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Manufacturing firms and integrated solutions: characteristics and implications
Linköping University, Department of Management and Economics. Linköping University, The Institute of Technology.
Linköping University, Department of Management and Economics. Linköping University, The Institute of Technology.
Linköping University, Department of Management and Engineering, Project management, Innovations and Entrepreneurship . Linköping University, The Institute of Technology.ORCID iD: 0000-0002-4233-5138
Linköping University, Department of Management and Economics. Linköping University, The Institute of Technology.
2004 (English)In: European Journal of Innovation Management, ISSN 1460-1060, Vol. 7, no 3, 218-228 p.Article in journal (Refereed) Published
Abstract [en]

For an increasing number of firms in the capital goods industry, combinations of products and services, so called integrated solutions, are becoming part of their future growth strategies. By analysing three case studies, the article highlights the variety of such solutions and some important implications for the involved companies. The analysis suggests that companies need an extended set of competences to succeed in providing integrated solutions, amounting to a balance of technical and integration competence with market/business, consulting and partnering competences. This implies a move from product-focus to customer-centric orientation and focus on optimisation of user processes. From a research perspective the paper underlines the importance of integrating studies of product and service innovation, two fields that so far have been studied separately.

Place, publisher, year, edition, pages
2004. Vol. 7, no 3, 218-228 p.
Keyword [en]
Capital, Innovation, Manufacturing industries, Services
National Category
Production Engineering, Human Work Science and Ergonomics
Identifiers
URN: urn:nbn:se:liu:diva-14481DOI: 10.1108/14601060410549900OAI: oai:DiVA.org:liu-14481DiVA: diva2:23574
Available from: 2008-11-12 Created: 2008-11-12 Last updated: 2014-05-12
In thesis
1. Integrated Solutions in the Capital Goods Sector: Exploring innovation, service and network perspectives
Open this publication in new window or tab >>Integrated Solutions in the Capital Goods Sector: Exploring innovation, service and network perspectives
2007 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

With varying degrees of success, a number of firms in the capital goods sector are experimenting with different ‘integrated solutions’ initiatives. Integrated solutions include product innovations which enable increased process control that allows the optimisation of the customers’ processes, as well as business innovations which change the firms’ business models and customer approach. It is not always easy to develop and commercialise these new offerings, especially for firms that have traditionally focused on developing and selling products. Integrated solutions challenge these firms to shift the focus from physical products, spare parts and support services to emphasis on delivery of performance optimisation and productivity.

This thesis is a compilation of five papers and five supporting chapters that discuss and analyse the challenges with developing and commercialising integrated solutions in the capital goods sector. The research builds on case studies of firms experimenting with integrated-solution offerings. The firms produce complex, expensive industrial machinery to customers in the process and manufacturing industries. The main case is based on a five-year, in-depth longitudinal study of Alfa Laval, and more specifically of the developments within the wastewater industry. Other case studies include ITT Flygt and Atlas Copco.

The thesis shows that the development and commercialisation of integrated solutions represent a multifaceted, iterative and complex process for the firms under study, who need to combine product, service and business innovations, create new business structures, and create new relationships with customers and possible partners. Consequently, the development of integrated solutions is not confined to or explained by one theoretical field in this thesis, but is linked to innovation, service and network perspectives.

The thesis also shows that the three activities of innovating, organising and building relationships are dependent on changing market structures, customer demands and business cycles. Therefore it becomes important to manage the coexistence of different types of offerings, such as products, services and integrated solutions.

Place, publisher, year, edition, pages
Institutionen för ekonomisk och industriell utveckling, 2007
Series
Linköping Studies in Science and Technology. Dissertations, ISSN 0345-7524 ; 1098Dissertations from the International Graduate School of Management and Industrial Engineering, ISSN 1402-0793 ; 107
Keyword
Integrated solutions, Innovation, Capital goods
National Category
Production Engineering, Human Work Science and Ergonomics
Identifiers
urn:nbn:se:liu:diva-8869 (URN)978-91-85715-06-0 (ISBN)
Public defence
2007-05-25, C3, C Huset, Linköping Universitet, Linköping, 13:00 (English)
Opponent
Supervisors
Available from: 2007-05-21 Created: 2007-05-21 Last updated: 2015-03-04
2. Towards integrated solutions: Alfa Laval and the wastewater industry
Open this publication in new window or tab >>Towards integrated solutions: Alfa Laval and the wastewater industry
2004 (English)Licentiate thesis, comprehensive summary (Other academic)
Abstract [en]

Manufacturing companies in the capital goods industry face opportunities and challenges to their traditionally used business model for selling products, spare parts and services. They are encountering increasing pressure to provide their customers with broader, more tailored solutions. With these integrated solutions, as they are referred to in this thesis, companies are combining services with products to address their customers' business needs, and focus on the delivery of performance.

