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The purpose of this paper is to examine the relationship between service integration and manufacturing firms’ profitability and to identify profitable services.

The study examines the service integration data of 202 firms in the machinery and equipment sector in Korea. Firm profitability comes from secondary data to eliminate common method bias.

The relationship between service integration, measured as the service-revenue ratio, and profitability has an inverted U-shape, likely stemming from political costs, a loss of opportunity in manufacturing improvements arising from resource constraints, and an increase in transaction costs. In addition, process operation outsourcing and technical consulting significantly contribute to profitability.

The authors show that the effect of service integration on profitability diminishes when firms experience both resource constraints and an increase in transaction costs from implementing the strategy. Furthermore, the profitability of services is heterogeneous across different offerings. Further research in other countries and sectors is necessary to refine the relationships suggested herein.

Managers should strive to minimize the costs and problems stemming from resource constraints and transaction costs. It is also important to utilize external resources to achieve profitability from service integration. Managers also need to realize the different cost-revenue structure of each service.

The authors find that the relationship between profitability and service integration depends on the degree of resource constraints and transaction costs. The authors also identify which service offerings are highly profitable, which has not been done in previous research.

The aim of this study is to gain important insights on integration oriented servitization identifying essential dimensions of effective structures, coordination approaches and management controls adopted by manufacturing firms that integrate forward towards distribution, sales and services.

The study adopts a theory-guided qualitative abductive methodology to conduct a comparative case-study of two manufacturing firms in the same industry integrating forward to enhance servitization but with significantly different performance outcomes. The findings are uncovered from a broad spectrum of primary and secondary data spanning two decades.

The consistently high-performing firm puts equal emphasis on production and downstream distribution, sales and services and motivate individuals to engage in entrepreneurial efforts to develop combined product-services offerings that are valued by customers. The underperforming firm prioritizes operating efficiency driven by engineering prowess and managed through planning, standardization, authority and central controls.

The study is based on two representative firms operating in a specific industry context, which has ramifications for the generalizability of results and calls for replication studies to substantiate and extend findings.

Forward integration from manufacturing into distribution, sales and services represents a specific servitization strategy that needs structure and particular coordination approaches to be effective in complex dynamic product-markets. The characteristics of the outperforming case company provide useful insights on effective integrated servitization efforts.

Forward integration is a commonly adopted strategy among manufacturing firms that constitute the backbone of modern economies and effective governance of these integration oriented servitization efforts has important implications for societal value creation.

This study builds on rationales from management science including economic theory, corporate strategy and different micro-foundational lenses and thereby hone recent calls for broader theoretical foundations to enlighten studies of the servitization puzzle.

The purpose of this paper is to explore the evolution of “product‐service” (P‐S) strategies in the aerospace sector. Despite the widespread perception that aerospace organisations are advanced in terms of P‐S integration, little is known about the realities of P‐S provision in the sector. Much of the existing literature is normative and prescriptive, focusing upon what organisations aspire to do, but offers little insights into how attempts to integrate products and services occur or the challenges organisations encounter.

This paper presents an in‐depth case study of an international aerospace original equipment manufacturer, referred to as “JetCo”. A total of 18 interviews were conducted with key actors involved in the operationalisation of P‐S strategy within defence aerospace and civil aerospace divisions. In addition, analysis of internal company documentation was also undertaken.

This paper reveals that current P‐S strategy, which builds upon a long history of service offerings, initially evolved separately in each division in response to the particular markets in which they operate. However, there was evidence of a corporate‐wide strategy for P‐S provision being developed across divisions to improve co‐ordination. This was founded on the recognition that P‐S delivery requires the development of a stronger customer orientation, better knowledge and information management strategies and the engagement of employees. A key challenge concerned integrating the product and service parts of the business to ensure consistent delivery of a seamless value offering to customers.

The paper offers fresh empirical evidence into the development of P‐S in an organisation drawn from a sector often flagged as an exemplar of P‐S provision, and provides insights into the complex realities of P‐S implementation and delivery. Notably, it highlights the challenge of attempting to embed an organisation‐wide “service culture” in pursuit of integrated P‐S delivery, and questions the nostrums and overly simplistic models which pervade the current solutions discourse.

