Lighting as a service : cash flow analysis for technology manufacturers
Nguyen, Thinh (2021)
Nguyen, Thinh
2021
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2021110619363
https://urn.fi/URN:NBN:fi:amk-2021110619363
Tiivistelmä
ARA is a start-up in the City of Munich, Germany with its mission being to promote the transition to a circular economy in manufacturing with modular lighting technology solutions through an “As-a-Service” model. This thesis was carried out as a case study for the ARA team.
The objective of the thesis was to discover potentials of servitization and service contracts in manufacturing. The study aimed to cast light on opportunities and barriers that manufacturers will face when they become a partner with ARA in order to provide modular lighting systems. Further, the impact of servitization on a firm's financial performance was investigated and subsequently used to develop a calculation toolkit for a manufacturer on a ceteris paribus basis.
The theoretical framework explores concepts of servitization, service classification, product as a service and servitization process. The data was collected from 6 individual interviews in the lighting industry and analyzed by applying the content analysis technique of qualitative research methodology.
Key findings showed that services had been recognized as a means of creating new values and maintaining long-term customer relationships. The majority of interview participants believed that servitization was a new notion and had unbound potentials to create a new business model with sustainable values and innovations. This is critical as modern consumers and governments increasingly demand solutions associated with sustainable development.
A financial analysis in the form of a calculation toolkit was carried out to support the feasibility of servitization. The results suggest that a manufacturer’s cash flow would be discounted due to inflation rate during the service contract. However, the company could promisingly obtain a high revenue if the product maintained its high level of durability and low failure rate throughout its lifecycle.
Further research is needed to produce a comprehensive picture of servitization in manufacturing. It should be also noted that basic financial knowledge and skills are required to employ the calculation toolkit successfully.
The objective of the thesis was to discover potentials of servitization and service contracts in manufacturing. The study aimed to cast light on opportunities and barriers that manufacturers will face when they become a partner with ARA in order to provide modular lighting systems. Further, the impact of servitization on a firm's financial performance was investigated and subsequently used to develop a calculation toolkit for a manufacturer on a ceteris paribus basis.
The theoretical framework explores concepts of servitization, service classification, product as a service and servitization process. The data was collected from 6 individual interviews in the lighting industry and analyzed by applying the content analysis technique of qualitative research methodology.
Key findings showed that services had been recognized as a means of creating new values and maintaining long-term customer relationships. The majority of interview participants believed that servitization was a new notion and had unbound potentials to create a new business model with sustainable values and innovations. This is critical as modern consumers and governments increasingly demand solutions associated with sustainable development.
A financial analysis in the form of a calculation toolkit was carried out to support the feasibility of servitization. The results suggest that a manufacturer’s cash flow would be discounted due to inflation rate during the service contract. However, the company could promisingly obtain a high revenue if the product maintained its high level of durability and low failure rate throughout its lifecycle.
Further research is needed to produce a comprehensive picture of servitization in manufacturing. It should be also noted that basic financial knowledge and skills are required to employ the calculation toolkit successfully.