مدل های کسب و کار راه حلی: تحول در امتداد چهار تدوام
|کد مقاله||سال انتشار||مقاله انگلیسی||ترجمه فارسی||تعداد کلمات|
|7851||2013||12 صفحه PDF||سفارش دهید||محاسبه نشده|
Publisher : Elsevier - Science Direct (الزویر - ساینس دایرکت)
Journal : Industrial Marketing Management, Available online 2 June 2013
Using a business model perspective, we identify four continua that are of specific relevance for industrial firms transforming toward solution business models: customer embeddedness, offering integratedness, operational adaptiveness, and organizational networkedness. Using these continua, we explore the opportunities and challenges related to solution business model development in two different business logics that are of particular importance in an industrial context: ‘installed-base’ (IB) and ‘input-to-process’ (I2P). The paper draws on eight independent research projects, spanning an eleven-year period, involving a total of 52 multinational enterprises. The findings show that the nature and importance of the continua differ between the I2P and IB business logics. IB firms can almost naturally transition toward solutions, usually through increasing customer embeddedness and offering integratedness, and then by addressing issues around the other continua. For I2P firms, the changes needed are less transitional. Rather, they have to completely change their mental models and address the development needs on all continua simultaneously.
Servitize, move forward in the value chain, and transform your product business model into a solution business model! Industrial firms are urged to consider that “the product is dead” (Phillips, Ochs, & Schrock, 1999, p. 51) and they need to “manage the transition from products to services” (Oliva & Kallenberg, 2003, p.160), and “make solutions the answer” (Foote, Galbraith, Hope, & Miller, 2001, p.1), because “however difficult the transition, manufacturers can't afford to ignore the opportunities that lie downstream” (Wise & Baumgartner, 1999, p.141). When companies take so called ‘servitization’ (Vandermerwe & Rada, 1988) steps toward solutions, they concurrently change their earning logic, move their position in the value network, and need to use and develop capabilities in a different way — inherently making fundamental business model changes. Nevertheless, though many scholars implicitly encourage a change of business models, few explicitly address challenges in developing and implementing solution business models (Baines, Lightfoot, Benedettini, & Kay, 2009). In this paper, we argue that using a business model lens when analyzing solution business is important for two reasons. First, it highlights the challenges associated with the transformation toward solution business model (c.f. Demil & Lecocq, 2010). Few firms actually make a complete transformation from a product business to a solution business — they have part of their activities focused on solution business, whilst building on their existing product business. Many of them will end up having parallel business models (Markides & Charitou, 2004). This implies that solution business models are not static and that the transformation needs to be seen in terms of degrees of change. Even though previous research highlights the importance of developing new solution business models (c.f., Storbacka, 2011), there is lack of research related to the transformational needs in various business model dimensions (Kapletia & Probert, 2010). Second, a business model approach facilitates a comparison across different business contexts. This is relevant as solution business is predisposed by particular industry conditions (Pisano, 2006 and Storbacka, 2011), commonly accepted dominant designs (Baldwin and Clark, 2006 and Srinivasan et al., 2006), or industry recipes (Spender, 1989). There are, however, few specific guidelines and tools for developing solution business in different industrial or business contexts (Baines et al., 2009). Rather, existing research tends to treat solution providers as a homogenous group, which has led to calls for further research that go beyond recommending broad reaching solution strategies and capabilities for solution suppliers (Kapletia & Probert, 2010). This paper addresses the above identified gaps by focusing on the following two research questions: (1) how do business models need to change when firms transform toward solution business, and (2) how do the opportunities and challenges for implementing solution business models differ between industrial contexts? More specifically, the paper focuses on the two generic business logics (Nenonen & Storbacka, 2010) of particular importance in a business-to-business, industrial context: ‘installed-base’ (IB) and ‘input-to-process’ (I2P). Firms operating with IB logic provide investment goods, thus creating an installed base at the customers. IB logic is common among firms representing machinery and equipment industries. The I2P logic is relevant for firms that provide goods that are utilized as inputs in the customers' process. The good is transformed during the customer's process in such a way that it ceases to exist as a separate entity. I2P firms are found in industries such as metal, pulp and paper, and utilities. We address the two research questions with an abductive research process, drawing simultaneously on the emerging body of business model research, on literature in the solution business area, as well as on empirical research.
