The measurement of degree of servitization: literature review and recommendations

Abstract

This study reviews systematically the literature on the measurement of the firm-level degree of servitization. The results show that servitization measures are inconsistent across studies, even among those investigating similar research questions, and that a theoretical reference for their appropriate use is still missing. Focusing on these shortcomings, this study theorizes the firm-level servitization degree in three classes, i.e. "extension", "infusion", and "orientation". Hence, measures to operationalize each class are derived from the literature review and, subsequently, discussed with a panel of experts. In addition, servitization measurement is conceptualized other than as firm level degree, as measurement at regional, product, and individual employee levels. This study is the first to provide a systematic review on the topic and to develop a general conceptualization and operationalization of servitization measurement. Furthermore, this research is the first to employ an international standard classification of economic activities as a basis to identify objectively firms' service offerings. This research supports both scholars and practitioners because it brings consistency across studies and applications, thus fostering assessment and comparability of servitization experiences.

Explaining the servitization paradox: a configurational theory and a performance measurement framework

“…Fliess and Lexutt (2019) reviewed the literature and found that only 18% of the articles adopts further performance criteria specific for servitization success. Calabrese et al (2019) demonstrate that such narrowed focus impairs measuring servitization level effectively. Limiting measurement to service turnover or service types for servitization level and to profitability or sales for performance makes comparison of the results difficult and provides only a partial picture of their relationship (Crozet and Milet, 2017;Sousa and Da Silveira, 2017).…”

“…Step Zou et al (2018), Scopus was chosen as the engine to search for relevant articles. A query was designed to collect all peer-reviewed material with the word "servitization" in the title, abstract or keywords, accommodating for the different spellings (Baines et al, 2017;Calabrese et al, 2019;Fliess and Lexutt, 2019). Three further restrictions were applied to maximize the relevance of the identified publications.…”

From Goods to Services and from Linear to Circular: The Role of Servitization’s Challenges and Drivers in the Shifting Process

“…In the case of the drivers, it was found that 10 papers did not identify either a hard driver or a soft driver [57][58][59][60]121,[127][128][129][130][131]; that is, they focused exclusively on the challenges instead of looking for the levers or opportunities that servitization may also bring to firms and that could overcome those challenges. For hard drivers, most papers also focus their findings on technical and market drivers, while economic drivers (less financial volatility, reduced costs in function-based business models) have received less attention.…”

“…Although literature reviews have been conducted on this topic [17,19,56,57], and some have focused either on the challenges [58][59][60] or drivers [45,61], and the development of new concepts engaging servitization [34,62,63], there is still a need to standardize the growing language (academic and practitioner) around the topic [64,65].…”

Assessment of Servitization Leagility Using Multi-Grade Fuzzy Approach

“…In addition to leagility, many manufacturing and non-manufacturing companies have applied servitization as a strategy to achieve growth, profitability, and economic stability (Calabrese et al, 2019). For example, Toyota uses 'Do not buy a forklift', Rolls-Royce applies 'Total Care Package' and 'Power by the Hour'.…”