operational objectives, inside the organisations and thus for the whole supply chain.

Aligning strategic profiles with operational metrics in after‐sales service

Purpose - The purpose of the paper is to overcome the limitations of the current models available in the literature in terms of relation and consistency between business strategy, service chain configuration and performance measurement systems, and on the alignment between strategic, tactical and operational levels of after-sales decision-making processes. Design/methodology/approach - The paper draws on a literature review of after-sales performance measurement systems and provides a first validation of the proposed integrated model through industrial case studies related to the provision of durable consumer goods in a business to consumer scenario. Findings - The paper aims to contribute to a better understanding of the factors which influence the performance of after-sales, in order to allow enterprises to consistently design their corporate after-sales service strategic performances with those required at operational levels within a service chain. Research limitations/implications - Further development must be carried out in order to: enlarge the sample of companies and cases where the model can be applied, with a specific extension on a business-to-business industry; extend the model to the whole supply and service chain; enrich the framework in order to consider other aspects, as empathy; and develop a full integration with the SCOR model, including the definition of best practices. Originality/value - The integration of the strategic and operational views subsumed by the framework would allow enterprises in relating more consistently their corporate After-sales strategic and operational performance within a service chain and to assess the cause and effect relationship between operational drivers and financial and competitive results.

Performance measurement systems in after-sales service: an integrated framework

In todays competitive markets, companies are shifting from a Product-centric to a Customer-centric view. The After-Sales (AS) service can become a key differentiator and a major profit source. Thus, after-sales cannot be considered simply a set of operative activities; rather it plays a strategic role, affecting the definition of the product-service mix offered to the customer and the physical and organisational configuration of the overall logistics chain. Therefore, importance should be given to its strategic management and to the definition of a structured business performance measurement system. In this context, this paper a) provides a review of the existing body of knowledge about AS performance measurement systems, b) proposes an integrated framework for AS performance measurement consisting of four levels (business, process, activity, and development and innovation), and c) provides an empirical application of the framework to four case studies in durable consumer goods – automotive, home appliances and consumer electronics.

The role and performance measurement of after‐sales in the durable consumer goods industries: an empirical study

Purpose – To analyse the role of after‐sales services in manufacturing contexts, and the related after‐sales performance measurement systems.Design/methodology/approach – An exploratory case study research was performed in the automotive, household appliance, IT and consumer electronics industries. The sample is made up of 48 firms with after‐sales operations in Italy.Findings – The role attributed to after‐sales activities in the IT and consumer electronics and household appliance industries shows an orientation to improve company image, customer satisfaction and retention (marketing focus). A different situation characterises the companies studied in the automotive industry. In most firms, however, measurement systems are quite simple and short‐term oriented, especially in the IT and consumer electronics and household appliance industries. The measurement of non‐financial performance emphasises effectiveness rather than efficiency, and the automotive industry, on the whole, presents more advanced measur...

The role of digital technologies for the service transformation of industrial companies

The role of digital technologies in service business transformation is under-investigated. This paper contributes to filling this gap by addressing how the Internet of things (IoT), cloud computing (CC) and predictive analytics (PA) facilitate service transformation in industrial companies. Through the Data–Information–Knowledge–Wisdom (DIKW) model, we discuss how the abovementioned technologies transform low-level entities such as data into information and knowledge to support the service transformation of manufacturers. We propose a set of digital capabilities, based on the extant literature and the findings from four case studies. Then, we discuss how these capabilities support the service transformation trajectories of manufacturers. We find that IoT is foundational to any service transformation, although it is mostly needed to become an availability provider. PA is essential for moving to the performance provider profile. Besides providing scalability in all profiles, CC is specifically used to implement an industrialiser strategy, therefore leading to standardised, repeatable and productised offerings.

Product-Service Engineering: State of the Art and Future Directions

Abstract Industrial companies are becoming more aware of the strategic and economic relevance of services relating to manufactured products. To overcome the apparent dichotomy between tangible artifacts and intangible elements, it is necessary to carry out a systematic reasoning encompassing different perspectives from both the manufacturing and service practices and related research streams. The paper reviews the State of the Art on Product-Service putting into evidence the current achievements fulfilled in the Service Engineering area and outlining possible future research directions.

A Service Engineering framework to design and configure Product-Service Systems

Companies are striving to create new sources of value, providing integrated product-service solutions to customers, evolving from a “pure product” orientation towards a Product-Service System (PSS) perspective. In this context, Service Engineering (SE), the discipline concerned with the systematic development and design of product-services, is becoming a predominant field. Most of the available Service Engineering models, methods and tools come from traditional engineering, business and computer science approaches adapted to the Service System or Product-Service System. In order to fill this gap, this paper proposes a Service Engineering framework that integrates a product-service design modelling tool developed at the Tokyo Metropolitan University with a discrete event simulation test-bench, which enables the comparison of several PSS configurations and the evaluation of both customer and internal performance. A sample case is reported to better clarify the different phases of the framework implementation.

