A New Perspective of Product-Service Business Models for Customized Manufacturing in Healthcare

Abstract

The notable increase of average life expectancy, especially in developed countries, has resulted in a dramatic increase of aging population within the past decade. As a consequence, a better healthcare system is required to serve this aging population both in terms of healthcare service and medical products in order to provide them a better quality of life. To this end, customized medical products which are designed based on individual requirements of each patient have a considerable impact on the treatment process and quality of life. The emerging innovative manufacturing technologies facilitate development and production of customized medical products. Thanks to the new technologies such as additive manufacturing, it is even possible to produce the customized medical products efficiently in the hospitals in patients proximity, which would transform the role of the hospital from a user to a producer of the medical products. In the other words, the hospital would extend its core business from a healthcare service provider to a healthcare product manufacturer and service provider. Accordingly, a new business model is required to facilitate and support such a shift by focusing on both product and service perspectives and hence taking into account an integrated product-service system approach. This chapter discusses innovative product-service business models based on customized manufacturing of medical products exploiting the potential of innovative technologies and the exchange of innovative products-services between the hospital (as the manufacturer) and the machinery producers (as the supplier). A structured business model design approach is presented, enabling the generation of different alternatives through different configurations of business model building blocks. Each alternative differs from another in terms of level of servitization and intensity of the relationship between customer and supplier. Eventually the best-fit business model can be generated and implemented by the hospital, based on the potential benefits and challenges that each alternative entails. The latter aspect will be also covered in the chapter through having a deeper look on pros and cons of each business model alternative.