Designing an advanced services contract in servitization strategy: a study from the B2B sector in Finland

Abstract

Since the 1990s servitization has gained increasing recognition as a strategy for manufacturing firms to differentiate themselves from competition and gain sustained competitive advantage by integrating services to their products. Despite that there are still question marks on how to successfully implement it for value creation in a profitable way. This research addresses this need and aims to design the key steps of an advanced services contract, which is an important stage in servitization. In achieving this aim design-based research methodology is applied in the context of a multinational company (MNC) operating in the business-to-business (B2B) sector in Finland, a country which is second in the world by the percentage of servitized firms. Results are important for managers in the B2B sector who aim to servitize their firms’ product offerings and develop advanced services contracts.