Teemu Laine

Using a business game concept to enhance servitization: a longitudinal case study

Purpose – The purpose of this paper is to examine the potential benefits of a business game on customers’ business in enhancing servitization. The concept is proposed to be helpful in the phases of defining the servitization initiative and gaining shared understanding about it at a manufacturer.Design/methodology/approach – The paper is based on a longitudinal case study at a manufacturer (2003‐2008), with a focus on the business game concept on customers’ business. The researchers and approximately 140 company representatives contributed to both early and later phases of the development of the concept.Findings – The business game concept appeared to serve the purpose of generating and sharing ideas about the customers’ business and the desired role of the OEM in it, as a potential outcome of servitization. The concept synthesizes the previously fragmented customer awareness across the business units and provides useful information for various stakeholders. The presence of personnel across the different b...

Downstream shift at a machinery manufacturer: the case of the remote technologies

Purpose – The purpose of this paper is twofold. First, it aims at defining the concept of the downstream shift in the context of the machinery manufacturers. The second aim of the paper is to analyze the potentially enabling role of remote technologies in that shift.Design/methodology/approach – Besides examining the development of the supply chains based on the literature and a case company, the paper refers to the case of the remote technologies developed and used by the case company for the years of 2003‐2008.Findings – The key finding of this paper is that no consensus exists on the favourable scope and content of the downstream shift aimed at by the machinery manufacturers. Respectively, the potential role of the technologies in the shift can also vary on a case‐by‐case basis. Based on the case study, instead of new sources of service revenues, the information processed with the help of the remote technologies may provide an opportunity for the machinery manufacturer to learn from its customers, thus...

Management accounting roles in supporting servitisation: Implications for decision making at multiple levels

Purpose – The purpose of this paper is to analyse the potentially supportive roles of management accounting (MA) in the servitisation of manufacturers.Design/methodology/approach – The paper is a conceptual analysis supported by empirical examples.Findings – The potentially supporting roles of MA are here connected to the process of justifying, defining, and controlling servitisation. The potential units of analysis for MA in such a process are explored by going through the different viewpoints regarding service. The actual roles of MA within the process are examined both conceptually and in light of empirical experience. The paper acknowledges MA as a social phenomenon, taking multiple roles in supporting decision making. Essentially, MA can be used as a source of restricting and enabling, and the roles of MA may range from that of “answer machine” to the subjective and interactive use of MA information.Research limitations/implications – The paper represents a starting point for studying the variety of ...

Boundary subjects and boundary objects in accounting fact construction and communication

Purpose This paper aims to elaborate the concepts of boundary subjects and boundary objects in constructing and communicating relevant accounting facts for managing product development (PD). Boundary subjects as reflective actors benefit effective accounting enactment, by building a shared understanding about different actors’ roles and information needs, and by helping to respond to these needs with new boundary objects. Design/methodology/approach The paper uses a longitudinal interventionist case study of a machinery manufacturer. The focus of this case study was the production ramp-up phase at the end of a PD program. Different actors’ needs were first collected and elaborated by interventionist researchers (boundary subjects). Then accounting prototypes (boundary objects) provided new means of communication. Findings The findings show that dealing with boundaries is crucial in accounting development. The role of boundary subjects was fundamental in the process of choosing, constructing, elaborating and communicating accounting facts. During this process, accounting prototypes integrated new accounting facts, the boundary subjects mitigated the boundaries and the boundary objects focused and restricted communication about accounting facts. Research limitations/implications The paper tests the pragmatic constructivism approach by examining accounting enactment under uncertainty and ambiguity. The study refines pragmatic constructivism in terms of boundaries, boundary subjects as actors and boundary objects. Practical implications The intentional use of boundary subjects and objects as communication platform could push a more active inclusion of business controllers as active business partners. Originality/value The paper contributes to the literature on accounting development by highlighting the use of boundary subjects and boundary objects as fundamental mechanisms in constructing and communicating accounting facts.

