Contents lists available at ScienceDirect
Industrial Marketing Management
journal homepage: www.elsevier.com/locate/indmarman
Firm boundaries in servitization: Interplay and repositioning practices
Tuomas Huikkolaa,⁎, Rodrigo Rabetinoa, Marko Kohtamäkia, Heiko Gebauerb,c
aUniversity of Vaasa, School of Management, PO Box 700, FI-65101 Vaasa, Finland
bDigital Project Group Data, Linköping University, Department of Management and Engineering, SE-581 83 Linköping, Sweden
c Fraunhofer Center for International Management and Knowledge Economy IMW, 04109 Leipzig, Germany
A R T I C L E I N F O
Keywords:
Servitization and digital servitization
Product-service systems (PSS)
Firm boundaries
Repositioning
Case study
Business ecosystem and interorganizational
networks
A B S T R A C T
The present study analyzes how servitization delineates a manufacturer's boundaries. Based on interviews with
57 senior managers and extensive secondary data collected from four global solution providers, this study
contributes by revealing how servitization shapes firm boundary decisions and repositioning practices. First, the
results demonstrate that servitization changes a manufacturer's a) identity from technology-focused to customer-
centric, b) capabilities to integrate technology development with customer value understanding, c) power po-
sition in the manufacturing ecosystem from upstream to downstream, and d) efficiency logic toward a service
factory logic. Second, this study describes the interplay among these boundary lenses in servitization. The de-
veloped framework can assist managers in their strategy implementation when moving toward servitization.
1. Introduction
Servitization has become a primary source of competitive advantage
for several established manufacturers, such as GE, Rolls-Royce, and
Caterpillar (Auguste, Harmon, & Pandit, 2006; Brax, 2005; Davies,
2004; Gebauer, Gustafsson, & Witell, 2011; Vandermerwe & Rada,
1988; Visnjic, Jovanovic, Neely, & Engwall, 2017). This transition to
selling fuller market packages or “bundles” of customer-focused com-
binations of goods, services, support, self-service, and knowledge
(Vandermerwe & Rada, 1988) has led manufacturers to redefine their
identity (Vaara & Tienari, 2011), reposition themselves in the eco-
system (Wise & Baumgartner, 1999), realign their capabilities (Ulaga &
Reinartz, 2011), and reassess decisions concerning whether some ac-
tivities should be performed in-house (a hierarchical mechanism),
outsourced (a market mechanism) (Salonen & Jaakkola, 2015) or im-
plemented through partnerships (Kohtamäki, Partanen, & Möller,
2013). Although the servitization literature has been expanding
(Rabetino, Harmsen, Kohtamäki, & Sihvonen, 2018; Raddats,
Kowalkowski, Benedettini, Burton, & Gebauer, 2019), there is a need to
understand better how servitization drives manufacturers' repositioning
strategies (Gebauer, Ren, Valtakoski, & Reynoso, 2012; Santos &
Eisenhardt, 2005).
The existing servitization literature has acknowledged that manu-
facturers can apply different strategies when attempting to find the best
positions in their industries. For instance, Baines, Lightfoot, and Smart
(2011) show that manufacturers use alternative repositioning practices,
such as focusing on product-related services while keeping a foothold in
production operations or combining original equipment manufacturing
(OEM) and product-related services. Davies, Brady, and Hobday (2007)
suggest the following two distinct ways to operate within an industry:
1) becoming a vertically integrated system seller (insourcing) or 2) be-
coming a system integrator (outsourcing) that organizes the integration
of modular parts supplied by third parties. However, this change is
profound and requires interdisciplinary research based on general
management theories; Gebauer et al. (2012: 127) suggested that
“[servitization] can be considered from the perspective of the boundary
of the firm”. Accordingly, the influence of servitization on firm
boundaries needs to be examined while accurately analyzing the impact
on both firms' scope and practices used to reposition companies within
the value system (Gebauer, Edvardsson, Gustafsson, & Witell, 2010).
Thus, the implementation of this new strategy requires firms to redefine
their horizontal and vertical organizational boundaries (Chesbrough &
Rosenbloom, 2002; Teece, 2007), which can be defined as “the scope of
product/markets addressed” and “the scope of activities undertaken in
the industry value chain”, respectively (Santos & Eisenhardt, 2005:
492).
The present study extends recent research concerning firm bound-
aries in servitization (Kohtamäki, Parida, Oghazi, Gebauer, & Baines,
2019; Rabetino & Kohtamäki, 2013; Rabetino & Kohtamäki, 2018;
Salonen & Jaakkola, 2015) by addressing the following question: “How
https://doi.org/10.1016/j.indmarman.2020.06.014
Received 22 October 2018; Received in revised form 11 June 2020; Accepted 27 June 2020
⁎ Corresponding author.
E-mail addresses: tuomas.huikkola@univaasa.fi (T. Huikkola), rodrigo.rabetino@univaasa.fi (R. Rabetino), marko.kohtamaki@univaasa.fi (M. Kohtamäki),
heiko.gebauer@imw.fraunhofer.de (H. Gebauer).
Industrial Marketing Management 90 (2020) 90–105
0019-8501/ © 2020 The Authors. Published by Elsevier Inc. This is an open access article under the CC BY-NC-ND license 
(http://creativecommons.org/licenses/BY-NC-ND/4.0/).
T
does servitization drive a manufacturer to realign its boundaries when
repositioning in the industrial ecosystem?” We use a multiple-case
study to analyze the servitization of four global companies that created
value by implementing servitization. Building upon the selected firm
boundary lenses (Bäck & Kohtamäki, 2015; Barney, 1999; Coe, Dicken,
& Hess, 2008; Santos & Eisenhardt, 2005), the contribution of the study
is two-fold: We 1) demonstrate how servitization shapes manufacturers'
firm boundaries through identity, capability, power, and efficiency
lenses, and 2) show the importance of the dynamic interplay among
these lenses when manufacturers are steered toward servitization. Ad-
ditionally, we present a managerial framework to guide firm boundary
delineation in servitization.
2. Theoretical framework
2.1. Defining servitization
Servitization has gained academic attention (Baines et al., 2017;
Rabetino et al., 2018; Raddats et al., 2019) and is acknowledged as a
central means to explain how a firm can strategically differentiate by
bundling products, services, and software to generate competitive ad-
vantage (Kowalkowski, Kindström, Alejandro, Brege, & Biggemann,
2012; Ulaga & Reinartz, 2011; Vandermerwe & Rada, 1988). Serviti-
zation is typically described on a continuum ranging from a purely
product-focused company to a purely service- and customer-focused
company (Martinez, Neely, Velu, Leinster-Evans, & Bisessar, 2017;
Shah, Rust, Parasuraman, Staelin, & Day, 2006). This strategic transi-
tion is not smooth and requires a wide array of changes in the company,
such as changes in organizational capabilities, structures, offerings, and
processes (Kohtamäki et al., 2019; Raja, Chakkol, Johnson, & Beltagui,
2018). Managers have adopted different frameworks and models to
manage this repositioning (Bustinza, Vendrell-Herrero, & Baines, 2017;
Rabetino, Kohtamäki, & Gebauer, 2017). However, only a few serviti-
zation studies (Kohtamäki et al., 2019; Rabetino & Kohtamäki, 2013;
Salonen & Jaakkola, 2015) have adopted the firm boundary lens
(Santos & Eisenhardt, 2005, 2009) despite its obvious potential to
provide an alternative narrative for the servitization literature (Luoto,
Brax, & Kohtamäki, 2017).
2.2. Servitization as a driver of firm boundary decisions
In servitization, manufacturers should adopt a broader view of their
industry and reconsider their position within the value system
(Gebauer, Paiola, & Saccani, 2013). This move requires firms to develop
new capabilities (Davies, 2004; Huikkola, Kohtamäki, & Rabetino,
2016; Kindström, Kowalkowski, & Sandberg, 2013; Ulaga & Reinartz,
2011; Worm, Bharadwaj, Ulaga, & Reinartz, 2017) and value proposi-
tions while learning to provide services (Lusch, Vargo, & Tanniru, 2010;
Storbacka, Windahl, Nenonen, & Salonen, 2013). Repositioning may
take alternative forms. Manufacturers can either focus on product-
centric services while remaining involved in production operations or
combine original equipment manufacturing (OEM) and product-centric
services (Baines et al., 2011). For instance, system integration allows
manufacturers to “shape their boundaries and their position in an in-
dustry value stream” while “enabling them to decide who to compete
with, who to collaborate with, what to make in-house, and what to
outsource” (Hobday, Davies, & Prencipe, 2005: 1136). Firm boundary
decisions are central in shaping the business ecosystem (Adner, 2016;
Jacobides, Cennamo, & Gawer, 2018; Kohtamäki et al., 2019; Möller &
Halinen, 2017).
2.3. Firm boundaries in servitization
Repositioning involves boundary (re)definition (Chandraprakaikul,
Baines, Lim, & Sakburanapech, 2010), which in the context of serviti-
zation may involve the design of a proper product-service offering and
decisions regarding which value-adding activities should be performed
internally and which should be outsourced to suppliers, partners, dis-
tributors, and/or customers (Baines, Kay, Adesola, & Higson, 2005;
Salonen & Jaakkola, 2015). Understanding the delineation of firm
boundaries requires the simultaneous use of multiple interdependent,
complementary and synergetic theoretical lenses (Brahm & Tarzijan,
2012; Schilling & Steensma, 2002; Yang, Lin, & Lin, 2010). Following
Santos and Eisenhardt (2005), this study applies the conceptual per-
spectives of power, efficiency, competence, and identity to analyze the
redefinition of firm boundaries resulting from the establishment of
servitization strategies.
2.3.1. Servitization shapes a firm's identity
According to Tuli, Kohli, and Bharadwaj (2007: 1), “customer so-
lutions embody the new service dominant logic”. Manufacturers must
reconsider almost every aspect of how they do business (Brady, Davies,
& Gann, 2005) to facilitate the creation of value-in-use for customers
(Baines et al., 2007; Johnstone, Dainty, & Wilkinson, 2009). Thus, the
shift toward a service- and customer-centric logic (Galbraith, 2002)
forces manufacturers to redefine their identity (Jacobides & Winter,
2005), which was originally defined by how organizational members
answer questions, such as “Who are we as an organization?” and “What
type of organization is this?” (Albert & Whetten, 1985; Livengood &
Reger, 2010). When firms offer customer solutions, answering such
questions may require them to balance elements from both a goods- and
a service-dominant logic (Töytäri et al., 2018; Windahl & Lakemond,
2010).
Because “identity emerges from the process of organizing”, in which
multiple identities are simultaneously involved (Clegg, Rhodes &
Kornberger, 2007: 497), the impact of servitization on organizational
identity is unpredictable. At the initial stage, servitization will at least
redefine the corporate identity, which is often expressed in public and
accessible forms and can be defined as the “identity attributed to an
organization” by corporate management (Rodrigues & Child, 2008:
886). Strategically redefining a firm's corporate identity engenders
significant organizational changes (Clark, Gioia, Ketchen, & Thomas,
2010) that involve the redefinition of firm boundaries. Although this
type of transformation typically begins with a new strategic vision/
mission (Vaara & Tienari, 2011), “top managers may try to foster an
organizational culture that lends credibility to their desired corporate
identity” (Rodrigues & Child, 2008: 890). Because strategy reflects a
firm's identity as defined by its boundaries (Kogut, 2000), a manu-
facturer must achieve the required consistency between the new
“identity of the organization and its activities” in servitization (Santos &
Eisenhardt, 2005: 500). Therefore, a new identity results in crucial
strategic boundary choices, such as “whether to make an acquisition,
enter a new market, or divest a division” (Tripsas, 2009: 441).
2.3.2. Servitization shapes a firm's capabilities
To effectively execute servitization strategies, manufacturers must
move downstream closer to the end customers (Wise & Baumgartner,
1999) while leveraging a set of extant and additional capabilities
(Hobday et al., 2005; Ulaga & Reinartz, 2011) and balancing between
generic and specialized capabilities (Ceci & Masini, 2011). Naturally,
technological capabilities are a necessary condition for the provision of
complex solutions (Ceci & Prencipe, 2008; Davies & Brady, 2000).
Moreover, servitization calls for new capabilities, such as capabilities in
system integration, project management, IT systems, consulting, fi-
nancial competences, delivery, and postsales service (Baines et al.,
2011; Brady et al., 2005; Davies, 2004; Huikkola et al., 2016;
Osegowitsch & Madhok, 2003; Prencipe, 2003), along with capabilities
in coordinating with suppliers (Ceci & Prencipe, 2008; Huikkola &
Kohtamäki, 2017), capabilities in facilitating learning in customer
partnerships (Bäck & Kohtamäki, 2015; Shepherd & Ahmed, 2000; Tuli
et al., 2007) and relational capabilities (Kohtamäki et al., 2013;
Kowalkowski, Witell, & Gustafsson, 2013; Matthyssens &
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
91
Vandenbempt, 2010). Occasionally, servitization calls for capabilities to
conduct a customer's existing operations effectively. For instance, in O&
M (operations and maintenance) solutions and performance-based
contracts (Visnjic et al., 2017), the manufacturer needs to build these
types of capabilities, which may cause conflicts in dedicated customer
groups.
Following the Resource-Advantage theory, Raddats, Burton, and
Ashman (2015) suggest that firms develop capabilities that enable
successful services through resource reconfigurations. Ulaga and
Reinartz (2011) conclude that to leverage these unique resources,
successful firms must build capabilities related to service-related data
processing and interpretation, risk assessment and mitigation, design-
to-service, and hybrid offering sales and deployment. According to
Mathieu (2001), the development of the required capabilities may
occur within a range that includes internalization, partnering, and
outsourcing. Among the benefits of collaborative forms, Paiola, Saccani,
Perona, and Gebauer (2013: 395) highlight “sharing risks, accessing
essential resources and skills in building a competitive advantage, and
moderating the political costs of entering the service business”. From
this viewpoint, firm boundaries are “dynamically determined by
matching organizational resources with environmental opportunities”
(Santos & Eisenhardt, 2005: 497).
2.3.3. Servitization shapes a firm's power position
While extending product offerings by adding services, manu-
facturers must move vertically (Davies, Brady, & Hobday, 2006; Hax &
Wilde II, 1999; Wise & Baumgartner, 1999) to protect their strategic
domain (Cacciatori & Jacobides, 2005). A certain degree of control over
the service value chain is required if complex services are to be offered
successfully (Raynor & Christensen, 2002). Providing solutions suc-
cessfully also requires manufacturers to ensure certain product speci-
fications and system compatibility and performance (Osegowitsch &
Madhok, 2003; Visnjic et al., 2017) while adjusting services to meet
customers' needs (Davies, 2004; Nordin & Kowalkowski, 2010). These
crucial concerns highlight the relevance of controlling how subsystems
are coupled and related processes are organized (Baines et al., 2011).
Because vertical integration is a method used by manufacturers to
guarantee that product specifications and services can be adjusted to
diverse customer needs (Davies, 2004), manufacturers commonly use
mergers and acquisitions (M&A) to retain downstream control
(Huikkola et al., 2016; Osegowitsch & Madhok, 2003). However,
manufacturers can also effectively internalize uncertainty and govern
the value system without full ownership by employing alliances, joint
ventures, and licenses to retain flexibility (Harrigan, 1984; Mahoney,
1992; Porter, 1980). Moreover, following Mathieu (2001), Paiola et al.
(2013) suggest that the use of collaborative options when manu-
facturers enter the service business may moderate the political cost
among partners, customers, traditional service providers, and other
manufacturers.
