Serv Bus (2011) 5:213–236 DOI 10.1007/s11628-011-0111-0 EMPIRICAL ARTICLE
The customisation framework for roadmapping product-service integration Youngjung Geum • Sungjoo Lee • Daekook Kang Yongtae Park
•
Received: 11 April 2011 / Accepted: 7 July 2011 / Published online: 20 July 2011 Ó Springer-Verlag 2011
Abstract Product-service integration is becoming a dominant contemporary trend, motivated by how technology can shape areas of potential product/service interactivity and triggers interactions. Since the role of technology differs from case to case, the strategic planning of product-service integration should focus on accommodating the real-life business situation. In response, this paper suggests a customisation framework for product-service roadmapping according to the technological interface involved, and provides practical guidance in its implementation. This framework consists of five steps in three main stages. The first deals with the structural determination of roadmapping, planning ‘what to plan’, determining the role of technology and the roadmapping format. The second phase plans the functional determination, dealing the issue of ‘how to plan’, including deciding on the relevant roadmapping procedures and methodology. Finally, the roadmap for product-service integration is developed. To illustrate the workings of proposed approach, six case examples are provided for different modes of integration, providing a practical illustration for product-service integration.
Y. Geum D. Kang Y. Park (&) Department of Industrial Engineering, School of Engineering, Seoul National University, San 56-1, Shilim-Dong, Kwanak-Gu, Seoul 151-742, Republic of Korea e-mail:
[email protected] Y. Geum e-mail:
[email protected] D. Kang e-mail:
[email protected] S. Lee Department of Industrial and Information Systems Engineering, Ajou University, San 5, Woncheon-dong, Paldal-gu, Suwon-si, Gyeonggi-do 443-749, Republic of Korea e-mail:
[email protected]
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Keywords Technology Product-service integration Technology roadmap Product-service system Case study
1 Introduction The trend towards the integration of products and services is becoming undeniable, with manufacturing firms no longer sticking with offering only products, but actively seeking to add relevant services to deliver the value customers desire (Goedkoop et al. 1999; Mont 2002; Baines et al. 2007). The change towards this new paradigm of integrated product-service offerings—which has been widely noted in both academia and practice—demands that firms change their strategies, operations, technologies, expertise and system integration capabilities (Oliva and Kallenberg 2003; Martinez et al. 2010). Much academic discussion have been focused on other related concepts, such as integrated product and service offering (Sundin et al. 2006) or product-service system (PSS) (Goedkoop et al. 1999; Tukker 2004). Given its increasing pervasiveness, developing an integrated framework for studying product/service integration is becoming an important issue. What is urgently required is to provide the strategic decision-making process that allows companies to adapt themselves to the conditions of their specific marketplace (Montoro-Sa´nchez 2009). Notwithstanding the existing body of literature about product-service integration, however, there have been few studies of the strategic development and planning of product-service integration—even though products and services are now considered as combined offerings, the literature still tends to employ manufacturing-originated methodology to plan their integration, simply using the body of theories and tools accumulated in the manufacturing arena. This same phenomenon affects the use of technology roadmaps, the most useful and widely used method for the strategic planning of product development (Phaal et al. 2004; Lee and Park 2005). Although a few attempts have been made to discus the planning of product-service integration (Kameoka 2005; Nakamura et al. 2006; An et al. 2008), related research has been stuck to the suggestion of generalised structure. But what is more important in today’s dynamic and complex environment is to be able to adjust this generalised structure to practical settings, suggesting that a process is required that can be customised according to specific circumstances (Lee and Park 2005). For this purpose, what is notable is Geum et al. (2011)’s work to suggest six types of product-service roadmaps based on the technological interfaces. However, in a practical situation, what is needed is to tailor the base structure of product-service roadmapping to fully accommodate the firms’ circumstances. For this purpose, simple suggestion of archetypes might not helpful. Instead, the customisation framework which enables a firm to select the formats and methods of product-service roadmapping is highly required, with a practically applicable business case. To achieve this end, this paper aims to suggest a framework for the customisation of product-service roadmapping, and provide the practical guidance on its implications using the real business cases. This paper outlines the relevant technological roles, roadmapping formats, roadmapping
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procedures and methodologies to show how this approach can covers full range of roadmapping to address the emerging industry dynamics of product-service integration. Six practical business cases are illustrated to represent the applicability of each roadmapping process. The paper organised as follows. The next section considers the current trend of product-service integration from both academic and practical perspectives, after which our proposed approach—a framework for customising roadmapping processes for product-service integration—is detailed and its process of three phases and five corresponding steps unpacked, and case examples provided to illustrating the customisation process. Finally, the major contribution and future research are discussed in the conclusion.
