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Intelligent Product-Service Systems: Online Monitoring Services in the European Tooling Industry

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abstract Today’s turbulent economic environment confronts the European tooling industry with new challenges: strategic differentiation via cost-leadership has not worked out for European toolmakers over the last years. Other industries have shown a promising approach for creating competitive advantages over competitors and higher profitability by enhancing the existing range of products with customer-specific services. An intelligent bundling of individual services with the core product leads to so-called hybrid products or product-service-systems. These systems not only ensure the proper functioning of the product but also increase efficiency and effectiveness of the customer's processes. Even though, the concept of product-service-systems is well known, few concepts exist, which build a holistic focus on products and services from a developers point of view. In order to apply the idea of moving into the service business to the tooling industry we set up a study on product-service systems in the tooling industry. As other European manufacturers as well, players in the tooling industry face an increasing market pressure from international competitors. One solution to remain competitive is to focus on delivering knowledge intensive products and services This research paper's goal is to develop an empirically based portfolio for future product-service systems and is embedded in a larger European study. The overall study is funded by the seventh framework program of the EU and has the goal to integrate the customer and developer perspectives in developing product-service-systems. This paper concentrates on the customer perspective of developing product-service systems. The first step of our study was to develop a questionnaire together with toolmakers covering topics like general customer needs, existing and desired services, the production process itself as well as the distribution of cost in the maintenance process. Conducting the survey using mailings and an internet based platform, we sent out 1000 questionnaires and requests for participation and achieved thereby a response rate of 11% with a total number of 110 questionnaires from all over Europe Based on a cluster analysis, we were able to identify a strong need for online monitoring services. Here, the seller of the tools can monitor the proper use and performance of the tools and is able to proactively react on any kind of disturbances which yield from e.g. over heating the materials, too much use of water during the process, wrong material use. In literature, we found evidence for this need. Vandermerwe (1988) predicted this type of requirement within the business servitization and underlined the needed artificial intelligence as a precondition. Such a solution, containing an intelligent tool will add value to the customers processes and symbolizes a typical representative of a product-service system. Moreover, we could discern requirement clusters for services and product-service systems which differ in terms of the content and enabled us to gather product-service requirements leading to a market segment specific product-service portfolio. Another outcome is the description and specification of an online-monitoring-service and the needed technical features on product- as well as service-side. The structure of the paper is as follows. In the first section a reference framework for formulating product service strategies is derived from the discussion of the relevant literature. The following section consists of a cluster analysis of the data gathered from tool customers of the mould and die industry through the questionnaire, resulting in different service clusters respectively portfolios. The related section discusses the consistency and usefulness of these portfolios and possible strategies for their implementation. A special focus is laid on the suggestion of product-service systems. The paper ends with a conclusion as well as suggestions for further research.
type conference paper (English)
keywords Service Portfolio, Product-Service-System, Tooling Industry, Online Monitoring
name of conference European Operations Management Association (EurOMA)) (Göteborg)
date of conference 14-6-2009
page(s) 10
publisher EurOMA
review double-blind review
citation Oschmann, G., Scherrer-Rathje, M., & Schittny, B. (2009). Intelligent Product-Service Systems: Online Monitoring Services in the European Tooling Industry. In , pp.10: EurOMA.