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Article
Publication date: 1 October 1995

Jane Kingman‐Brundage, William R. George and David E. Bowen

Offers a “service logic model” as a managerial tool fortackling cross‐functional issues embedded in service systems. Uncoversand describes the logical components inherent…

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3704

Abstract

Offers a “service logic model” as a managerial tool for tackling cross‐functional issues embedded in service systems. Uncovers and describes the logical components inherent in the three key service management functions – marketing, operations and human resources‐and suggests that the real management challenge, above and beyond cross‐functional co‐ordination, is integration of these components as the real drivers of service experience. A step‐by‐step template is offered for using service logic to achieve the fundamental grass roots integration required in the creation of outcomes valued for customers.

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International Journal of Service Industry Management, vol. 6 no. 4
Type: Research Article
ISSN: 0956-4233

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Article
Publication date: 27 June 2008

Christian Grönroos

In the discussion on service‐dominant logic and its consequences for value creation and marketing the inner meaning of the value‐in‐use notion and the nature of service…

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25234

Abstract

Purpose

In the discussion on service‐dominant logic and its consequences for value creation and marketing the inner meaning of the value‐in‐use notion and the nature of service marketing have not been considered thoroughly. The purpose of this paper is to analyze the meaning of a service logic as a logic for consumption and provision, respectively, and explore the consequences for value creation and marketing.

Design/methodology/approach

Being a research‐based paper, the topic is approached by theoretical analysis and conceptual development.

Findings

Discussing the differences between value‐in‐exchange and value‐in‐use, the paper concludes that value‐in‐exchange in essence concerns resources used as a value foundation which are aimed at facilitating customers' fulfilment of value‐in‐use. When accepting value‐in‐use as a foundational value creation concept customers are the value creators. Adopting a service logic makes it possible for firms to get involved with their customers' value‐generating processes, and the market offering is expanded to including firm‐customer interactions. In this way, the supplier can become a co‐creator of value with its customers. Drawing on the analysis, ten concluding service logic propositions are put forward.

Research limitations/implications

The analysis provides a foundation for further development of a service logic for customers and suppliers, respectively, (“service logic” is preferred over the normally used “service‐dominant logic”) as well for further analysis of the marketing consequences of adopting such a business and marketing logic.

Practical implications

Marketing practitioners will find new ways of understanding customers' value creation and of developing marketing strategies with an aim to engage suppliers with their customers' consumption processes in order to enhance customer satisfaction.

Originality/value

For a scholarly audience, the paper provides a more truly service‐centric understanding of value creation and of its marketing consequences. For a practitioner audience, it offers service‐based means of further developing marketing practices.

Details

European Business Review, vol. 20 no. 4
Type: Research Article
ISSN: 0955-534X

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Article
Publication date: 14 September 2015

Kristina Heinonen and Tore Strandvik

The purpose of this paper is to analyze the theoretical and practical implications of adopting customer-dominant logic (CDL) of service, focusing on how firms can become…

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6804

Abstract

Purpose

The purpose of this paper is to analyze the theoretical and practical implications of adopting customer-dominant logic (CDL) of service, focusing on how firms can become involved in the customers’ context.

Design/methodology/approach

Inspired by the conceptual discussion of service logic and service-dominant logic, this paper focuses on the conceptual underpinnings of CDL. CDL is contrasted with other service perspectives in marketing; CDL is a marketing and business perspective dominated by customer-related aspects instead of products, service, systems, costs or growth. It is grounded in understanding customer logic and how firms’ offerings can become embedded in customers’ lives/businesses.

Findings

The conceptual analysis challenges the prevailing assumptions of key phenomena in service research, including interaction, co-creation, service value and service. The paper presents five essential foundations of CDL: marketing as a business perspective, customer logic as the central concept, offering seen through the customer lens, value as formed and not created and the prevalence of customer ecosystems.

Research limitations/implications

The paper differentiates CDL from other marketing perspectives. Further empirical research is needed in different empirical settings to provide guidelines for adopting the perspective on a strategic and operational business level.

Practical implications

As a firm’s holistic and strategic foundation, marketing is based on understanding how providers participate, at a profit, in customers’ value formation. The paper suggests how firms can successfully conduct business in dynamic markets with empowered customers.

Originality/value

This paper expands marketing and business logic based on customer dominance. It accentuates the importance of understanding customer logic and stresses the presence of providers in the customer ecosystem.

Details

Journal of Services Marketing, vol. 29 no. 6/7
Type: Research Article
ISSN: 0887-6045

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Article
Publication date: 26 March 2018

Jukka Ojasalo and Katri Ojasalo

The purpose of this study is to develop a service logic oriented framework for business model development. “Service logic” covers the basic principles of the three…

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11705

Abstract

Purpose

The purpose of this study is to develop a service logic oriented framework for business model development. “Service logic” covers the basic principles of the three contemporary customer value focused business logics: service-dominant logic, service logic and customer-dominant logic.

Design/methodology/approach

This study is based on an empirical qualitative research and deployed the focus group method. The data are generated in a series of interactive co-creative focus group workshops involving both practitioners and academics.

