Exploring the alignment between service strategy and service innovation

Confronted with more complex customer needs and eroding product margin, capital goods manufacturing companies have started to explore the opportunities provided by an extension of the service business. Despite the increasing relevance of the service business, literature is relatively sparse on describing how companies should align their determinants for service innovations with their different types of service strategies. Without a proper alignment, companies face strong difficulties to manage service innovation projects successfully. This study explores the alignment between three types of service strategies and determinants for service innovations. For business practice, it means that a service strategy such as providing after-sales services requires a specific configuration of service-related factors (front line expertise, service complexity/cost, service quality evidence, improved service experience and standardized service), market-related factors (client/need fit and market competitiveness and market potential), company-related factors (strategy and resource fit, innovation culture and management) and new service development process factors (formal evaluation & design and formal testing & launch) to succeed with service innovations. Other service strategies such as customer support service provider and development partner differ in their configuration of these factors. The resulting configurations guide managers to set-up an efficient and effective service innovation management that helps them to implement their service strategy through successful service innovation project.

http://www.cerog.org/lalondeCB/SM/2010_lalonde_seminar/papers/p22-150-lightfoot-gebauer-rev2010-03-15.pdf