To employ specific control mechanisms and understand the sources
of industry control, one must accurately analyze the distribution of
power (McGahan, 2000) to identify profitable industry “bottlenecks”
(Grant, 2010). Within such an approach, questions such as how the
value system is governed (Adams & Brock, 1982) and how the interfirm
division of labor is organized within the value system (Gereffi,
Humphrey, & Sturgeon, 2005) must be addressed. Achieving industry
dominance requires a redefinition of roles and responsibilities through
an examination of other players' needs and the implementation of a less
replaceable bottleneck (Jacobides, 2011). While companies move
within the industry value system to increase their governance of stra-
tegic relationships, knowledge (Garud & Kumaraswamy, 1993), and
resources, firm “boundaries determine the sphere of organizational
influence, including its degree of industry control and its power over
the external forces” (Santos & Eisenhardt, 2005: 491).
2.3.4. Servitization shapes a firm's efficiency logic
The efficiency concept is rooted in a transaction-cost economics
(TCE) approach that evaluates the costs of coordination mechanisms,
i.e., whether it is reasonable for a firm to conduct operations inside the
corporation (a hierarchical structure), purchase outcomes from external
firms (a market mechanism), or ally with external partners (a colla-
borative mechanism) (Williamson, 2008). The previous literature has
acknowledged that hierarchical governance is used to mitigate the ef-
fects of behavioral uncertainty, whereas the market mechanism is pri-
marily used to maintain flexibility (Dyer, 1996). The efficiency ap-
proach thus attempts to maximize the firm's long-term savings and
minimize its governance costs (e.g., negotiation and monitoring costs).
Thus, firms typically need to cope with the contradictory goals of si-
multaneously sourcing cheap and building trust (Vesalainen, Valkokari,
& Hellström, 2017).
In servitization, a manufacturer typically outsources its noncore and
upstream activities (e.g., operations that occur during the raw material
and production stages) to external partners and internalizes the most
strategic downstream activities (e.g., operations that occur during the
distribution phase and involve entities closest to the end customer) to
retain customer intimacy (Huikkola et al., 2016). Information asym-
metries between parties are particularly likely to increase governance
costs and shape boundary decisions (Zou, Brax, Vuori, & Rajala, 2019).
Emerging transaction costs can be decreased by building trust, personal
relationships, and mutual commitment (Dyer, 1997; Huikkola, Ylimäki,
& Kohtamäki, 2013). Table 1 outlines selected firm boundary theories
and their linkage to servitization.
3. Research methodology
3.1. Research strategy and case selection
We use a multiple-case study to analyze how four servitized global
companies headquartered in Finland changed their boundaries for re-
positioning. The case study is a suitable choice when studying questions
that have not been studied comprehensively (Yin, 1994), and they are
justified if the study intends to explore and describe in further detail the
presence of an important phenomenon and its driving forces under
uncommon and difficult-to-replicate conditions (Dubois & Gadde, 2002;
Eisenhardt & Graebner, 2007; Siggelkow, 2007).
Purposeful sampling (Patton, 2002) was chosen as the case selection
method. As the main selection criteria, we focused on manufacturers
that 1) are further ahead in servitization (proven track record in gen-
erating financial value from services), 2) moved along the value system
while continuously changing their boundaries (firms' top management
publicly stated that their firms underwent strategic transitioning to-
ward services), and 3) offer their customers different types of solutions
(e.g., turnkey projects, O&M solutions, maintenance and repair ser-
vices, and long-term service agreements). Therefore, the solutions
provided involve a wide range of activities that support the develop-
ment of a customer's business productivity.
3.2. Data collection
We conducted 57 interviews with the firms' executives between
2010 and 2017 (Table 2). The respondents were selected based on their
senior management positions, experience in developing service and
solution businesses, and responsibility for developing a particular
business unit, product/service line, or business relationship. Fifty-two
internal respondents (focal companies' managers) and five external
respondents (focal companies' strategic customers' and suppliers' man-
agers) were interviewed because of the need to triangulate the data to
increase reliability and accuracy. The interviews ranged from 40 to
105 min, and all interviews were audiotaped and transcribed verbatim
with the interviewees' permission, resulting in approximately 900 pages
of transcribed text. Additionally, extensive secondary data collection
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
92
was conducted, including an analysis of public presentations, annual
reports, press releases, and firm histories, to cover, complement, and
support issues that were not addressed during the interviews. Table 2
describes the general information of the studied cases and respondents
and the data utilized in the analysis in the study. In summary, the
studied firms were relatively large manufacturers, and on average, the
respondents had almost 20 years of work experience in related business
fields (median 19 years; no work experience information was available
for six interviewees).
3.3. Analysis process
Content and thematic pattern matching (Yin, 1994) were employed
to analyze the data. The coauthors of this article read and discussed the
data to discover patterns and identify differences across the cases. First,
a within-case analysis of each corporation was constructed to under-
stand how each corporation's economic performance developed during
the investigated time-period (2000–2014). In these analyses, although
not explicitly reported in this manuscript due to word-count limitations,
a detailed analysis of how a company's financial numbers, service
business, installed base of products, and number of employees evolved
during the corresponding period was performed. Additionally, a
spreadsheet program was used to list all corporations' reported invest-
ments, divestments, joint ventures, acquisitions, stake-ins, alliances,
and license agreements based on public information (mainly annual
reports and press releases). Then, an analysis of how each corporation's
identity, efficiency, power, and capabilities changed during the study
period was conducted. Second, a cross-case analysis was constructed to
discover patterns and variety across the cases in terms of identity, ef-
ficiency, power, and capabilities (Beverland & Lindgreen, 2010;
Eisenhardt, 1989; Huberman & Miles, 1994). In this analysis, selected
boundary theories (i.e., identity, capabilities, power, and efficiency)
were used as the main categories when trying to identify how serviti-
zation drives firm boundary delineation. We coded the interviews based
on respondents' answers regarding logic change from products to so-
lutions. These codes were compressed into first-order items that de-
scribe the language used by the respondent in the interviews (Nag,
Corley, & Gioia, 2007). The next phase focused on the analyses of first-
order items, thus representing second-order items. The final step in-
cluded third-order items that reflect the most abstract analysis dimen-
sion. The qualitative content analysis technique was utilized in the data
analysis, which helped the researchers convert the empirical interview
content into the four firm boundary lenses. Fig. 1 describes the study's
general coding and reasoning process, proceeding from the language
used by the respondents on the left side to the most abstract and the-
oretical phenomena on the right side.
4. Primary drivers for repositioning and firm boundary
realignment in servitization
The case companies focus on system integration, which entails as-
sembling and testing systems while outsourcing subsystems and com-
ponent manufacturing. Although this process is typically the first step
toward customer solutions, alliances and joint ventures are common
coordinating mechanisms in the upstream end that simultaneously
allow focal companies to minimize transaction costs and exploit po-
tential localization advantages in cost-competitive countries (Fig. 2).
Although it is becoming a strategic focus area, procurement was
centralized to strategic suppliers. Because this situation may increase
subsystem suppliers' bargaining power, case companies should develop
a strong supply base while finding mechanisms to limit suppliers' bar-
gaining power and cope with dependence and transaction costs. The
trend seems to be to adopt a hybrid form between a vertically in-
tegrated system seller and an agnostic system integrator that combines
the benefits of both models (Davies et al., 2007). However, it was also
possible to give more power to the strategic suppliers because of closerTa
bl
e1
Se
lec
ted
fir
m
bo
un
da
ry
th
eo
rie
sa
nd
th
eir
lin
ka
ge
to
ser
vit
iza
tio
n.
Co
nc
ep
t
Th
eo
ret
ica
lp
rem
ise
Ke
yq
ue
sti
on
Ke
yo
bje
cti
ve
Lin
ka
ge
be
tw
ee
n
ser
vit
iza
tio
na
nd
fir
m
bo
un
da
ry
th
eo
rie
s
Im
pli
ca
tio
ns
Ca
pa
bil
iti
es
Re
so
ur
ce
-ba
sed
th
eo
ry
(R
BT
),
dy
na
mi
cc
ap
ab
ili
tie
s(
DC
)
W
ha
ta
re
th
em
os
ts
tra
teg
ic
as
set
sf
or
th
efi
rm
?H
ow
do
ca
pa
bil
iti
es
ev
olv
e?
Ma
xim
izi
ng
th
ev
alu
eo
ft
he
mo
st
va
lua
ble
res
ou
rce
s
Mi
nim
izi
ng
th
ep
os
ses
sio
n
of
no
nc
or
e/
de
ca
yin
gr
eso
ur
ce
s
Bu
ild
ing
th
er
eso
ur
ce
sn
ee
de
d
in
ser
vit
iza
tio
n
Le
ve
rag
ing
ex
ist
ing
tec
hn
olo
gic
al
res
ou
rce
si
n
ne
w
ser
vic
eo
ffe
rin
gs
Re
lea
sin
gn
on
co
re
res
ou
rce
st
ob
uil
dn
ew
res
ou
rce
sa
nd
lev
era
ge
ex
ist
ing
on
es
Se
rv
iti
za
tio
nr
eq
uir
es
rec
on
fig
ur
ati
on
of
th
e
ma
nu
fac
tu
rer
'sc
ap
ab
ili
tie
s
Po
we
r
Ind
us
tri
al
or
ga
niz
ati
on
(IO
)
Ho
w
ca
nt
he
fir
m
be
pr
ote
cte
df
ro
m
ex
ter
na
lc
om
pe
tit
ive
for
ce
s?
Ma
xim
izi
ng
th
ec
on
tro
lo
ft
he
mo
st
str
ate
gic
res
ou
rce
st
op
ro
tec
tf
ro
m
ex
ter
na
l
for
ce
s
Mi
nim
izi
ng
th
ee
ffe
cts
of
ex
ter
na
lf
or
ce
s
Ou
tso
ur
ce
ac
tiv
iti
es
at
th
eu
ps
tre
am
en
dw
he
n
th
ere
is
lit
tle
de
pe
nd
en
cy
on
ex
ter
na
lp
art
ne
rs
Int
ern
ali
ze
ac
tiv
iti
es
at
th
ec
us
tom
er
en
dw
he
n
th
ere
is
too
mu
ch
de
pe
nd
en
cy
on
ex
ter
na
l
pa
rtn
ers
Se
rv
iti
za
tio
nr
eq
uir
es
as
tro
ng
er
po
sit
ion
at
th
e
cu
sto
me
re
nd
Ide
nt
ity
Ma
na
ge
ria
lc
og
nit
ion
Ho
w
ca
nw
em
ak
es
en
se
of
“w
ho
we
are
as
an
or
ga
niz
ati
on
”?
Ma
xim
izi
ng
mu
tu
al
un
de
rst
an
din
go
ft
he
fir
m'
si
de
nt
ity
Mi
nim
izi
ng
ine
rti
ar
eg
ard
ing
th
efi
rm
's
ide
nt
ity
Em
ph
as
ize
th
ei
mp
or
tan
ce
of
cu
sto
me
r-
or
ien
ted
cu
ltu
re
Di
mi
nis
ht
he
do
mi
na
nc
eo
f
pr
od
uc
tl
og
ic
Se
rv
iti
za
tio
nr
eq
uir
es
ac
ha
ng
ei
na
ma
nu
fac
tu
rer
's
ide
nt
ity
(w
ho
we
are
as
an
or
ga
niz
ati
on
)
Effi
cie
nc
y
Tr
an
sa
cti
on
-co
st
ec
on
om
ics
(T
CE
)
Sh
ou
ld
we
ma
ke
,b
uy
,o
ra
lly
?
Ma
xim
izi
ng
fut
ur
es
av
ing
s
Mi
nim
izi
ng
th
ec
os
to
fg
ov
ern
an
ce
Mi
tig
ate
th
ee
ffe
cts
of
be
ha
vio
ral
un
ce
rta
int
y
Us
em
ark
et
me
ch
an
ism
st
om
ain
tai
nfl
ex
ibi
lit
y
Se
rv
iti
za
tio
nc
all
sf
or
th
eu
se
of
diff
ere
nt
go
ve
rn
an
ce
me
ch
an
ism
si
nu
ps
tre
am
an
d
do
wn
str
ea
m
ac
tiv
iti
es
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
93
Ta
bl
e2
Sa
mp
le
de
scr
ipt
ion
an
ds
ou
rce
so
fi
nfo
rm
ati
on
.
