Identifying (territorial) tensions in the servitization value chain

Abstract

Purpose: To understand the tensions that servitization activities create between actors within networks. Design/methodology/approach: Interviews were conducted with manufacturers, intermediaries and customers across a range of industrial sectors. Findings: Tensions relating to two key sets of capabilities are identified: in developing or acquiring (i) operant technical expertise and (ii) operand service infrastructure. The former tension concerns whom knowledge is co-created with and where expertise resides. The latter involves a territorial investment component; firms developing strategies to acquire greater access to, or ownership of, infrastructures closer to customers. Developing and acquiring these capabilities is a strategic decision on the part of managers of servitizing firms, in order to gain recognized power and control in a particular territory. Originality/value: This paper explores how firms’ servitization activities involve value appropriation (from the rest of the network), contrasting with the narrative norm for servitization: that it creates additional value. There is a need to understand the tensions that servitization activities create within networks. Some firms may be able to improve servitization performance through co-operation rather than competition, generating co-opetitive relationships. Others may need to become much more aggressive, if they are to take a greater share of the ‘value’ from the value chain.

Divisions: Aston Business School > Operations & Information Management
Aston Business School > Advanced Services Group
Additional Information: © Aston Business School
Event Title: Spring Servitization Conference SSC2015
Event Type: Other
Event Dates: 2015-05-18 - 2015-05-19
Uncontrolled Keywords: servitization infrastructure,capabilities,territory
ISBN: 978-1-85449-492-4
PURE Output Type: Conference contribution
Published Date: 2015-05
Authors: Burton, Jamie
Story, Vicky
Zolkiewski, Judy
Raddats, Chris
Baines, Tim S. ( 0000-0002-7518-2967)
Medway, Dominic

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