The strategic transition to services: a dominant logic perspective and its implications for operations

The recent transformation of industry, characterised by saturated and commoditised global environments and where companies strive to attract and retain customers, has pushed manufacturing organisations to rethink their traditional dominant logic based on the provision of artefacts. Research and anecdotal cases have shown that competing on the basis of product-delivery strategies has its limits, whereby companies’ continuous race towards the market proposition of advanced technological and functional features into a product could translate into the value destruction of their own business (Gebauer and Friedli 2005; Oliva and Kallenberg 2003). On the contrary, the development of differentiation strategies rooted in the product–service paradigm may represent a key element for competitive advantage (Brax and Jonsson 2009; Matthyssens and Vandenbempt 2008). It is recognised that over one-third of large manufacturing firms offer services (Visnjic Kastalli, Van Looy, and Neely 2013). The success stories of General Electric, IBM, Rolls Royce Aerospace, Siemens and Xerox are just some of the popular examples of how competing on the basis of a service-based business model allows for prosperity in markets affected by weak demand, hard competition and decreasing margins (Quinn, Doorley, and Paquette 1990; Reinartz and Ulaga 2008; Spring and Araujo 2009). The growing importance of services in manufacturing has been underlined by a noticeable upsurge in studies on a phenomenon, widely acknowledged with the term of servitisation of manufacturing, which has been characterising the scientific and managerial literature since its first appearance in 1988 (Vandermerwe and Rada 1988). Different schools of thought, related to a multitude of disciplines, have sought to explore the variegated angles and facets of the phenomenon, often adopting various geneses, motivations, and cultural and methodological approaches. After 25 years, the research communities have been converging around a common understanding: in essence, it is a transformational journey, which commits industrial organisations to move along a continuum, from the provision of products and artefacts, through the proposition of product–service solutions, to a change in their structural and infrastructural capabilities and decisionmaking processes. Despite the economic (Cohen, Agrawal, and Agrawal 2006; Wise and Baumgartner 1999), financial (Brax 2005; Neely 2009), strategic (Gebauer, Fleisch, and Friedli 2005; Oliva and Kallenberg 2003) and marketing benefits (Corra et al. 2007; Gebauer and Fleisch 2007) of servitisation, the literature has underlined that most firms find it extremely difficult to provide services effectively (Spring and Araujo 2009). As revealed by surveys, servitisation often means higher investment costs and a greater risk of failure and bankruptcy, due to companies’ incapability to boost the sovereignty of services and develop the same awareness towards service with their partners and customers (Gebauer, Fleisch, and Friedli 2005). This involves the inability to transform service-based interactions into resource-efficacy or cost-efficiency (Håkansson and Waluszewski 2002, 2007). Several studies demonstrate how firms cannot merely add services to their original goods-dominated offerings to evolve into well servitised organisations (Cavalieri and Pezzotta 2012; Gaiardelli et al. 2014; Martinez et al. 2010). There is still a debate over whether an effective servitisation journey would require a radical and abrupt change in the way organisations think about their operations and value delivery. For instance, the effect of selling outcome-based services such as the miles per gallon from MAN Trucks and Busses Ltd or the EffiFuel service provided by Michelin, as opposed to selling products such as trucks or tyres, radically changes the way in which industrial firms operate (Martinez et al. 2011). It forces organisations to learn about new operations and strategies, such as service contracts, pricing, selling, asset management and risk sharing, in order to propose the promised service: value and experience to customers. However, as much as the service dominant logic (SDL) foundational premises shape the understanding of a service offering and its market implications (Vargo and Lusch 2004, 2008), they lack the strategic, functional and tactical directions for organisations to apply. The organisational changes and adaptation encapsulated in servitisation, the action of transformation to services, still appear to be an unexplored topic. Most of the existing studies still dwell on a static and spotted perspective, where the suggested organisation and business models are functional in order to respond to the need and

The Automotive Industry: Heading Towards Servitization in Turbulent Times

The European automotive industry has been fiercely hit by the recent economic downturn, which has further emphasized the structural overcapacity of production plants and price competition in the sales of new vehicles. Services constitute the main means for original equipment manufacturers (OEMs), authorised dealers, and repair shops, as well as the independent actors, to survive and be profitable, thanks to the size and age of the vehicle fleet. Servitization is thus a strategy pursued by manufacturers and their networks. However, the offering is still dominated by transactional, product-oriented services. Moreover, the relevance of services is still not fully recognized by the service network, which is not completely aware of the impact of servitization on profitability and customer loyalty. In addition, end customers are often not aware of the full range of services available. Further, the perceived importance of services by the network and the final customers may differ. At the forefront of servitization are noteworthy experimentations of sustainable mobility solutions that improve environmental impact and quality of life. These are the forerunners of new business models dominated by result-oriented services, where customer get access to vehicles on-demand rather than through direct ownership.

From a service-dominant logic to a good-dominant logic

Purpose – Productization, defined as the standardization of the production and delivery processes of services, is an approach that many service companies undertake, moving from relationship-intensive customer projects toward selling specific standardized offerings. In contrast to research on servitization, little in-depth research is available on the effects of this change of approach on the buyer-seller relationship. The purpose of this paper is to narrow this gap by providing evidence of the outcomes of productization in a corporate bank which has been serving Tier 1 customers for more than 15 years. Design/methodology/approach – Using the IMP Group approach, this research identifies how productization affects buyer-seller relationships. In total, 37 key informant interviews were conducted on both sides of the buyer-seller relationship. Findings – This research identified direct effects of productization relevant to buyer-seller relationships, and as many indirect effects through internal organizational...