Uncovering the competitive priorities for servitization: A repertory grid study

Abstract

Manufacturers have traditionally sold products but are increasingly providing integrated products and service offerings to increase competitiveness and satisfy customer needs. This phenomenon is typically referred to as the ‘servitization of manufacturing’. Whilst the competitive priorities for pure manufacturing are well understood, the same is not true of servitized offerings. In order to address this gap, we studied four customers of a servitized manufacturer to identify the competitive priorities that ought to be focused on. Given the longevity and complexity of servitized offerings, we adopted a technique predominately used in psychology--the repertory grid--to allow interviewees to articulate their perceptions of the attributes of servitized offerings. In total, 33 repertory grid interviews were conducted with both buyers and users of servitized offerings. Our research identified 29 attributes, 12 of which were classified as key attributes. The identified attributes were deemed to be of different importance to buyers and users with some attributes being unique to the two stakeholders. Buyers uniquely valued cost savings and innovation as key attributes, whilst users valued control over working processes. The results of the empirical investigation broaden our understanding of the attributes manufacturers need to focus on and indicate that value from servitized offerings will be derived differently by buyers and users.