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The logic for increasing service revenue in product manufacturing companies

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abstract To respond to increasing challenges from competitors, manufacturing companies have developed a growing interest in extending their service business. They have started initiatives to generate revenue growth through services. However, creating service revenue is not easy. The majority of manufacturing companies still earn a relatively small share of their total revenue through services. If services were fundamentally ineffective in generating revenue, it would be easy to explain why companies struggle to succeed in deriving a high percentage of overall revenue from services. It would not explain, however, why some companies have, in the past, achieved a high share of service revenue. Based on five focus groups and ten in-depth bi-polar case studies, we attempt to provide a better understanding of how manufacturing companies can increase their service revenue. We illustrate the implicit logic of increasing service revenue, the keys to success and fundamental dimensions for implementing them.
   
type journal paper
   
keywords service revenue; managerial motivation; service strategy; organisational arrangements; service management; manufacturing companies.
   
project Internationalisierungskonzepte für industrielle Dienstleistungen
language English
kind of paper journal article
date of appearance 16-5-2007
journal International Journal of Services and Operations Management
publisher Inderscience
ISSN 1744-2370
ISSN (online) 1744-2389
volume of journal 3
number of issue 4
page(s) 394 - 410
review double-blind review
   
citation Gebauer, H. (2007). The logic for increasing service revenue in product manufacturing companies. International Journal of Services and Operations Management, 3(4), 394 - 410.