An Empirical Research On The Relationship Between Servitization And Firm Performance And Contingent Factors Of Servitization

With the globalization and diversification of customer needs,the competitive dimensions of manufacturing companies have expanded from traditional cost,quality,delivery,and flexibility to service and innovation.As illustrated by the smiling curve,the profit of the upstream and downstream of manufacturing companies is far more than the manufacturing section.Consequently,manufacturing companies are increasingly transferring from selling the pure product to “product and service” bundles to achieve differentiation.However,many companies suffered from service paradox;they invested a lot in servitization but failed to get the expected returns from service.The main reason for servitization is the lack of fit among the internal resource and capability and the change of environment.This dissertation aims to examine the route,performance implication,supply chain management pattern of servitized manufacturing companies.Based on the categorization of product vs.customer services and contingency theory,this dissertation proposed the “external motivation – internal capability” framework for servitization route.In addition,this dissertation suggests that the relationship between servitization and firm performance is contingent on the cultural environment and the implementation of supply chain integration and supply chain risk management.Based on a sample of 931 manufacturing companies from 22 countries and the GLOBE national culture scores,this dissertation tested the hypotheses based on multiple regression and hierarchical linear modeling.The results are summarized as follows.First,competitive intensity and customer service needs motivate manufacturing companies to servitize through the enhancement of service capability.In addition,manufacturing capability negatively moderate the relationship between customer service needs and servitization,while the moderating effect of organizational culture is not significant.Second,the relationship between servitization and firm performance is contingent on the types of servitization.Product-related services enhance market performance and operational performance,while customer-related services enhance market,financial,and operational performance.Third,the GLOBE national culture dimensions moderate the relationship between servitization and firm performance.Product-related services have a stronger impact on financial performance on culture background characterized as high institutional collectivism,high humane orientation,high-performance orientation,low power distance,and high uncertainty avoidance.In a culture characterized as low assertiveness,high institutional collectivism,high future orientation,high-performance orientation,low power distance,and high uncertainty avoidance,customer-related services have a stronger impact on market performance.Finally,supply chain integration and supply chain risk management do not always enhance the relationship between servitization and firm performance.Specifically,cross-functional integration negatively moderates the relationship between product-related services and market and financial performance,and it positively moderates the relationship between customer-related performance and operational performance.Supplier integration positively moderated the relationship between product-related services and market performance as well as the relationship between customer-related services and operational performance.Customer integration negatively moderates the relationship between product-related services and financial performance and positively moderate the relationship between customer-related services and financial performance.In addition,supply chain risk management negatively moderates the relationship between product-related services and financial performance,and positively moderate the relationship between customer-related services and financial performance and operational performance.This dissertation proposes the route model of servitization,which provides the fit pattern of external motivation and internal capability.It also empirically examined the performance implication of servitization based on the categorization of product-and customer-related services and discussed the national culture background for the implementation of servitization.In addition,this dissertation examined the supply chain management pattern of servitized companies,which deepened our understanding of supply chain management in the servitization context.As for managers,this article suggests that the success of servitization depends on the fit between internal capability and external environment.Competitive intensity and customer service demand facilitate servitization through the enhancement of service capability.In addition,manufacturing companies should choose service type based on their objective and capability and build an appropriate organizational culture to increase the efficiency of servitization.Finally,in terms of supply chain management pattern,supply chain integration and supply chain risk management do not always improve the efficiency of service design and delivery.Manufacturing companies should implement supply chain management pattern based on the types of services and their operational objective.