CA
SE
A
CA
SE
B
CA
SE
C
CA
SE
D
Tu
rn
ov
er
€(
20
14
)
4.7
bil
lio
n
€
1.4
bil
lio
n
€
2b
illi
on
€
7b
illi
on
€
Se
rv
ice
sh
are
41
%
36
%
42
%
45
%
Ind
us
try
En
erg
y
Mi
nin
g
He
av
yi
nd
us
try
Co
ns
tru
cti
on
Ne
tp
ro
fit
%
(5
-ye
ar
av
era
ge
)
11
.34
%
8.7
2%
8,3
6%
13
.7%
RO
I% (5
-ye
ar
av
era
ge
)
21
.28
%
20
%
19
%
34
.5%
Co
re
pr
od
uc
ts
Pr
op
uls
ion
sy
ste
ms
an
dp
ow
er
pla
nt
s
Mi
ne
ral
sa
nd
me
tal
sp
ro
ce
ssi
ng
tec
hn
olo
gy
Ind
us
tri
al
cra
ne
sa
nd
lif
tin
gs
ys
tem
s
Lif
tin
ge
qu
ipm
en
t
Co
re
ser
vic
es
Int
eg
rat
ed
so
lut
ion
s,
ser
vic
ea
gr
ee
me
nt
s,
sp
are
pa
rts
,m
ain
ten
an
ce
,O
&M
,m
od
ern
iza
tio
n,
sm
art
so
lut
ion
s
Tu
rn
ke
ys
olu
tio
ns
,s
pa
re
pa
rts
,m
ain
ten
an
ce
,O
&
M,
mo
de
rn
iza
tio
n
Se
rv
ice
co
nt
rac
ts,
sp
are
pa
rts
,m
ain
ten
an
ce
,
mo
de
rn
iza
tio
n,
sm
art
so
lut
ion
s
Se
rv
ice
co
nt
rac
ts,
mo
de
rn
iza
tio
n,
tu
rn
ke
y
so
lut
ion
s,
ma
int
en
an
ce
,s
pa
re
pa
rts
,p
eo
ple
flo
w
an
aly
ses
Ar
ch
iva
ld
ata
-P
res
en
tat
ion
si
ni
nv
est
or
me
eti
ng
s
-H
ist
or
ies
-Pr
ess
rel
ea
ses
-A
nn
ua
lr
ep
or
ts
an
d
fin
an
cia
ls
tat
em
en
ts
(2
00
0–
14
)
1(
CE
O)
1h
ist
or
y(
31
1p
ag
es)
1(
VP
,S
erv
ice
Un
it)
20
do
cu
me
nt
so
fp
res
sr
ele
as
es
25
33
pa
ge
so
fa
nn
ua
lr
ep
or
ts
1(
CE
O)
90
0p
ag
es
of
an
nu
al
rep
or
ts
2(
CE
O)
2h
ist
or
ies
(6
76
pa
ge
s)
40
3d
oc
um
en
ts
of
pr
ess
rel
ea
ses
13
88
pa
ge
so
fa
nn
ua
lr
ep
or
ts
2(
CE
O
an
dC
ha
irm
an
of
th
eB
oa
rd
)
4h
ist
or
ies
(1
59
3p
ag
es)
27
3d
oc
um
en
ts
of
pr
ess
rel
ea
ses
10
37
pa
ge
so
fa
nn
ua
lr
ep
or
ts
Nu
mb
er
of
int
erv
iew
sa
nd
pa
ge
so
ft
ran
scr
ipt
s
21
int
erv
iew
s(
28
0p
ag
es)
16
int
erv
iew
s(
32
8p
ag
es)
14
int
erv
iew
s(
24
7p
ag
es)
6i
nt
erv
iew
s(
88
pa
ge
s)
Ex
am
ple
so
fr
esp
on
de
nt
s'
po
sit
ion
s
So
ur
cin
gD
ire
cto
r,
Ma
int
en
an
ce
Di
rec
tor
,G
en
era
l
Ma
na
ge
r,
Sa
les
Di
rec
tor
,B
us
ine
ss
De
ve
lop
me
nt
Di
rec
tor
,M
ark
eti
ng
Di
rec
tor
,D
igi
tiz
ati
on
Di
rec
tor
,
So
lut
ion
sD
ire
cto
r,
Se
rv
ice
Un
it
Di
rec
tor
,
Te
ch
no
log
yM
an
ag
em
en
tD
ire
cto
r,
VP
/S
olu
tio
ns
,
Di
rec
tor
of
Fin
an
ce
Sit
ed
ire
cto
r,
VP
/S
ale
s,
Gl
ob
al
Se
rv
ice
Op
era
tio
ns
Di
rec
tor
,V
P/
Str
ate
gy
,S
VP
/H
R,
He
ad
of
Se
rv
ice
s,
VP
/S
erv
ice
s,
VP
/R
eg
ion
al
Se
rv
ice
s,
VP
/O
pe
rat
ion
s
an
dP
ro
ce
ss
De
ve
lop
me
nt
,S
erv
ice
Bu
sin
ess
Ma
na
ge
r,
Ma
rk
eti
ng
Di
rec
tor
Se
rv
ice
Di
rec
tor
,A
rea
Ma
na
ge
r,
Di
str
ict
Ma
na
ge
r,
Pr
od
uc
ta
nd
Se
rv
ice
De
ve
lop
me
nt
Di
rec
tor
,G
lob
al
Ca
teg
or
yM
an
ag
er,
Inn
ov
ati
on
Di
rec
tor
,C
DO
,
Re
gio
na
lS
ale
sD
ire
cto
r,
Pr
od
uc
tM
an
ag
er,
Gl
ob
al
Ke
yA
cc
ou
nt
Ma
na
ge
r
Se
rv
ice
Ma
na
ge
r,
Ar
ea
Ma
na
ge
r,
He
ad
of
Se
rv
ice
Bu
sin
ess
,S
erv
ice
De
ve
lop
me
nt
Di
rec
tor
,P
ur
ch
as
ing
Di
rec
tor
,K
ey
Ac
co
un
tM
an
ag
er
Av
era
ge
an
dm
ed
ian
wo
rk
ex
pe
rie
nc
ei
nt
he
ind
us
try
(in
ye
ars
)
20
.74
ye
ars
(m
ea
n)
19
ye
ars
(m
ed
ian
)
16
.64
ye
ars
(m
ea
n)
16
ye
ars
(m
ed
ian
)
22
.7
ye
ars
(m
ea
n)
22
.7
ye
ars
(m
ed
ian
)
20
ye
ars
(m
ea
n)
18
.5
ye
ars
(m
ed
ian
)
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
94
interaction with customers, enabled by digital technologies such as the
Internet of Things (IoT). Otherwise, giving control to the upstream
would have created too many dependencies between upstream provi-
ders and focal companies. The respondents reflected that their in-
dustries are likely to follow the patterns occurring in other industries.
It's going to happen, as in the car industry in the beginning of the
70s. The car industry began to purchase and create system suppliers,
and they continued to develop it (Director, Case A).
Some initiatives implemented by the analyzed companies include
expert heuristics, such as a rule stipulating that a given supplier's sales
to the company can account for only 20–50% of its total sales, and other
practices, such as the facilitation of the development of key suppliers or
the use of a dual-sourcing policy for critical components. In all cases,
companies have to safeguard intellectual property rights mainly to
protect their profitable and vital spare parts business.
I don't think that that has been a strategy to purchase part providers.
Fig. 1. Illustration of the data structure.
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
95
Fig. 2. Number of repositioning moves throughout the value system (2000–2014).
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
96
Ta
bl
e3
Ill
us
tra
tiv
ep
ro
of
qu
ote
s.
Ca
se
A
Ca
se
B
Ca
se
C
Ca
se
D
Se
rv
iti
za
tio
n
sh
ap
ing
afi
rm
's
ide
nt
ity
(1
.F
ro
m
pr
od
uc
t-o
rie
nt
ed
to
cu
sto
me
r-c
en
tri
cfi
rm
;2
.
Ide
nt
ity
ins
tit
ut
ion
ali
za
tio
n;
3.
Ar
tif
ac
ts
an
d
sta
tem
en
ts)
1.
“W
ea
im
ed
to
rea
lly
get
the
me
ssa
ge
thr
ou
gh
the
org
an
iza
tio
na
nd
get
eve
ryb
od
yt
ob
eco
me
cu
sto
me
r-f
oc
use
d,
cre
ati
ve,
inn
ov
ati
ve
rat
he
r
tha
no
nly
tec
hn
ica
lly
foc
use
d.
(V
Ps
erv
ice
un
it)
2.
“It
[b
ran
d]
is
ac
om
bin
ati
on
of
ac
om
pa
ny
's
rep
uta
tio
na
nd
ide
nti
ty.
Ou
rr
ep
uta
tio
nc
om
es
fro
m
ma
kin
gp
rom
ise
sa
nd
ke
ep
ing
the
m.
W
e
op
tim
ize
life
cy
cle
va
lue
thr
ou
gh
effi
cie
nt,
fle
xib
le
an
de
nv
iro
nm
en
tal
ly
sou
nd
po
we
rs
olu
tio
ns
on
lan
da
nd
at
sea
.O
ur
roo
ts
are
in
en
gin
es
an
d
en
gin
eer
ing
,s
hip
sa
nd
po
we
rp
lan
ts.
W
ea
re
pa
ssi
on
ate
ab
ou
tt
ech
no
log
ya
nd
wi
llin
gt
og
ot
o
gre
at
len
gth
st
oe
nsu
re
tha
to
ur
sol
uti
on
sw
ork
as
the
ys
ho
uld
.W
ef
oc
us
on
ma
xim
izi
ng
the
cu
sto
me
rb
en
efi
ts
of
ou
rp
rod
uc
ts
an
ds
erv
ice
s
thr
ou
gh
en
vir
on
me
nta
lly
an
de
co
no
mi
ca
lly
sus
tai
na
ble
me
asu
res
.(
W
eb
sit
e)
3.
“T
ha
t's
wh
yI
lik
ey
est
erd
ay
'ss
tat
em
en
tv
ery
mu
ch
fro
m
the
CE
O
ab
ou
te
ntr
ep
ren
eu
rsh
ip.
Yo
u
ne
ed
to
go
ba
ck
al
ittl
eb
it
to
en
tre
pre
ne
urs
hip
.
Yo
un
eed
to
loo
ku
po
nw
ha
tt
he
cu
sto
me
rr
ea
lly
ne
ed
s,a
nd
yo
un
eed
to
ha
ve
an
org
an
iza
tio
nt
ha
t
is
fle
xib
le
an
de
ntr
ep
ren
eu
ria
le
no
ug
ht
ob
ea
ble
to
pu
tt
ha
tp
ac
ka
ge
an
dt
he
sol
uti
on
tog
eth
er.
”
(D
ire
cto
r)
1.
“W
eu
sed
to
say
[fo
rk
ick
s]
tha
tw
es
old
the
pro
jec
t,
an
dt
ha
t's
it.
W
ed
eli
ver
ed
the
pro
jec
t
an
df
org
ot
the
cu
sto
me
r.”
(V
P,
Sa
les
)
2.
“O
ne
of
the
foc
us
are
as
for
20
11
ha
sb
een
de
fin
ed
as
the
str
en
gth
en
ing
an
du
nifi
ca
tio
no
f
ou
ri
de
nti
ty.
Af
ter
sev
era
lc
ha
ng
es
an
d
ac
qu
isi
tio
ns,
the
re
is
an
eed
to
foc
us
on
co
mm
on
go
als
,o
pe
rat
ing
me
tho
ds,
an
dp
rac
tic
es
ba
sed
on
the
co
mp
an
y's
va
lue
sa
nd
pri
nc
ipl
es.
Th
e
str
en
gth
en
ing
of
ac
om
mo
ni
de
nti
ty
an
ds
mo
oth
co
op
era
tio
nt
hro
ug
ho
ut.
”(
Ca
se
B's
An
nu
al
Re
po
rt,
20
10
:5
0)
3.
“T
hu
s,i
na
llc
om
mu
nic
ati
on
an
da
llm
ark
eti
ng
rea
lly
,t
ha
ts
tuff
,it
'st
he
re
an
dv
isu
al,
the
top
ma
na
gem
en
th
as
do
ne
we
ll,
the
yh
av
eh
igh
lig
hte
d
ho
w
im
po
rta
nt
the
ser
vic
es
are
qu
ite
tho
rou
gh
ly
an
dc
on
sis
ten
tly
for
sev
era
ly
ea
rs,
so
pe
op
le
ha
ve
sta
rte
dt
ou
nd
ers
tan
dt
ha
tit
bri
ng
sv
alu
et
ot
he
co
mp
an
y.”
(H
ea
do
fS
erv
ice
s)
1.
“T
he
co
nte
nt
of
the
co
ntr
ac
t[
in
sm
art
so
lut
ion
s]
wi
llb
eco
me
mo
re
str
ate
gic
for
the
cu
sto
me
r,
an
dy
ou
wi
lln
ot
be
co
mp
eti
ng
wi
th
pu
re
ma
int
en
an
ce
fir
ms
an
ym
ore
.Y
ou
're
no
ti
n
the
sam
ea
rea
wi
th
the
m
an
ym
ore
,a
nd
yo
u'l
lb
e
at
the
sam
el
eve
la
sF
err
ari
.B
oth
yo
ua
nd
the
cu
sto
me
rk
no
w
tha
ty
ou
're
no
tc
om
pe
tin
gw
ith
the
ma
sse
s,
bu
td
iff
ere
nti
ati
on
rea
lly
oc
cu
rs.
W
e
ca
nr
ea
lly
be
dis
tin
cti
ve
wi
th
ou
rs
erv
ice
s…
.
Ba
sic
all
y,
eve
ryt
hin
gc
ha
ng
es—
bu
sin
ess
mo
de
l,
wo
rki
ng
sa
nd
glo
ba
lp
roc
ess
es.
W
em
ov
ef
rom
gre
asi
ng
to
da
ta
ma
na
gem
en
tt
oo
pti
mi
ze
life
-
cy
cle
co
sts
.T
his
is
alr
ea
dy
ex
tre
me
ly
diffi
cu
lt,
an
dt
his
wo
uld
n't
be
po
ssi
ble
wi
tho
ut
sup
po
rt
of
top
ma
na
gem
en
t.”
(H
ea
do
fB
us
ine
ss
De
ve
lop
me
nt
)
2.
“C
ase
Cm
ov
ed
fro
m
sel
lin
gp
rod
uc
ts
to
sel
lin
g
sol
uti
on
ss
om
et
im
ea
go
.W
e'r
en
ow
tak
ing
thi
s
pro
ces
so
ne
ste
pf
urt
he
ra
nd
sel
lin
gs
ma
rt
sol
uti
on
st
ha
tin
clu
de
sof
tw
are
an
da
uto
ma
tio
n
to
giv
ec
ust
om
ers
the
hig
he
st
life
-cy
cle
va
lue
.”
(C
as
eC
's
An
nu
al
rep
or
t2
00
9:
27
)
3.
“T
op
ma
na
ger
s'j
ob
is
to
thi
nk
ab
ou
th
ow
to
ma
ke
ap
rod
uc
td
esi
rab
le,
ho
w
its
olv
es
cu
sto
me
rs'
pro
ble
ms
an
dh
ow
itw
ill
be
pre
sen
ted
to
the
cu
sto
me
ri
na
wa
yt
ha
ti
si
nte
res
tin
ga
nd
ea
sy
to
un
de
rst
an
d.
To
pm
an
ag
ers
ne
ed
to
sho
w
an
ex
am
ple
an
di
nfe
ct
pe
rso
nn
el
aro
un
dt
he
m
wi
th
en
thu
sia
sm
for
ma
rke
tin
ga
nd
sal
es.
”(
CE
O,
Ca
se
C)
1.
“O
ur
un
am
big
uo
us
go
al
wa
st
ot
ran
sfo
rm
a
tra
dit
ion
al
pro
du
ct-
foc
use
dc
om
pa
ny
int
oa
cu
sto
me
r-c
en
tri
cc
om
pa
ny
.”
(C
EO
)
2.
“S
erv
ice
su
sed
to
be
ma
nd
ato
ry,
som
eth
ing
tha
ta
llo
we
du
st
os
ell
ha
rdw
are
an
d
pro
du
cts
.W
eh
ad
to
pro
vid
es
erv
ice
st
ok
eep
the
pro
du
ct
on
tra
ck
.T
his
wa
st
he
sit
ua
tio
n
15
–2
0y
ea
rs
ag
o.
To
da
y,
the
rol
eo
fs
erv
ice
s
is
em
ph
asi
zed
,a
nd
pe
op
le
un
de
rst
an
dt
he
im
po
rta
nc
eo
fl
ife
-cy
cle
co
sts
an
dh
ow
im
po
rta
nt
ser
vic
es
are
for
pro
du
ct
sal
es.
To
da
y,
the
ser
vic
eb
usi
ne
ss
is
ou
rk
ey
bu
sin
ess
.”
(A
rea
ma
na
ge
r)
3.
“W
er
egu
lar
ly
de
scr
ibe
in
ou
rp
ers
on
ne
l
ma
ga
zin
ew
hic
hc
ou
ntr
ies
ha
ve
be
st
ac
hie
ved
the
ir
fin
an
cia
lg
oa
ls
in
ser
vic
eb
usi
ne
ss
an
d
ad
op
ted
ou
rb
est
pra
cti
ces
.”
(C
EO
)
Se
rv
iti
za
tio
n
sh
ap
ing
afi
rm
's
ca
pa
bil
iti
es
(1
.
Cr
ea
tio
n
of
ne
w
ca
pa
bil
iti
es
th
ro
ug
h
M&
As
;2
.
Int
eg
rat
ion
of
tec
hn
olo
gy
an
ds
erv
ice
s;
3.
De
ve
lop
ing
av
alu
e-b
as
ed
ap
pr
oa
ch
to
sel
lin
g;
4.
Cr
ea
tin
gs
oft
wa
re
co
mp
ete
nc
ies
;5
.V
ert
ica
l
int
eg
rat
ion
in
ser
vic
es)
1.
“T
he
re
wa
sa
tim
ew
he
nw
ea
cq
uir
ed
as
erv
ice
co
mp
an
ye
ver
yw
eek
or
mo
nth
.T
ha
t's
wh
yw
e
sta
rte
dt
oa
cq
uir
eo
ur
ow
nm
ain
ten
an
ce
ba
se
all
ov
er
the
wo
rld
.”
(D
ire
cto
r)
2.
“O
ur
str
ate
gy
is
ba
sed
on
tec
hn
olo
gy
,
cu
sto
me
r,
an
dd
igi
tiz
ati
on
.I
t's
mu
ch
ab
ou
t
ch
an
gin
gy
ou
rb
usi
ne
ss
mo
de
la
nd
de
vel
op
ing
yo
ur
cu
sto
me
ri
nte
rac
tio
n.
