5.1 Discussion of the results
The identified function clusters’ content has been examined to determine the primary purpose, offering and expected relationship between the service provider and the customer. The aim was to recognise features of the observed service subsystems that required particular attention during the service design phase, which might in turn influence service provision. The subsystems were presented as service bundles and named as follows: Cluster 1 – Operational Services, Cluster 2 – Transactional Services, Cluster 3 – Performance Services and Cluster 4 – Outlier.
The identified service clusters formed service bundles in which the offerings had varying emphasis on co-creation and orientation in terms of service provision. Cluster 1 included key functions for managing data and connecting service provision networks. It also included planning services to allow access to customer processes, which were advantageous in controlling the service provision networks. The basis for Cluster 1 was also able to be linked to Cluster 4 – Outlier. Cluster 2 was characterised by typical operational services such as product supply activities. This model focused on service integration and solution provision without interaction with the end customer. Cluster 3, which involved maintenance services, was a complex entity because its functions were elements of a continuous process. This cluster also included a central activity, F10, which connected the other functions to a wider service solution to create a local service integration model.
The conducted regression analysis showed that perceived importance of the provision of a solution service bundle had significant impact on the potential value of the service’s reliability and assurance. No similar effect could be found among the other service clusters. It was concluded that overall, the analysed function portfolios consisted of different layers on which
service bundles had local hubs connected to larger, integrated service models. The analysis also revealed that a service network needs global hubs, or service integrators, that are able to co-ordinate information about the service process throughout the network. This conclusion was further supported by the key functions of each cluster, which were connected to the central function of the network but not necessarily to the other cluster hubs. From the perspective of service modularity, the local networks could be separated from the larger network without affecting their value creation potential, whereas systems lacking a global actor collapsed.
Through this, it can be determined that systemic value functions operate on multiple levels, both locally and globally.
5.2 Theoretical implications
A complex product and service portfolio providing network maintenance services has been examined to bring practical evidence to the theoretical observation of the systemic nature of customer value (Lusch et al., 2010; Pynnönen et al., 2011). The main contribution of this paper is its systematic analysis of value creation mechanisms in complex service solutions (Englis and Solomon, 1996; Ennen and Richter, 2010; Epp and Price, 2011; Lusch et al., 2010;
Normann and Ramirez, 1993; Shocker et al., 2004; Vargo et al., 2008; Dass and Fox, 2011; De Rosa et al., 2013). The contributing SD logic demonstrates that value created collaboratively relates to specific circumstances in which a business relationship impacts customer performance directly, rather than serves as a general feature of service provision. Key relationships have been recognised in the present study as connecting different service operation models (e.g. Windahl and Lakemond, 2010; Helander and Möller, 2007). These connections transfer information from one process to another. It is therefore proposed that the existence of these links either enables or disables the functioning of the service system; inefficient design or a lack of key connections can create bottlenecks in service processes or disable the fluent
communication between partners. Thus, well-designed connections allow service providers a competitive advantage through the ability to control key network points.
5.3 Managerial implications
In the present study, systemic service functions were categorised into two types: local and global (Ulrich, 1995). Local service functions connect with similar service functions to form service bundles, and global service functions connect these bundles together. Analyses of local service functions reveal that to achieve integration on the solution level, a global service function requires the design of interfaces and platforms among and around the local service functions. This is especially important during the designing phase of the solution. The present study’s analysis also identified eight service functions (F3, F9, F10, F11, F12, F13, F14, F15), which by definition could be called systemic service functions. These were found to be significant to customers (based on importance) and also strongly connected to other service functions in the solution, making them powerful within the system. All but one of these systemic service functions were related to Cluster 2 , driving the value expectation of customers.