Despite the increasing attention given to product-service integration (PSI), little is known about this innovation strategy from a key decision-maker’s perspective. To address this gap, our study draws from personality psychology and decision-making (DM) logics theory to better understand why and how companies’ decision-makers strategize for PSI.

Using an abductive, empirics-first approach, we identify the study’s theoretical building blocks, followed by an exploratory quantitative analysis to generate new theory. We propose a fit-as-mediation conceptual framework suggesting that (1) specific personality traits [i.e. honesty-humility (H), emotionality (E), extraversion (X), agreeableness (A), conscientiousness (C) and openness to experience (O) (HEXACO)] make decision-makers more likely to include PSI in their company’s strategy and (2) depending on their personality, they apply different DM logics (i.e. causation or effectuation) to do so. To empirically examine this, we use data from 289 SMEs’ decision-makers.

We report several meaningful relationships among our key theoretical constructs. For instance, we find that conscientious decision-makers are more likely to develop a PSI strategy via causation, whereas extravert decision-makers are more likely to do so via both causation and effectuation.

This service study is the first to apply the well-established HEXACO Personality Inventory to companies’ key decision-makers. Moreover, it contributes to the microfoundations of PSI strategy and DM logic theories.

The purpose of this paper is to explore the patterns of service strategy changes in manufacturing firms and indicates how each pattern is interrelated with modifications in organizational design elements.

The paper draws on a longitudinal study using a survey of 97 manufacturers of capital goods. In addition, 15 case studies have been conducted. Survey and qualitative data are obtained in 1997, 2001, and 2004.

The findings highlight four patterns of service strategy changes: from customer service strategy to after‐sales service provider, from after‐sales service provider to customer‐support service provider, from customer‐support service provider to development partner, and from customer‐support service provider to the outsourcing partner. Evidence of specific alignment between service strategy and organizational design elements is provided.

The main limitation of this paper is the purposive sample.

Managers should follow the patterns of service strategy changes by extending the service offerings and modifying the organizational design elements.

Previous studies investigate service strategies and organizational design elements only at a specific time, which leads to a static perspective. This paper offers insights into interrelations among service strategy changes and organizational design elements.

The purpose of this paper is to analyze the available literature on the relationship between servitization strategy and firm performance, which identifies the main streams and theoretical foundations of research and provides guidelines for future research in this area.

The paper discusses the relationship between servitization strategy and manufacturing firm performance by gathering and analyzing existing research published between 1988 and 2019 through bibliometric analysis and content analysis, and then unpacking the processes and impacts servitization has on firm performance.

This paper analyzes the evolution of the concept and servitization strategy of manufacturing organizations, and the relationship between servitization strategy and manufacturing company performance. Then, the authors establish an integrated theoretical framework aimed at conveying the factors and providing a practical reference.

The paper establishes an integrated theoretical framework on servitization and firm performance. The results of the systematic analysis of the literature can be used to inform managers about implementing servitization. Managers need to measure the benefits of servitization from two aspects: financial performance and non-financial performance. And managers need to consider some internal and external influencing factors to achieve a strategic–environmental–organizational fit that will bring better benefits to the firm.

The paper contributes to the existing research in three different ways. First, the study perfects the gap of research on the range of all of the factors within the relationship between servitization strategy and manufacturing company performance. Second, the study demonstrates a clear indication of how existing studies’ differences influence the research outcomes. Third, this paper proposes research problems and future research directions.

The purpose of this paper is to examine the environment-strategy-structure fit in the context of industrial servitization and its impact on the profitability of manufacturing SMEs.

Data were collected from face-to-face interviews with the CEOs of 184 French manufacturing SMEs. These primary data were complemented by the indicators extracted from a financial database to ensure objective measures of financial performance. Analyses were conducted by means of partial least squares structural equation modeling.

The research tests the impact of the organizational design (customer interface, service delivery system and service culture (SC)) on financial performance. It also tests the moderating effect on this relationship of servitization strategies adopted by the firm (added services (AS), activities reconfiguration (AR) and business model reconfiguration (BMR)) and the environment in which the firm is situated (industry dynamism, competitive intensity and industry munificence).

