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The effect of servitization on the product-oriented strategic net of SMEs

Lansink, M.J. (2020) The effect of servitization on the product-oriented strategic net of SMEs.

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Abstract:This research explores the effect of servitization on the product-oriented strategic net of small and medium-sized enterprises (hereinafter SMEs), emphasizing its network structure. A qualitative single case study has been conducted at a construction and installation company that focuses on the utilities market. The company is currently considering to modify their business strategy to provide not only products but an integrated product-service offering. The main drivers for this change are, according to the literature, that companies can benefit from servitization regarding marketing, strategy, and finance. However, despite these findings, it appears that research often focuses on multinational enterprises (hereinafter MNEs), as a result of which SMEs remain underexposed. Moreover, despite the fact that the existing literature has shown that SMEs need to enter into partnerships with external actors in order to supplement the internally missing resources and capabilities and make the movement to servitization possible, research often focuses on the dyadic perspective rather than the network level of analysis. Accordingly, the following research question was formulated: “What is the effect of servitization on a product-oriented strategic net of SMEs in terms of its structure?”. By emphasizing the network structure, consisting of actor (bonds), activity (links), and resource (ties), insights have been gained into the current network (base services) as well as the changes related to the future network (advanced services). The overarching finding of the analysis is that offering advanced services requires increasing interorganizational collaboration, both within and across processes. More specifically, this implies that the activity base and underlying resources need to expand, which results in an increase of linkages. Consequently, more coordination between actors is required with regard to the reallocation and increased alignment of activities (across processes), aimed at improving the process and joint outcomes. As a result, the complexity of the linkages is increasing accordingly. Moreover, as a consequence of the increase of the activity base, the knowledge of the focal firm becomes more superficial, which requires decentralization of responsibilities across actors. Last, the mutual relationship between actors, including the customer who needs to be engaged, must be strengthened in terms of trust, reinforcing the commitment to share resources.
Item Type:Essay (Master)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:Business Administration MSc (60644)
Link to this item:http://purl.utwente.nl/essays/81760
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