The present results show that although the service functions in company products and service portfolios are uniquely important to the customer, they also form a complex, interconnected value system. Within this value system, connections between certain service functions are stronger and more influential in creating customer value than are others; these may all be found around the domain of customer problems. These findings are in line with the results of previous research (Windahl and Lakemond, 2010). According to these findings, activities related to co-creational relationships and long-term responsibilities to customer process quality value have the most influence on customers’ value expectations. Hence, the value generated by relationship attributes is most relevant to continuous supporting services, but it has a lesser role in strategic design or project services.
5.4 Limitations and further research
The limitations of the present study should be taken into consideration when applying its results.
First, the data used for the network analysis only reflected customer views on the value creation mechanisms of one company product and service portfolio. The results indicate that the value to the firm lay in its different service functions, and that the system of relationships exhibited these differences as well. This perceived value is subjective, and as such the different service functions deliver value to the provider rather than the customer. This is something that future research should address in studies of systemic customer value, or value provision and capture in general. Second, the statistical correlations observed between service functions as shown in the distributed customer survey were used as the basis of the present analysis. It might be useful in future study to measure these relationships directly. This would not be an easy task, but would serve to explain the phenomenon more completely. Third, the data collected in the present study represents the total customer base of the provider, but it may be that there are different preference profiles within that population. This would mean that the value system would change according to the different profiles. As a final conclusion of this study, the value creation logic of the integrated solutions, in further studies, should be analysed from multiple perspectives and in holistic manner.
References
Aarikka-Stenroos, L and Jaakkola, E. (2012) ”Value co-creation in knowledge intensive business services: A dyadic perspective on the joint problem solving process”, Industrial Marketing Management, Vol. 41 No. 1, pp.15-26
Adel, R and Wiesner, S. A. (2015) “Conceptual approach for value driven performance in servitising companies”, International Journal of Services and Operations Management,
Vol. 21 No. 4, pp.504–531
Alexander, A Walker, H and Naim, M. (2014) “Decision theory in sustainable supply chain management: a literature review” Supply Chain Management: An International Journal, Vol. 19 No. 5/6, pp.504–522
Alonso-Rasgado, T Thompson, G and Elfstrom, B. (2004) ”The design of functional (total care) products”, Journal of Engineering Design, Vol. 15 No. 6, pp.515-540
Andrews, M L Benedicktus, R L and Brady, M K. (2010) ”The effect of incentives on customer evaluations of service bundles”, Journal of Business Research, Vol. 63 No. 1, pp.71-76 Bettencourt, L A Ostrom, A L Brown, S W and Roundtree, R I. (2002) ”Client co-production
in knowledge-intensive business services”, California Management Review, Vol. 44 No.
4, pp.100-128
Bonacich, P. (1987) ”Power and centrality: A family of measures”, American Journal of Sociology, Vol. 92 No. 5, pp.1170-1182
Bonacich, P. (2007) ”Some unique properties of eigenvector centrality”, Social Networks, Vol.
29 No. 4, pp.555-564
Borgatti, S P Everett, M G and Freeman, L C. (2002) Ucinet for Windows: Software for Social Network Analysis, Analytic technologies.
Bowman, C and Ambrosini, V. (2000) ”Value creation versus value capture: Towards a coherent definition of value in strategy”, British Journal of Management, Vol. 11 No. 1, pp.1-15
Brady, T Davies, A and Gann, D M. (2005) ”Creating value by delivering integrated solutions”, International Journal of Project Management, Vol. 23 No. 5, pp.360-365
Calabrese, A. (2012) ”Service productivity and service quality: A necessary trade-off?”, International Journal of Production Economics, Vol. 135 No. 2, pp.800–812
Cannon, J. P and Perreault Jr., W D. (1999) “Buyer-Seller Relationships in Business Markets”, Journal of Marketing Research, Vol. 36 No. 4, pp.439–460
Chen, K and Liu, R. (2005) ”Interface strategies in modular product innovation”, Technovation, Vol. 25 No. 7, pp.771-782
Cova, B and Salle, R. (2008) ”Marketing solutions in accordance with the S-D logic: Co-creating value with customer network actors”, Industrial Marketing Management, Vol. 37 No. 3, pp.270-277
Dahmus, J B Gonzalez-Zugasti, J P and Otto, K N. (2001) ”Modular product architecture”, Design Studies, Vol. 22 No. 5, pp.409-424
Dass, M and Fox, G L. (2011) ”A holistic network model for supply chain analysis”, International Journal of Production Economics, Vol. 131 No. 2, pp.587-594
Davies, A Brady, T and Hobday, M. (2006) ”Charting a path toward integrated solutions”, MIT Sloan Management Review, Vol. 47 No. 3, pp.39-48
Davies, A Brady, T and Hobday, M. (2007) ”Organizing for solutions: Systems seller vs.
