The Effect Of Service Transition On Firm Value

Since the beginning of birth, Service-centered Dominant Logic has got a high degree concern. Both domestic and foreign scholars have studied them, but more research is still in the Theoretical exploration stage. The empirical studies are scarce. Since the1990s, manufacturing is undergoing a profound transformation in the developed countries. In the developed countries, the proportion of service elements in the manufacturing value chain is growing. This is the phenomenon of service transitions strategies. This transformation in developed countries has made a great achievement, but what about the manufacturing in china which is currently the world’s fabrication plant? We have found that both developed countries and emerging economies are experiencing the high value or low value service transitions. Perhaps, we can’t deny service transitions is an effective marketing strategy, but we still have many questions and confusion about the service transitions in China.The authors investigate the effectiveness of service transitions strategies for generating shareholder value by evaluating secondary panel data pertaining to159publicly traded manufacturing firms during2003-2008. The impact of a firm’s transition to services on firm value (as measured by Tobin’s q) remains U-relationship between the characteristics. In addition, we found that the service transitions stays on a low level and has a negative impact on company value. Further, we analyze the effects of service transition on firm value from firm and industry levels on the basis of resource-based view. We found the market share and resource slack have negative or non-significant effect. At the industry level, industry growth have the positive effect, industry competitiveness have the negative effect. Finally, we analyze the service transition value at this China’s manufacturing industry stage with the combination of the financial characteristics of China’s listed companies and market characteristics of China’s interpretation.This research is divided into seven parts. The main content of each part is as follows:The first chapter is the introduction. At first, the author put forward the problems which the author intends to study in this paper. In this part, I mainly use the observation and theory analysis. So far, research about the relations between service transitions and firm value are very different. Most empirical research selects the United States and other developed countries as sample. Every country has a unique environment and market structure, it is very necessary for developing countries, such as China, to take service transitions strategies in the context of global economic integration. In addition, the chapter also focuses on the research objective, the study frame, the research significance, the research methods and possible innovative points.The second chapter is mainly literature review and theoretical overview about service transition and firm value. In this chapter, the relevant concept which this study first use are defined, the existing main service transition theory and the concept of firm value get more attention. Finally, this part also analyzes the relationship between service transition strategies and firm value from the strategic management, marketing, finance etc.In the third chapter, the author builds the theory model between service transition and firm value relations. This part is mainly about the mechanism of Resource-Based View in Chinese manufacturing service transition. Finally, in the context of the domestic and foreign relevant research, the author construct the relation model which is better for Chinese manufacturing, also put forward some hypothesis about the relation.The research method and related variables are designed in this part. This chapter has elaborated the analysis method in this paper. The author also elaborated independent variables, the dependent variable and control variable metric system which are used in the research model.There are empirical results analysis and discussion in the fifth part. This chapter chose a certain number of Chinese manufacturing firms as research samples to test our hypothesis. The different results between Chinese manufacturing and developed countries are discussed. Although appropriate services transition is valuable for firm, but this value increment function may not is inevitable. In the life cycle of the different development phase, the internal resources and external environment is likely to change, which decides effectiveness of service transition strategies.Finally, we talked about the limitations and further research. This part analyzed the existing limitations, and discussed the future research direction.