Tangible services and intangible products in industrial product service systems

Abstract

The importance of intangibles in the product lifecycle of industrial goods has been increasing for many years. On the other hand, for many services tangibility, especially for partial services that are prepared in advance, is a requirement that is growing with the industrialization of services. This paper starts by discussing the roles of tangibility and intangibility when offering products and services. It will use examples to show the importance of both service-orientation in conventional industry and of product-orientation in the service industry. Finally, the role of tangibility and intangibility of value creation in an industrial product-service system is discussed using the packaging industry as a typical example. It becomes clear that it depends on the customer’s focus whether the value in its entirety is perceived as a product or as a service.