systems integrator”, Industrial Marketing Management, Vol. 36 no. 2, pp.183-193 De Rosa, V Gebhard, M Hartmann, E and Wollenweber, J. (2013) ”Robust sustainable
bi-directional logistics network design under uncertainty”, International Journal of Production Economics, Vol. 145 No. 1, pp.184-198
Dragoicea, M Falcao, E Cunha, J and Patrascu, M. (2015) “Self-organising socio-technical description in service systems for supporting smart user decisions in public transport”, Expert Systems with Applications, Vol. 42 No.17–18, pp.6329–6341
Englis, B G and Solomon, M R. (1996) ”Using consumption constellations to develop integrated communications strategies”. Journal of Business Research, Vol. 37 No. 3, pp.183-191
Ennen, E and Richter, A. (2010) ”The whole is more than the sum of its parts-- or is it? A review of the empirical literature on complementarities in organizations”, Journal of Management, Vol. 36 No.1, pp.207-233
Epp, A M and Price, L L. (2011) ”Designing solutions around customer network identity goals”, Journal of Marketing, Vol. 75 No. 2, pp.36-54
Fliess, S and Kleinaltenkamp, M. (2004) ”Blueprinting the service company: Managing service processes efficiently”, Journal of Business Research, Vol. 57 No.4, pp.392-404
Flint, D J Woodruff, R B and Gardial, S F. (1997) ”Customer value change in industrial marketing relationships: A call for new strategies and research”, Industrial Marketing Management, Vol. 26 No. 2, pp.163-175
Geum, Y Lee, S Kang, D and Park, Y. (2011) ”Technology roadmapping for technology-based product-service integration: A case study”, Journal of Engineering and Technology Management, Vol. 28 No. 3, pp.128-146
Grönroos, C and Ravald, A. (2011) ”Service as business logic: Implications for value creation and marketing”, Journal of Service Management, Vol. 22 No. 1, pp.5-22
Grönroos, C and Voima, P. (2013) ”Critical service logic: Making sense of value creation and co-creation”, Journal of the Academy of Marketing Science, Vol. 41 No. 2, pp.133-150 Halldórsson, Á Hsuan, J and Kotzab, H. (2015) “Complementary theories to supply chain
management revisited – from borrowing theories to theorizing”, Supply Chain Management: An International Journal, Vol. 20 No. 6, pp.574–586
Hallikas, J Immonen, M Pynnönen, M and Mikkonen, K. (2014) ”Service purchasing and value creation: Towards systemic purchases”, International Journal of Production Economics, Vol. 147 No. January, pp.53-61
Harmsen, H and Jensen, B. (2004) ”Identifying the determinants of value creation in the market:
A competence-based approach”, Journal of Business Research, Vol. 57 No. 5, pp.533-547 Hawkins, T G Gravier, M J Berkowitz, D and Muir, W A. (2015) ”Improving services supply
management in the defense sector: How the procurement process affects B2B service quality”, Journal of Purchasing and Supply Management, Vol. 21 No. 2, pp.81-94 Helander, A and Möller, K. (2007) ”System supplier's customer strategy”, Industrial Marketing
Management, Vol. 36 No. 6, pp.719-730
Hofenk, D Schipper, R Semeijn, J and Gelderman, C. (2011) ”The influence of contractual and relational factors on the effectiveness of third party logistics relationships”, Journal of Purchasing and Supply Management, Vol. 17 No. 3, pp.167-175
Howden, C and Pressey, A D. (2008) ”Customer value creation in professional service relationships: The case of credence goods”, The Service Industries Journal, Vol. 28 No. 6, pp.789-812
Hu, H Kandampully, J and Juwaheer, T D. (2009) ”Relationships and impacts of service quality, perceived value, customer satisfaction, and image: An empirical study”, The Service Industries Journal, Vol. 29 No. 2, pp.111-125
Jaaron, A and Backhouse, C J. (2014) “Building antifragility in service organisations: Going beyond resilience”, International Journal of Services and Operations Management, Vol.