Findings

As the outcome, a new tool was developed, called Service Logic Business Model Canvas. The new canvas is a modified version of the original Business Model Canvas (Osterwalder and Pigneur, 2010).

Research limitations/implications

This study adopts service logic in business model thinking and increases knowledge on how to keep the customer needs in the centre of business model development.

Practical implications

The developed canvas makes the theory of service-dominant logic tangible and easily applicable in practice. It enables service innovation truly based on customer value by ensuring that the customer is in the centre of all the elements of a business model. It can function both as a rapid prototype of a new business model and as a communication tool that quickly illustrates the company’s current business model. It can also help in creating a customer-centred business culture. It is designed to be applied to each customer profile separately, thus enabling a deeper understanding of the customer logic of each relevant profile.

Originality/value

Earlier business model frameworks tend to be provider-centric and goods-dominant, and require further development and adaptation to service logic. This study adopts service logic in business model thinking. It embeds the true and deep customer understanding and customer value in each element of the business model, and contributes to both business model and service-dominant logic literature.

Details

Journal of Research in Marketing and Entrepreneurship, vol. 20 no. 1
Type: Research Article
ISSN: 1471-5201

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Article
Publication date: 10 August 2010

Kristina Heinonen, Tore Strandvik, Karl‐Jacob Mickelsson, Bo Edvardsson, Erik Sundström and Per Andersson

The paper seeks to introduce to a new perspective on the roles of customers and companies in creating value by outlining a customer‐based approach to service. The customer

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15153

Abstract

Purpose

The paper seeks to introduce to a new perspective on the roles of customers and companies in creating value by outlining a customer‐based approach to service. The customer's logic is examined in‐depth as being the foundation of a customer‐dominant (CD) marketing and business logic.

Design/methodology/approach

The authors argue that both the goods‐ and service‐dominant logic are provider‐dominant. Contrasting the provider‐dominant logic with CD logic, the paper examines the creation of service value from the perspectives of value‐in‐use, the customer's own context, and the customer's experience of service.

Findings

Moving from a provider‐dominant logic to a CD logic uncovered five major challenges to service marketers: company involvement, company control in co‐creation, visibility of value creation, scope of customer experience, and character of customer experience.

Research limitations/implications

The paper is exploratory. It presents and discusses a new perspective and suggests implications for research and practice.

Practical implications

Awareness of the mechanisms of customer logic will provide businesses with new perspectives on the role of the company in their customers' lives. It is proposed that understanding the customer's logic should represent the starting‐point for the company's marketing and business logic.

Originality/value

The paper increases the understanding of how the customer's logic underpins the CD business logic. By exploring consequences of applying a CD logic, further directions for theoretical and empirical research are suggested.

Details

Journal of Service Management, vol. 21 no. 4
Type: Research Article
ISSN: 1757-5818

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Article
Publication date: 9 January 2017

Anne Vorre Hansen

The aim of this paper is to give an empirical illustration of value co-creation and to argue for narrative methodology as a fruitful analytical strategy when exploring the…

Abstract

Purpose

The aim of this paper is to give an empirical illustration of value co-creation and to argue for narrative methodology as a fruitful analytical strategy when exploring the processes of value co-creation.

Design/methodology/approach

Through an in-depth case study in the non-profit housing sector in Denmark, the research explored how residents perceive and co-create value in a long-term service relationship. The point of departure is an understanding of value co-creation as a phenomenological construct determined by the beneficiary, and the research is based primarily on the perspectives of service-dominant logic and customer-dominant logic.

Findings

The research elucidated how value is both socially created and deconstructed through stories. Moreover, narrative analysis revealed how residents’ perceptions of services are deeply embedded in context and time. In this way, the study highlighted that the co-creation of value is inherently social and temporal.

Practical implications

Understanding how value is perceived and negotiated by customers might assist practitioners to refine their understanding of value co-creation and lead them to address customers in more nuanced ways.

Originality/value

Prevailing streams in service research on value co-creation argue for more studies and empirically grounded examples of value co-creation processes, especially those based in the customer sphere. This paper contributes to such an enhanced understanding of the process of value co-creation and gives the outline of a new methodology for studies in this specific area of service research.

Details

European Business Review, vol. 29 no. 1
Type: Research Article
ISSN: 0955-534X

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Article
Publication date: 1 March 2013

Kristina Heinonen, Tore Strandvik and Päivi Voima

The purpose of this paper is to extend current discussions of value creation and propose a customer dominant value perspective. The point of origin in a customer‐dominant…

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5932

Abstract

Purpose

The purpose of this paper is to extend current discussions of value creation and propose a customer dominant value perspective. The point of origin in a customer‐dominant marketing logic (C‐D logic) is the customer, rather than the service provider, interaction or the system. The focus is shifted from the company's service processes involving the customer, to the customer's multi‐contextual value formation, involving the company.

