Journal of Business & Industrial Marketing Providing a method for composing modular B2B services Martin Böttcher Stephan Klingner
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To cite this document: Martin Böttcher Stephan Klingner, (2011),"Providing a method for composing modular B2B services", Journal of Business & Industrial Marketing, Vol. 26 Iss 5 pp. 320 - 331 Permanent link to this document: http://dx.doi.org/10.1108/08858621111144389 Downloaded on: 30 July 2015, At: 06:11 (PT) References: this document contains references to 41 other documents. To copy this document:
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Providing a method for composing modular B2B services Martin Bo¨ttcher and Stephan Klingner
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Faculty of Mathematics and Computer Science, Department of Computer Science, University of Leipzig, Leipzig, Germany Abstract Purpose – The purpose of this paper is to provide a method that allows the decollating of formerly monolithic services into separate modules. To provide a semantically equivalent decomposed model, structure and dependencies need to be defined. This fine-grained image of the service allows an easier configuration and optimisation of single service modules and the service portfolio as a whole. Design/methodology/approach – As an initial point of the work the authors conducted an extensive literature review, transferring insights from other domains that already make use of modularisation, such as industrial engineering and software engineering. The method developed on that basis was evaluated consecutively in use cases conducted with three companies. Findings – As research in the fields of industrial and software engineering has shown, modularisation is a suitable approach for handling complexity. In this paper approaches and concepts of modularisation in industrial and software engineering were identified, adapted, and transferred into the field of service engineering, resulting in a method to modularise services. Additionally, potential positive effects of modularisation were compiled. Research limitations/implications – The process of modularising in general requires three aspects: an architecture to describe the system’s structure; interfaces to describe the interaction of modules; and standards for testing a module’s conformity to the design rules. The method presented contributes primarily to the architecture. Further research efforts need to be conducted regarding aspects of interfaces and standards. Practical implications – Nowadays, service providers are facing growing competition, which requires greater economical efficiency. Furthermore, customers increasingly demand individualised services, which can only be offered by applying the concepts of mass customisation. Both challenges can be met with the application of the concept of modularisation. Originality/value – While service modularisation is increasingly discussed for the service domain, only little work has been done on presenting a method for a structured description. The provision of a method for describing the architecture of services and service portfolios can be used as the basis for further research regarding optimisation and configuration of service offers. Keywords Business planning, Business-to-business marketing, Modelling, Mass customization, Service industries Paper type Research paper
An executive summary for managers and executive readers can be found at the end of this article.
(2005). Many of these challenges correlate to the necessity of well structured information (Heiskala et al., 2005). Thus, it is necessary to provide a systematic representation of modules that allows checking the validity of the structure of service modules. Additionally, service modules have to be described very precisely to tap the full potentials of service modularisation. Such descriptions are necessary to find the right modules for individual service offerings regarding cost efficiency, optimisation and adequacy. Finally a verification of the specification validity of a configuration is needed. For tackling these specific challenges of service modularisation, our goal is to provide a method that allows the precise composition and description of service modules as preparation for service configuration. Primarily, we focus on business-to-business-services that have a high complexity and high divergence (Shostack, 1987). While other domains such as software engineering and industrial engineering have already made use of the advantages of modularisation (Duray et al., 2000, Szyperski, 2002) the service domain seems to need some adaptation to tap the full potentials of modularisation. Therefore our research questions for providing the mentioned method are: . How can existing methods for modelling modules of software and industrial engineering be translated into the domain of services? . Which adoptions need to be made due to the characteristics of the service domain?
Introduction Today, the business-to-business-service industry is undergoing a structural change. Services are getting more complex, more comprehensive and are increasingly offered by a network of service providers. Additionally, business customers demand individualised services and at the same time highly competitive markets require a great level of standardisation (Lampel and Mintzberg, 1996). This situation leads to challenges regarding how to handle complex service portfolios, how to enable service standardisation and individualisation at the same time, as well as regarding the configuration of comprehensive service offerings. For these demands modularisation seems to be a promising approach in the service domain (Araujo and Spring, 2010). Still, the modularisation of services poses different challenges, as discussed widely by Heiskala et al. The current issue and full text archive of this journal is available at www.emeraldinsight.com/0885-8624.htm
Journal of Business & Industrial Marketing 26/5 (2011) 320– 331 q Emerald Group Publishing Limited [ISSN 0885-8624] [DOI 10.1108/08858621111144389]
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Providing a method for composing modular B2B services
Journal of Business & Industrial Marketing
Martin Bo¨ttcher and Stephan Klingner
Volume 26 · Number 5 · 2011 · 320 –331
Which advantages result from the modularisation of services in general and the structured description of service modularisation in specific?
and evaluate the scientific findings. Therefore, the field study has to be seen as a qualitative approach in contrast to a quantitative survey. Our provided method for composing modular business-tobusiness services is primarily based on a wide literature analysis. The results of this analysis comprise the identification of the necessity for service modularisation and the description of existing approaches for modularising services as well as the description of similar approaches in other domains such as industrial engineering and software engineering. Therefore a literature review was conducted, which comprises literature sources from the domains of service science, industrial engineering and software engineering. The selection of the literature sources depended on the objective of the analysis – literature from service science was used for identifying the necessity of service modularisation and existing approaches in that domain. Literature from industrial engineering and software engineering was used for describing existing approaches in these two domains. Literature sources for motivating service modularisation and for describing existing approaches of service modularisation were found by searching for terms such as “service”, “modules”, “modularisation” in common literature databases. Whereas for the analysis of approaches from other domains, literature sources were used that cover the main approaches of these domains. In industrial engineering literature sources were analysed that cover approaches such as the “Gozinto graph” (e.g. Vazsonyi, 1954) or “and-or graphs” (e.g. Homem de Mello and Sanderson, 1990). In software engineering two aspects were covered by the literature analysis: 1 existing approaches for applying the idea of modularisation were incorporated, such as “service oriented architecture” (e.g. Newcomer and Lomow, 2005), “object oriented programming” (e.g. McLaughlin et al., 2007) and “software-components” (e.g. Sametinger, 1997, Szyperski, 2002); and 2 approaches of configuration were analysed, such as “feature modelling” (e.g. Czarnecki and Eisenecker, 2000) and “software product lines” (e.g. Pohl et al., 2005).