19 No. 4.
Kapletia, D and Probert, D. (2010) ”Migrating from products to solutions: An exploration of system support in the UK defense industry”, Industrial Marketing Management, Vol. 39 No. 4, pp.582-592
Karatzas, A Johnson, M and Bastl, M. (2016) “Relationship Determinants of Performance in Service Triads: A Configurational Approach”, Journal of Supply Chain Management, Vol 52 No. 3, pp.28–47
Kline, R B. (2011) Principles and Practice of Structural Equation Modeling, 3 rd edn, The Guilford Press, New York, USA.
Larivière, B Joosten, H Malthouse, E C Marcel, V B Aksoy, P Kunz, W H and Ming‐Hui Huang. (2013) ”Value fusion”, Journal of Service Management, Vol. 24 No. 3, pp.268-293
Levitt, T. (1980) ”Marketing success through differentiation-of anything”, Harvard Business Review, Vol. 58, pp.83-91
Lin, C Chen, L and Hsu, C. (2011) ”An innovative approach for RFID product functions development”, Expert Systems with Applications, Vol. 38 No.12, pp.15523-15533
McDougall, G H G and Levesque, T. (2000) ”Customer satisfaction with services: Putting perceived value into the equation”, The Journal of Services Marketing, Vol. 14 No.5, pp.392-410
Normann, R and Ramirez, R. (1993) ”From value chain to value constellation: Designing interactive strategy” Harvard Business Review, Vol. 71, pp.65-77
Parasuraman, A Berry, L L and Zeithaml, V A (1988) ”SERVQUAL: A Multiple-Item Scale For Measuring Consumer Perceptions of Service Quality”, Journal of Retailing, Vol. 64 No. 1, pp.12-40
Park, Y Geum, Y and Lee, H. (2012) ”Toward integration of products and services: Taxonomy and typology”, Journal of Engineering and Technology Management, Vol. 29 No. 4, pp.528-545
Persson, M and Ahlstrom, P. (2006) ”Managerial issues in modularising complex products”, Technovation, Vol. 26 No. 11, pp.1201-1209.
Pynnönen, M Hallikas, J Ritala, P and Mikkonen, K. (2014) ”Analyzing systemic customer value in scalable business services”, The Service Industries Journal, Vol. 34 No. 14, pp.1154-1166
Pynnönen, M Ritala, P and Hallikas, J. (2011) ”The new meaning of customer value: A systemic perspective”, The Journal of Business Strategy, Vol. 32 No. 1, pp.51-57
Rintala, A Karppinen, H and Koivuniemi, J. (2016) “Operations management in improving elderly home care”, International Journal of Services and Operations Management, Vol.
24 No. 3, pp.331-362
Roehrich, J K and Caldwell, N D. (2012) ”Delivering integrated solutions in the public sector:
The unbundling paradox”, Industrial Marketing Management, Vol. 41 No. 6, pp.995-1007 Saccani, N Visintin, F and Rapaccini, M. (2014) “Investigating the linkages between service
types and supplier relationships in servitized environments”, International Journal of Production Economics, Vol. 149, pp.226–238
Segura, M and Maroto, C. (2017) “A multiple criteria supplier segmentation using outranking and value function methods”, Expert Systems with Applications, Vol. 69, pp.87–100 Shankar, V Smith, A K and Rangaswamy, A. (2003) ”Customer satisfaction and loyalty in
online and offline environments”, International Journal of Research in Marketing, Vol. 20 No. 2, pp.153-175
Shocker, A D Bayus, B L and Kim, N. (2004) ”Product complements and substitutes in the real world: The relevance of ”other products””, Journal of Marketing, Vol. 68 No.1, pp.28-40 Tabachnick, B G and Fidell, L S. (2013) Using Multivariate Statistics, Pearson Education, New
York, NY.