2 Related work 2.1 Product-service integration Recently, the basis of customer value has changed from manufacturing to more product-service oriented systems across a range of economies (Wise and Baumgartner 1999), as manufacturing companies become more oriented to marketing product-service offerings rather than pure products (Mont 2002; Manzini and Vezolli 2003), and sought growth through increasing their sales of services (Wise and Baumgartner 1999; Reinartz and Ulaga 2008). This is in line with the recent megatrends to bring new business opportunities by stimulating new convergences. This fosters the strategic innovation, including convergence between products, services, functions, and organisations through convergence of technologies and industries (Lee and Olson 2010). Thus, the concept of product-service integration has been emerged to deal with this issue. Table 1 defines these product-service concepts in more detail (Park and Lee 2009). The concept of integrating products and services has not only been discussed in academia, but also already happened in practical settings: companies such as IBM, General Electric, Xerox, Cannon and Parkersell have been gaining revenues and profits from services since the middle of 1990s, exemplifying a shift from the product to service perspective (Martinez et al. 2010). Car sharing is a well-known strategy for product-service integration, retaining the benefits of car use but creating social value at the same time, with customers gaining the function the need— mobility—rather than the car as a product (Shaheen et al. 1998), with companies involved changing their business product from the automobile to an integrated products/services offering. Xerox’s copy machine business is another case of product-service integration, with Xerox changing their competitive offering from the copy machine as a product to document management as a service, dealing with the full range of related activities—planning, consultation, realisation and evaluation. Its ‘Office Service’ solution promises to ‘‘right-size’’ clients’ printing operations to optimise utilisation and reduce costs. Similar business models can be found at GE, which has grown its profit model from a manufacturing-oriented to a
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Table 1 Concepts regarding product-service integration [adapted from Park and Lee (2009)] Concept
Definition
Bundling
Practice of marketing two or more products and/or services in a single package (Guiltinan 1987)
Systems selling
A combination of products and services to fulfil a more extended customer need (Mattson 1973)
Full service
A comprehensive bundle of products and/or services that fully satisfies the needs and wants of a customer related to a specific event or problem (Stremersch et al. 2001)
Service package
A bundle of goods and services with information that is provided in some environment (Fitzsimmons and Fitzsimmons 1994)
Product service
The set of all potential additional services a supplier can supplement his product offering with, in order to differentiate his offering relative to the competitors (Frambach et al. 1997)
Installed based service
The range of product- or process related services required by an end-user over the useful life of a product in order to run it effectively in the context of its operating process (Oliva and Kallenberg 2003)
Solution
Integrated combinations of products and/or services that are unusually tailored to create outcomes desired by specific clients or types of clients (Miller et al. 2002)
Integrated solution
Combined products and services to address specific customer needs (Windahl 2007)
Eco-efficient producer service (EEPS)
Certain product-service mix which has a higher added value and a smaller environmental impact (Zaring et al. 2001)
Product-service system
A marketable set of products and services capable of jointly fulfilling a user’s need (Goedkoop et al. 1999)
Functional sale
Functional solution with a combination of products and services that satisfies an identified customer need from a life-cycle-perspective ¨ lundh 2001) (Lindahl and O
Functional product
A product that comprises combinations of hard and soft elements (Markeset and Kumar 2005)
total solution business by increasing service capability. GE Medical Systems provides ‘lease and loan’ service (connected to a finance service) to help sell its medical equipment, and has recently added a global medical information solution. This range of practical evidence shows how product-service integration can be realised with the help of technology. In fact, most recent advances in productservice integration seem to have been technology-driven, technology-dependent or at least technology-related processes—so planning product-service integration should start from considering the role of technology. 2.2 Technology roadmap A technology roadmap is a tool for strategic planning of technology (Kostoff and Schaller 2001; Phaal et al. 2004; Lee and Park 2005). By forecasting future trends and identifying gaps between the firm’s current technology levels and advanced levels it desires to achieve, the roadmap enables a firm to carry out its R&D
