TY  - CHAP
AB  - As an answer for the limited growth potentials of diversification and internationalization, services became increasingly important for industrial firms in recent years. Based on existing and established business concepts, companies explore new segments in their traditional value chains beyond traditional market penetration strategies: they pursue service transition strategies to open up new sources for growth, even in markets that do not promise great expansion potential. Our paper addresses the issue of economies of scope of service transition. In this context, we first explore the question, to what extent the insights about product diversification strategies from physical goods sectors can be transferred to the service sector. Using competence-based considerations on diversification we focus on dynamic economies of scope, whose central idea is exploration and development of new resources rather than the static exploitation of existing ones. Furthermore, we integrate the largely neglected issue of how the phenomenon of service diversification depends on the industry's life cycle stage. In a small empirical study of the German mechanical engineering industry we demonstrate that diversification steps into services require a shift in the resource and competence base of firms. Using a dynamic perspective, we construct a conceptual framework for analyzing and explaining the advantages of service transition strategies. The developed model describes a service diversification trajectory and points out that the establishment of a profitable service business requires the exploration and development of competences and adequate organizational structures.
VL  - 12
SN  - 978-1-84855-877-9, 978-1-84855-876-2/0749-6826
DO  - 10.1108/S0749-6826(2010)0000012005
UR  - https://doi.org/10.1108/S0749-6826(2010)0000012005
AU  - Kessler Tim
AU  - Stephan Michael
ED  - Ron Sanchez
ED  - Aimé Heene
PY  - 2010
Y1  - 2010/01/01
TI  - Competence-based strategies of service transition
T2  - Enhancing Competences for Competitive Advantage
T3  - Advances in Applied Business Strategy
PB  - Emerald Group Publishing Limited
SP  - 23
EP  - 61
Y2  - 2024/04/25
ER  -