From Selling Products to Providing User Oriented Product-Service Systems – Exploring Service Orientation in the German Machine and Plant Manufacturing Industry

Abstract

Companies shifting from selling technical products towards offering integrated product-service systems (PSS) need to extend their existing service portfolio according to their customers’ needs. Using a qualitative case study approach this paper explores service orientation in the German machine and plant manufacturing industry. We develop a measure for firm service orientation based on interview and secondary data. We assess the firms’ status quo of PSS development and allocate companies on a continuum from product- to result- oriented PSS. Our results indicate that service orientation varies substantially across firms and that a high service orientation is related to a high level of user integration. With regard to product portfolio, we find, that individualized or modularized product architectures foster the development of a higher service orientation. This paper contributes to the understanding of how product and service characteristics need to be intertwined when developing integrated PSS. User integration is identified as an instrument for enhancing service orientation. This paper provides guidance about how to overcome common barriers to enhancing service orientation and shifting from technical products to result-oriented PSS.