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activities in a systematic manner, laying out explicit plans about what technologies to develop when and how. Figure 1 illustrates the generic structure of a technology roadmap as a time-based chart, comprising a number of layers such as market, product and technology layer, which thus represents their evolutionary patterns, as well as the linkages and discontinuities between them (Phaal et al. 2004). There have been several attempts to find the most effective way to build technology roadmaps. Bray and Garcia (1997) have suggested three phases: preliminary activity, roadmap development, and follow-up activity, and described well the step-by-step activities required for each phase. Groenveld (1997) have developed a seven-stage process. While such work has yielded significant implications for building roadmaps in general, there still remains a practical problem of providing detailed guidelines on how to construct a technology roadmap. In response, the development of the ‘T-Plan’ supports the swift initiation of roadmapping in three stages: planning, roadmapping and roll-out (Phaal et al. 2001), and a modified T-Plan process has also been introduced with five key modules (Holmes and Ferrill 2005). Lee and Park (2005) suggested a framework for customising the technology roadmapping process according to its specific purposes, suggesting eight standardised formats. Gerdsri et al. (2010) also suggested an activity guideline for technology roadmapping implementation, together with some action plans. In terms of the issue of product-service integration, a few suggested some approaches to combining the service and product layers, such as suggesting a mobile business roadmap including technology, service, value and enablers (Fouskas et al. 2005), introducing a service layer (Kameoka 2005), or integrating the role of services in the manufacturing industry into the traditional technology roadmap (Nakamura et al. 2006). Recently, An et al. (2008) suggested a productservice integrated roadmap as a tool for the strategic management of product-service integration, locating both product and service at the same level, just below the market/customer layer, while Geum et al. (2011) proposed a more advanced
Fig. 1 General structure of technology roadmap
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framework that extends the product-service integrated roadmap, suggesting six types of integrated roadmap according to the technological interface involved. Following on the structure and characteristics of technological interface, a new type of technology roadmap which enables the planning of strategic management of product-service integration is suggested, named as ‘‘product-service integrated roadmap’’ (Geum et al. 2011). As well as the conceptual suggestion, the architecture of integrated roadmap is suggested with the typology which differentiated the characteristics, roadmapping process, and corresponding implications. However, this the previous studies have all stuck to concepts for integrated roadmaps which involve simply adding the service layer to the conventional roadmap structure in a generalised form. While the value of these studies cannot be neglected, they lack a focus on the practical context, and so do not propose a customisation framework that enables firms to adapt themselves to the practical business cases—this remains a significant need.
3 Proposed approach 3.1 Overall process Putting these considerations together, this paper aims to propose a customisation framework for roadmapping process for product-service integration. This section describes the overall process of proposed approach (as shown in Fig. 2) in which customising product-service integration comprises three main phases and five steps. The proposed approach focuses on how a firm can customise or tailor the generalised structure of product-service integrated roadmap to the firm-specific
Fig. 2 Overall process of proposed approach
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practical situation. For this purpose, we suggest a customisation process of selecting the structural and functional determination of product-service roadmapping. The first phase deals with the structural determination of roadmapping, covering ‘what to plan’, and is composed of two substeps. Step 1 defines the role of technology in product-service integration, since as technology drives integration by shaping the interfaces between products and services, while step 2 decides the architectural structure of the roadmap’s layers, which affects the selection of its structural format. The second phase deals with functional determination, covering ‘how to plan’ the product-service integration, including two substeps. Step 3 determines the roadmapping activities, in other words, determines how to use the methodology to plan the product-service integration in relations to the contents of each layer and its sublayers. Step 4 covers the key decision of selecting which roadmapping methodology should be used to support the roadmapping process. Based on the results of these two phases: structural determination (what) and functional determination (how), the third phase (Step 5) sees the development of the final roadmap for product-service integration and its implementation. 3.2 Step 1: Structural determination (what to plan): defining the role of technology Broadly defined as ‘know-how’ or knowledge that improves our understanding about how to do things (Capon and Glazer 1987), technology can be classified into the following three types; product, process and management technologies (Chadee and Pang 2008). Technology has been considered as an important driver for convergence, especially the computer and communication technology (Lee and Olson 2010). In terms of product-service integration, too, technology has also played a key role (as the cases noted above show in shaping areas where products and services intersect (Auernhammer and Stabe 2002). It provides the means for customisation processes, effective administration of products (Drejer 2002; Stock and Tatikonda 2004), and technology-based communication channels (Froehle and Roth 2004; Ruiz-Molina et al. 2011) and new types of service or transaction (Froehle and Roth 2004). There have been attempts to classify the technological interfaces involved in product-service integration. Geum et al. (2010) identified three major types of technological interfaces as shown in Table 2—technology as an enabler, as a mediator, and as a facilitator—with each type further classified into two sub-types, for a total of six types of suggested technological interface. The selection of the technological interface involved can affect further roadmapping steps, since its role can vary the shape of the interaction between products and services, and, more specifically, the format of roadmapping. 3.3 Step 2: Structural determination (what to plan): determining the roadmapping format The next step after defining the role of technology is to determine the roadmapping format. Since the six types of technological interfaces show different characteristics
