Solution providers’ strategic capabilities

Abstract

Purpose – Drawing on the resource-based view of the firm, this study analyzes solution providers’ strategic capabilities that facilitate above-average returns.

Design/methodology/approach – The study applies a qualitative comparative case method. In addition to an extensive set of secondary data, the results are based on interviews with 35 executives from nine leading industrial solution providers, their strategic customers, and suppliers. The analyzed solution providers were identified based on quantitative survey data.

Findings – By observing six distinctive resources and three strategic business processes, the present study identifies seven strategic capabilities that occur in different phases of solution development and deployment: 1) fleet management capability, 2) technology-development capability, 3) M&A (mergers and acquisitions) capability, 4) value quantifying capability, 5) project management capability, 6) supplier network management capability and 7) value co-creation capability.

Research limitations/implications – The study develops a generic model for the strategic capabilities of servitization. Application of the developed model to different contexts would further validate and enhance it.

Practical implications – Managers can use the developed model to benchmark, identify, build, and manage solution providers’ strategic capabilities and associated practices.

Originality/value – The study develops a valuable conceptual model based on the comparative case data. Case firms were selected for the study based on a representative quantitative dataset. The results were verified and triangulated with external data.