Understanding the shift: contextual determinants of classic and alternative servitisation trajectories

Abstract

Purpose

While servitization has been recognised for its potential to augment organizational revenue and fortify competitive advantage, the exploration of alternative servitization trajectories to the classical servitization model has been little explored in literature. Recent literature introduces the “service paradox” and presents different trajectories to the classical model, but it does not explain why a company chooses one trajectory instead of another. Therefore, this study aims to provide a model that, based on the contextual factors present, recommends which servitization trajectory the company should choose.

Design/methodology/approach

This study uses a combination of design science research (DSR) and context, intervention, mechanisms and outcomes (CIMO) to propose the model. An initial contextual factors list was created based on the literature, refined by the company’s employees and evaluated in three selected initiatives in the focal company. Furthermore, based on the understanding of the CIMO logic elements, four design propositions were elaborated to summarize the main findings of the study.

Findings

The study has demonstrated that the choice of a servitisation trajectory is intricately tied to a multitude of contextual factors, prompting organisations to deviate from conventional models towards alternative paths. Furthermore, the research sheds light on the underlying mechanisms and contextual drivers that shape servitisation decisions within the context of a consumer goods manufacturer. The analysis underscores the pivotal role of market dynamics and strategic adaptability in shaping servitisation strategies, underscoring the importance of customized approaches that cater to the distinct circumstances of each organisations.

Originality/value

The research contributes to both theory and practice by offering profound insights into the complex nature of servitisation, advocating for continuous adaptation and strategic alignment with market demands. For practitioners and decision-makers, the study provides valuable guidance on enhancing service offerings and navigating the complexities of servitisation within specific sectors, fostering a culture of learning and adaptation to drive sustainable growth.