Value co-creation : applying Service-Dominant logic to the cutting tool business
Koutonen, Timo (2018)
Koutonen, Timo
Tampereen ammattikorkeakoulu
2018
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2018111917508
https://urn.fi/URN:NBN:fi:amk-2018111917508
Tiivistelmä
This thesis focused on the change from Goods-Dominant logic (G-D logic) to Service-Dominant logic (S-D logic) in the cutting tool business. The main difference between these two business logics is the nature of value creation that has traditionally been seen in exchange (value-in exchange), but according to S-D logic it is in use (value-in use). Since products or services from a provider are used by a customer, co-operation between those business actors is the essence of an effective value creation process. Hence, value co-creation is a fundamental characteristic in the idea of S-D logic.
The goals of this thesis were, firstly analyzing the recent situation of the cutting tool business, and secondly, finding the practical aspects of S-D logic that best apply to the business. The approach was examining the cutting tool business at a general level, and not focus on individual companies and their product brands. The three main topics were selected into the thesis theory section. Firstly, the key events in the industrial development that have been closely connected to the evolution of the cutting tool business, then the related principles of G-D logic, and finally, the essentials of S-D logic. The empirical part of the thesis was conducted through two main steps. Firstly, the quantitative data was collected from the cutting tool companies and at the personnel who operate at the customer interface. Secondly, the qualitative data was collected by interviewing decision makers of the customers that are influential for the future of the cutting tool business.
The main conclusion of the research was that the recent cutting tool business is polarized in relation to the S-D logic based business model. On the other hand, there is a growing demand for the value-in-use focused co-operation in the cutting tool business. Additional findings were the three research topics that are related to the strategies of individual companies, and therefore were not analyzed in this research. Firstly, how to match the strategy of an individual company to S-D logic based business development. Secondly, how to define the connection between money and value in value-in-use centric business. Thirdly, how to develop efficiency of co-operation in order to maintain profitability in the S-D logic based cutting tool business.
The goals of this thesis were, firstly analyzing the recent situation of the cutting tool business, and secondly, finding the practical aspects of S-D logic that best apply to the business. The approach was examining the cutting tool business at a general level, and not focus on individual companies and their product brands. The three main topics were selected into the thesis theory section. Firstly, the key events in the industrial development that have been closely connected to the evolution of the cutting tool business, then the related principles of G-D logic, and finally, the essentials of S-D logic. The empirical part of the thesis was conducted through two main steps. Firstly, the quantitative data was collected from the cutting tool companies and at the personnel who operate at the customer interface. Secondly, the qualitative data was collected by interviewing decision makers of the customers that are influential for the future of the cutting tool business.
The main conclusion of the research was that the recent cutting tool business is polarized in relation to the S-D logic based business model. On the other hand, there is a growing demand for the value-in-use focused co-operation in the cutting tool business. Additional findings were the three research topics that are related to the strategies of individual companies, and therefore were not analyzed in this research. Firstly, how to match the strategy of an individual company to S-D logic based business development. Secondly, how to define the connection between money and value in value-in-use centric business. Thirdly, how to develop efficiency of co-operation in order to maintain profitability in the S-D logic based cutting tool business.