Applying SPAT for understanding B‐to‐B supplier switching processes

Purpose: This study aims to focus on the switching path analysis technique (SPAT) application to enlarge the understanding of customer switching from the business to consumer (B-to-C) context to th ...

Innovation for Multiproject Management: The Case of Component Commonality

To attain benefits and value, multiproject R&D management seeks synergy between projects. Selecting or inventing appropriate end-product components within R&D programs is a concrete example of the synergy between projects. Lowering the number of different components used across projects (i.e., increasing component commonality) can lower end-product costs, which can contribute to firm-level profitability. Prior research, however, shows component commonality as a limitation of innovativeness in multiproject R&D. Conversely, this article shows that component commonality can also serve as the source of innovation, making component commonality an area of special interest to multiproject R&D management and research.

Accounting for networks: the consolidated network approach

In the network economy a profitability analysis based on the figures of one company is not sufficient to obtain an insight into the competitiveness of the whole network. In this paper, the applicability of the consolidated financial statement as a tool for managing network profitability is analyzed. The idea of the consolidated network is presented on the basis of a conceptual analysis, derived from an action research in two company networks. Despite the fact that there are a number of barriers on the way of the consolidated network, the idea of a consolidated view on business has received a positive feedback. The recognized benefits include value creation, profit calculation and profit sharing, and some other ways to improve performance within the network. Using the consolidated network as a metaphor is a way to communicate in supply chains.

Analyzing commodities: Ambiguous differences between goods and services

Commodities are the goods and services that a company sells. The business literature makes a clear distinction between goods and services, based on intangibility, heterogeneity, simultaneous production and consumption, and imperishability of services. All businesses, however, seem to be service businesses to some extent. The objective of this paper is to find a new model to analyze different types of commodities. The bases of the new Commodity Characteristics Model (CCM) are the eight recognized characteristics of goods and services, combined with the phase structure of real-life processes. This model has the advantage of breaking free from prejudices concerning goods and services. OEM companies, for instance, are willing to become solution providers by developing new services, with a variety of opinions concerning what those services actually are. These new service activities could be analyzed by a comprehensive, yet interpretive, model, case by case.

The potential of management accounting and control in global operations: Profitability-driven service business development

Purpose The purpose of this paper is to identify the financial potential of new service businesses in the context of a global machinery manufacturer. The objective is to examine the supportive role of management accounting (MA) and control in service business development, which has not been empirically examined previously. Design/methodology/approach The paper takes advantage of an interventionist case study at a global machinery manufacturer and is empirically based on a comprehensive examination of the service business potential in the selected product category in different market areas. The researchers were actively involved in the accounting development activities underlying this paper. Findings The results suggest that the development of a global service business is necessary to build on market area characteristics. An analysis should combine financial information and equipment fleet information across product lines and organizational units. Research limitations/implications MA and control practices tend to require significant development to actually support the process of identifying and capturing the service business potentials. As the findings are limited to one case environment, further studies should address the longitudinal evolution of MA and control, and the choice and utilization of different performance measures, in similar contexts. Practical implications The paper provides managerial insights on how to utilize MA information and proposes ideas for performance indicators. Originality/value The process examined in this paper responds to the need for tools and techniques supporting service business development. MA and control could provide a comprehensive understanding of the dynamics of service business profitability potential and support in identifying and prioritizing the possible avenues of realizing such potential.

Diffusion of industrial services: is it another story?

In this paper, the objective is to identify challenges in the diffusion process of new industrial services and to compare the findings with the diffusion process of new products. The importance of this topic was raised during a research project launched by a global OEM (Original Equipment Manufacturer). The strategic choice of the OEM was to grow by developing an after-sales service business. Moreover, the OEM assumes that after-sales business is more profitable than manufacturing. The role of the researchers in the project is to propose a reasonable new service-based business model. The researchers have been intensively involved in the process. Thus, the conceptual research on product innovations and diffusion of innovation in service business is supported by empirical observations from the business case.