But before going into detail, it is appropriate to look into the existing problems of complex monolithic services and to analyse the potential advantages of modularisation and the intended method. Our findings are based on a wide literature analysis and augmented by three use cases (see the “Methodology” section). Regarding to service modularisation, we identified the following problems in service offerings: . no standardisation of complex services and therefore a loss of economies of scale; . no ability to handle the service complexity and thus less structured planning and provision; . no opportunity to reuse existing service offerings, leading to the necessity of reinventing or re-planning existing service offerings; and . no or only poorly documented service catalogues, resulting in suboptimal offerings. By solving these problems, vendors can tap the full potentials regarding profitability, productivity and competitiveness. The problems listed above can be minimised by the application of modularisation. The primary aim is to reduce the conflict of standardisation and individualisation (“mass customisation”) by offering standardised modules which can be combined individually (Pine, 1999). Furthermore standardised modules allow a focused improvement as less profitable modules can be enhanced without paying attention to the complex service offering (Brusoni and Prencipe, 2001). Further advantages include reusability, easier outsourcing and faster developing cycles; a more detailed view is provided in the subsequent section “Advantages of a structured description”. But all the advantages mentioned can only be achieved by offering a method that allows an adequate specification and management of the service modules in preparation of a subsequent configuration. Therefore, the purpose of this paper is to present a method that enables modularising, structuring and modelling complex services. Even though the method is based on technical elaborations, this paper stresses the resulting business-relevant advantages. Modelling details are presented only partially. The paper is therefore structured as follows. After the description of the methodology the idea of modularisation in other domains is analysed, since experiences gained in these domains should be also employed in the service domain. Service modularisation covers a wide range of research aspects, which will be sketched in a subsequent section because it helps outlining the focus of this paper. The advantages of a structured description will then be discussed. Following the main method of structuring and modelling service modules will be presented. Finally, the conclusion will evaluate the method and give an outlook on further research work.
The scientific analysis gave us deep insights into the motivation of service modularisation and existing approaches of the service domain as well as other domains. This led to the development of a comprehensive method for the modularisation of services. Even though the results and findings were actually scientifically, they are of very interest to both scientists and practitioners. We were looking for ways to augment or evaluate our findings. Therefore, we conducted use cases for a qualitative evaluation of our findings. The use cases executed helped us to: . understand the state of the art and needs of service modularisation in industries; . deduct industry relevant requirements for service modularisation; and . evaluate (although not scientifically validate) our method for service modularisation.
Methodology Our applied methodology is a combination of a deductive approach (scientific analysis) and a supporting field study. While the scientific analysis was used for identifying basic requirements and specifying an approach for service modularisation, the field study was conducted to support
The use cases were carried out with globally operating companies with a turnover between $US45m and $US14bn. Two of them are industrial companies increasingly offering services and the other is shifting from being a pure software 321
Providing a method for composing modular B2B services
Journal of Business & Industrial Marketing
Martin Bo¨ttcher and Stephan Klingner
Volume 26 · Number 5 · 2011 · 320 –331
Modules in industrial and software engineering
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company to a full service provider. All companies are mainly operating in the business-to-business-market. For the first use case we organised workshops with members of staff and management working in different countries all over Europe. In a first workshop we identified problems and requirements that could be assigned to the topic of service modularisation. The problems resulted mainly from service offerings that were: . fully customer-specific without any standardised reusable parts; . offered by sales personnel without centralised planning and management; and . documented in a purely textual form, with almost no structure.
While modularisation is seen as a new approach in service engineering, it is quite established in other domains such as industrial engineering (Starr, 1965; Baldwin and Clark, 1997) and software engineering (Sametinger, 1997). It is worth scrutinising these domains in order to understand how they benefit from modularisation and how they implement the idea of modules. Both industrial engineering and software engineering apply modularisation primarily to reduce the tension between individualised offerings and standardisation, trying to reduce costs (Jiao and Tseng, 1999; Peters and Sadin, 2000; Feitzinger and Lee, 1997). In industrial engineering modularisation is defined as “building a complex product [. . .] from smaller subsystems that can be designed independently yet function together as a whole” (Baldwin and Clark, 1997). The idea is to produce parts that can be combined in numerous ways and enable a vast number of configurations (Starr, 1965). Therefore every part has to offer a certain functionality that can be accessed by a well-defined interface (Brusoni and Prencipe, 2001). Even though it is said that every module offers a certain functionality, it needs to be stressed that a module in industrial engineering is a tangible good. In contrast, services and therefore service modules are process-related. In industrial modularisation, time-relevant aspects are covered only partially. For managing industrial modules (modelling and configuration) a huge amount of supporting software has been provided (Salvendy, 2001). Every piece of software is based on an underlying model that contains all information, relevant for modularisation. These models can be used as a starting point for our method. In software engineering the idea of modularisation has been implemented for several years. This evolution led to so-called software components that are meant to cover even more of the objectives of modularisation. Even though a unique definition of the term “software component” is neither existent nor desirable (Czarnecki and Eisenecker, 2000), several authors have proposed different approaches. The following two definitions present general ideas of software components. Firstly, “a software component is a unit of composition with contractually specified interfaces and explicit context dependencies only. A software component can be developed independently and is subject to composition by third parties” (Szyperski, 2002). Secondly, “components are artefacts that we clearly identify in our software systems. They have an interface, encapsulate internal details and are documented separately” (Sametinger, 1997). It is noticeable that software modules (or components) are characterised by reusability, accessibility by interface and encapsulation of functionality. The idea of software modules covers time-relevant aspects, because a software module does offer functionality that changes the state of given information over the time. A service module therefore resembles software modules more than modules in industrial engineering. The intention of developing and using software modules is the reduction of complexity, the combination of customer-specific and standardised software, the reduction of code duplications, the increase in reuse and the achievement of cost benefits (Szyperski, 2002; Czarnecki and Eisenecker, 2000; Gao et al., 2006). Both industrial engineering and software engineering pursue comparable advantages when using the idea of
In a second workshop we applied our method for service modularisation. Based on an analysis of their service documentation (several hundred pages of written text with almost no structure) we identified approximately 150 service modules. These service modules were analysed to merge similar or identical modules. Furthermore the modules were structured due to our method. That structure could then be used for configuring customer individual services. In a third workshop we discussed our findings and identified further requirements for implementing service modularisation and configuration. The company of the second use case offered services based on software functionalities (e.g. “remote control”, based on software functionalities such as “remote analysis”, “data transformation”, etc.). The objective of the company was the identification of services that could be sold to the customer, i.e. the fine-grained description of the software had to be aggregated to a more coarse grained description that also comprises business information (i.e. price, validity, etc.). Therefore, we applied our method by aggregating the functionality that was found in the software source code. Finally we identified 45 service modules that could be bundled into individual service offerings. These service modules comprised the actual software and further processes and resources such as maintenance personnel. The description of these service modules had to be augmented with further business-relevant information such as price, availability, etc. The third use case was conducted, similar to the first one, for identifying problems and requirements in the domain of service modularisation. The company was increasingly offering services that are complementing their core products (i.e. software products). Here again, service offerings were little structured and no customer-specific configuration could be made from existing service modules. In several workshops we structured their service offerings and identified 50 service modules. Based on our method, these modules were structured and precisely described. Even though this was done without any dedicated tool-support, the results helped to understand the existing service portfolio. Based on that understanding the company was able to optimise their service portfolio due to customer specific requirements. Service modules could be reused and the effort of specifying service offerings decreased significantly. Furthermore singular service modules were discussed in terms of outsourcing. 322
Providing a method for composing modular B2B services
Journal of Business & Industrial Marketing
Martin Bo¨ttcher and Stephan Klingner
Volume 26 · Number 5 · 2011 · 320 –331
modularisation. Even though the individual implementation of modularisation differs, the basic methods are almost equivalent in both areas. It can therefore be assumed that modularisation of services can benefit from the experiences of industrial and software engineering. Nevertheless, as will be seen in subsequent sections, the existing methods need certain adaptations for the domain of service modularisation.