Di
git
iza
tio
ni
sa
pre
tex
tf
or
thi
s.”
(D
ire
cto
r,
So
lut
ion
s)
3.
“It
'sn
ot
on
ly
san
cti
on
sb
ut
als
ob
on
use
s.
W
e
sho
uld
get
bo
nu
ses
if
we
do
ab
ett
er
job
.F
or
ins
tan
ce,
we
gu
ara
nte
e9
7%
usa
bil
ity
to
ou
r
cu
sto
me
ri
nt
his
ind
ust
ry.
”(
Ge
ne
ral
Ma
na
ge
r,
As
set
Pe
rfo
rm
an
ce
Op
tim
iza
tio
n)
4.
“T
his
ac
qu
isi
tio
ns
up
po
rts
ou
rg
row
th
an
d
str
en
gth
en
so
ur
dig
ita
lo
ffe
rin
gs
an
d
co
mp
ete
nc
ies
,in
pa
rti
cu
lar
in
are
as
of
da
ta
an
aly
tic
s,
mo
de
llin
g,
an
dp
erf
orm
an
ce
op
tim
iza
tio
n.”
(P
res
sr
ele
as
e)
5.
“…
W
eh
av
em
ore
tha
n1
80
diff
ere
nt
loc
ati
on
s,
so
itr
ea
lly
me
an
st
ha
tC
ase
A
is
ver
y
loc
al
an
di
sf
ull
yo
wn
ed
by
Ca
se
A,
so
the
ya
re
no
ta
gen
ts
or
de
ale
rs.
Th
ey
are
ou
ro
wn
pe
op
le,
an
dt
he
re
are
mo
re
tha
n1
0,0
00
pe
op
le
in
1.
“W
em
ad
et
his
ac
qu
isi
tio
nt
ha
tc
om
ple
me
nts
ou
rt
ech
no
log
y,
bu
tit
giv
es
us
als
oa
str
on
g
ser
vic
eb
usi
ne
ss.
In
ad
dit
ion
to
ser
vic
ec
om
pa
nie
s,
we
ha
ve
scr
een
ed
co
mp
an
ies
tha
td
eve
lop
dig
ita
l
ser
vic
es
an
ds
ma
rt
sol
uti
on
s.”
(H
ea
do
f
Se
rv
ice
s)
2.“
Pu
re
pro
du
cts
ca
nb
ec
op
ied
.C
om
pe
tin
g
pro
du
cts
ma
yn
ot
be
tec
hn
olo
gic
all
yt
ha
tg
oo
d,
bu
tt
he
diff
ere
nc
ei
ss
ma
lle
ra
nd
no
ts
oc
ruc
ial
.
Th
at'
sw
hy
we
ne
ed
to
pro
vid
ea
lso
ser
vic
es
tha
t
giv
ea
dd
ed
va
lue
to
the
cu
sto
me
r.”
(H
ea
do
f
Se
rv
ice
s)
3.
“I
ha
ve
see
nm
an
yg
oo
de
ng
ine
ers
tha
ta
re
go
od
at
tal
kin
ga
bo
ut
pro
du
ct
fea
tur
es
an
d
fun
cti
on
ali
tie
s.
Bu
tt
he
yd
on
'tu
nd
ers
tan
dt
ha
t
sol
uti
on
sal
es
are
ab
ou
tc
on
sul
tin
gt
he
cu
sto
me
r.I
use
the
ter
m
co
nsu
lta
tiv
es
ell
ing
.It
'sr
ea
ls
olu
tio
n
sal
es
–a
diff
ere
nt
sty
le
to
sel
l.”
(V
P)
4.
“W
eh
ad
thi
sa
cq
uis
itio
nt
ha
tc
om
ple
me
nte
d
ou
rt
ech
no
log
yo
ffe
rin
gs…
W
eh
av
en
'tm
ad
ea
ny
de
cis
ion
s,
bu
tw
ea
re
att
em
pti
ng
to
ma
ke
ac
qu
isi
tio
ns
rel
ate
dt
os
ma
rt
ser
vic
es
an
d
dig
itiz
ati
on
.”
(D
ire
cto
r,
Gl
ob
al
Se
rv
ice
Op
era
tio
ns
)
1.
“…
W
ith
eve
ry
ac
qu
isi
tio
nc
om
es
ap
iec
eo
f
un
iqu
ek
no
wl
ed
ge.
Ev
en
mo
re
im
po
rta
nt,
thr
ou
gh
ou
rm
ain
ten
an
ce
ac
tiv
itie
s,
we
get
al
ot
of
inp
ut
inf
orm
ati
on
for
ou
rR
&D
.”
(C
as
eC
's
An
nu
al
rep
or
t,
20
01
:6
)
2.
“W
et
ry
to
co
mb
ine
ou
rm
ain
ten
an
ce
an
d
rem
ote
da
ta.
Th
en
ex
ts
tep
is
to
ac
hie
ve
be
ne
fits
thr
ou
gh
int
egr
ati
on
of
rem
ote
an
ds
erv
ice
kn
ow
-
ho
w.
”(
He
ad
of
Bu
sin
ess
De
ve
lop
me
nt
)
3.
“W
he
nw
eb
egi
nt
op
rov
ide
tot
al
sol
uti
on
st
o
ou
rc
ust
om
ers
,w
en
eed
to
un
de
rst
an
dt
he
ir
bu
sin
ess
en
vir
on
me
nt
ex
tre
me
ly
we
ll.
W
he
nw
e
go
to
tal
kt
oo
ur
cu
sto
me
rs
an
dp
rov
ide
for
ex
am
ple
ou
tso
urc
ing
ser
vic
es,
we
ne
ed
to
ha
ve
ma
ny
co
mp
ete
nc
ies
eve
nb
efo
re
we
eve
nb
egi
nt
o
ne
go
tia
te
wi
th
the
m.
”(
Ma
na
ge
r)
4.
“T
he
Ca
se
C
au
tom
ati
on
an
ds
oft
wa
re
de
vel
op
me
nt
un
itw
as
fou
nd
ed
to
be
tte
ru
tili
ze
the
sca
le
of
Ca
se
C's
bu
sin
ess
an
df
urt
he
rd
eve
lop
sof
tw
are
pro
du
cts
for
all
bu
sin
ess
lin
es.
”(
Ca
se
C's
An
nu
al
rep
or
t2
01
0:
5)
5.
“W
eh
av
et
oh
av
ep
ers
on
ne
lw
ho
are
ins
ide
the
fac
tor
y,
ou
ro
wn
me
n,
ou
ro
wn
ma
int
en
an
ce
1.
“W
eh
av
em
ad
em
ore
tha
n2
0a
cq
uis
itio
ns
ea
ch
ye
ar
to
inc
rea
se
ou
rm
ain
ten
an
ce
ba
se.
”
(C
EO
)
2.
“W
ea
re
tec
hn
olo
gy
ex
pe
rts
.B
ut
we
ne
ed
to
int
egr
ate
tha
tin
to
ou
rs
erv
ice
bu
sin
ess
an
d
un
de
rst
an
din
gc
ust
om
er
va
lue
an
db
ein
g
hu
mb
le
in
the
cu
sto
me
rw
ork
.I
'm
gla
dw
e
ha
ve
be
en
ab
le
to
fin
dt
ha
tk
ind
of
pe
rso
n.”
(A
rea
Ma
na
ge
r)
3.
“Q
ua
nti
fyi
ng
cu
sto
me
rv
alu
ed
uri
ng
the
sal
es
ph
ase
isc
ruc
ial
.W
en
eed
to
inc
rea
se
ou
r
pro
du
cti
vit
yi
nt
he
fie
ld
an
dc
ap
tur
ea
nd
ver
ify
the
rea
lv
alu
ef
or
the
cu
sto
me
r.”
(A
rea
Ma
na
ge
r)
4.
“T
he
CI
O
po
sit
ion
off
ers
av
an
tag
ep
oin
t
ac
ros
st
he
wh
ole
co
mp
an
y.
Ic
an
no
tt
hin
ko
f
an
yo
the
rr
ole
in
wh
ich
yo
ug
et
to
wo
rk
wi
th
eve
ry
sin
gle
fun
cti
on
.”
(C
IO
)
5.
“W
eh
av
eo
ur
ow
nt
ech
nic
al
sch
oo
lw
he
re
we
tra
in
ou
rp
eo
ple
an
ds
ub
co
ntr
ac
tor
s.
It's
co
nti
nu
ou
st
rai
nin
g.
W
ea
re
ag
lob
al
co
mp
an
ya
nd
we
ac
qu
ire
al
ot
of
inf
orm
ati
on
tha
tw
es
ha
re
thr
ou
gh
the
se
tra
ini
ng
s.”
(A
rea
Ma
na
ge
r)
(co
nti
nu
ed
on
ne
xt
pa
ge)
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
97
Ta
bl
e3
(co
nti
nu
ed
)
Ca
se
A
Ca
se
B
Ca
se
C
Ca
se
D
ser
vic
es,
so
tha
t's
ma
yb
et
he
big
ges
td
iff
ere
nc
e.
Ou
rc
om
pe
tito
rs,
the
yd
on
'tr
ea
lly
ha
ve
thi
sw
ide
glo
ba
ln
etw
ork
of
the
ir
ow
np
eo
ple
'sc
om
pa
nie
s.
Th
at'
sp
rob
ab
ly
ou
rb
igg
est
co
mp
eti
tiv
ee
dg
e.”
(V
P)
5.
“O
ur
ser
vic
eh
as
mo
stl
yb
een
ab
ou
ta
dv
iso
r-
typ
eo
fp
rov
isi
on
to
the
cu
sto
me
r.
Th
is
en
ab
les
us
to
ob
tai
nb
ett
er
ma
rgi
ns.
Of
co
urs
e,
we
do
n't
ha
ve
ful
lre
spo
nsi
bil
ity
for
the
fac
tor
y's
ma
int
en
an
ce
in
thi
sc
ase
eit
he
r.”
(D
ire
cto
r,
Sit
eS
erv
ice
s)
pe
op
le…
wh
oh
av
eb
een
tra
ine
dt
od
ot
ha
t
ma
int
en
an
ce
job
.”
(A
rea
Ma
na
ge
r)
Se
rv
iti
za
tio
n
sh
ap
ing
afi
rm
's
po
we
rp
os
iti
on
(1
.
Co
mp
ati
bil
ity
co
nt
ro
lo
fc
om
po
ne
nt
s;
2.
Lif
e-
cy
cle
co
nt
ro
l;
3.
Ta
kin
go
ve
ri
nt
erm
ed
iar
ies
)
1.
“L
ast
sum
me
rw
ea
cq
uir
ed
thi
s[
so
ftw
are
]
co
mp
an
yt
ha
th
as
inc
rea
sed
ou
rs
co
pe
of
off
eri
ng
s.
To
da
yw
ec
an
say
tha
tw
eh
av
et
he
mo
st
ex
ten
siv
eo
ffe
rin
gi
nt
he
ind
ust
ry.
”(
CI
O)
2.
“If
yo
ua
re
an
int
egr
ato
ry
ou
get
the
sta
nd
ard
pro
du
ct
of
the
pro
pe
lle
r,
yo
ug
et
the
sta
nd
ard
pro
du
ct
of
an
en
gin
e,
an
dy
ou
ha
ve
to
pu
tt
he
m
tog
eth
er
wi
tho
ut
ma
tch
ing
the
pe
rfo
rm
an
ce;
thi
s
me
an
st
ha
tit
'sa
dis
ast
er—
yo
uc
an
sti
ll
som
eti
me
sh
av
et
wo
diff
ere
nt
sup
pli
ers
,a
nd
yo
u
ha
ve
to
ma
tch
the
m,
me
an
ing
tha
tt
he
re
is
al
ot
of
wo
rk
wi
th
dra
wi
ng
sa
nd
thi
sa
nd
tha
t…
.O
f
co
urs
e,
we
ca
np
rom
ise
be
tte
rw
arr
an
ty
ter
ms
be
ca
use
we
ha
ve
co
ntr
ol
ov
er
the
wh
ole
thi
ng
…
”
(G
en
era
lM
an
ag
er)
3.
“W
he
nt
he
cu
sto
me
rp
res
en
ts
us
wi
th
an
inq
uir
y,
the
dia
log
ue
ha
sb
een
go
ing
on
for
som
e
tim
ea
lre
ad
y.
Th
ec
on
cep
ts
are
mo
re
or
les
s
rea
dy
,a
nd
it's
diffi
cu
ltt
oi
nfl
ue
nc
e.
Yo
uc
an
do
thi
ss
om
ew
ha
t,
bu
tfi
ve,
six
ye
ars
ag
o,
we
tho
ug
ht,
‘ho
w
ca
nw
ec
ha
ng
et
his
?’
An
dw
es
aw
tha
ts
hip
de
sig
ne
rs
are
alw
ay
se
arl
yb
eca
use
tha
t's
be
for
ey
ou
go
to
the
ya
rd,
an
dy
ou
ne
ed
to
ha
ve
ad
esi
gn
of
wh
at
kin
do
fs
hip
.T
ha
t's
wh
y
we
ac
qu
ire
ds
eve
ral
shi
pd
esi
gn
co
mp
an
ies
ba
ck
the
n…
,s
ot
od
ay
,w
eh
av
e4
00
pe
op
le
rou
gh
ly
wo
rki
ng
on
shi
pd
esi
gn
s.
Th
ese
pe
op
le
are
inv
olv
ed
wi
th
shi
ps
ow
ne
rs
in
rea
lly
ea
rly
ph
ase
s,
de
vel
op
ing
…
”(
VP
)
1.
“L
ast
ye
ar
we
ha
do
ne
eq
uip
me
nt
de
liv
ery
un
de
rn
ego
tia
tio
n.
W
eg
ot
the
de
al…
be
ca
use
we
un
de
rst
oo
dt
op
rov
ide
O&
M
sol
uti
on
ea
rly
en
ou
gh
.O
ur
tot
al
sol
uti
on
wa
sm
ore
ex
pe
nsi
ve,
bu
tw
eg
ot
the
de
al
be
ca
use
we
ma
de
pro
mi
ses
to
the
cu
sto
me
ra
bo
ut
usa
bil
ity
etc
.”
(D
ire
cto
r,
Gl
ob
al
Se
rv
ice
Op
era
tio
ns
)
2.
“W
he
nw
es
ell
the
se
kin
ds
of
lon
g-l
ast
ing
pro
du
cts
,w
eh
av
et
og
ive
ap
ict
ure
tha
tw
ec
an
co
ntr
ol
the
pro
du
ct
du
rin
gt
he
wh
ole
life
-cy
cle
.
No
w
thi
si
sn
ot
ha
pp
en
ing
.”
(Su
sta
ina
bil
ity
Ma
na
ge
r)
3.
“…
W
ea
re
sel
lin
gt
oe
ng
ine
eri
ng
co
mp
an
ies
,
an
dt
he
en
gin
eer
ing
co
mp
an
ies
are
sel
lin
gt
ot
he
en
dc
ust
om
er.
An
dt
he
en
gin
eer
ing
co
mp
an
ies
are
no
tin
ter
est
ed
in
bu
yin
gs
erv
ice
sf
rom
us.
Th
us,
ho
w
are
we
ab
le
to
co
nn
ect
wi
th
the
en
dc
ust
om
er
an
da
tt
he
sam
et
im
et
os
ell
pro
du
cts
to
the
en
gin
eer
ing
co
mp
an
y?
