Abstract
This study extends the discussion of digital servitization business models by adopting the perspective of the theory of the firm. We use four theories of the firm (industrial organization, the resource-based view, organizational identity, and the transaction cost approach) to understand digital servitization business models of firms in the context of ecosystems. Digitalization transforms the business models of solution providers and shapes their firm boundary decisions as they develop digital solutions across organizational boundaries within ecosystems such as harbors, mines, and airports. Thus, digitalization not only affects individual firms' business models but also requires the alignment of the business models of other firms within the ecosystem. Hence, business models in digital servitization should be viewed from an ecosystem perspective. Based on a rigorous literature review, we provide suggestions for future research on digital servitization business models within ecosystems.
Highlights
Digitalization aids servitization in manufacturing companies, creating new opportunities for services, platforms, intelligent products, and novel business models
This review establishes what types of business model configurations are discussed in the servitization literature and how the digital shapes servitization business models
We use three dimensions: 1) solution customization, 2) solution pricing, and 3) solution digitalization. These are the core characteristics of smart solutions that digital servitization business models are built on
Summary
Digitalization aids servitization in manufacturing companies, creating new opportunities for services, platforms, intelligent products, and novel business models. Digitalization and software have been inherently involved in servitization from its infancy (Rabetino, Harmsen, Kohtamäki, & Sihvonen, 2018), shaping servitization strategies and structures as well as macro- and micro-level activities Companies, such as Rolls-Royce, Wärtsilä, and Caterpillar have used a variety of sensor-based technologies to enable product-servicesoftware systems and smart solutions (Grubic, 2018; Rymaszewska, Helo, & Gunasekaran, 2017). We use four theories of the firm (industrial organization, the resource-based view, organizational identity, and the transaction cost approach) to understand digital servitization business models within ecosystems We use these theories of the firm to understand configurations of the following five specific business models drawn from the literature: 1) product-oriented service provider, 2) industrializer, 3) customized integrated solution provider, 4) platform provider, and 5) outcome provider (Huikkola & Kohtamäki, 2018; Kowalkowski, Windahl, Kindström, & Gebauer, 2015).
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