Service Orientation Strategy of Manufacturers: Antecedents, Performance Outcomes and Contingency Variables

Augmenting products with services is a key way manufacturers have of pursuing differentiation in today's competitive market, especially in China, an economy in transition. This paper adopts a comprehensive perspective on service in manufacturers by examining the antecedents and the consequences related to a service orientation strategy, as well as the contingency variables with its implementation performance. The authors propose a two-stage model which incorporates both strategy formulation and strategy implementation, and conduct an empirical study of a sample of 221 manufacturers in China. This study provides evidence for the proposed conceptualization of a service orientation strategy. The authors also find that the investigated antecedents explain some variance of the service orientation strategy, which in turn positively influences its market effectiveness and thereby financial profitability. Finally, the authors explore the organizational configuration factor that will affect the strategy implementation performance of manufacturers.