Th
is
is
the
wa
yw
ea
re
mo
vin
g,
to
tak
et
he
EP
C
an
dE
PC
M
rol
e,
so
we
wo
uld
n't
ne
ed
en
gin
eer
ing
co
mp
an
ies
,b
ut
ma
yb
e
we
wo
uld
use
the
m
as
sub
co
ntr
ac
tor
s,
no
tv
ice
ve
rsa
.(
He
ad
of
Se
rv
ice
s)
1.
“O
ne
int
ere
sti
ng
pa
th
wo
uld
inv
olv
et
ak
ing
ful
l
res
po
nsi
bil
ity
for
the
en
tir
el
ifti
ng
pro
ces
s.
W
ed
o
al
ot
of
wo
rk
wi
th
thi
si
ssu
e.”
(D
ire
cto
r,
Op
era
tio
ns
De
ve
lop
me
nt
)
2.
“O
ur
pre
dic
tio
ni
sb
ase
do
nh
ist
ori
ca
ld
ata
.
W
eh
av
ea
lso
ga
ine
dd
ata
thr
ou
gh
rem
ote
ser
vic
es
ab
ou
tw
ha
tt
he
ch
an
ge
int
erv
als
an
d
ca
lcu
lat
ory
life
tim
es
ha
ve
be
en
for
som
ec
rit
ica
l
co
mp
on
en
ts.
Th
ese
ha
ve
be
en
str
ate
gic
de
cis
ion
s
for
som
es
pe
cifi
cp
rod
uc
ts.
”(
VP
)
3.
“O
ur
po
sit
ion
in
Fin
lan
di
sv
ery
str
on
g.
Id
on
't
see
tha
tw
ew
ou
ld
pro
gre
ss
wi
th
the
dis
tri
bu
tor
s
he
re,
bu
td
ist
rib
uto
rs
are
ver
yi
mp
ort
an
tw
he
n
en
ter
ing
ne
w
co
un
tri
es.
”(
VP
,B
us
ine
ss
lin
e)
1.
“T
he
fir
m
ha
sf
ull
res
po
nsi
bil
ity
for
its
pro
du
ct
for
its
cu
sto
me
rs
-e
ven
fro
m
the
are
as
it's
no
tw
ork
ing
on
its
elf
.”
(C
EO
)
2.
“T
od
ay
,c
ust
om
ers
un
de
rst
an
dt
he
im
po
rta
nc
eo
fl
ife
-cy
cle
co
sts
we
ll.
Lif
e-c
yc
le
eva
lua
tio
ns
an
ds
erv
ice
sa
re
an
im
po
rta
nt
pa
rt
of
ha
rdw
are
sal
es
tod
ay
.”
(A
rea
Ma
na
ge
r)
3.
“A
fif
th
im
po
rta
nt
de
vel
op
me
nt
are
ai
n
Ch
ina
is
to
de
vel
op
the
ser
vic
eb
usi
ne
ss.
In
Ch
ina
,t
he
ma
rke
ts
tru
ctu
re
is
diff
ere
nt,
as
dis
tri
bu
tor
sp
lay
an
im
po
rta
nt
rol
ei
ns
ell
ing
the
eq
uip
me
nt.
”(
CE
O)
Effi
cie
nc
y(
1.
Up
str
ea
m
effi
cie
nc
y;
2.
Do
wn
str
ea
m
effi
cie
nc
y;
3.
To
tal
Co
st
of
Ow
ne
rsh
ip
(T
CO
);
4.
Se
rv
ice
ind
us
tri
ali
za
tio
n;
5.
Mu
tu
al
ris
k-s
ha
rin
g;
6.
Tr
us
tb
uil
din
g)
1.
“I
do
n't
ne
ces
sar
ily
me
an
tha
tw
ea
re
go
ing
to
de
vel
op
all
thi
s,
bu
tw
ep
rob
ab
ly
ha
ve
ou
r
sol
uti
on
sf
or
en
gin
es
an
dp
rop
ell
ers
an
dt
hru
ste
rs
an
dm
ay
be
ele
ctr
ica
lm
oto
rs.
Th
en
,w
en
eed
to
co
nn
ect
thi
st
os
om
ee
xte
rn
al
thi
rd-
pa
rty
pa
rtn
ers
wh
ot
he
nm
ay
be
co
me
wi
th
we
ath
er
rou
tin
go
rw
ha
tev
er
iti
s.
Bu
tw
ea
re
ma
yb
et
he
int
egr
ato
r…
we
pro
vid
ea
llt
his
va
ria
ble
inf
orm
ati
on
,a
nd
we
pu
tt
og
eth
er
the
se
pe
rfo
rm
ers
'g
ua
ran
tee
s,
bu
tt
he
nw
ew
ork
wi
th
som
eo
the
rp
rov
ide
rs.
”(
Di
rec
tor
,M
ain
ten
an
ce
)
2.
“W
eh
av
eb
een
ab
le
to
bu
nd
le
the
se
tec
hn
olo
gie
si
nto
pe
rfo
rm
an
ce-
ba
sed
co
ntr
ac
ts.
Ou
rc
ust
om
ers
pa
yf
or
the
co
st
sav
ing
st
ha
ta
re
en
ab
led
by
ou
rn
ew
tec
hn
olo
gy
.”
(M
an
ag
er,
Str
ate
gic
Al
lia
nc
es)
3.
“…
Th
ec
ust
om
er
is
pre
pa
red
to
bu
yd
esi
gn
fro
m
us
an
dh
ei
sp
rep
are
dt
ob
uy
all
the
ma
ch
ine
ry
for
his
ten
ves
sel
s,
an
dh
ei
sa
lre
ad
y
co
nsi
de
rin
gt
os
ign
afi
ve-
or
ten
-ye
ar-
lon
g
ser
vic
ea
gre
em
en
ts
ot
his
is
wh
ere
we
co
me
int
o
1.
“W
es
hif
tt
he
se
res
po
nsi
bil
itie
st
oo
ur
ne
tw
ork
of
sub
co
ntr
ac
tor
st
oo
,s
ot
he
yw
ork
tow
ard
ou
r
mu
tua
lg
oa
ls.
W
em
ea
sur
eh
ow
go
od
the
sup
pli
er
is.
”(
Sit
eD
ire
cto
r)
2.
“O
ne
of
ou
rs
tra
teg
ic
ob
jec
tiv
es
is
to
inc
rea
se
ou
ro
ver
all
effi
cie
nc
ya
nd
de
vel
op
ou
rs
erv
ice
bu
sin
ess
.”
(V
P,
Str
ate
gy
)
3.
“T
ota
lc
ost
of
ow
ne
rsh
ip
is
an
im
po
rta
nt
me
tri
cs
to
us
as
we
lla
sc
ost
pe
rt
on
.T
ha
t
me
asu
res
ou
ro
pe
rat
ion
al
effi
cie
nc
y.
Al
so,
en
erg
y
co
st
is
vit
al
as
the
cu
sto
me
r's
top
ex
ecu
tiv
es
em
ph
asi
ze
tha
t.”
(H
ea
do
fS
erv
ice
s)
4.
“W
ea
re
go
ing
mo
re
tow
ard
O&
M
ag
ree
me
nts
in
wh
ich
the
cu
sto
me
rp
ay
sfi
xe
dp
ric
ea
nd
we
att
em
pt
to
op
tim
ize
the
co
nsu
mp
tio
no
fs
pa
re
pa
rts
an
dm
ain
ten
an
ce
cy
cle
s…
W
es
eek
op
po
rtu
nit
ies
to
cre
ate
ser
vic
ep
ac
ka
ges
tha
t
co
mb
ine
the
OP
EX
an
dC
AP
EX
bu
sin
ess
es.
”(
VP
,
Str
ate
gy
)
5.
“O
ur
cu
sto
me
rs
wa
nt
to
mi
tig
ate
the
ir
ris
ks
rel
ate
dt
ot
he
ir
ow
nb
usi
ne
ss…
Is
ee
tha
t
1.
“W
ed
ecr
ea
se
the
nu
mb
er
of
sup
pli
ers
be
ca
use
we
wa
nt
to
co
lla
bo
rat
em
ore
wi
th
the
m.
Th
at'
s
ou
rp
rim
ary
go
al.
By
cen
tra
liz
ing
pu
rch
ase
s,
it's
po
ssi
ble
to
ac
hie
ve
co
st
be
ne
fits
.”
(C
PO
)
2.
“O
ur
tar
get
is
[to
]o
bta
in
co
st-
sav
ing
st
hro
ug
h
co
st-
effi
cie
nc
y…
we
ma
ke
ap
rofi
ta
nd
los
s
ac
co
un
ta
nd
ch
oo
se
ou
rt
arg
et
for
the
bo
tto
m
lin
e.
W
eo
fte
nh
av
ea
tar
get
pri
ce,
wh
ich
isl
ink
ed
to
the
cu
sto
me
r's
pro
du
cti
on
'so
utp
ut.
W
ea
tte
mp
t
to
ob
tai
nl
ow
er
co
sts
tha
nt
ha
t.
Bo
nu
ss
an
cti
on
s
are
als
ou
tili
zed
to
get
the
job
do
ne
.F
urt
he
rm
ore
,
me
asu
res
suc
ha
sq
ua
lity
,u
sed
ca
pa
cit
y,
an
dt
he
nu
mb
er
of
ma
lfu
nc
tio
ns
are
me
asu
red
to
en
sur
e
tha
tw
ea
re
go
ing
in
the
rig
ht
dir
ect
ion
.”
(Se
rv
ice
Di
rec
tor
)
3.
“…
Ho
we
ver
,w
es
ay
tha
tw
ea
re
ch
ea
pe
ri
n
ter
ms
of
life
-cy
cle
co
sts
be
ca
use
we
ha
ve
suc
ha
da
mn
go
od
ser
vic
eo
rga
niz
ati
on
…
in
the
en
d,
the
life
-cy
cle
co
st
is
low
er
an
dr
em
ote
sup
po
rts
all
of
thi
s.”
(R
em
ote
Se
rv
ice
Pr
od
uc
tM
an
ag
er)
4.
“T
he
ke
yd
riv
er
wa
st
oa
ch
iev
el
arg
ev
olu
me
s,
1.
–
2.
“W
eh
av
ef
oc
use
do
ni
mp
rov
ing
qu
ali
ty
iss
ue
sa
nd
pro
du
cti
vit
y[
in
ser
vic
es]
.”
(Se
rv
ice
De
ve
lop
me
nt
Di
rec
tor
)
3.
“B
ut
for
the
life
tim
e,
ye
s[
it's
ch
ea
pe
st]
…
no
rm
al
life
tim
ee
xp
ect
an
cy
is
15
ye
ars
on
a
cru
ise
shi
p,
an
dw
e'r
ew
ay
pa
st
tha
t,
sti
ll
run
nin
g.”
(H
ea
d
of
Se
rv
ice
s)
4.
“W
eh
av
et
oa
ch
iev
ef
ast
er
res
po
nse
tim
es
wi
th
low
er
co
sts
.W
eh
av
et
ou
tili
ze
the
de
nsi
ty
of
ou
ri
nst
all
ed
ba
se.
W
en
eed
to
op
tim
ize
the
wo
rk
we
are
do
ing
.”
(A
rea
Ma
na
ge
r)
5.
“…
W
eh
av
et
his
kin
do
fi
de
at
ha
tt
he
cu
sto
me
rd
oe
sn'
th
av
et
ot
ran
sfe
ra
llo
fh
is
ris
ks
to
us,
bu
th
ec
an
ke
ep
pa
rt
of
the
ris
k
him
sel
fa
nd
mo
ve
an
oth
er
pa
rt
to
us”
(Se
rv
ice
Ma
na
ge
r)
6.
“W
en
eed
fac
e-t
o-f
ac
es
erv
ice
s.
W
en
eed
me
eti
ng
st
ob
uil
dt
rus
t.
Th
at
tru
st
is
no
t
cre
ate
dt
hro
ug
he
-m
ail
s,
SM
So
re
xtr
an
et
(co
nti
nu
ed
on
ne
xt
pa
ge)
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
98
It has been more to outsource. Of course, this can be a problem.
Thus, we are using other suppliers, too [dual sourcing]… so there's a
contract with a supplier, and they have to sign for the intellectual
property rights (Director, Case A).
In contrast, the level of vertical integration increases at the down-
stream end. The companies do not use alliances, licensing agreements,
or joint ventures. Instead, new investments, acquisitions, and stake-ins
are the preferred strategic practices to acquire the service-related
knowledge and operative capacity required for service delivery while
building a proper service network (Fig. 2). Our data demonstrate not
only the need to diversify the industry risk, expand the installed base,
and become closer to customers while packaging services for higher
margins but also the attempt to safeguard the strategic domain and
leverage capabilities that lead the case firms to shift to vertical in-
tegration (Cacciatori & Jacobides, 2005; Davies et al., 2006; Hax &
Wilde II, 1999; Wise & Baumgartner, 1999). Table 3 provides quotes
illustrating how servitization shapes manufacturers' boundaries.
Through acquisitions, Case B strives to increase its sales, strengthen
its market position, add resources and know-how and expand its
technology and service offerings. Furthermore, acquisitions can be
focused on areas that reduce Case B's sensitivity to fluctuations in
the mining and metallurgical industries (Annual report, Case B).
4.1. Reconfiguring corporate identity as a solution provider
Organizational identity answers questions such as who we are as an
organization. While challenging the existing business logic, mindset,
and corporate identity, the service transition involves a change in
companies' identity along with a reconsideration of the scope of their
vertical positioning. The interviewees had many ways to describe the
change in their corporate identity from a product and technology or-
ganization to a customer solution provider. Commonly, they concluded
that the change was intense and that it influenced offerings, processes,
structures, and organizational culture such that they found a balance
between efficiency-centered manufacturing values and service-oriented
values, which are based on customization and flexibility (Gebauer,
Fleisch, & Friedli, 2005). The interviewees indicated that their organi-
zational identity did not completely change and that the service identity
was built on top of the firm's technological heritage. In addition, the
shift in corporate identity has been institutionalized to an extent, with
examples found in annual reports, official documents, and our inter-
views.
…It's a fundamental change to really only think about the tech-
nology, the hardcore equipment to start thinking of all the services
related to that, and the customer from a different perspective and
angle... (Head of Services, Case B).
Defined as the “general expression of the overall purpose of the
organisation, which, ideally, is aligned with the values and expectations
of major stakeholders and concerned with the scope and boundaries of
the organisation” (Johnson, Scholes, & Whittington, 2008: 10), a
company's mission constitutes an essential part of its core organiza-
tional ideology (Collins & Porras, 1996). The corporate identity at-
tached to an organization by its executives can be imperfectly projected
in objective public documents and mission statements (Rodrigues &
Child, 2008). Although not an entirely accurate image, examining how
their missions have evolved can be an imperfect but still suitable il-
lustration and reflection of the evolution of the firm's identity (Vaara &
Tienari, 2011; see Table 4).
Although altering the organizational identity through a new mission
and vision statements is an important tool (Clark et al., 2010), man-
agers' articulation of the company vision was identified as a funda-
mental step in determining the formation process (Gioia, Price,
Hamilton, & Thomas, 2010). According to Rodrigues and Child (2008:
890), “top managers may try to foster an organizational culture thatTa
bl
e3
(co
nti
nu
ed
)
Ca
se
A
Ca
se
B
Ca
se
C
Ca
se
D
the
pic
tur
e.
Th
us,
as
suc
h,
in
life
-cy
cle
sol
uti
on
s,
the
yd
on
'td
eve
lop
som
eth
ing
by
the
ms
elv
es.
”
(D
ire
cto
r,
Ma
int
en
an
ce
)
4.