Basically, the advantages of a modular service architecture can be described as a more efficient exploration of the existing potentials of resources (Burr, 2002). In more detail the aims of modularisation can be divided into the following five key aspects: 1 Reduction of efforts – Efforts regarding pricing, allocation of resources and the management of monolithic services can be reduced by using modules. 2 Configuration – The possibility for a structured configuration of individual services for customers should be provided through the use of service modules. A portfolio of standardised modules is given, by which the customer may compose a custom-tailored service. This is a viable trade-off between overall standardisation and entirely individual offerings. 3 Improved transparency, reduced complexity – Many service companies are constantly developing new service offerings, which causes extensive and hard-to-overlook service portfolios. Structuring this portfolio by the use of service modules will lead to a greater transparency. Beyond that, a structured portfolio will support further processing through electronic catalogues or service configurators. 4 Enhancements and improvements – It is more feasible to develop delimited and less complex modules further, since inter-dependencies within the service system are transparent through well-defined interfaces. Being able to focus actions on a module level, a very precise improvement approach is possible. 5 Reuse – Planning, implementation and improvement of service offerings demand great investments. The reuse of service modules allows using economies of scale and reduces the efforts for service development and improvement. Once the design or optimisation of a service module is finished, it can be used in many different service offerings.
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Aspects of service modularisation When thinking about service modularisation, different topics need to be addressed. In general, a scientific specification of terms, for example “service module”, is necessary. In this context it is useful to define whether a term like “service component” should be considered as synonymous. This paper makes use of a pragmatic definition of the term “service module”, as given in the section “Structure of service modules”. Furthermore, two approaches exist for creating service modules. Both need to be addressed scientifically, which is, however, beyond the scope of this paper. Comparable to software components, as covered in Bastide et al. (2006), modules can be designed by: . creating new service modules that can be used for service offerings (creation); or . segregating existing monolithic service offerings into service modules (decomposition). Another aspect of service modularisation copes with the evaluation of service modules. It is necessary to develop adequate methods to analyse the performance and quality of those modules and derive realisable modification strategies for service modules. Finally the aspects of marketing (e.g. how to place service modules), staff education (e.g. how to work with service modules), organisational changes (e.g. the restructuring of departments) and the creation of new development methods have to be addressed adequately. Apart from the aspects of service modularisation mentioned previously, the question has to be answered as to how service modules should be described and structured so that reuse, customer-specific configuration and the creation of service catalogues is supported adequately. In order to do so, a method for composing, decomposing and structuring service modules has to be specified. This method includes a structure-representing graph and the representation of interdependencies between service modules that are both logical and temporal. The purpose of this paper lies in the development of such a method. It does not cover other aspects of service modularisation as mentioned above. Even though the paper discusses the advantages of service modularisation, it does not comprise a quantitative evaluation of the economic potential of modularisation.
To give a holistic view of the economic potential of modularisation, a two-step approach will be taken in the following. First, the five key aspects mentioned above will be assigned to four business perspectives, which are deduced from the concept of balanced scorecards (Kaplan and Norton, 1996), to illustrate the advantages of modularisation in all different business aspects. Second, a sample of key performance indicators (KPIs) is taken and assigned to each of those four areas to concretise the potential of modularisation in this specific field. The selected lists of KPIs positively influenced by modularisation are not to be seen as exhaustive. Rather, an exemplary selection of KPIs relevant in many business areas shall be given. Furthermore, a distinction between key performance indicators and key result indicators (KRIs) as drawn in Parmenter (2010) is not relevant in our case; to illustrate the economic usefulness of modularisation, an aggregated view of KPIs and KRIs, referred to as “KPIs”, is assumed to be sufficient. Balanced scorecards define four main areas, in which performance indicators can be segregated (Beatham et al., 2004): 1 The financial perspective: “How do we look to our shareholders?”. 2 The customer perspective: “How do our customers see us?”. 3 The internal perspective: “What must we excel at?”. 4 The innovation and learning perspective: “Can we continue to improve and create value?”.
Advantages of a structured description Various trends, such as increased market competition, a demand for increased productivity, a demand for quality and a tendency towards internationalisation, have arisen in the service sector in recent years (Sundbo, 1994). The recent evolution as well as the increasing importance of the service industry has shaped those new demands and challenges, for which it needs to be proven that modularisation is an appropriate solution. 323
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Providing a method for composing modular B2B services
Journal of Business & Industrial Marketing
Martin Bo¨ttcher and Stephan Klingner
Volume 26 · Number 5 · 2011 · 320 –331
Each of those four perspectives will be analysed separately. The extracted key aspects will be illustrated by using examples; the economical relevance will be emphasised by KPIs. Table I provides a complete overview.
