<p>The overall purpose of this thesis is to describe and analyse how capital goods manufacturers can enhance their industrial service offering.</p><p>The theoretical basis of this research is found in services marketing, recognising co-creation of value, that the service process is an open production system and that the customer determines value as the manufacturer can only offer value propositions.</p><p>The empirical basis is a multiple case study of service management at BT Industries, Electrolux Laundry Systems, ITT Flygt, and Saab. The four companies operate within different industries, have different service offerings and they are facing different internal and external conditions, which affect their service organisation and offering.</p><p>It is becoming increasingly important for capital goods manufacturers to offer services and there are further growth and profit opportunities on the market for industrial services. It is suggested that there is major improvement potential and financial gains possible to achieve if more resources are allocated to services. Moreover, utilisation of new technological means leads to increased dematerialisation and enable manufacturers to enhance existing service offerings as well as enable new ones.</p><p>Depending on whether the services have a traditional product-orientated focus or a customer-centric process-orientated focus, and depending on the scope of the offering, there are different critical factors to consider. Process-orientated services require knowledge about not only how to service the installed base but also how to improve the customer’s industrial production process.</p><p>Generally, bundled services require a modular structure with standardised, formalised processes and integration between local and central organisation. Extensive bundled offerings require that both customer and provider have relational intent and a long-term relationship is regarded as a condition for successful customer involvement in service development. Long-term relationships also enable the company to act proactive and develop offerings with a customer-centric approach, instead of having a product-centric approach and internally-focused innovation.</p><p>To conclude, operational service processes and interfaces, internal and with the customer, are critical to manage both from a cost-efficiency and revenue-effectiveness perspective. Furthermore, it is argued that customer relationships and development of the service offering must be managed strategically.</p> / Report code: LiU-TEK-LIC 2006:42

The overall purpose of this thesis is to describe and analyse how capital goods manufacturers can enhance their industrial service offering. The theoretical basis of this research is found in services marketing, recognising co-creation of value, that the service process is an open production system and that the customer determines value as the manufacturer can only offer value propositions. The empirical basis is a multiple case study of service management at BT Industries, Electrolux Laundry Systems, ITT Flygt, and Saab. The four companies operate within different industries, have different service offerings and they are facing different internal and external conditions, which affect their service organisation and offering. It is becoming increasingly important for capital goods manufacturers to offer services and there are further growth and profit opportunities on the market for industrial services. It is suggested that there is major improvement potential and financial gains possible to achieve if more resources are allocated to services. Moreover, utilisation of new technological means leads to increased dematerialisation and enable manufacturers to enhance existing service offerings as well as enable new ones. Depending on whether the services have a traditional product-orientated focus or a customer-centric process-orientated focus, and depending on the scope of the offering, there are different critical factors to consider. Process-orientated services require knowledge about not only how to service the installed base but also how to improve the customer’s industrial production process. Generally, bundled services require a modular structure with standardised, formalised processes and integration between local and central organisation. Extensive bundled offerings require that both customer and provider have relational intent and a long-term relationship is regarded as a condition for successful customer involvement in service development. Long-term relationships also enable the company to act proactive and develop offerings with a customer-centric approach, instead of having a product-centric approach and internally-focused innovation. To conclude, operational service processes and interfaces, internal and with the customer, are critical to manage both from a cost-efficiency and revenue-effectiveness perspective. Furthermore, it is argued that customer relationships and development of the service offering must be managed strategically. / Report code: LiU-TEK-LIC 2006:42

During the past decade, growing attention has been given to industrial service offerings in the marketing literature as well as in many manufacturing firms. This phenomenon is often described as a goods-services transition, in which companies increasingly turn to the provision of industrial services in order to achieve competitive advantage, such a closer customer relationships and higher profit margins. Industrial services span a wide range of offerings, from basic after-sales services to process-orientated solutions consisting of both services and capital goods. With industrial service offerings receiving increased attention as their importance is understood, the ability to manage the service business in a manufacturing context becomes ever more vital. The overall purpose of this doctoral thesis is to describe and analyse how capital equipment manufacturing firms strategically manage their industrial service offerings in order to achieve long-term competitive advantage. This includes analysing how to organise the firm for the development and production of service, and, depending on the type of industrial service offering, what the requirements on the service processes are. Furthermore the role of information and communication technologies as enablers for new offerings and processes is analysed. The thesis consists of a compilation of five papers, two case descriptions and an extended summary. The research builds on a multiple case study of the service organisations of market-leading manufacturing firms. The main cases are based on in-depth studies at ITT Water &amp; Wastewater and Toyota Material Handling Group. The results suggest that, as the division between goods and services becomes ever more blurred, there is an increasing need for cooperation between the service and the product organisations. Applying a service logic means that the traditional division between goods sales and after-sales services becomes outdated. Instead, the customer relationship becomes the centre of the offering regardless of its combination of services and goods. Further, the infusion of service in manufacturing firms means that more service processes and interfaces have to be managed simultaneously. Theoretically, this research contributes mainly to the fields of industrial marketing and service as a business logic. One contribution is the proposed typologies for industrial service offerings which make it possible to better understand the dynamics of service processes. Another important contribution of this research is the service function concept. Industrial services must not be equated with the activities of the industrial service organisation only. Although the service organisation most likely is the key entity, it is only one subset of the service function; sales product development, manufacturing, senior management, and other organisational entities, as well as external service providers and customers, are to be seen as part-time service functions that influence the offering. Compared to previously, competitive advantage through industrial service offerings is to a greater extent based on factors outside the service organisation, i.e. in other parts of the service function.