Servitization in Finnish manufacturing industry : a framework for transforming businesses
Mughal, Muhammad Haseeb (2022)
Diplomityö
Mughal, Muhammad Haseeb
2022
School of Engineering Science, Laskennallinen tekniikka
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi-fe2022052438605
https://urn.fi/URN:NBN:fi-fe2022052438605
Tiivistelmä
This research studies the journey of manufacturing companies that are making a transition from being product-centric to offering a blend of product and services. Research in this domain is important because a practical framework is needed in the industry that can be utilized to define a central strategy for the company's service offerings and to determine clear standards for the implementation and measurement of servitization. The study followed an inductive qualitative approach with embedded case study. For the part of data analysis, grounded theory was used as the framework for qualitative research. As a result, a data structure was developed that represented three dimensions namely i) structure and change-oriented internal factors, ii) consumer-oriented external factors, and iii) strategic factors, and how these dimensions facilitate or hinder the transition from manufacturing to service business.
The results highlighted the key elements, phases, and challenges faced in the transition from product-centred business to service-centred business (servitization) in the context of chemical manufacturing industry and focused on how the development of servitization transition can be measured and what are the key performance indicators (KPIs) to use. For measurement, the understanding of the existing service offering of the firm, the strategic aim for future service offerings, and service orientation were considered as crucial elements of the servitization plan. Finally, to reflect the economic implications of the servitization strategy, revenue growth was considered to be the key component for evaluating servitization. As a practical implication, a framework was developed that can be utilized by senior or middle-level management to define an overarching strategy for the organization's product/service offerings and to establish explicit standards for the implementation of servitization. The main limitation of this research is that it only covered the chemical manufacturing sector of Finland and hinders the generalization of findings of the study.
The results highlighted the key elements, phases, and challenges faced in the transition from product-centred business to service-centred business (servitization) in the context of chemical manufacturing industry and focused on how the development of servitization transition can be measured and what are the key performance indicators (KPIs) to use. For measurement, the understanding of the existing service offering of the firm, the strategic aim for future service offerings, and service orientation were considered as crucial elements of the servitization plan. Finally, to reflect the economic implications of the servitization strategy, revenue growth was considered to be the key component for evaluating servitization. As a practical implication, a framework was developed that can be utilized by senior or middle-level management to define an overarching strategy for the organization's product/service offerings and to establish explicit standards for the implementation of servitization. The main limitation of this research is that it only covered the chemical manufacturing sector of Finland and hinders the generalization of findings of the study.