Through the option of configuration custom-tailored services can be realised with less effort, which will better suit the taste and needs of the consumers (Baldwin and Clark, 1997). It is possible to react rapidly on new market demands by offering new services composed of modules (Heiskala et al., 2005). Offering customer-specific services becomes also practicable with the use of configurators (Hart, 1995). Altogether, these quantitative advantages will result in a greater variety of services. The customer perspective was the focus at the beginning of our use cases, because internal problems dominated. During the course of the use cases, the advantages of the customers were discovered as an additional incentive for implementing the modularisation of services.
Area: financial perspective Relevant key aspects: reuse, enhancements, improved transparency, reduction of efforts Because of the reusability of modules you can benefit from economies of scale and so reduce the efforts of implementing new and improving existent services. Furthermore standardisation allows a better controllability of the human element (Blumberg, 1994), which also leads to cost reduction. Likewise, the improvement process can be carried out much more precisely: . the analysis will extract the modules with a financial performance significantly in need of improvement (qualitative approach) . the analysis will extract the modules used most and, therefore, an improvement will have the greatest financial leverage (quantitative approach)
Area: internal perspective Relevant key aspects: reuse, enhancements, improved transparency, reduction of efforts, configuration The internal perspective comprises all previously mentioned advantages. Productivity, for example, is increased through various characteristics of modularisation (Baldwin and Clark, 1997, Langlois and Robertson, 1995), such as: . the reuse of modules; . the specialisation of employers on tasks of specific modules; . more easily manageable modules; . a standardised way of documenting service modules; and . an overview about all service modules in a company’s service catalogue.
Since complexity is reduced by the use of modules, enhancements can be applied much faster and less risky thanks to the limited scope of modules. Furthermore, outsourcing is eased, as the functionality of a module is well-defined by its interfaces (Baldwin and Clark, 1997). For the use cases, financial aspects were of secondary importance, although it still was expected to gain these advantages as well during the implementation of service modules. Area: customer perspective Relevant key aspects: configuration, enhancements, reduction of efforts The benefits of modularisation from a customer point of view can be separated into qualitative and quantitative advantages. More easily manageable service modules with an accurately defined output will result in a more homogenous quality and a higher reliability of the entire service offering (Shostack, 1987). This leads to a better service quality which, in turn, increases customer satisfaction and the company’s competitive score.
The use of service modules also decreases the maintenance cost, since, within the delimited scope of a module, improvements and new developments are less error-prone. The increase in transparency by the use of service catalogues was one of the most important aspects for the companies in our use cases, because the existing service offerings were poorly documented let alone structured. Furthermore they were seeking the reduction of efforts during the development of service offerings.
Table I Key aspects of and KPIs affected by modularisation Financial perspective Key aspects of modularisation Reuse Enhancements and improvements Improved transparency, reduced complexity Reduction of efforts
KPIs affected Extension of customer base Cost reduction (absolute/ratios) Outsource ratio
Innovation and learning perspective
Customer perspective
Internal perspective
Configuration Enhancements and improvements Reduction of efforts
Reuse Enhancements and improvements Improved transparency, reduced complexity Reduction of efforts Configuration
Reuse Enhancements and improvements Improved transparency, reduced complexity
Variety of services Competitive score Customer satisfaction
Maintenance cost Productivity
Faster developing cycles Development redundancy Productivity
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Providing a method for composing modular B2B services
Journal of Business & Industrial Marketing
Martin Bo¨ttcher and Stephan Klingner
Volume 26 · Number 5 · 2011 · 320 –331
Area: innovation and learning perspective Relevant key aspects: reuse, enhancements, improved transparency Developing cycles are faster due to two characteristics of modularisation: 1 reusability decreases the time needed for development through the composition of service offerings by the use of existing modules; and 2 reduced complexity decreases the time needed for development of new modules.
Using the existing definitions of services and adapting the ideas of modularisation from other domains, a service module can be defined as follows: A “service module” offers a well-defined functionality via precisely described interfaces. A service module can be used for composition and can, therefore, itself be part of a more coarse-grained service module. The composition allows a customer-specific configuration, as the customer can assemble a service offering from a given set of service modules.
For preparing customer-specific configurations, it is necessary to precisely describe singular service modules as well as the compositional structure that depicts how service modules can be combined. Singular service modules can be described with two sets of attributes, i.e. functional properties and nonfunctional properties (O’Sullivan et al., 2002). Functional properties cover all aspects of the offered functionalities. They include the following concerns (Bo¨ttcher and Fa¨hnrich, 2009): . customer and provider objectives, showing what customers and providers expect when using the functionality of a service module; . the classification due to a certain standard (e.g. UN/ SPSC), which allows an implication of the functionality; . the change of properties (e.g. the change of colour of a painted car); and . further functional attributes that can be described in an informal way by using plain text (e.g. the description of excitement when going to a theme park).
The former also decreases the ratio of redundancy in development. These advantages and the ability to analyse and optimise performance on module level (as described above) increase productivity. To summarise, modularity increases the rate of innovation (Baldwin and Clark, 1997). Even though the companies of our use cases were offering new services regularly, had no coordination or overview of their service innovations. Knowing what new services or what new service parts were invented by other departments in their organisation would have improved their innovation cycles. Most advantages of service modularisation directly correlate with the necessity of a structured and well-defined description of the service modules and their inter-dependencies. Without a structured description the challenges of service modularisation, as discussed by Heiskala et al. (2005) cannot be tackled and the expected benefits will not be achieved. Therefore in the next section a structure of service modules will be presented.
The other set of attributes covers the non-functional properties of a service. These non-functional properties act as restrictions on the functionality. The essential nonfunctional properties are as follows (O’Sullivan, 2006): . temporal availability (“When can a service be used?”); . locative availability (“Where can a service be used?”); . temporal duration (“How long does the service take?”); . price (“How much is the service?”); . payment (“How can a service be paid for – e.g. credit card?”); . consequences (“What happens if violations of contracts occur?”); . provider (“Who offers the service?”); . attributes for identifying the service module itself within a service portfolio; and . attributes for specifying quality and productivity ratios.