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Table 2 Types of technological interface (Geum et al. 2010) Type
Characteristics
Direct integration enabler
Technology directly enables the integration of products and services, directly infused in the process of integration
Indirect integration enabler
Technology indirectly enables the integration of products and services by being applied to the products and services so as to provide the means for integration
Servitisation mediator
Technology mediates product-originated integration: the technology is firstly applied to the product, after which the technology-embedded product is servitised
Productisation mediator
Technology mediates service-originated integration, being firstly applied to the service which is then productised to provide more valuable information
Service facilitator
Technology and products are independently applied to the services, facilitating product-service integration Mostly happens in technology-based maintenance services
Product facilitator
Technology and services are independently applied to the product, facilitating the product-service integration
in functional interaction as well as schematic representation, use of relevant roadmapping formats can help the effective roadmapping process. Adapting Geum et al.’s (2011) work, we suggest six types of differentiated roadmapping formats, as shown in Tables 3 and 4. The layout of these formats starts from the fact that product-service integration does not follow a single pattern—rather, today’s range of complex business environments require structurally different roadmap formats. Firstly, type (a) in Table 3 shows a direct integration roadmap in which the product and service layers are placed adjacently, representing their close relationship in integration. Type (b) represents the roadmap for indirect integration, in which the technology layer is applied to the products and services individually, making it an intermediate between the two. Type (c) shows the servitisation roadmap, where the main evolution path is from technology to product and then to service. Type (d), a productisation roadmap is structured in the reverse direction, with the technology affecting the service layer and then the product layer. In type (e), the service facilitation roadmap, technology and product are applied independently to the service. The composition of type (f)— the product facilitation roadmap—is similar except for the reversal of the product and service layers.
Table 3 Standard formats of roadmapping for product-service integration Technology
Emphasis Service
Product
Enabler
(a) Direct integration roadmap
(b) Indirect integration roadmap
Mediator
(c) Servitisation roadmap
(d) Productisation roadmap
Facilitator
(e) Service facilitation roadmap
(f) Product facilitation roadmap
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Table 4 Explanation of each format Format
Layer
Characteristics
(a) Direct integration roadmap
The product layer and the service layer are located adjacently
Enabler for integration
(b) Indirect integration roadmap
The technology layer is located at the intermediate
(c) Servitisation roadmap
Technology layer is located at the bottom, affecting the upper layer (product layer), and the top layer (service layer)
Evolution towards service
(d) Productisation roadmap
Technology layer is located at the bottom, affecting the upper layer (service layer), and the top layer (product layer)
Evolution towards product
(e) Service facilitation roadmap
The service layer is located at the intermediate, getting the influence of both the product layer and the technology layer
Facilitation toward service
(f) Product facilitation roadmap
The product layer is located at the intermediate, getting the influence of both the service layer and the technology layer
Facilitation toward service
The technology layer is linked to the integrative feature of products and service The technology layer is applied to both the service layer and the product layer
Indirect enabler for integration
Our suggestion for standard roadmapping formats is designed to help firms select the best-fit structure for their planning efforts. While many different technology roadmap formats and structures exist (Phaal et al. 2004; Lee and Park 2005), only limited efforts have been directed toward developing standard formats for specific purposes. This paper provides relevant formats which can be applied in a productservice integration situation, offering the user the chance to tailor them to various kinds of business context. 3.4 Step 3: Functional determination (how to plan): defining the roadmapping procedures After selecting the appropriate methodology, the roadmapping procedure must be determined. Since the formats and methodology suggested for product-service roadmapping have distinct characteristics in terms of layer composition, linking arrows and planning direction, the roadmapping process is differentiated to reflect the characteristics of each type effectively. 3.4.1 Direct integration roadmap In this type, the relationship between the product and service components is measured, and reflected in the upper layer of roadmap, while the relationship between the product-service features and the technological solution is reflected in the lower layer of roadmap, illustrating how the technological solution can affect product/ service integration. Both the market layer and the technology layers seem to be the integration driver according to the case of a market-pull and a technology-push.
