1.1 Background
Traditionally manufacturing industries have been offering tangible goods that they have developed and produced. Secondary stream of income has been the maintenance and repair services that have not played important role in the strategies of the manufactur-ing companies. Nevertheless, resent trend has changed the focus and the value of the services has been pointed out to the manufacturing companies by researchers and consultants. So called servitization where the manufacturers become service providers has changed the way business models and strategies are built. (Lay, 2014). The man-agers of different manufacturing companies are attempting to change the attitude from services as add-ons to services as value-adding function. When competition between different companies increases the main differentiator between making the deal or not might be whether the company has value adding services to offer or not. (Matthyssens
& Vandenbempt, 2008).
To succeed in the servitization effectively, company needs to have clear understanding of the strategic logic. This includes understanding how the financial targets are in-tended to be achieved with the servitization and how the assets are aligned with pro-cess. Which means understanding the business model of the company. (Rabetino et al.
2017). The purpose of the business model is to describe how to make an idea into an action and make money with it. This action is aligned with the competencies and capa-bilities of carrying out the value proposition given to the customers. (Newth, 2012, p.1-6).
Even though many papers see e.g. (Alghisi & Saccani, 2015; Martinez et al. 2010) go through the core difficulties of servitization, there is relatively low amount of research about business model decisions behind successful execution of servitization. There-fore, this research aims to fill this gap by doing comprehensive case study about prod-uct centric company and its possibilities for the servitization. Other similar case studies see e.g. (Ahamed et al. 2013) are mainly focused on big corporations and therefore, might provide different narratives that empirical studies based on small to medium sized growth companies.
1.2 Research objective and questions
To fulfil the demand for research that fills the gap highlighted earlier, this study aims to identify the potential of servitization, the business model decisions behind the real exe-cution of the servitization and to clarify the required steps for achieving the desired level of servitization. To complete this task, this paper answers to the main research question and its three sub-questions:
Main RQ: How should a company integrate the service systems as part of their busi-ness model?
The main research question aims to find ways to effectively integrate potential services to the existing business model of the company. It guides the research to consider the nature of the case company and current business model decisions when finding out how far the case company should go with the service-goods continuum. The study is also guided towards creating steps and guidelines for the operative actions required from the case company to achieve successful service offering integration.
Sub RQ1: How the internal knowledge of the case company can be transferred into productive service sold through reseller network?
The first sub question aims to find theoretical background and empirical data that could be concluded into guidelines that could be used for recognizing the potential services that the case company has to offer for their customers. This research question also guides the research to focus on the means of evaluating whether the identified service is reasonable for the case company or not.
Sub RQ2: What parts of the internal knowledge of the case company would a customer be willing to invest?
The second sub question continues with the evaluation of the potential services. After the theoretical potential has been recognized the study aims to find different qualitative methods to create realistic view of those services that have potential to be invested by the customers of the case company. The purpose of this question is to guide the re-search towards customer value recognition.
Sub RQ3: How should the organizational structure of the case company change to support the servitization?
The third sub question aims to define whether the case company needs to do changes to the structure of the organization to support the servitization. And if the change is re-quired, how the organizational structure should change. With it the study is also guided
to identify current resources and the allocation to be able to define whether organiza-tional changes or addiorganiza-tional resources are required for the success of the servitization.
1.3 Structure of the thesis
The structure of the thesis is highlighted with in figure 1 below. The first chapter intro-duces the background of the thesis, research questions and the structure of the thesis.
The purpose of the first chapter is to guide the reader of the paper to the topic and clar-ify what is the purpose of this thesis.
The second chapter of the thesis is theoretical background of the topic. It consists of three different main subjects and theories. The subjects are business model, goods-to-services continuum, and organizational structure. With these main topics, the study aims to cover the theoretical aspects of the research topic. This theoretical data is used later as a reference to the findings done in the empirical case research.
The third chapter covers the research methodology of this thesis and the reasons be-hind the methodological decisions.
The fourth chapter of the thesis covers the empirical research of the study and the re-sults of the research.
The fifth chapter of the thesis presents the analysis done on the empirical research re-sults and it is then referred to the previous studies presented in the theoretical chapter.
In the sixth chapter the conclusion of the thesis is presented, and possible future re-search objectives are highlighted.
Figure 1. How this thesis is structured.