نتیجه گیری انگلیسی
This paper responds to calls for providing specific guidelines and tools for the development of solution business models in different contexts (Baines et al., 2009), and for improving firms' capabilities to co-create complex business solutions (Marketing Science Institute, 2010). In the paper we illustrate that using a business model lens contributes to our understanding of solution business in two interrelated ways. First, by integrating a systemic and dynamic view on solution business, it deconstructs the process definition of solutions, and conceptualizes changes taking place in four interrelated continua of specific relevance for industrial firms developing solution business models. Second, using the continua, the paper identifies opportunities and challenges related to developing solution business models in two different industrial contexts: ‘installed-base’ (IB) and ‘input-to-process’ (I2P). We will next describe these contributions more closely. 5.1. Various degrees of change along four interdependent continua To date there is not much research addressing the need for cross-functional alignment (Nordin & Kowalkowski, 2010) in solution business model development. Previous research tends to focus on particular aspects of solution business. These aspects include servitization (e.g., Baines et al., 2009 and Mathieu, 2001), solution marketing and sales (e.g., Anderson et al., 2006, Spekman and Carraway, 2002 and Tuli et al., 2007), solution strategy and management (e.g., Brady et al., 2005, Davies, 2004 and Galbraith, 2002a), and operation management related to product/service systems (e.g., Meier et al., 2010 and Tan et al., 2010). Our research incorporates all of these aspects and, thus, provides an overview of the complexities associated with the transformation toward solution business, as firms attempt to change the way that they create value. The identified continua – customer embeddedness, offering integratedness, operational adaptiveness and organizational networkedness – emphasize degrees of change (rather than an absolute change) hereby facilitating the comparison of different types of solution business models as well as challenges between and within contexts. The continua are interdependent, i.e., a change in one of them will affect the others, and only a comprehensive view will help firms to realize the value creation potential inherent in a transformation toward solution business. Consequently, there is a clear need for interaction between customer embeddedness and offering integratedness in order to be able to develop customer specific value propositions. In addition, degrees of integratedness and embeddedness need to be balanced with various degrees of operational adaptiveness. This becomes especially important, as firms need to secure the delivery of repeatable solutions. Various degrees of operational adaptiveness imply different levels of offering component and process modularity, which enables firms to cost-effectively match their solution with the customers' processes, activities and characteristics. Furthermore, higher degrees of offering integratedness and operational adaptiveness are likely to demand higher degrees of organizational networkedness. It becomes paramount to increase cooperation across functional as well as organizational boundaries in order to increase integration of components and achieve modularity. Higher levels of networkedness imply a need for developing modular configurations across the network. 5.2. Solution business models in two business logics Extant literature on solution business gives few specific guidelines and tools for developing solution business in different industrial contexts. Our research explicates that the nature and importance of, as well as the interdependencies between, the identified continua differ between industrial contexts. Consequently, also the challenges and opportunities related to the transformation toward solution business models will be different. This is exemplified in the paper by analyzing the transformation toward solution business models in two business logics (IB and I2P). We found that IB firms can almost naturally transition toward solutions, usually by increasing the customer embeddedness and offering integratedness and then addressing issues around the other continua. Additionally, IB firms seem to have more opportunities to experiment with different degrees on all continua, as well as different degrees of dependencies between the continua. An IB firm can move from less advanced service contracts, in which the interdependencies between the continua are not necessarily that strong, toward increasingly advanced interdependencies. In many cases, this gradual transition actually prevents the firms from explicitly addressing the interdependencies and many firms end up with various kinds of misfits between the continua. For instance, firms may develop value propositions related to customized life-cycle solutions, but end up not modularizing the solutions and, hence, creating an operationally complex and untenable cost position. For I2P firms, the changes needed are less transitional; rather firms have to completely change their mental models and more explicitly address the effects on all of the continua. Rather than gradually transitioning along the continua, I2P firms need to make choices between possibly discrete options. There are especially strong overlaps between offering integratedness, customer embeddedness and operational adaptiveness if the firm offers solutions related to ‘optimizing the use of the supplier's goods in the customer's process’. In the ‘optimizing customer's process’ option, the overlaps are especially strong between offering integratedness, customer embeddedness and organizational networkedness. Many I2P firms seem to especially struggle with the transformation toward fully-fledged solutions, as this transformation may mean that they have to change their business definition, for instance by incorporating equipment and equipment maintenance into their solutions. The increased complexity resulting from such a move may increase operational costs more than the solution business generates additional revenue. 