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3.4.2 Indirect integration roadmap The individual relationships between technology and product and between technology and service should first be identified. Technology-embedded products and technology-embedded services are then integrated based on the technological interface, so the sequence is (1) technology-product, (2) technology-service, and (3) product-service. This roadmapping process can be thought of a technologypush case, in that the first integration is generally driven by technological capabilities. 3.4.3 Servitisation roadmap In this type, the technology-product relations are identified first, and the evolution towards the service provision follows. So the technology layer should be planned first, and the product layer planning follows, based on the technology, and finally the service layer planning is based on the characteristics of technology-infused product layer as they evolve. The result of the analysis of the first relationship is reflected in the next analysis as technology-embedded products evolve to relevant services. 3.4.4 Productisation roadmap The planning procedure is the reverse of that for servitisation. The technology is applied first to the service and then the technology-embedded services are investigated to see what relationship might exist with products that would allow for product-service integration. The roadmapping is similar to the case of the servitisation roadmap, again based on a one-way on the analysis sequence based on the links between the technology-embedded services and the product layer. 3.4.5 Service facilitation roadmap In this type of roadmap, the technology and product layers are planned independently, since either can be starting points for facilitating services, after which these two factors drive the planning for facilitated service provision. However, if the planning is focused on the integration itself, it might start with the service layer. 3.4.6 Product facilitation roadmap The planning procedure is similar to the service facilitation roadmap, so the technology and service layers should be planned firstly, and the product layer planned with consideration of those factors. The construction of roadmap is also similar to the service facilitation roadmap, but here emphasising how service and technology can help the effective working of products.
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3.5 Step 4: Functional determination (how to plan): determining the roadmapping methodology The next step is to determine the appropriate methodology for roadmapping the product-service integration. In a practical situation, identifying the impact and direction of the relationships between product, service and technology is a key to differentiating the roadmaps. Therefore, a concrete methodology is required to elucidate the relationships to facilitate roadmapping and building the required collaboration. Among a range of methodologies supporting the elucidation of relationships for roadmapping, we adopt the linking grid as a standard roadmapping methodology. This is especially powerful in deriving relationships because of its matrix-like structure which identifies the linkages between layers. This feature can be utilised effectively in planning product-service integration where the relationships between products and services are of great importance. Figure 3 represents four different types of roadmapping methodologies: the stepwise linking grid, the combined linking grid, the evolutionary linking grid, and the independent linking grid. 3.5.1 Stepwise linking grid The stepwise linking gird represents a stepwise procedure starting from the identification of integrative features. These grids are designed to be used step-bystep, linking the results of each step to the next grid—for example, first defining product-service relationship, then the relationship between integrated features and technological solution.
Fig. 3 Standard types of roadmapping methodologies (adopted from Geum et al. (2011))
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3.5.2 Combined linking grid The combined linking grid is used when individual linking grids need to be combined to provide integrated information. It shapes like a quality function deployment (QFD), extracting the individual relationships between products and technology, services and technology, and technology-embedded products and services. Letting the technology as a left space of linking grid, the relationship matrix represents the technology-product and technology-service relationships, while the roof matrix identifies the feature-to-feature relationships, divided into product-to-product, service-to-service and product-to-service categories. 3.5.3 Evolutionary linking grid The evolutionary linking grid is used when the roadmapping process is supported by a series of linking grids. Each grid provides the relations between the result from the previous grid and other elements—thus, if the first grid represents the technology/ product relationship, the second grid identifies the relationship between technologyembedded products and services, thus mirroring the characteristics of the one-sided evolution of, for example, servitisation or productisation. 3.5.4 Independent linking grid The independent linking grid illustrates the individual effects between two elements which have no have relationship with each other. The order of planning is not important in applying this methodology—for example, in a service facilitation case, both technology and products will have individual affects on the service to be delivered, so the technology-service and product-service relations can be identified on ‘independent linking grids’ where technology and products are applied to the service individually but with no internal relationship between the two. Table 5 represents the type of methodologies and roadmap formats, indicating their practical application. In a direct integration roadmap, technology is applied to the integrative features of products and services, so the relationship between products and services must be identified, which implies the use of a stepwise linking grid. In an indirect integration roadmap, technology is basically applied to both products and services, and the combined linking grid fits this type of situation well, since it enables the analysis of multi-dimensional relationships. The servitisation or productisation roadmap is likely to employ an evolutionary linking grid, due to need to display the linkage(s) between a technology-embedded product and a service (or the reverse). Finally, facilitation roadmaps tend to employ independent linking grids, as no linkage exists between the separate relationship matrices. 3.6 Step 5: Implementing the roadmapping process After determining the structure, process, and methodology of roadmapping, the final step is to actually implement the roadmapping process. For this purpose, T-plan can be used to support the start-up of company-specific TRM (technology roadmap)