Structure of service modules To apply the idea of service modularisation in an adequate way, a structured description of both service modules and their compositional structure is required, which is necessary for overcoming the challenges of service modularisation (Heiskala et al., 2005) and for further configuration. The configuration aims at the provision of individual service offerings based on standardised service modules. In order to do so, an unstructured set of service modules (Figure 1a) is structured by using a graph (Figure 1b). Within this graph, logical and temporal inter-dependencies are specified by using rules. Based on the logical rules, a customer can choose from the structured set of service modules (Figure 1c). Finally, the service process chain is implemented on the basis of the temporal rules specified in the graph (Figure 1d). These temporal rules define when a service module has to be executed (e.g. module “wiping the floor” has to be executed after module “sweeping the floor”).
All of these non-functional properties can be described in great detail, which supports IT-based searching, automatic generation of service catalogues, IT-based management of service modules as well as IT-based simulation and optimisation. In addition to functional and non-functional
Figure 1 Steps towards a configured service offering
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Providing a method for composing modular B2B services
Journal of Business & Industrial Marketing
Martin Bo¨ttcher and Stephan Klingner
Volume 26 · Number 5 · 2011 · 320 –331
properties the resources necessary for fulfilling a module’s functionality have to be described in detail. Hence, resources provided by the customer and the service vendor have to be specified by using adequate attributes, supporting resource planning and resource allocation (Bo¨ttcher and Fa¨hnrich, 2009). The companies of our use cases did apply some of the functional and non-functional properties. It was mainly used for structuring existing information (e.g. by transforming continuous text into structured tables). The idea of automatically generating service catalogues or supporting the search of service offerings were considered very helpful. Apart from the description of singular service modules, it is essential to outline the compositional structure of service modules. This structure allows statements such as: “service module A consists of service module B and C and optionally service module D”. Based on these compositional structures, customer-specific configurations can be achieved. That is, a customer can choose from a set of standardised service modules resulting in an individual service offering. At the same time the service provider can rely on well-defined and standardised service modules when implementing the chosen service offering. Hence, an increase in customer satisfaction, due to the option of individual choice, corresponds with a decrease in offering efforts due to the reuse of standardised service modules. The use cases revealed that the application of the compositional structure facilitated the comprehension of the own service portfolio. That allowed the elimination of redundant service modules and the optimisation of the aggregated service offerings. This kind of configuration is well known in the domains of industrial engineering and software engineering (Czarnecki and Eisenecker, 2000; Newcomer and Lomow, 2005; Felfering et al., 2000).
The graph shows the general structure of service modules. But it does not enable the choice between different modules. For configuration it is necessary to represent additional information because then it can be stated that a service module (e.g. module C) either consists of both modules (module A and module B) or consists of one of the modules (module A or module B). Therefore, the graph needs to be extended and another kind of node has to be specified, i.e. connecting nodes. The connecting nodes contain an additional semantic that can be used for configuration. The semantic of these nodes is based on the idea of and/or graphs (Homem de Mello and Sanderson, 1990). Five different types of node are specified (Table II). For a better understanding, a node connected by a directed edge is called “parent node” if the edge ends in a node. If the edge starts at the node, the node is called “child node”. While some of the connecting nodes are primarily used for linking service modules, others are meant to link primarily connecting nodes themselves. Figure 3 visualises exemplarily a graph containing service modules and connecting nodes. Even though the graph allows structuring service modules in an easy way and covers a wide range of configurationrelevant aspects, its expressiveness is still limited. Statements like “A service module consists of three to five service modules (child nodes)” cannot be made. In this case another extension of the graph is necessary. This extension is done by adding cardinalities. Cardinalities have been proposed for different purposes, for example for describing sets (Cunis et al., 1989) or as an extension to feature modelling in software engineering (Czarnecki et al., 2004). Cardinalities can be specified for connecting nodes (Figure 4). Hereby it is necessary to prevent any inconsistencies between the connecting node and the cardinalities (e.g. an exclusive-ornode must not have a cardinality that is more than “one”). Strictly speaking, cardinalities can replace the different types of connecting nodes. Nevertheless, the different types of connecting nodes support a better understanding of the graph. Cardinalities are specified as follows: . a set of tuples defines cardinality ranges (e.g. “between three and six” or “between eight and 12”); and . a default value defines which cardinality is recommended.
Composition graph for structuring service modules For defining the compositional structure of service modules, a graph needs to be defined at first (Figure 2). Such a graph allows outlining the main compositional structure of service modules comparable to approaches like the Gozinto graph in industrial engineering (Vazsonyi, 1954). The relations between service modules, defined in this graph, can be named “has-parts” or “consist-of”. Furthermore the graph ensures a structure that is free of redundancies, i.e. every service module (even though it might be part of several other service modules) is represented within the graph only once. This increases the clarity and decreases the maintenance efforts as well as inconsistencies. Hence, the graph supports the intention of cost reduction and productivity enhancement. The graph consists of nodes, representing service modules, and directed edges, representing that a service module consists of other service modules.
For example, the following statement can be made by using cardinalities: “A service module consists of two to three or five to six service modules and three service modules are recommended”. Table II Types of connecting nodes Node type
Description
Conjunctive-node
All child nodes have to be chosen during a configuration Exactly one child node has to be chosen during a configuration Exactly one or none child node has to be chosen during configuration At least one of the child nodes has to be chosen during configuration An arbitrary amount (inclusive none) of child nodes can be chosen during configuration
Exclusive-or-node
Figure 2 Graph consisting of service modules and directed edges
Optional-exclusive-or-node Disjunctive-obligatory-node Disjunctive-node
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Providing a method for composing modular B2B services
Journal of Business & Industrial Marketing
Martin Bo¨ttcher and Stephan Klingner
Volume 26 · Number 5 · 2011 · 320 –331
Figure 3 Graph containing connecting nodes
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Figure 4 Graph containing cardinalities
support error-free service configurations (Heiskala et al., 2005). For specifying these inter-dependencies, expressive methods like propositional logic (Krajicek, 1995) are best suited. But as the application of propositional logic is quite complex, typical rules can be specified that are based on propositional logic, but are at the same time applicable for users that are unfamiliar with propositional logic. The four rules shown in Table III are examples that can be used when specifying inter-dependencies between service modules. The graph represents a variability defined via service modules. If a customer can chose between two non-functional properties (e.g. location), two modules are specified that differ only in their location. Even though this approach is a very consistent, one might not want to display the marginal changes (e.g. location) by specifying two almost identical service modules. In this case the graph has to be extended by nodes representing properties and their variable values. A module would have a property node “location” with two values “Berlin” and “Leipzig”. However, in this paper the seemingly more complex but nevertheless more consistent approach of only representing service modules is preferred.