Thomé, A M T Scavarda, L F Pires, S R I Ceryno, P and Klingebiel, K. (2014) “A multi-tier study on supply chain flexibility in the automotive industry”, International Journal of Production Economics, Vol. 158 No. December, pp.91–105
Thomke, S and von Hippel, E. (2002) ”Customers as innovators: A new way to create value”, Harvard Business Review, Vol. 80, pp.74-81
Tuli, K R Kohli, A K and Bharadwaj, S G. (2007) ”Rethinking customer solutions: From product bundles to relational processes”, Journal of Marketing, Vol. 71 No. 3, pp.1-17 Ukko, J and Pekkola, S. (2015) “A framework for a customer approach to performance
measurement in a service context”, International Journal of Services and Operations Management, Vol. 22 No. 2, pp.210–220.
Ulaga, W and Chacour, S. (2001) ”Measuring customer-perceived value in business markets:
A prerequisite for marketing strategy development and implementation” Industrial Marketing Management, Vol. 30 No. 6, pp.525-540
Ulrich, K. (1995) ”The role of product architecture in the manufacturing firm”, Research Policy, Vol. 24 No. 3, pp.419-440
Wang, J Lai, J-Y and Hsiao, L-C. (2015) “Value network analysis for complex service
systems: a case study on Taiwan’s mobile application services”, Service Business, Vol. 9 No. 3, 381–407
Vargo, S L and Lusch, R F. (2004) “Evolving to a New Dominant Logic for Marketing”, Journal of Marketing, Vol. 68 No. 1, pp. 1–17
Vargo, S L Maglio, P P and Akaka, M A. (2008) ”On value and value co-creation: A service systems and service logic perspective”, European Management Journal, Vol. 26 No. 3, pp.145-152
Wasserman, S and Faust, K. (1994) Social network analysis: Methods and applications, Cambridge, UK: Cambridge university press.
Weeks, R and Benade, S. (2015) “The development of a generic servitization systems framework”, Technology in Society, Vol.43, pp.97–104
Windahl, C and Lakemond, N. (2006) ”Developing integrated solutions: The importance of relationships within the network”, Industrial Marketing Management, Vol. 35 No. 7, pp.806-818
Windahl, C and Lakemond, N. (2010) ”Integrated solutions from a service-centered perspective: Applicability and limitations in the capital goods industry”, Industrial Marketing Management, Vol. 39 No. 8, pp.1278-1290
Vivaldini, M and Pires, S R I. (2016) “Logistics service providers coordinating sustainable supply chains: A fast food industry case”, International Journal of Services and Operations Management, Vol. 24 No.4.
Yee, R W Y Yeung, A C L and Cheng, T C E. (2010) ”An empirical study of employee loyalty, service quality and firm performance in the service industry”, International Journal of Production Economics, Vol. 124, pp.109–120
Zhang, M Zhao, X Voss, C and Zhu, G. (2016) “Innovating through services, co-creation and supplier integration: Cases from China”, International Journal of Production Economics, Vol. 171, pp.289-300
Zhang, X Chen, R. (2008) ”Examining the mechanism of the value co-creation with customers”, International Journal of Production Economics, Vol. 116 No. 2, pp.242-250
Åhlström, P and Nordin, F. (2006) ”Problems of establishing service supply relationships:
Evidence from a high-tech manufacturing company”, Journal of Purchasing and Supply Management, Vol. 12 No. 2, pp.75-89