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Table 5 Relations between roadmap methodologies and roadmap formats Types
Indirect integration roadmap
Servitisation roadmap
Productisation roadmap
Stepwise œ linking grid
s
s
s
Combined linking grid
œ
4
4
4
œ
œ
Evolutionary linking grid
Direct integration roadmap
s
Independent linking grid
4
Service facilitation roadmap
Product facilitation roadmap
œ
œ
œ Very strong relationship between formats and methodology s Strong relationship between formats and methodology 4 Medium relationship between formats and methodology
processes (Phaal et al. 2001) by establishing key linkages between technology resources and business drivers, and identifying important gaps in market, product, and technology intelligence. Following a frequently used workshop-based approach (Phaal et al. 2001), the standard T-plan process is composed of four half-day workshops which focus on: Market Analysis, including the identification of market/ business drivers, prioritisation, SWOT analysis, or gap analysis; Product Analysis, to identify product feature concepts, grouping, or impact rankings; Technology Analysis, to identify technology solutions, grouping, or impact rankings; and Roadmapping, linking technology resources to future market opportunities. After establishing the roadmap, the focus moves to integrating the roadmapping process into the organisation’s ongoing business operations (Gerdsri et al. 2009), which is a vital step, since roadmapping is not a on–off effort but should rather be part of an ongoing process, linking roadmapping to strategic business planning. For this purpose, roadmapping results can be maintained and shared within a company via relevant information system (Richey and Grinnell 2004). Motorola is a representative case of using the system to manage its roadmapping process, having established a ‘best practice’ Enterprise Roadmap Management System (ERMS) to provide common strategic roadmapping processes, software solutions and information architecture across the whole corporation (Richey and Grinnell 2004), which has evolved from paper roadmaps to digitised roadmaps, now created on-line, so that system implementation can be collaborative and involves the communication, sharing and continuous updating of roadmaps.
4 Case examples To illustrate the working of the proposed approach, we illustrate case examples for each type of integrated roadmap. The case study introduced in this paper includes
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interesting implication for product-service integration in a practical situation. Table 6 gives an overview of case studies. 4.1 Dell customisation In this case, the product is a computer (or computer components) provided by Dell as the core of a customisation service that features its direct sales and build-toproduction system. A variety of technologies (especially information technology) have contributed to Dell’s new business systems, including internet order systems, call centre automation and other customised services (Kraemer et al. 2000) so that, for instance, its direct sales process transmits customer orders directly to Dell, where a second check is run for technical and financial feasibility. This case is considered as a ‘‘technology as a direct enabler’’, since the role of technology is to provide the direct means for the integration of products and services. Initially, products and services are supposed to be integrated based on the help of technology. Evolving from complete product PC to the mass customisation PC, many types of services are provided to enable the customisation or technological support due to the technology enablers. To construct the roadmap, the relationships between products and services are derived in the first linking grid, the results of which indicate the integrative features of Dell’s customisation—the combinatory or virtual interfaces between its products and services—which are then related in the second linking grid. Based on the result of second grid which represents the relationship between integrative features and technological solution, the final roadmap is constructed, as shown in Fig. 4. Since this case example is provided just to illustrate the suggested formats, the roadmap is constructed based on ‘existing’ products/services that Dell provides, so the horizontal axis does not imply time: the figure simply shows the relationships between hierarchical layers by which Dell achieves product-service integration in this case. 4.2 U-healthcare This case was selected as an example of an indirect integration roadmap. U-healthcare service offers a new paradigm in medical care by offering a ubiquitous sensor network (USN) for the disabled and elderly people (Kim and Kim 2006). Various types of Table 6 Summary of case examples Case
Format
Methodology
1. Dell customisation
Direct integration roadmap
Stepwise linking grid
2. U-healthcare
Indirect integration roadmap
Combined linking grid
3. Xerox case
Servitisation roadmap
Evolutionary linking grid
4. Automatic teller machine
Productisation roadmap
Evolutionary linking grid
5. RFID-based service
Service facilitation roadmap
Independent linking grid
6. Water purifier
Product facilitation roadmap:
Independent linking grid
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Fig. 4 Roadmapping case of Dell customisation