This study considers the coalescence of the environment-strategy-structure to be a driver of firm performance in the context of industrial firms’ servitization. Three specific servitization strategies (AS, AR and BMR) are suggested based on the service offering’s impact on the customer’s activity chain or business model.

The research proposes some optimal organizational design depending on servitization strategy and environmental factors; for example, SC has a strong impact on financial performance when BMR is adopted.

This empirical study is based on an extended sample of 184 SMEs and provides quantitative support for the claim that good alignment between strategy and organizational design based on environmental factors increases profitability.

The advent of the new retail era witnessed the consumers’ demand shift from on the traditional product quality to on the full supply chain service quality, and product service and service manufacturing is gradually taking shape. The purpose of this paper is to propose whether there is a “quality bridge” in the dynamic evolution process of retail service supply chain (RSSC) and discuss the system role, steady-state characteristics and dynamic evolution mechanism of service quality in this dynamic evolution process.

This paper proposes the dissipation system structure of the RSSC under the steady-state quality constraint, constructs a Markov chain model (MCM) for the evolution of the service quality of RSSC, and tests the objective existence of the steady-state distribution of the service quality by taking Chinese HJ retail enterprises as samples.

The research value of this study is summarized as follows. The research finds that the evolution of service quality of RSSC is a dynamic and non-linear growth process, which has significant characteristics of complex adaptability and steady-state convergence. The study finds that the quality evolution process of the RSSC is a steady-state convergence process, and there is a steady-state distribution of quality in its co-evolution, in which different process input levels have a significant positive impact on the stable level of quality state. The study finds that the steady state of quality plays a crucial role in the collaborative evolution of the RSSC, that is, when the service quality reaches a certain steady state distribution, the operating efficiency and profit level of the whole chain will show an “explosive” growth trend.

Quality bridge, an original concept in this paper, represents the role of quality steady-state in the operation of RSSC. Based on Markov chain and system simulation tools, this paper verifies the existence of steady-state service quality and its positive effect on the co-evolution and sustainable development of RSSC. When the service quality reaches a certain steady distribution, the operating efficiency and income level of the whole chain will show n trend of explosive growth.

This study aims to examine the impact of the servitization on the performance of small and medium enterprises (SMEs) in Brazil.

The study uses data from Brazilian SMEs and applies partial least squares structural equation modeling (PLS-SEM) to test the research hypotheses.

The findings suggest a positive relationship between servitization and SME performance. It is found that the strategy of offering base services does impact SME performance. Furthermore, servitization aims to promote a fit between environmental pressures and SME performance.

SMEs can use servitization to increase their performance in spite of their resources restrictions, size limitation and low level of service revenue. However, the adoption of servitization should be accompanied by managerial adjustments in servitization practices.

This paper is dedicated to investigating the servitization-performance relationship in the context of SMEs, which is not a usual research publication. Moreover, it adds to the servitization theory by demonstrating that it is not necessary to reach a critical mass of services to be profitable and base services may be also a source of revenues and profits.

This paper aims to review logistics and supply chain management topics where theories have been applied to better understand the supply chain management (SCM) discipline identity. The purpose is threefold: to identify research topics in logistics and supply chain management where one or more theories have been examined; provide commentary on the theories that have been applied to the various logistics and SCM research topics; and to provide reference material and direction for future research.

This structured literature review (SLR) examines research papers in logistics and SCM from 1991 to 2015 published in eight leading academic journals. Papers in the data set are grouped by topic and further analyzed in terms of research method, purpose, year and journal.

This research categorizes papers by the topics that were studied to understand important insights about how these topics have been examined by researchers. Within each topic area, theories that researchers have used to investigate the topics are identified. This method exposes insights such as: how topics have evolved over time, which topics have lost prominence, which topics may be particularly promising for future research and how topics are treated in the literature.

Despite multiple calls for clarification regarding how theory has been used in logistics and SCM, the logistics and SCM disciplines continue to grow without adequate research on how theory has been used to examine SCM topics. This SLR therefore provides a broad compilation of logistics and SCM research that uses named theories and that is organized by SCM topic to better understand the SCM discipline.