“In
ou
rs
tra
teg
y,
we
ha
ve
thr
ee
iss
ue
s:
1)
effi
cie
nc
y,
2)
en
vir
on
me
nt,
an
d3
)l
ife
-cy
cle
…
W
ed
eve
lop
tec
hn
olo
gie
st
ha
te
na
ble
the
cre
ati
on
of
cu
sto
me
rb
en
efi
t.”
(D
ire
cto
r,
So
lut
ion
s)
5.
“P
art
of
wh
at
we
ne
ed
are
ne
w
too
ls
to
pu
tu
s
in
as
itu
ati
on
wh
ere
we
rea
lly
ca
ng
ua
ran
tee
som
ep
erf
orm
an
ce.
An
dt
he
pri
cin
gi
st
he
nm
ay
be
pre
tty
mu
ch
ac
co
rdi
ng
ly,
pro
vid
ed
tha
tw
e
ac
hie
ve
thi
sp
erf
orm
an
ce…
If
it's
les
s,
I'm
pre
pa
red
to
sha
re
tha
tr
isk
,t
he
ny
ou
're
go
ing
to
pa
ym
el
ess
.B
ut
in
the
be
st
ca
se,
if
we
ac
tua
lly
ma
na
ge
to
ex
cee
dt
he
tar
get
lev
el
an
di
ft
ha
t
inc
rea
ses
cu
sto
me
r's
inc
om
e,
Iw
an
tp
art
of
tha
t
as
som
es
ort
of
bo
nu
st
he
n.”
(D
ire
cto
r,
Ma
int
en
an
ce
)
6.
“A
pro
du
ct
ow
ne
rm
igh
tb
ew
ork
ing
in
all
the
ma
jor
hu
bs
all
ov
er
the
wo
rld
,a
nd
the
ni
t's
for
sur
ea
big
ad
va
nta
ge
if
yo
uc
ou
ld
ha
ve
as
erv
ice
pro
vid
er
lik
eu
sw
ho
yo
uc
an
tru
st.
”(
Di
rec
tor
,
Ma
int
en
an
ce
cu
sto
me
rs
inc
rea
sin
gly
wa
nt
us
to
mo
de
la
nd
co
mm
itt
oc
ert
ain
lev
el
of
effi
cie
nc
y.
An
dt
he
y
pa
yf
or
it”
(V
P,
Se
rv
ice
s)
6.
“W
eh
av
et
og
ot
ot
he
dir
ect
ion
tha
tw
et
alk
ab
ou
to
ur
cu
sto
me
r's
str
ate
gy
.T
his
me
an
st
ha
t
the
re
ha
st
ob
et
rus
t.
W
eh
av
ea
ver
ys
tru
ctu
red
sys
tem
ho
w
we
ma
na
ge
ou
rc
ust
om
er
rel
ati
on
shi
ps.
”(
VP
,S
ale
s)
eve
nt
ho
ug
hw
es
pe
nt
lot
of
mo
ne
yo
nt
his
[d
igi
tal
ser
vic
ed
eve
lop
me
nt]
…
In
ah
igh
-
vo
lum
eb
usi
ne
ss,
we
ne
ed
to
ac
hie
ve
ex
tre
me
ly
low
un
itc
ost
s.”
(H
ea
do
fB
us
ine
ss
De
ve
lop
me
nt
)
5.
“W
eh
av
em
ov
ed
to
an
ins
ura
nc
e-b
ase
d
mo
de
l.I
nt
ha
tm
od
el,
we
tak
et
he
ris
ka
nd
sha
re
itw
ith
the
cu
sto
me
r.”
(H
ea
do
fB
us
ine
ss
De
ve
lop
me
nt
)
6.
“C
ust
om
ers
ca
ns
ee
the
rea
l-ti
me
da
ta.
W
e
ha
ve
cre
ate
dd
iff
ere
nt
mo
de
ls,
bu
tw
et
ry
to
sup
po
rt
ou
rc
ust
om
er
thr
ou
gh
the
eq
uip
me
nt
da
ta.
Ou
rs
erv
ice
pe
op
le
ca
ns
ee
the
inf
orm
ati
on
,
an
dt
he
cu
sto
me
rh
as
po
ssi
bil
ity
to
see
the
inf
orm
ati
on
too
.”
(C
ate
go
ry
Ma
na
ge
r)
ser
vic
es.
Tr
ust
is
cre
ate
df
ac
e-t
o-f
ac
ea
nd
thr
ou
gh
ser
vic
es.
W
en
eed
to
go
thr
ou
gh
iss
ue
s,
an
dw
eh
av
es
yst
em
st
ha
ts
up
po
rt
thi
s
tru
st
bu
ild
ing
.”
(A
rea
Ma
na
ge
r)
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
99
lends credibility to their desired corporate identity”, as shown in the
interviewees' accounts.
Modifying corporate identity does not imply an instantaneous
change in organizational identity and culture. Such a change takes a
long time to institutionalize. While hiring new people with different
attitudes and mind-sets was used “as [a] boundary mechanism to re-
shape identity” (Santos & Eisenhardt, 2005: 503), identity change has
also increased the need to acquire new knowledge (Nag et al., 2007)
and control industry bottlenecks (Jacobides, 2011) to create and im-
plement innovative solutions while assuring system reliability and
profitability (Salonen, Gabrielsson, & Al-Obaidi, 2006) and guaran-
teeing life-cycle performance (Rabetino, Kohtamäki, Lehtonen, &
Kostama, 2015). Overall, every case firm began to emphasize its cus-
tomers' productivity gains as a part of their organizational purpose, as
evident in Table 4.
4.2. Developing new capabilities for going downstream
Shifting toward a customer-centric organization increases the need
to develop new capabilities to deliver novel solutions to different cus-
tomers (Brady et al., 2005; Ceci & Masini, 2011; Penttinen & Palmer,
2007). Notably, the case firms obtained new service-related capabilities
through acquisitions, as acquisitions enable firms to obtain service
competencies rapidly.
…We made a lot of acquisitions—I think almost 10 acquisitions that
are more or less service related. That has been a quick way to get
services-oriented people with a service-mindset in the company.
(Head of Services, Case B).
The studied companies considered customer solutions a potential
competitive advantage source that would require some reconfiguration
of resources and the actualization of processes. The respondents high-
lighted the importance of developing capabilities to bundle products
and services into effective solutions. All case firms acknowledged that
the performance edge depends on how technology and services are
intertwined:
You won't be successful at selling pure technology, because every-
body can do it, probably even cheaper than you can do it. Thus,
technology itself cannot be your competitive advantage.
Competitive advantage emerges from your ability to transform
technology into services. (Product manager, Case C).
The transformation from products to customer solutions intersects
with strategic capabilities by providing opportunities to develop new
capabilities while establishing expectations about capability develop-
ment to cocreate and capture value from solutions. The interviewees
emphasized several capabilities that are central to integrated solutions,
such as solution selling capabilities.
One of our strategic development programs is to develop sales
competencies. Selling solutions, selling value and quantifying the
delivered value during the sales process are our focus areas. (Area
manager, Case D).
Additionally, all studied corporations invested in building software
capabilities, which are primarily related to remote services and auto-
mation. The transition from manufacturing-based to digitally enabled
business strategies requires new types of capabilities and investments.
Simultaneously, this transition creates a significant challenge for the
organizational identity as executives must consider whether they are
software companies or technology companies.
… If I look at the bigger attempt that we made [in terms of acqui-
sitions], sometimes, it might be something more than just physical
products or conventional industrial services. It might be things like
software. Now these optimizers and condition-based monitoring are
so important for us that we might even need software products or
some kind of…software as a service capability (Director, Case A).
Furthermore, the interviewees stressed the importance of building a
global network for achieving the required field service capacity to de-
liver solutions. Moving downstream requires firms to develop compe-
tencies related to network management. The capability of orchestrating
the supplier network was reminiscent of the “system-integrator”
strategy, while the capability of orchestrating the fleet or customer
network was considered as an adoption of a “system-seller” strategy.
In the 90s, we started to understand that in the upstream, we had to
work closely with the most advanced partners. Developing and
learning jointly with these component and module suppliers, it was
possible to build competitiveness and differentiate ourselves (CEO,
Case D).
4.3. Shifting positions to increase the bargaining power in the ecosystem
Repositioning can be analyzed by examining the different me-
chanisms developed during the establishment of the customer solutions
strategy. Based on their acquisitions and investments, the case com-
panies moved downstream not only to gain bargaining power vis-à-vis
intermediate and end customers but also to control compatibility and
technical aspects in the systems to warrant a performance threshold.
Delivering customer solutions requires companies to address spe-
cific customer preferences and required technical features simulta-
neously, which are two critical dimensions explaining manufacturers'
need to control how components and subsystems are coupled when
providing complex solutions (Baines et al., 2011). Thus, because
Table 4
The evolution of companies' identities during service transition.
Case Mission/Vision/Strategy Intent
Case A 2000–2002
Case A develops efficient and sustainable equipment and
services.
2003–2004
Case A develops efficient, reliable, and
sustainable solutions.
2005–2014
Case A develops sustainable and complex lifecycle
solutions
Case B 2007–2014
Case B offers cutting-edge, innovative, and sustainable solutions to process industries.
Case C 2003–2005
Case C develops and provides cutting edge technical solutions
and associated maintenance services that offer the lowest
cost of ownership and maximize uptime.
2006–2010
Case C offers customer services to
improve customers' performance and
their entire businesses.
2011–2014
Case C offers productive and safe operations and
improves customers' entire businesses through real-time
data.
Case D 2006–2007
Case D contributes to the core of the customer's system.
2008
Case D contributes to the fluid
movement of citizens and materials.
2012–2013
Case D's strategy is to deliver a performance edge for
B2B customers by offering innovative, cost-
competitive, and sustainable solutions.
SOURCE: Authors' summaries and interpretations based on companies' annual reports and other public materials. Original quotes have not been used to secure
companies' anonymity (original meaning remains).
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
100
solution providers must guarantee system compatibility based on cer-
tain specifications to offer a threshold level of performance and custo-
mized services (Davies, 2004), servitization calls for a specific gov-
ernance structure to coordinate activities within the ecosystem
(Osegowitsch & Madhok, 2003). Product control becomes essential
when a manufacturer becomes responsible for a product's functionality
or produced outcomes (e.g., in O&M agreements).
The service business enables us to manage and control the product
and customer through the product life-cycle. This enables us to
know how our products function during the life cycle and what is
required at different stages. Additionally, this enables us to under-
stand our customers' requirements and needs better. This is the
benefit of services. (Area manager, Case D).
Although the studied firms used to operate as subsystem providers,
they found it challenging to access end-users because third parties
controlled such access. For the case companies, the fact that current
customers blocked them from selling integrated solutions to their cus-
tomers' customers presented a significant challenge. When product
systems are sold to intermediate customers because of scale benefits,
service agreements should be separately sold to the system end-users to
obtain a direct connection to them. To overcome industry bottlenecks
and sell products and services simultaneously, the case companies had
to change their position and move downstream, closer to the end cus-
tomers. As suggested by Pil and Holweg (2006), the analyzed compa-
nies attempted to find permeable penetration points within the value
system to influence end-users' demands. This effort was validated by the
interviewees and multiple strategic actions, such as acquisitions and the
establishment of strategic alliances. Although distributors/dealers may
be beneficial when scaling the product business, they may hinder future
service sales. In particular, Case D acquired some distributors to get
access to end customers and retain service control. Furthermore,
manufacturers attempted to find different ways to decrease the power
of engineering companies in the value system, as they hindered service
sales to end-customers. One practice used to overcome this positioning
challenge was to bypass the engineering companies and build deep and
direct relationships with (end) customers, as occurred in Case B:
…We are selling to engineering companies, and they are selling to
the end customer. And, the engineering companies are not inter-
ested in buying services from us. Thus, how are we able to connect
with the end customer and at the same time to sell products to the
engineering company? This is the way we are moving, to take the
EPC and EPCM role, so we wouldn't need engineering companies,
but maybe we could use them as subcontractors, not vice versa. To
do that, you need to take a lot more risk. (Head of services, Case B).
4.4. Increasing efficiencies by selling customer solutions
Focusing deliveries on a smaller number of system integrators can
also decrease transaction costs by reducing the parties with whom the
customer needs to negotiate, although these changes add complexity to
certain manufacturer-customer relationships. In the long term, ex-
tending the transition to full-fledged customer solutions could decrease
the transaction costs by transferring the focus from complex technical
systems to the produced outcomes. Thus, transaction costs can be de-
creased in both upstream and downstream ends by increasing the size of
supplies from the system suppliers, by bundling individual products and
services into total solutions, or by building mutual trust and commit-
ment. In the upstream, the studied solution providers reported that
collaborating with many suppliers would increase their transaction
costs and inefficiency. Hence, alliances and joint-ventures are key co-
ordinating practices in the upstream that help companies to minimize
their transaction costs. Studied companies centralized purchases to
fewer system suppliers to generate efficiency benefits. The downside of
this action was the loss of control, which was replaced by a deeper
collaboration with customers enabled by smart solutions.
If suppliers are responsible for bigger entities, they have better op-
portunities to affect their own costs. When they can better direct
their own businesses, they have better possibilities to develop it.
(CPO, Case C).
The initial idea behind providing a solution is that one plus one is
more than two (Ulaga & Reinartz, 2011). Therefore, suppliers should
generate efficiency benefits through bundling separate offerings into
larger packages, and customers should obtain either direct or indirect
cost-savings through centralization benefits. In the solution business,
the goal is rarely to split the pie but instead to make a bigger pie
(Kowalkowski & Ulaga, 2017). To better control these life-cycle costs,
studied companies relied on strategic practices such as acquisitions,
new investments and stake-ins in the downstream end. Subsequently,
the respondents highlighted the need to emphasize the life-cycle costs
of the customer. Thus, the respondents highlighted the importance of
evaluating and verifying the equipment's total cost of ownership (TCO),
which required substantial changes in routines.
I prefer talking about the total value of ownership rather than the
total cost of ownership. Our customers can generate more money
when they use our technology. We have to ensure that we can get
added value and additional price for our solution. (VP/Sales, Case
C).
The interviewees emphasized the importance of trust among the
dyads for increasing efficiency in the upstream and downstream.
Building trust was seen as essential to providing services that enabled
customers to increase their productivity.
This is a very complicated model, but your credibility increases re-
markably when you can show professional reports to the customer.
You can show fact-based numbers and calculations. (Head of
Business Development, Case C).
4.5. Interplay between identity, power, capabilities, and efficiency
The decision to servitize is made to decommoditize products and
create higher value through differentiation by integrated solutions.
Servitization changes the manufacturer's logic regarding its identity,
power, capabilities, and efficiency. The opportunities generated by
servitization should not be evaluated only by utilizing single lenses; the
interplay among the lenses should also be considered.
This study underlines the effect of power, how servitization is uti-
lized as a strategic choice, and the means of differentiation to increase
manufacturers' power in the market by increasing the attractiveness of
their offerings. This increase in power can facilitate the internal tran-
sition toward servitization, as power rhetoric can be utilized to per-
suade organizational members to accept servitization as the new or-
ganizational identity. However, a stronger servitization identity may
enable more effective strategy implementation, further increasing a
manufacturer's capacity to use power at the microlevel, e.g., in solution
sales processes. A stronger service identity also seems to facilitate
capability development. A well-visualized servitization strategy signals
a firm's capability development requirements and supports capability
development from the microlevel to personnel development discussions
in which competence development targets are established. In some case
companies (particularly A and B), the top management board estab-
lished strategic initiatives to improve the status of services in-house,
attempting to improve the service's reputation by nominating (future)
talents to run services. In contrast, developing servitization capabilities
also shapes the organizational identity toward servitization.