future products for practical applications exist to measure health data, such as wearable computer or wrist phone which involve technological interfaces that relate to both products and services. The relationship between technology-embedded products and technology-embedded services can be measured by the roof matrix of a combined linking grid. Figure 5 shows the roadmapping process for the U-healthcare service. The relationships are identified from the QFD-like matrix achieving by combining two linking grids. The intermediate technological solutions—for example, medical tag technology—affect both products (here, RFIDs) and services (personal identification or information transmission). The technology for embedded Linux enables most of the monitoring systems (such as pulse monitoring or information transmission) and also enables the development of such products as vital sign or mobility sensor, and integrating these Linux-embedded products and services allows sensor monitoring systems to be developed. The technology-embedded products or services are then integrated to provide the final offering, providing an indirect integration case. Even the technology do not provide direct means for integration, however, the shape of interaction is made by the indirect infusion of technology to the products or services. Based on the result, the final roadmap is constructed to synthesise the plans for the entire range of products, services, and technological components. A roadmap is constructed which focuses on the item’s components and describes the development
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Fig. 5 Roadmapping case of U-healthcare
strategies. Setting the technology characteristics of technological components as the middle level illustrates how technology affects both products and services. 4.3 Xerox case Xerox’s copy machine business is selected to illustrate the case of a servitisation mediator. Xerox has changed its competitive offering from manufacturing copying machines to offering an integrated document management service, by setting a consulting arm, dealing with planning, consultation, realisation and evaluation issues concerning all document related activities such as writing, printing or providing documents on the web. Xerox tried to do what they call asset management—or in other words, the establishment and utilisation of a much closer relationship to both the physical artefact and to the customer (McAloone and Andreasen 2002). With this relationship, Xerox has changed their competitive position. Now, this company is no longer considered as a photocopier manufacturer,
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but as a document management company, who provides a service of managing documents from the moment they are created through to the copying, distribution and archiving activities (McAloone and Andreasen 2002). As a typical servitisation case, evolutionary linking grids are used to quantify the relations between each component across different layers. The relationships between technological solutions and product components are identified in the first matrix. Web service, broadband, remote control and barcode encoding technologies are selected as likely to offer technological solutions for product-service integration. These technological solutions then affect to the products. For example, web service, formatting, and other related technologies affect various product lines of Xerox Corporation, and these technology-embedded products provide the interfaces for such services as document management, handling, archiving or imaging. Evolutionary linking grids are then constructed, with the matrix rows as technology-embedded products identified from the first matrix and the columns as the service characteristics or component, illustrating the evolutionary path towards product-service integration. The relationships between these evolutionary linking grids are reflected on the micro-level roadmap. Setting the technology as the bottom level, the technology affects to product first, and then the products are linked to the service layer, as shown in Fig. 6. 4.4 Automatic teller machine (ATM) ATMs are an example of productisation. Firstly, the application of technology to the banking service enables the automation of the banking system, which them evolves toward productisation, in this case the development of the ATM (the ‘product’) which would not be possible had the service not been automated in advance. Technology development—in terms of transaction, security, database, process management and communication technology—enables product-service integration via service productisation. The ATM can be understood as the banking system in productised form. The relationship between services and technologies can be identified, assuming the ATM is developed based on the technological advances and service support. Figure 7 shows the relationship between services and technologies which work as the basis of ATM productisation. Technologies such as TCP/IP Ethernet, bisync or routers are applied to the elements of banking services, such as cash withdrawals, balance inquiries, or credit card payments, and evolved to the point where they can be applied to the ATM’s functionality. In developing roadmaps, the product layer is simply presented as the final form of the ATM, since the physical component cannot be separated from its functionality, and further functional evolution is ignored here for simplicity’s sake. 4.5 RFID-based service The RFID technology has been identified as an important tool to increase the effectiveness of supply chain. The initial applications of RFID have been as a provision of the inter-organisational linkages between end-product manufacturers
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Fig. 6 Roadmapping case of Xerox case
and their customers or have focused on the tracking of materials between specified locations. However, it has been extended to the adoption by firms in the service sector—especially RFID’s use as a tool for altering the way in which a service is provided (Lee et al. 2008). The case of RFID (Radio Frequency Identification) service is a good example of a service facilitator. RFID is considered here as a product, which enables identification from a distance without a line of sight, which facilitates the delivery of advanced RFID-based services. We can consider the planning of RFID-related services as starting from the development of RFID tag, so this route can be thought of as a servitisation case, in which the advances of technology triggers the development of the RFID product, which evolves into the RFID-based service. However, if we regard the RFID technology as being independent of the product, this case can be seen as one of service facilitation. In this paper, we do not consider the development of RFID itself, but—given that it is already developed and in use— we consider the technology as an independent factor and focus on the planning of RFID-related services.
