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

Abstract

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)(2004)(2005)(2006)(2007)(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 business units and from a key customer company in the game events enabled new types of discussion related to the servitization initiative.Research limitations/implications -The concept presented in this paper represents a potential tool for enhancing a servitization initiative. Due to the limitations of the case, the findings are tentative and primarily transferrable to contexts where a manufacturer provides machinery for industrial production. Moreover, the ability of the concept to capture real-life customer values is critical for success and thus should be carefully examined. Originality/value -The case study enables an in-depth view of the phenomena under examination. Moreover, due to the researchers' interventions in developing and using the concept, they observed actual processes of overcoming the challenges of servitization.

RFM customer analysis for product-oriented services and service business development: an interventionist case study of two machinery manufacturers

“…Third, more specifically, the paper contributes to literature on management accounting supporting service business development (Malleret 2006;Laine et al 2012a;Lindholm et al 2017) by introducing a method that can use installed base and customer information to measure, analyze and govern the business potential of an industrial machinery fleet. It is noteworthy that although the RFM analyses presented in this paper focus on the existing product-related services, information about the different customer segments regarding these service activities may provide insights into service potentials regarding more advanced services as well [see e.g., Laine et al (2012b) for service business potential simulations]. The findings of this paper encourage further examinations from management accounting and governance perspectives.…”

“…Service businesses challenge OEMs' management and governance structures and practices. Holmström et al (2010) and Laine et al (2012b) highlighted the importance of connecting the manufacturing companies' service activities to customers' value generations processes. The most profitable service activities may stem from the activities that are undertaken by the manufacturers in the most effective way according to the needs of the customers' processes.…”

“…Particularly, many manufacturing companies aim at long-term customer relationships (e.g., Penttinen and Palmer 2007), and thus the nature of the new kinds of customer relationships needs to be more thoroughly captured by supporting management accounting analyses. It is noteworthy that, to a large extent, the long-term customer relationships tie OEMs' profitability to the profitability of their customers (Laine et al 2012b). In this vein, Lindholm et al (2017) suggest new performance indicators related to machinery fleets and their after-sales service needs (from the customer's viewpoint) and potentials (from the manufacturing company's perspective).…”

“…The paper relies on qualitative inquiry, particularly on an interventionist case study (Jönsson and Lukka 2007;Lukka and Suomala 2014;Suomala et al 2014;Laine et al 2012b). A case study approach is a reasonable choice because the paper addresses a complex, longitudinal phenomenon, i.e., the governance of product-oriented services and embedded wider implications to the service business development.…”

Improvisation as a Prerequisite for the Dynamic Interplay of Production and Service in PSS: Insights of an Organizational Design Principle and a Game-based Learning Approach

“…Secondly, learners should acquire the capabilities to cope with the dynamics of collaborative improvisational learning processes in PSS. In order to meet these learning objectives, the method of business gaming, which has recently been applied to the context of PSS and servitization, is considered as an appropriate method where learners acquire capabilities through reflection-in-action, in reality analogous, but virtual settings [39,40]. A business game represents a model of the relevant dynamics and principles of an organization within a computer-based simulation framework.…”