5.3. Further research avenues The research process has several limitations that also constitute potential avenues for further research. First, there are sampling biases in the underlying studies, as these samples originally were not driven by the comparison between IB and I2P, but rather by the case firms' interest in, and experience from solution business. Hence, there are more IB firms than I2P firms in the sample. Furthermore, it is clear that the case-firms do not cover all possible forms of IB or I2P firms. The IB sample is biased toward large scale investment goods, such as machines and production lines. Component suppliers are clearly underrepresented. The I2P sample is biased toward asset heavy production of commodities (electricity, chemicals, paper, etc.), which may have overemphasized economies of a scale. I2P firms focusing on highly specialized goods and operating a batch production system may experience different challenges. Consequently, sampling should be developed in order to cover a larger array of both IB and I2P firms and more research is needed specifically focusing on I2P firms. Second, there are other business logics that would warrant further investigation. Nenonen and Storbacka (2010) identify three additional generic business logics in business-to-business firms: continuous relationships (services that are characterized by long-term contracts); consumer-brands (products for the consumer market that are sold through a channel); and situational services (project-based services, which fulfill customers' situation-driven needs). A further exploration of the differences between solution business models in these business logics would improve our understanding of the transformation toward solution business. Third, some of the solution business model dimensions are less investigated than others within the solution literature. Issues that would need additional investigation are for instance: how do firms select segments and/or customers that they focus their solution business models on, what are the challenges related to targeting customers' core versus non-core processes, and how do the customers' capabilities influence successful solution business model development? Finally, the research suggests a need to apply a network perspective in developing solution business models. This highlights role of the network actors in co-creating the solution. The idea of value co-creation in a network includes the idea of reciprocity, i.e., not only should one be freed from a dyadic perspective, but also from the provider–customer notion. Adapting an actor-to-actor perspective (Vargo & Lusch, 2011) would emphasize the role of the customer in developing solution business models. It is clear that customers buying solutions also need to adapt their business models, and this perspective constitutes an interesting avenue for further research. 5.4. Managerial implications The research highlights several important implications for firms wanting to develop their solution business. It suggests that moving toward solution business requires changes in all parts of the business model. Hence, firms should be liberated from the shackles of functional thinking, and that they need to make solution business development a common strategic priority anchored within top management. Without managerial commitment, the need for resources for developing new capabilities may not be recognized within functions that are not customer facing. By making the solution business a priority for the whole firm, all functions can more easily be aligned. It is important to note the interdependence of the identified continua. Moving toward greater embeddedness will, for instance, require changes also in the other continua. Furthermore, having an excellence only in one of the business dimensions may not create a sufficient competitive advantage, if the firm has capability gaps in the other dimensions. The key is to secure configurational fit between the dimensions and develop gradually and simultaneously across dimensions. This paper does not suggest that there is one ideal solution business model for any particular business logic. Instead, it argues that there are several possible solution business models that may be equally successful. The comparison between the IB and I2P business logic, however, clearly highlights that firms need to be careful when benchmarking across industrial contexts. A setup that works and creates value in one industry may not be viable in another industry, due to the underlying logic of that industry. It is, hence, important to understand the underlying business logic and implement changes based on this. This will also make it easier to identify where problems will arise. When analyzing the participating case-firms, we noted that there are major differences in how firms have started their solution business. Due to the natural extension into life-cycle thinking, many of the IB firms have more or less ‘drifted’ toward solution business, letting opportunities identified among customers drive a quest toward solutions. Other firms, particularly those with an I2P business logic, start with strategic decisions and make deliberate investments in building the necessary capabilities on a broad scale. The research does not provide us with evidence on which development path is more effective, but it clearly indicates that a gradual development is particularly difficult for firms in the I2P context.