A well-defined service identity may also decrease the transaction
costs caused by selling solutions because a firm's objectives related to
the development of services are more evident to customers. A stronger
service identity facilitates a firm's productization of services, further
generating efficiency benefits. Furthermore, a stronger service identity
provides the necessary commitment and stability to develop exchange
processes together with the customer. That said, the complexity of
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
101
solution sales may increase doubts about the servitization process re-
gardless of whether customer solutions can be sold and delivered effi-
ciently.
An improved power position in the downstream facilitates serviti-
zation capability investments, which, in turn, may support risk-taking
when making the investment decisions required for new capability
development. Nevertheless, strengthening capabilities may also im-
prove the manufacturer's power position in contrast to market compe-
tition. In particular, firms A and B implemented strategic initiatives to
bypass engineering companies (the bottlenecks) and sell more service to
end-customers. The question of power versus capabilities is reminiscent
of the chicken-and-egg dilemma, which makes it challenging to scru-
tinize whether power or capabilities were first to drive (re)positioning.
Increases in power enable the manufacturer to steer relational de-
velopment and improve relational efficiencies by lowering transaction
costs. Sharing the benefits between the manufacturer and the customer
incentivizes development, whereas using power exclusively to benefit
the manufacturer may increase the costs of customer interactions in the
long term, reminding us of the logic of a zero-sum game. Power against
capabilities is a double-edged sword. While the focal company may
become more powerful than its customers through its solutions, it si-
multaneously becomes more dependent on both suppliers' and custo-
mers' competencies and commitment. Capabilities enable the develop-
ment of relational exchange processes enabling transactional
efficiencies. Additionally, the improvement of exchange routines should
free resources for more creative development tasks in the relationships.
In the long run, the case companies could create a virtuous cycle for
solution business development. Although the firms experienced set-
backs during their servitization journeys, their overall performance in
services has been outstanding. This strategic transition required the
simultaneous development of a strong service identity, a more powerful
ecosystem position, new capabilities, and efficiency in transactions and
relationships. These changes have been interlinked. Consequently,
boundary movements must be concurrently analyzed through all of
these lenses. These simultaneous alterations explain how servitization
shapes a firm's boundary decisions, leading to repositioning moves and
generating various effects as conceptualized by the firm boundary
lenses and their dynamic interplay (Fig. 3).
5. Conclusions
5.1. Theoretical contribution
The present study examines four leading manufacturer boundary
delineations to address the question of strategic repositioning and firm
boundaries in servitization. The contributions of this article are two-
fold, as this study 1) demonstrates how servitization shapes manu-
facturers' firm boundaries through the identity, capability, power, and
efficiency lenses, and 2) shows the importance of the dynamic interplay
among these lenses when manufacturers are steered toward servitiza-
tion. Additionally, we crafted a managerial framework to facilitate firm
boundary delineation in servitization.
Regarding the first theoretical contribution, the four proposed firm
boundary lenses provide complementary explanations for the re-
positioning in servitization. Servitization involves an explicit redefini-
tion of a company's corporate identity, which affects the organizational
culture (e.g., because of the coexistence of different organizational
cultures inside the organization), with no single organizational identity
but many identities across the business units. During the transition,
rather than following a pure product or service logic, manufacturers
balance between product and service identities while adopting both
logics simultaneously (Ceci & Masini, 2011; Davies et al., 2007).
Therefore, the question of identity can take the form of “Who are we as
a unit in the organization?”, “What type of unit is this in the organi-
zation?” or “How do we contribute to our organization's overall pur-
pose?” Top management should consider these different subidentities
and make sense of the whole corporation's mission and identity.
While changing the organizational identity is not straightforward,
servitizing manufacturers must move downstream closer to the end-
users to establish a position as a solution provider. Repositioning in-
volves the need for using specific mechanisms to gain bargaining power
vis-à-vis intermediaries (e.g., bypassing intermediaries) and control
compatibility and technical aspects in the systems to warrant a per-
formance threshold. These moves not only directly imply reshaping
firm boundaries (e.g., through mergers, acquisitions, or direct invest-
ments to sell services directly to end customers) but also trigger addi-
tional boundary reshaping instances because of the need for developing
new capabilities in the customer interface and areas, such as software
development (Raja et al., 2018; Sklyar, Kowalkowski, Tronvåll, &
Sörhammar, 2019; Töytäri et al., 2018).
Efficiency also emerges as driving boundary changes in servitiza-
tion. Although procurement was often centralized to a few system
suppliers, the case companies have had to develop a reliable supply
base while finding mechanisms to cope with dependence and transac-
tion costs. Therefore, in addition to centralizing purchases to fewer
system suppliers at the upstream, companies developed not only me-
chanisms to assure deeper collaboration and trust among the dyads and
increase efficiency but also certain rules, such as a dual purchasing
policy, to limit dependence. Alliances and joint ventures are common
coordinating mechanisms in the upstream end that simultaneously
allow companies to minimize the transaction costs and exploit potential
localization advantages in cost-competitive countries, whereas acqui-
sitions, new investments and stake-ins are preferred practices in the
downstream end to ensure better life-cycle control.
Regarding the second theoretical contribution, this study exposes
the dynamic interplay of firm boundary theories in servitization.
Instead of focusing only on a single theory, the present study con-
centrated on the interplay among different perspectives (Bäck &
Kohtamäki, 2015). This requirement is reminiscent of a domino effect.
For instance, servitization may push the firm to establish a stronger
position on the customer end. To achieve such a position, the firm must
obtain, acquire, and develop new capabilities to sell and deliver ser-
vices to its clients (Danneels, 2011; Kindström et al., 2013). During
capability evolution, the firm should reconstruct the organizational
identity toward a more customer-centric approach. Finally, during the
lengthy process, the firm should also change its efficiency logic by in-
troducing service elements into its product and manufacturing opera-
tions while introducing production elements into its service operations
(Kohtamäki, Einola, & Rabetino, 2020; Spring & Araujo, 2013). All
these boundary decisions can occur simultaneously and require top
management attention. The idea of interplay supports the concept of
equifinality, i.e., multiple paths can lead to a common end state (Sjödin,
Parida, & Kohtamäki, 2016). These paths can assume different forms
and orders in terms of boundary lenses.
5.2. Managerial implications
The redefinition of firm boundaries is an essential consideration
when planning and implementing servitization and should not be ne-
glected by managers. For companies preparing for servitization, the
study conceptualizes a framework to manage servitization in practice.
The framework presents possible practices that can be utilized to stra-
tegically reposition a company, analyze repositioning moves in the
value system (for instance, competitors' moves or other firms' moves
within the ecosystem), or benchmark these moves against manu-
facturers that successfully underwent this strategic transition. The fra-
mework may help managers answer questions, such as “What strategic
practices should be utilized in our servitization initiative?” “How
should our identity be changed?” “How should our organizational
capabilities be altered?” “How should we position ourselves in the
markets?” and “What governance mechanism should be employed in
different parts of the value system?” Based on analytical reasoning and
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
102
experiences in the markets, managers can stipulate a rule of thumb to
(re)direct the firm in practice through expert heuristics (Bingham &
Eisenhardt, 2011), i.e., create rules-of-thumb to manage that change in
practice. Fig. 4 illustrates the dichotomies between the product and
service logics in terms of the firm boundary lenses.
5.3. Limitations and suggestions for further research
This article compares leading cases, and although far-reaching
generalizations cannot be made because of qualitative nature of the
study and the studied firms' geographical and cultural scopes, it none-
theless offers insights into the redefinition of firm boundaries in servi-
tization. Because the present study utilized four firm boundary lenses to
discuss their complementary effects and, thus, cannot conduct an in-
depth analysis of the use of any single theory, further in-depth em-
pirical research is required to explore both the positioning and orga-
nizational identity perspectives. In particular, the study of mergers and
acquisitions as a tool for servitization is an unexplored research area
(Kowalkowski, Gebauer, & Oliva, 2017) that could provide valuable
information on how executives try to steer a firm's direction.
Fig. 3. Interplay among identity, power, capabilities, and efficiency in servitization.
Fig. 4. Boundary dichotomies and delineations in servitization.
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
103
Although research concerning capabilities in servitization is ex-
tensive, future studies can focus on the microlevel practices of resource
reconfigurations. Additionally, servitization is heterogeneous across
industries and service offerings, and consequently, different firm
boundary configurations may be needed for manufacturers' product-
service offerings (Bustinza, Lafuente, Rabetino, Vaillant, & Vendrell-
Herrero, 2019). Thus, there is room to study how different servitization
strategies and the associated business models and business innovation
practices shape firm boundary decisions. Future studies may focus on
the processual aspect to study boundary changes over time, focusing on
several boundary lenses simultaneously, as previous studies have typi-
cally focused on investigating change processes from single theoretical
lenses, such as studies focusing on identity (Corley & Gioia, 2004; Vaara
& Tienari, 2011) and capability alterations (Danneels, 2011), when
firms undergo strategic change.
As this study investigated firm boundaries from the focal company
perspective, future research could study competitive dynamics in so-
lution provision and the effects of these dynamics on the boundaries of
individual enterprises and the ecosystem's structure. Finally, the in-
creasing adoption of digital technologies opens an important window
for studying firm boundaries in the context of digital servitization and
the platform economy, utilizing a process-based research method.
References
Adams, W., & Brock, J. W. (1982). Integrated monopoly and market power: System
selling, compatibility standards, and market control. The Quarterly Review of
Economics and Business, 22(4), 29–42.
Adner, R. (2016). Ecosystem as structure: An actionable construct for strategy. Journal of
Management, 43(1), 39–58.
Albert, S., & Whetten, D. A. (1985). Organizational identity. In L. L. Cummings, & B. M.
Staw (Eds.). Research in organizational behaviorGreenwich, CT: JAI Press p. 7:
263–295.
Auguste, B. G., Harmon, E., & Pandit, V. (2006). The right service strategies for product
companies. Mckinsey Quarterly, 1(1), 40–51.
Bäck, I., & Kohtamäki, M. (2015). Boundaries of R&D collaboration. Technovation, 45–46
November-December, 15–28.
Baines, T., Ziaee Bigdeli, A., Bustinza, O. F., Shi, V. G., Baldwin, J., & Ridgway, K. (2017).
Servitization: Revisiting the state-of-the-art and research priorities. International
Journal of Operations and Production Management, 37(2), 256–278.
Baines, T. S., Kay, G., Adesola, S., & Higson, M. (2005). Strategic positioning: An in-
tegrated decision process for manufacturers. International Journal of Operations &
Production Management, 25(2), 180–201.
Baines, T. S., Lightfoot, H. W., & Smart, P. (2011). Servitization within manufacturing:
Exploring the provision of advanced services and their impact on vertical integration.
Journal of Manufacturing Technology Management, 22(7), 947–954.
Baines, T. S., Lightfoot, H. W., Steve, E., Neely, A., Greenough, R., Peppard, J., ... Wilson,
H. (2007). State-of-the-art in product-service systems. Proceedings of the Institution of
Mechanical Engineers, Part B: Journal of Engineering Manufacture, 221(10), 1–11.
Barney, J. (1999). How a firm's capabilities affect boundary decisions. Sloan Management
Review, 40(3), 137–146.
Beverland, M., & Lindgreen, A. (2010). What makes a good case study? A positivist review
of qualitative case research published in industrial marketing management,
1971–2006. Industrial Marketing Management, 39(1), 56–63.
Bingham, J. B., & Eisenhardt, K. M. (2011). Rational heuristics: The “simple rules” that
strategists learn from process experience. Strategic Management Journal, 32,
1437–1464.
Brady, T., Davies, A., & Gann, D. M. (2005). Creating value by delivering integrated so-
lutions. International Journal of Project Management, 23(5), 360–365.
Brahm, F., & Tarzijan, J. (2012). Boundary choice interdependency: Evidence from the
construction industry. Industrial and Corporate Change, 22(5), 1229–1271.
Brax, S. A. (2005). A manufacturer becoming service provider – Challenges and a
paradox. Managing Service Quality, 15(2), 142–155.
Bustinza, O. F., Lafuente, E., Rabetino, R., Vaillant, Y., & Vendrell-Herrero, F. (2019).
Make-or-buy configurational approaches in product-service ecosystems and perfor-
mance. Journal of Business Research, 104, 393–401.
Bustinza, O. F., Vendrell-Herrero, F., & Baines, T. S. (2017). Service implementation in
manufacturing: An organisational transformation perspective. International Journal of
Production Economics, 192, 1–8.
Cacciatori, E., & Jacobides, M. G. (2005). The Dynamic Limits of Specialization: Vertical
Integration Reconsidered. Organ. Stud. 26(12), 1851–1883.
Ceci, F., & Masini, A. (2011). Balancing specialized and generic capabilities in the pro-
vision of integrated solutions. Industrial and Corporate Change, 20(1), 91–131.
Ceci, F., & Prencipe, A. (2008). Configuring capabilities for integrated solutions: Evidence
from the IT sector. Industry & Innovation, 15(3), 277–296.
Chandraprakaikul, W., Baines, T. S., Lim, R. Y., & Sakburanapech, A. (2010). Success
factors in a forming strategic positioning of manufacturing operations within global
supply chains. Proceedings of the Institution of Mechanical Engineers, Part B: Journal of
Engineering Manufacture, 831–844 224, May.
Chesbrough, H., & Rosenbloom, R. S. (2002). The role of the business model in capturing
value from innovation: Evidence from Xerox corporation’s technology spin-off com-
panies. Industrial and Corporate Change, 11(3), 529–555.
Clark, S. M., Gioia, D. A., Ketchen, D. J., & Thomas, J. B. (2010). Transitional identity as a
facilitator of organizational identity change during a merger. Administrative Science
Quarterly, 55(3), 397–438.
Clegg, S. R., Rhodes, C., & Kornberger, M. (2007). Desperately seeking legitimacy:
Organizational identity and emerging industries. Organization Studies, 28(4),
495–513.
Coe, N. M., Dicken, P., & Hess, M. (2008). Global production networks: Realizing the
potential. Journal of Economic Geography, 8(3), 271–295.
Collins, J. C., & Porras, J. I. (1996). Building your company’s vision. Harvard Business
Review, 74(5), 65–77.
Corley, K. G., & Gioia, D. A. (2004). Identity ambiguity and change in the wake of a
corporate spin-off. Administrative Science Quarterly, 49(2), 173–208.
Danneels, E. (2011). Trying to become a different type of company: Dynamic capability at
smith Corona. Strategic Management Journal, 32(1), 1–31.
Davies, A. (2004). Moving base into high-value integrated solutions: A value stream ap-
proach. Industrial and Corporate Change, 13(5), 727–756.
Davies, A., & Brady, T. (2000). Organisational capabilities and learning in complex
product systems: Towards repeatable solutions. Research Policy, 29(7–8), 931–953.
Davies, A., Brady, T., & Hobday, M. (2006). Charting a path toward integrated solutions.
MIT Sloan Management Review, 47(3), 39–48.
Davies, A., Brady, T., & Hobday, M. (2007). Organizing for solutions: Systems seller vs.
systems integrator. Industrial Marketing Management, 36(2), 183–193.
Dubois, A., & Gadde, L. E. (2002). Systematic combining: An abductive approach to case
research. Journal of Business Research, 55(7), 553–560.
Dyer, J. H. (1996). Does governance matter? Keiretsu alliances and asset specificity as
sources of Japanese competitive advantage. Organization Science, 7(6), 649–666.
Dyer, J. H. (1997). Effective interim collaboration: How firms minimize transaction costs
and maximise transaction value. Strategic Management Journal, 18(7), 535–556.
Eisenhardt, K. M. (1989). Building theories from case study research. The Academy of
Management Review, 14(4), 532–550.