Our use cases indicated that the application of the different types of connecting nodes covered most of the needs for structured representation. Additionally the node types were acknowledged to be more straightforward and therefore more understandable. Nevertheless a few cases occurred where cardinalities had to be applied, because the pre-defined nodetypes did not suffice for expressing the structural dependencies.
Logical inter-dependencies The specified graph with different types of connecting nodes and cardinalities defines the dependencies between service modules that are directly inter-related by the given graph. Additionally, inter-dependencies have to be specified for service modules that are neither children nor parents of other service modules. These inter-dependencies are necessary to make statements like “when choosing service module A during a configuration, service module X has to be chosen as well” or “when choosing service module B during a configuration, service module Y must not be chosen”. As these inter-dependencies present logical restrictions for configuration, they are called “logical inter-dependencies” (Figure 5). Such logical inter-dependencies are necessary to
Temporal inter-dependencies The distinctiveness of services is their procedural characteristic. Whereas industrial modules represent tangible goods, service modules, comparable to software modules, represent processes that have to be executed in a specific sequence. Concerning the specified graph, it is therefore not enough to display only logical inter-dependencies between service modules, but also to display temporal interdependencies. These temporal inter-dependencies define whether a service module has to be performed before or after another service module. Using this information, it will be easier finally to implement the whole service process out of the chosen service modules. The instantiation of a service process (specifying which service module has to be executed at which time) has to take into account the specified temporal inter-dependencies. For keeping the graph as flexible as possible, temporal inter-dependencies can be specified by using a declarative approach (as opposed to a procedural approach). Such an approach has been proposed by van der Aalst and Pesic (2006). The application of the linear temporal logic (LTL) (Sistla and Clarke, 1985) would offer the most flexible and expressive way of specifying the temporal interdependencies. Nevertheless, this approach is not applicable for users that are unfamiliar with LTL. Therefore, a set of rules can be specified that covers most of the temporal interdependencies. These rules are, on the one hand,
Figure 5 Examples of logical inter-dependencies
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Providing a method for composing modular B2B services
Journal of Business & Industrial Marketing
Martin Bo¨ttcher and Stephan Klingner
Volume 26 · Number 5 · 2011 · 320 –331
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Table III Rules for specifying logical inter-dependencies of service modules Rule
Propositional logic
Explanation
a-causes-b Not-a-causes-not-b Not-a-causes-b a-and-b-are-exclusive
a)b : a ): b :a)b ða ): bÞ ^ ðb ): aÞ
If module If module If module If module
“a” is chosen during configuration, module “b” has to be chosen as well “a” is not chosen during configuration, module “b” must not be chosen as well “a” is not chosen during configuration, module “b” must be chosen instead “a” is chosen during configuration, module “b” must not be chosen (and vice versa)
understandable to laymen and, on the other hand, based on the LTL, which allows functionalities like model checking or simulation. van der Aalst and Pesic (2006) specify a comprehensive set of rules that exceed the amount, necessary for service modularisation. Therefore, only the main rules will be presented as examples (Table IV), allowing the specification of direct and indirect successions as well as the prohibition of successions. The temporal inter-dependencies were of less interest in the use cases, because the service modules were coarse-grained and the sequence of the service modules was obvious. As soon as modules are designed fine-grained and the number of service modules increases, the temporal inter-dependencies become important. This can be seen for software modules where the information about the temporal sequences is used for specifying complex processes from singular modules, for example web services (Juric et al., 2006).
1 2 3
an architecture specifying the modules of the system and their functions; an interface that describes how the modules will interact; and standards for testing a module’s conformity to the design rules (Baldwin and Clark, 1997).
The method presented contributes primarily to the architecture. Additionally basic aspects for interfaces and standards were also considered. When coping with the idea of service modularisation, the structured representation of service modules is one of the main aspects. In this paper a method has been presented allowing the structuring and configuration of service modules, including logical and temporal inter-dependencies. Hence, service vendors can offer individual services based on standardised service modules. The IT-based processing of service modules (e.g. management, configuration) is supported, as the method is based on formal approaches. The method adapts many appropriate ideas from other disciplines like industrial engineering and software engineering and considers the characteristics of services. The conducted use cases gave us various insights. On the one hand the use cases reinforced certain aspects of our scientific findings. All use cases profited from the method for structuring service modules. Nevertheless, other aspects of our method were not applied to their full extent. For example, temporal dependencies necessary for specifying the actual process were not utilised as this was not in the focus of the initial service structuring. On the other hand the use cases revealed requirements that were not covered by our method. These requirements mainly define further research questions, such as the assignment of key performance indicators to modules to measure productivity. Even though the use cases confirmed our assumption of the necessity of service modularisation, and even though several
Recommendations and conclusions The purpose of this paper is the provision of a method that allows the structuring of service modules for service configuration and therefore overcomes some of the challenges of service modularisation. The findings were based on scientific research, transferring insights from other domains that make already use of modularisation (e.g. industrial engineering and software engineering), and on use cases, conducted with three companies. The use cases were additionally utilised for evaluating the scientific results. While service modularisation is increasingly discussed for the service domain (Araujo and Spring, 2010), only little work has been done on presenting a method for a structured description, therefore leading to certain unsolved challenges for service modularisation (Heiskala et al., 2005). Modularisation in general demands the consideration of three important aspects: Table IV Rules for specifying temporal inter-dependencies Rule and LTL
Visualisation
Explanation
a-needs-succeeding-b Aða ) SðbÞÞ
The execution of module “a” demands the execution of module “b” at any future time
a-needs-immediately-succeeding-b Aða+ ) ððbÞÞ _ ð+ðbÞÞÞ
The execution of module “a” demands the immediate execution of module “b” without any module being executed in between
a-never-before-b : Sða ^ SbÞ
The execution of module “a” prohibits the execution of module “b” at any future time
a-never-immediately-before-b : Sða ^ +bÞ
The execution of module “a” prohibits the immediate execution of module “b” without any module being executed in between
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Providing a method for composing modular B2B services
Journal of Business & Industrial Marketing
Martin Bo¨ttcher and Stephan Klingner
Volume 26 · Number 5 · 2011 · 320 –331
aspects of our method were applied, the usefulness of rather scientific concepts, for example temporal inter-dependencies, has to be validated by further evaluation. Additionally the basic method could be advanced by including aspects such as key performance indicators. Even though the method presented is a very precise and consistent approach, it can only live up to its expectations when other methods (e.g. for describing how to develop service modules) are developed and used as well. Furthermore, the method needs a technical implementation that offers an IT-based support (e.g. a modelling tool and a configuration tool) – as yet it is rather a purely methodical approach. Additionally, comparable methods of other disciplines lived up to their promises when they became a (quasi-) standard – therefore the service domain needs more work on this topic. The method presented contributes to the area of service modules by presenting a precise description of service structuring and configuration, and hence covers rather a technical aspect that is, nevertheless, essential for other parts in service modularisation. Comparable to other domains like industrial engineering and software engineering, the method allows the structuring of modules by respecting the distinctive characteristics of services.
