Resource Realignment in Servitization

Abstract

OVERVIEW:When transitioning from a product-centered business model to one focusing on providing services and solutions, manufacturers must realign and reallocate resources to support the new business model. Based on a study of nine leading solution providers that have successfully transitioned from products to services, we demonstrate how manufacturers create new resources and organizational structures to facilitate co-creation of value with customers, leverage existing resources to develop new service products and markets, and systematically release non-core upstream resources to nurture downstream resources.