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Fig. 7 Roadmapping case of ATM
The product elements such as tag, antenna, or touch screen monitor affect to the service to facilitate the effective working of service element such as RFID issue information or e-tracking system. This is same at the technological solution. Technology such as the RFID fixed writers, barcode issue system, or EPC information system help to realise the RFID-based services by facilitating the functionality of services. The linking grid measures the interrelationships among those elements. Based on the result of linking grid, the final roadmap is constructed as shown in Fig. 8: note that it is based on currently existing in RFID-based services and products, so the horizontal axis does not represent the timeline. 4.6 Water purifier Finally, a water purifier is the case of product facilitation roadmap. This case mostly concerns technology-based maintenance services. In many cases, customer-service is provided with the help of technology, especially information technology, even if the technology is not embedded in the product.
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Fig. 8 Roadmapping case of RFID-based service
Maintenance services for water purifiers are generally characterised by regular maintenance service visits, typically involving informing the user regarding the product’s state, changing filters, disinfecting internal and external parts and advising on possible further products that might meet the customer’s needs (Jung and Nam 2008). The company employs information technology systems applied to manage the service history and organise scheduled maintenance services effectively. As well as selling the product, the company may also provide appropriate associated services, such as rental or credit loan services. This case represents the case of Woongin Coway which is a Korean firm famous for the water purifier. Selling the product, the company provides appropriate services to facilitate the functionality of water purifiers. Prior to the services of Woongin Coway, customers thought that a water purifier was very expensive and hard to manage because of regular filter change which is a tedious task. However, due to the rental service with maintenance care system, many customers get great satisfaction and trust the hygienic state of their water purifiers. In addition, customers can take the ownership of the product after the contract or return it to the company depending upon the contract. Figure 9 shows a finalised roadmap of this product-service integrated offering. Starting from the basic rental services, other services and technologies have evolved
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Fig. 9 Roadmapping case of water purifier
to help improve the experience of owning and using the water purifier by facilitating the product’s functionality.
5 Conclusion To address the increasing industrial trend towards product-service integration, this paper suggests a customisation framework for managers who want to start and plan the product-service integration by providing interesting business cases that have translated into the customisation practice of product-service roadmapping. Covering the role of technology, relevant formats for planning, and related methodologies, this paper introduces six appropriate case examples to illustrate the applicability of proposed approach, dealing with the emerging dynamics of product-service integration. The primary contribution of this paper is to provide the practical guidance for customising the product-service roadmapping, extended from the traditional generalised form of roadmapping. Depending on the technological interfaces, roadmapping formats and methodologies are further selected according to the firms’ context, providing the firm-specific tailoring process of product-service integration. The incorporation of product-service integration in the technology roadmap has significant value in terms of accommodating a current business environment paradigm. As well, provided six case examples are worth to suggest the practical application of proposed approach in the context of actual business case. Interpreting
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and adapting the business cases, this paper draws the managerial implication of adjusting the customisation process of product-service integration. However, our research has a room for further research due to some limitations. First, our case examples need to be further complemented from a more practical viewpoint—although we try to illustrate the workings of each type of integrated roadmap, there remain some problems of ex post facto analysis based on the interpretation of current business, and future research should focus on applying the suggested structure and roadmapping process to real business settings, as a tool for proactive planning tool for product-service integration, rather than for such post hoc analysis. Second, an in-depth analysis of business case is required. Even suggested six case examples are worth to illustrate the working of proposed approach, more suitable case that is clear for each type of integration will provide the clear and meaningful result. Acknowledgment This work was supported by the National Research Foundation of Korea (NRF) grant funded by the Korea government (MEST) (No. 2009-0085757).
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