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References Araujo, L. and Spring, M. (2010), “Complex performance, process modularity and the spatial configuration of production”, in Caldwell, N. and Howard, M. (Eds), Procuring Complex Performance: Studies in Innovation in Product-service Management, Routledge, London. Baldwin, C.Y. and Clark, K.B. (1997), “Managing in an age of modularity”, Harvard Business Review, Vol. 75, pp. 84-93. Bastide, G., Seriai, A. and Oussalah, M. (2006), “Adaptation of monolithic software components by their transformation into composite configurations based on refactoring”, in Gorton, I., Heineman, G.T., Crnkovic, I., Schmidt, H.W., Stafford, J.A., Szyperski, C.A. and Wallnau, K. (Eds), Component-based Software Engineering, Springer, Berlin/Heidelberg. Beatham, S., Anumba, C., Thorpe, T. and Hedges, I. (2004), “KPIs: a critical appraisal of their use in construction”, Benchmarking: An International Journal, Vol. 11, pp. 98-117. Blumberg, D.F. (1994), “Strategies for improving field service operations productivity and quality”, Service lndustries Journal, Vol. 14, pp. 262-77. Bo¨ttcher, M. and Fa¨hnrich, K.-P. (2009), “Service systems modelling”, in Alt, R., Fa¨hnrich, K.-P. and Franczyk, B. (Eds), Proceedings of the First International Symposium on Services Science (ISSS’09), Logos, Berlin. Brusoni, S. and Prencipe, A. (2001), “Unpacking the black box of modularity: technologies, products and organizations”, Industrial and Corporate Change, Vol. 10, pp. 197-315. Burr, W. (2002), Service Engineering bei technischen Dienstleistungen: eine o¨konomische Analyse der Modularisierung, Leistungstiefengestaltung und Systembu¨ndelung, Deutscher Universita¨tsverlag, Wiesbaden. Cunis, R., Gu¨nter, A., Syska, I., Peters, H. and Bode, H. (1989), “PLAKON – an approach to domain-independent construction”, Proceedings of the 2nd International Conference on Industrial and Engineering Applications of Artificial 329
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Providing a method for composing modular B2B services
Journal of Business & Industrial Marketing
Martin Bo¨ttcher and Stephan Klingner
Volume 26 · Number 5 · 2011 · 320 –331
functional service properties”, Distributed and Parallel Databases, Vol. 12, pp. 117-33. Parmenter, D. (2010), Key Performance Indicators (KPI): Developing, Implementing, and Using Winning KPIs, Wiley, New York, NY. Peters, L. and Sadin, H. (2000), “IT and the mass customiziation of services: the challenges of implementation”, International Journal of Information Management, Vol. 20, pp. 103-19. Pine, J.B. II (1999), Mass Customization: The Frontier in Business Competition, Harvard Business School Press, Boston, MA. Pohl, K., Bo¨ckle, G. and van der Linden, F. (2005), Software Product Line Engineering – Foundations, Principles, and Techniques, Springer, Berlin/Heidelberg. Salvendy, G. (Ed.) (2001), Handbook of Industrial Engineering – Technology and Operations Management, Wiley, New York, NY. Sametinger, J. (1997), Software Engineering with Reusable Components, Springer, Berlin/Heidelberg. Shostack, G.L. (1987), “Service positioning through structural change”, The Journal of Marketing, Vol. 51, pp. 33-43. Sistla, A.P. and Clarke, E.M. (1985), “The complexity of propositional linear temporal logics”, Journal of the ACM, Vol. 32, pp. 733-49. Starr, M.K. (1965), “Modular production – a new concept”, Harvard Business Review, Vol. 43, pp. 131-42. Sundbo, J. (1994), “Modulization of service production and a thesis of convergence between service and manufacturing organizations”, Scandinavian Journal of Management, Vol. 10, pp. 245-66. Szyperski, C. (2002), Component Software - Beyond Objectoriented Programming, Addison-Wesley, Reading, MA. van der Aalst, M.W.P. and Pesic, M. (2006), “Specifying, discovering, and monitoring service flows: making web services process-aware”, BPM Center Report, BPM Center, Eindhoven/Brisbane. Vazsonyi, A. (1954), “The use of mathematics in production and inventory control. I”, Management Science, Vol. 1, pp. 70-85.
Klingner has a Diploma in Computer Science and a Master’s in Media and Computing, both from the University of Applied Sciences Leipzig (HTWK). Previously he worked as Vice Head of Software Development at Unister GmbH. His research topics cover service science, virtual services and web-based service offerings.
