At the origins of Product Service Systems: Supporting the concept assessment with the Engineering Value Assessment method

Abstract

In recent years, the economic circumstances spur many companies in changing their traditional product-oriented value proposition toward a more customised and sustainable offer referred as Product-Service Systems (PSS). The main advantages of the new solutions are related to their customisation which can grant an improved customer experience. However, while pursuing greater differentiation from competitors and ‘locking-in’ customers and ‘locking-out’ competitors, many of the above-cited companies either miss interesting business opportunities or bet on the wrong solution concept. Early stage engineering phase plays a crucial role concerning the subsequent lifecycle phases, guiding the identification and the selection of valuable solutions while preventing commitment of resources on poor design alternatives. In the light of the criticality of this phase, this paper builds on empirical studies in the manufacturing industry and highlights the need for systematic procedures, methods and metrics able to encompass customer satisfaction together with the producer’s value perspective during the early design assessment. The outcome of the paper is the Engineering Value Assessment (EVA) method. It is a 2 step procedure composed of multi-criteria decision-making methods with specific criteria for a comprehensive value assessment of PSS from both the customers’ and the provider’s perspectives. The EVA also guides the identification of trade-off between the two through the Importance-Performance Analysis. Verification activities in the power and automation industry highlight the main benefits and the implications of the EVA method in guiding the decision making in the early stages of design and in balancing the trade-off between customer and provider value during the PSS assessment phase. Further developments and improvements are also discussed.