Eisenhardt, K. M., & Graebner, M. E. (2007). Theory building from cases: Opportunities
and challenges. Academy of Management Journal, 50(1), 25–32.
Galbraith, J. R. (2002). Organizing to deliver solutions. Organizational Dynamics, 31(2),
194–207.
Garud, R., & Kumaraswamy, A. (1993). Changing competitive dynamics in network in-
dustries: An exploration of sun Microsystems’ open systems strategy. Strategic
Management Journal, 14(5), 351–369.
Gebauer, H., Edvardsson, B., Gustafsson, A., & Witell, L. (2010). Match or mismatch:
Strategy-structure configurations in the service business of manufacturing companies.
Journal of Service Research, 13(2), 198–215.
Gebauer, H., Fleisch, E., & Friedli, T. (2005). Overcoming the service paradox in manu-
facturing companies. European Management Journal, 23(1), 14–26.
Gebauer, H., Gustafsson, A., & Witell, L. (2011). Competitive advantage through service
differentiation by manufacturing companies. Journal of Business Research, 64(12),
1270–1280.
Gebauer, H., Paiola, M., & Saccani, N. (2013). Characterizing service networks for moving
from products to solutions. Industrial Marketing Management, 42(1), 31–46.
Gebauer, H., Ren, G.-J., Valtakoski, A., & Reynoso, J. (2012). Service-driven manu-
facturing: Provision, evolution and financial impact of services in industrial firms.
Journal of Service Management, 23(1), 120–136.
Gereffi, G., Humphrey, J., & Sturgeon, T. (2005). The governance of global value chains.
Review of International Political Economy, 12(1), 78–104.
Gioia, D. A., Price, K. N., Hamilton, A. L., & Thomas, J. B. (2010). Forging an identity: An
insider-outsider study of processes involved in the formation of organizational
identity. Administrative Science Quarterly, 55(1), 1–46.
Grant, R. M. (2010). Contemporary strategy analysis. Wiley, Seventh Ed.
Harrigan, K. R. (1984). Formulating vertical integration strategies. Academy of
Management Review, 9(4), 638–652.
Hax, A. C., & Wilde, D. L., II (1999). The delta model: Adaptive management for a
changing world. Sloan Management Review, 19(4), 11–28.
Hobday, M., Davies, A., & Prencipe, A. (2005). Systems integration: A core capability of
the modern corporation. Industrial and Corporate Change, 14(6), 1109–1143.
Huberman, M., & Miles, M. (1994). Data management and analysis methods. In N.
Denzin, & Y. Lincoln (Eds.). Handbook of qualitative research (pp. 428–444). London:
Thousand Oaks.
Huikkola, T., & Kohtamäki, M. (2017). Solution Providers’ strategic capabilities. Journal
of Business and Industrial Marketing, 32(5), 752–770.
Huikkola, T., Kohtamäki, M., & Rabetino, R. (2016). Resource realignment in servitiza-
tion. Research-Technology Management, 59(4), 30–39.
Huikkola, T., Ylimäki, J., & Kohtamäki, M. (2013). Joint learning in R&D collaborations
and the facilitating relational practices. Industrial Marketing Management, 42(7),
1167–1180.
Jacobides, M. G. (2011). Strategy bottlenecks: How TME player can shape and win
control of their industry architecture. Telecom & Media Insights, 1–11 Issue 63,
Capgemini.
Jacobides, M. G., Cennamo, C., & Gawer, A. (2018). Towards a theory of ecosystems.
Strategic Management Journal, 39(8), 2255–2276.
Jacobides, M. G., & Winter, S. G. (2005). The co-evolution of capabilities and transaction
cost: Explaining the institutional structure of production. Strategic Management
Journal, 26(5), 395–413.
Johnson, G., Scholes, K., & Whittington, R. (2008). Exploring corporate strategy. Perason
Education, Essex: FT Prentice Hall Eighth.
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
104
Johnstone, S., Dainty, A., & Wilkinson, A. (2009). Integrating products and services
through life: An aerospace experience. International Journal of Operations & Production
Management, 29(5), 520–538.
Kindström, D., Kowalkowski, C., & Sandberg, E. (2013). Enabling service innovation: A
dynamic capabilities approach. Journal of Business Research, 66(8), 1063–1073.
Kogut, B. (2000). The network as knowledge: Generative rules and the emergence of
structure. Strategic Management Journal, 21(3), 405–425.
Kohtamäki, M., Einola, S., & Rabetino, R. (2020). Exploring servitization through the
paradox lens: Coping practices in servitization. International Journal of Production
Economics. https://doi.org/10.1016/j.ijpe.2020.107619 In Press.
Kohtamäki, M., Parida, V., Oghazi, P., Gebauer, H., & Baines, T. (2019). Digital serviti-
zation business models in ecosystems: A theory of the firm. Journal of Business
Research, 104, 380–392.
Kohtamäki, M., Partanen, J., & Möller, K. (2013). Making a profit with R&D services —
The critical role of relational capital. Industrial Marketing Management, 42(1), 71–81.
Kowalkowski, C., Gebauer, H., & Oliva, R. (2017). Service growth in product firms: Past,
present, and future. Industrial Marketing Management, 60, 82–88.
Kowalkowski, C., Kindström, D., Alejandro, T. B., Brege, S., & Biggemann, S. (2012).
Service infusion as agile incrementalism in action. Journal of Business Research, 65(6),
765–772.
Kowalkowski, C., & Ulaga, W. (2017). Service strategy in action: A practical guide for growing
your B2B service and solution business. Publisher: Service Strategy Press.
Kowalkowski, C., Witell, L., & Gustafsson, A. (2013). Any way goes: Identifying value
constellations for service infusion in SMEs. Industrial Marketing Management, 42(1),
18–30.
Livengood, R. S., & Reger, R. K. (2010). That’s our turf! Identity domains and competitive
dynamics. Academy of Management Review, 35(1), 48–66.
Luoto, S., Brax, S. A., & Kohtamäki, M. (2017). Critical meta-analysis of servitization
research: Constructing a model-narrative to reveal paradigmatic assumptions.
Industrial Marketing Management, 60(1), 89–100.
Lusch, R. F., Vargo, S. L., & Tanniru, M. (2010). Service, value networks and learning.
Journal of the Academy of Marketing, 38(1), 19–31.
Mahoney, J. T. (1992). The choice of organizational form: Vertical financial ownership
versus other methods of vertical integration. Strategic Management Journal, 13(8),
559–584.
Martinez, V., Neely, A., Velu, C., Leinster-Evans, S., & Bisessar, D. (2017). Exploring the
journey to services. International Journal of Production Economics, 192(October),
66–80.
Mathieu, V. (2001). Service strategies within the manufacturing sector: Benefits, costs and
partnership. International Journal of Service Industry Management, 12(5), 451–475.
Matthyssens, P., & Vandenbempt, K. (2010). Service addition as business market strategy:
Identification of transition trajectories. Journal of Service Management, 21(5),
693–714.
McGahan, A. M. (2000). How industries evolve. Business Strategy Review, 11(3), 1–16.
Möller, K., & Halinen, A. (2017). Managing business and innovation networks—From
strategic nets to business fields and ecosystems. Industrial Marketing Management, 67
(November), 5–22).
Nag, R., Corley, K. G., & Gioia, D. A. (2007). The intersection of organizational identity,
knowledge and practice: Attempting stratetgic change via knowledge grafting.
Academy of Management Journal, 50(4), 821–847.
Nordin, F., & Kowalkowski, C. (2010). Solutions offerings: A critical review and re-
conceptualisation. Journal of Service Management, 21(4), 441–459.
Osegowitsch, T., & Madhok, A. (2003). Vertical integration is dead, or is it? Business
Horizons, 46(2), 25–34.
Paiola, M., Saccani, N., Perona, M., & Gebauer, H. (2013). Moving from products to so-
lutions: Strategic approaches for developing capabilities. European Management
Journal, 31(4), 390–409.
Patton, M. Q. (2002). Qualitative research and evaluation methods. Thousand Oaks, CA:
Sage (Third Edit).
Penttinen, E., & Palmer, J. (2007). Improving firm positioning through enhanced offer-
ings and buyer-seller relationships. Industrial Marketing Management, 36(5), 552–564.
Pil, F. K., & Holweg, M. (2006). Evolving from value chain to value grid. MIT Sloan
Management Review, 47(4), 72–80.
Porter, M. E. (1980). Competitive strategy: Techniques for analyzing industries and competi-
tors. The Free Press.
Prencipe, A. (2003). Corporate strategy and systems integration capabilities: Managing
networks in complex systems industries. In A. Prencipe, A. Davies, & M. Hobday
(Eds.). The business of system integration. Oxford: Oxford University Press.
Rabetino, R., Harmsen, W., Kohtamäki, M., & Sihvonen, J. (2018). Structuring serviti-
zation related research. International Journal of Operations and Production
Management, 38(2), 350–371.
Rabetino, R., & Kohtamäki, M. (2013). System integration, integrated solutions and in-
dustry organization: A value system approach. IMP 2013, Atlanta.
Rabetino, R., & Kohtamäki, M. (2018). To Servitize is to (re)position: Utilizing a Porterian
view to understand Servitization and value systems. In M. Kohtamäki, (Ed.). Practices
and tools for Servitization (pp. 325–341). Palgrave-MacMillan.
Rabetino, R., Kohtamäki, M., & Gebauer, H. (2017). Strategy map of servitization.
International Journal of Production Economics, 192(October), 144–156.
Rabetino, R., Kohtamäki, M., Lehtonen, H., & Kostama, H. (2015). Developing the concept
of life-cycle service offering. Industrial Marketing Management, 49, 53–66.
Raddats, C., Burton, J., & Ashman, R. (2015). Resource configurations for services success
in manufacturing companies. Journal of Service Management, 26(1), 97–116.
Raddats, C., Kowalkowski, C., Benedettini, O., Burton, J., & Gebauer, H. (2019).
Servitization: A contemporary thematic review of four major research streams.
Industrial Marketing Management. https://doi.org/10.1016/j.indmarman.2019.03.
015.
Raja, J., Chakkol, M., Johnson, M., & Beltagui, A. (2018). Organizing for servitization:
Examining front- and back-end design configurations. International Journal of
Operations & Production Management, 38(1), 249–271.
Raynor, M. E., & Christensen, C. M. (2002). Integrate to innovate: The determinants of
success in developing and deploying new services in the communications industry. New
York.
Rodrigues, S., & Child, J. (2008). The development of corporate identity: A political
perspective. Journal of Management Studies, 45(5), 885–911.
Salonen, A., Gabrielsson, M., & Al-Obaidi, Z. (2006). Systems sales as a competitive re-
sponse to the Asian challenge: Case of a global ship power supplier. Industrial
Marketing Management, 35(6), 740–750.
Salonen, A., & Jaakkola, E. (2015). Firm boundary decisions in solution business:
Examining internal vs. external resource integration. Industrial Marketing
Management, 51, 171–183 November.
Santos, F. M., & Eisenhardt, K. M. (2005). Organizational boundaries and theories of
organization. Organization Science, 16(5), 491–508.
Santos, F. M., & Eisenhardt, K. M. (2009). Constructing markets and shaping boundaries:
Entrepreneurial power in nascent fields. The Academy of Management Journal, 52(4),
643–671.
Schilling, M. A., & Steensma, H. K. (2002). Disentangling the theories of firm boundaries:
A path model and empirical test. Organization Science, 13(4), 387–401.
Shah, D., Rust, R. T., Parasuraman, A., Staelin, R., & Day, G. S. (2006). The path to
customer centricity. Journal of Service Research, 9(2), 113–124.
Shepherd, C., & Ahmed, P. K. (2000). From product innovation to solutions innovation: A
new paradigm for competitive advantage. European Journal of Innovation Management,
3(2), 100–106.
Siggelkow, N. (2007). Persuasion with case studies. Academy of Management Journal,
50(1), 20–24.
Sjödin, D. R., Parida, V., & Kohtamäki, M. (2016). Capability configurations for advance
service offerings in manufacturing firms: Using fuzzy set qualitative comparative
analysis. Journal of Business Research, 69(11), 5330–5335.
Sklyar, A., Kowalkowski, C., Tronvåll, B., & Sörhammar, D. (2019). Organizing for digital
Servitization: A service ecosystem perspective. Journal of Business Research, 104,
450–460.
Spring, M., & Araujo, L. (2013). Beyond the service factory: Service innovation in man-
ufacturing supply networks. Industrial Marketing Management, 42(1), 59–70.
Storbacka, K., Windahl, C., Nenonen, S., & Salonen, A. (2013). Solution business models:
Transformation along four continua. Industrial Marketing Management, 42(5),
705–716.
Teece, D. J. (2007). Explicating dynamic capabilities: The nature and microfoundations of
(sustainable) enterprise performance. Strategic Management Journal, 28(13),
1319–1350.
Töytäri, P., Turunen, T., Klein, M., Eloranta, V., Biehl, S., & Rajala, R. (2018). Aligning the
mindset and capabilities within a business network for successful adoption of smart
services. Journal of Product Innovation Management, 35(5), 763–779.
Tripsas, M. (2009). Technology, identity, and inertia through the lens of “the digital
photography company”. Organization Science, 20(2), 441–460.
Tuli, K. R., Kohli, A. K., & Bharadwaj, S. G. (2007). Rethinking customer solutions: From
product bundles to relational processes. Journal of Marketing, 71(3), 1–17.
Ulaga, W., & Reinartz, W. J. (2011). Hybrid offerings : How manufacturing firms combine
goods and services successfully. Journal of Marketing, 75, 5–23 November.
Vaara, E., & Tienari, J. (2011). On the narrative construction of multinational corpora-
tions: An antenarrative analysis of legitimation and resistance in a cross-border
merger. Organization Science, 22(2), 370–390.
Vandermerwe, S., & Rada, J. (1988). Servitization of business: Adding value by adding
services. European Management Journal, 6(4), 314–324.
Vesalainen, J., Valkokari, K., & Hellström, M. (2017). Practices for network management - In
search of collaborative advantage. Palgrave – MacMillan.
Visnjic, I., Jovanovic, M., Neely, A., & Engwall, M. (2017). What brings the value to
outcome-based contract providers? Value drivers in outcome business models.
International Journal of Production Economics, 192, 169–181.
Williamson, O. E. (2008). Outsourcing:Transaction cost economics and supply chain
management. Journal of Supply Chain Management, 44(2), 5–16.
Windahl, C., & Lakemond, N. (2010). Integrated solutions from a service-centered per-
spective: Applicability and limitations in the capital goods industry. Industrial
Marketing Management, 39(8), 1278–1290.
Wise, R., & Baumgartner, P. (1999). Go downstream: The new profit imperative in
manufacturing. Harvard Business Review, 77(5), 133–142.
Worm, S., Bharadwaj, S. G., Ulaga, W., & Reinartz, W. J. (2017). When and why do
customer solutions pay off in business markets? Journal of the Academy of Marketing
Science, 45(4), 490–512.
Yang, H., Lin, Z., & Lin, Y. (2010). A multilevel framework of firm boundaries: Firm
characteristics, dyadic differences, and network attributes. Strategic Management
Journal, 31(3), 237–261.
Yin, R. K. (1994). Case study research: Design and methods. Newbury Park, CA: Sage2nd.
Zou, W., Brax, S., Vuori, M., & Rajala, R. (2019). The influences of contract structure,
contracting process, and service complexity on supplier performance. International
Journal of Operations and Production Management, 39(4), 525–549.
T. Huikkola, et al. Industrial Marketing Management 90 (2020) 90–105
105