Design/methodology/approach

Value formation is contrasted to earlier views on the company's role in value creation in a conceptual analysis focusing on five central aspects. Implications of the proposed characteristics of value formation compared to earlier approaches are put forward.

Findings

The paper highlights earlier hidden aspects on the role of a service for the customer. It is proposed that value is not always an active process of creation; instead, value is embedded and formed in the highly dynamic and multi‐contextual reality and life of the customer. This leads to a need to look beyond the line of visibility focused on visible customer‐company interactions, to the invisible and mental life of the customer. From this follows a need to extend the temporal scope, from exchange and use even further to accumulated experiences in the customer's life and ecosystem.

Research limitations/implications

This paper is conceptual. It discusses and presents a customer‐dominant value perspective and suggests implications for empirical research and practice.

Practical implications

Awareness of the mechanism of the customer value formation process provides companies with new insight on the service strategy, service design and new service innovations.

Originality/value

The paper contributes by extending the value construct through a new customer dominant value perspective, recognizing value as multi‐contextual and dynamic based on customers' life and ecosystem. The findings mark out new avenues for future research.

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Article
Publication date: 28 August 2007

David Ballantyne and Robert Aitken

This paper aims to explore how the service‐dominant (S‐D) logic of marketing proposed by Vargo and Lusch impacts on business‐to‐business branding concepts and practice.

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19628

Abstract

Purpose

This paper aims to explore how the service‐dominant (S‐D) logic of marketing proposed by Vargo and Lusch impacts on business‐to‐business branding concepts and practice.

Design/methodology/approach

Vargo and Lusch argue that service interaction comes from goods‐in‐use as well as from interactions between a buyer and a supplier. Their key concepts are examined and the branding literature critically compared.

Findings

Goods become service appliances. Buyer judgments about the value‐in‐use of goods extends the time‐logic of marketing. The exchange concept is no longer transaction bound. Service‐ability (the capability to serve) becomes the essence of a firm's value propositions. Service experience becomes paramount in developing and sustaining the life of a brand.

Research limitations/implications

S‐D logic highlights the need for rigour and clarity in the use of the term “brand”. It also opens up for consideration a variety of previously unexplored contact points in the customer service cycle, expanded to include customer assessments of value‐in‐use.

Practical implications

S‐D logic encourages extending brand strategies into a wider variety of communicative interaction modes.

Originality/value

Some of the issues raised are not new but currently compete for attention in the shadow of media‐dominant approaches to branding.

Details

Journal of Business & Industrial Marketing, vol. 22 no. 6
Type: Research Article
ISSN: 0885-8624

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Article
Publication date: 5 August 2014

Elin Nilsson and David Ballantyne

The purpose of this paper was to extend understanding of the sense of place captured by the servicescape concept, as a means by which customers clarify their service…

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7275

Abstract

Purpose

The purpose of this paper was to extend understanding of the sense of place captured by the servicescape concept, as a means by which customers clarify their service expectations and their satisfaction with service experiences.

Design/methodology/approach

The design is conceptual. This article critically examines and extends the servicescape concept in the light of insights from the service-dominant (S-D) logic.

Findings

First, we explain how servicescape adds meaning to a service provider’s value proposition, part of a pattern of customer expectations which are later confirmed or disconfirmed as value-in-use. Second, the servicescape is a more socially imbued context than has previously been recognized, because the service experience is co-created by customer and service provider. Third, the context for service is not restricted to the traditional physical servicescape, as other more fluid and web-based settings are now common.

Practical implications

Extending the understanding of place as a context for value determination in new ways.

Originality/value

The literature on servicescape is extensive, but it is anchored to the physicality of the service environment. Given the rise of the Internet and, more recently, digital social media as a virtual “place” of business, the relevance of servicescape is due for critical review. Our critical examination adds to the experience value of service and also extends the S-D logic understanding of value-in-use.

Details

Journal of Services Marketing, vol. 28 no. 5
Type: Research Article
ISSN: 0887-6045

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Article
Publication date: 10 February 2012

Bård Tronvoll

The purpose of this paper is to propose a conceptual model of customer complaining behaviour as a dynamic process in accordance with the service‐dominant logic perspective…

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4999

Abstract

Purpose

The purpose of this paper is to propose a conceptual model of customer complaining behaviour as a dynamic process in accordance with the service‐dominant logic perspective of marketing.

Design/methodology/approach

The study reviews the common behaviour models of customer complaints and relates this to the service‐dominant logic perspective in order to develop and describe a dynamic conceptual model of customer complaining behaviour.

Findings

The proposed model posits three categories of complaining behaviour due to a customer's unfavourable service experience: no complaining response, communication complaining responses, and action complaining responses.

Research limitations/implications

Empirical validation of the proposed conceptual model is needed.

Practical implications

The proposed model can be used by managers to understand the various behaviour responses of customer complaints that the company experiences. In addition, the model assists in framing appropriate managerial responses, including service recovery and improved service design.

Originality/value

The study represents a thorough conceptual examination of the complaint process and proposes a dynamic model of customer complaining behaviour based on the service‐dominant logic perspective.

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