Executive summary and implications for managers and executives This summary has been provided to allow managers and executives a rapid appreciation of the content of the article. Those with a particular interest in the topic covered may then read the article in toto to take advantage of the more comprehensive description of the research undertaken and its results to get the full benefit of the material present. While other domains such as software engineering and industrial engineering have already made use of the advantages of modularisation, the service domain seems to need some adaptation to tap its full potentials. How can existing methods for modelling modules of software and industrial engineering be translated into the domain of services? Which adaptations need to be made due to the characteristics of the service domain? Which advantages result from the modularisation of services in general and the structured description of service modularisation specifically? Looking into existing problems of complex monolithic services and to analysing potential advantages of modularisation, the following problems in service offerings are identified: . no standardisation of complex services and therefore a loss of economies of scale; . no ability to handle the service complexity and thus less structured planning and provision; . no opportunity to reuse existing service offerings, leading to the necessity of reinventing or re-planning existing service offerings; and . no or only poorly documented service catalogues, resulting in suboptimal offerings. By solving these problems, vendors can tap the full potential regarding profitability, productivity and competitiveness. The problems can be minimised by the application of modularisation, the primary aim being to reduce the conflict of standardisation and individualisation (“mass customisation”) by offering standardised modules which can be combined individually. Furthermore standardised modules allow a focused improvement as less profitable modules can be enhanced without paying attention to the complex service offering. Further advantages include reusability, easier outsourcing and faster developing cycles. But all the advantages mentioned can only be achieved by offering a method that allows an adequate specification and management of the service modules in preparation of a subsequent configuration. In “Providing a method for composing modular B2B services” Martin Bottcher and Stephan Klinger present a method that enables modularising, structuring and modelling complex services. Even though the method is based on technical elaborations, this paper stresses the resulting business-relevant advantages. Services today are of increased importance requiring an efficient provision by organisations. However, their
About the authors Martin Bo¨ttcher is the leader of the research group Service Modelling and Engineering at the Institute for Applied Informatics (InfAI) in Leipzig (Germany). Additionally, he works at the University of Leipzig as a Senior Research Assistant in the Department of Business Information Systems. Dr Bo¨ttcher studied Information Management at the University of Leipzig. Subsequently he was a member of the doctoral program “Knowledge representation” sponsored by the German Research Foundation. Dr Bo¨ttcher received his PhD for his work on service modelling. His research topics cover service science, service engineering, formal service systems modelling and the industrialisation of service systems. Martin Bo¨ttcher is the corresponding author and can be contacted at:
[email protected] Stephan Klingner is member of the research group Service Modelling and Engineering at the Institute for Applied Informatics (InfAI) in Leipzig (Germany). Additionally, he works at the University of Leipzig as a Research Assistant in the Department of Business Information Systems. Mr 330
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Providing a method for composing modular B2B services
Journal of Business & Industrial Marketing
Martin Bo¨ttcher and Stephan Klingner
Volume 26 · Number 5 · 2011 · 320 –331
complexity increases in two-fold manner. On the one hand, services are becoming more complex and are often executed by a network of service providers. On the other hand, customers demand a higher degree of individualisation. As a possible solution this paper suggests the adoption of the paradigm of modularisation, as employed in the areas of industrial and software engineering, to face the growing complexity of B2B services. This postulation is supported by elaborations regarding the economic usefulness of modularisation and thereby affected performance indicators. The aims of modularisation can be divided into the following five key aspects: 1 Reduction of efforts – Efforts regarding pricing, allocation of resources and the management of monolithic services can be reduced by using modules. 2 Configuration – The possibility for a structured configuration of individual services for customers should be provided through the use of service modules. A portfolio of standardised modules is given, by which the customer may compose a custom-tailored service. This is a viable trade-off between overall standardisation and entirely individual offerings. 3 Improved transparency, reduced complexity – Many service companies are constantly developing new service offerings, which causes extensive and hard-to-overlook service portfolios. Structuring this portfolio by the use of service modules will lead to a greater transparency. Beyond that, a structured portfolio will support further processing through electronic catalogues or service configurators. 4 Enhancements and improvements – It is more feasible to develop delimited and less complex modules further, since inter-dependencies within the service system are transparent through well-defined interfaces. Being able
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to focus actions on module-level, a very precise improvement approach is possible. Reuse – Planning, implementation and improvement of service offerings demand great investments. The reuse of service modules allows using economies of scale and reduces the efforts for service development and improvement. Once the design or optimisation of a service module is finished, it can be used in many different service offerings.
When coping with the idea of service modularisation, the structured representation of service modules is one of the main aspects. In this paper a method is presented allowing the structuring and configuration of service modules, including logical and temporal inter-dependencies. Hence, service vendors can offer individual services based on standardised service modules. The IT-based processing of service modules (e.g. management, configuration) is supported, as the method is based on formal approaches. The method adapts many appropriate ideas from other disciplines like industrial engineering and software engineering and considers the characteristics of services. The question has to be answered as to how service modules should be described and structured so that reuse, customerspecific configuration and the creation of service catalogues is supported adequately. In order to do so, a method for composing, decomposing and structuring service modules has to be specified. The method presented includes a structurerepresenting graph and the representation of interdependencies between service modules that are both logical and temporal. (A pre´cis of the article “Providing a method for composing modular B2B services”. Supplied by Marketing Consultants for Emerald.)
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This article has been cited by: 1. Wenyan Song, Zhenyong Wu, Xiuzhen Li, Zhitao Xu. 2015. Modularizing product extension services: An approach based on modified service blueprint and fuzzy graph. Computers & Industrial Engineering 85, 186-195. [CrossRef] 2. Stephan Klingner, Stephanie Pravemann, Michael Becker. 2015. Service productivity in different industries – an empirical investigation. Benchmarking: An International Journal 22:2, 238-253. [Abstract] [Full Text] [PDF] 3. Anu Bask, Hilkka Merisalo-Rantanen, Tuure Tuunanen. 2014. Developing a Modular Service Architecture for E-store Supply Chains: The Small- and Medium-Sized Enterprise Perspective. Service Science 6, 251-273. [CrossRef] 4. Tuure Tuunanen, Anu Bask, Hilkka Merisalo-Rantanen. 2014. Typology for Modular Service Design. International Journal of Service Science, Management, Engineering, and Technology 3:10.4018/IJSSMET.20120701, 99-112. [CrossRef] 5. Per Carlborg, Daniel Kindström. 2014. Service process modularization and modular strategies. Journal of Business & Industrial Marketing 29:4, 313-323. [Abstract] [Full Text] [PDF] 6. Rutger Soffers, Bert Meijboom, Jos van Zaanen, Christina van der Feltz-Cornelis. 2014. Modular health services: a single case study approach to the applicability of modularity to residential mental healthcare. BMC Health Services Research 14, 210. [CrossRef] 7. Stephan Klingner, Michael Becker. 2012. Formal Modelling of Components and Dependencies for Configuring Product-ServiceSystems. Enterprise Modelling and Information Systems Architectures 7, 44-66. [CrossRef] 8. Kaj Storbacka. 2012. Strategic account management programs: alignment of design elements and management practices. Journal of Business & Industrial Marketing 27:4, 259-274. [Abstract] [Full Text] [PDF]