The objective of this thesis is to address this fairly new concept of integrated solutions using Alfa Laval as a study case in a wastewater industry setting. The business and organisational implications of the move towards integrated solutions have been explored and the move characterised in the context of innovation literature. The thesis comprises five supporting chapters and four empirical papers. The first of these four papers explores and identifies incentives and new competence requirements for providing integrated solutions. The second paper highlights the influence that external elements such as changes in market structure have on providing integrated solutions. The third paper explores internal processes at Alfa Laval supporting a move towards integrated solutions. The fourth and final paper describes the development and launch of a self-optimising control system for the dewatering process, which is licensed out to customers, hence challenging Alfa Laval's traditional way of doing business.

The thesis links Alfa Laval's move towards integrated solutions with its capabilities in the areas of system integration, operational services, partnering and organisational competence, and its approach to customers. It also shows that Alfa Laval's move towards integrated solutions encompasses products, services, performance and organisational innovations.

Place, publisher, year, edition, pages
Linköping: Linköpings universitet, 2004. 59 p.
Series
Dissertations from the International Graduate School of Management and Industrial Engineering, ISSN 1402-0793 ; 81Linköping Studies in Science and Technology. Thesis, ISSN 0280-7971 ; 40
National Category
Social Sciences
Identifiers
urn:nbn:se:liu:diva-22207 (URN)LiU-Tek-Lic-2004:40 (ISRN)1364 (Local ID)91-85295-23-X (ISBN)1364 (Archive number)1364 (OAI)
Available from: 2009-10-07 Created: 2009-10-07 Last updated: 2013-10-23
3. The Business of Integrated Solutions
Open this publication in new window or tab >>The Business of Integrated Solutions
2005 (English)Licentiate thesis, comprehensive summary (Other academic)
Abstract [en]

The after-sales market is increasing in importance for many manufacturing firms. Sales of spare-parts and services is at the same time facing stiffer competitions from third-party suppliers. For many of these companies, the answer to this development has been to engage in the sales of integrates solutions, an offering that allows manufacturing firms to add customer value by including sophisticated products and services, activity specific knowledge and/or resources, and incentives based on successful customer operations. However, not all firms have succeeded in this endeavor and the main research question investigated in this licentiate thesis is: when and under which circumstances are certain integrated solutions preferable options to traditional sales of products and services?

The thesis is constituted of one cover paper and four appended papers. Although the individual aims of each paper vary, they all work together towards answering the main research question. The results of each have been synthesized and analyzed for this purpose in the cover paper. Paper 1 investigates three cases and highlights some important implications for firms moving towards integrated solutions. Among the implications identified is the need of an extended set of new competencies. The need for an increased customer-centric orientation is also acknowledged. Paper 2 suggest that the one of the important challenges facing these mentioned firms is creating value-adding offerings based on deepened relationships with their customers. Paper 3 expand on the discussion of the offering by providing a tentative conceptual model for buying ,integrated solutions. The paper is written from a customer perspective rather than taking the view of the supplier, which have been the most common perspective in the academic area of integrated solutions until now. Paper 4 addresses the issue of pricing the solution based on the performance of the supplying firm, the intent of this pricing model being increased performance and better cost coverage. A contingency framework is suggested as a way to analyze integrated solutions from this perspective. The cover paper gives special attention to the importance of supplier-customer relationships. It also returns to the main research question by suggesting that integrated solutions as a concept may be viewed from several perspectives and each perspective brings forth various organizational and offering options which may or may not be applicable under certain circumstances.

Place, publisher, year, edition, pages
Linköping: Linköpings universitet, 2005. 38 p.
Series
Linköping Studies in Science and Technology. Thesis, ISSN 0280-7971 ; 1151
National Category
Social Sciences
Identifiers
urn:nbn:se:liu:diva-24473 (URN)6589 (Local ID)91-85297-52-6 (ISBN)6589 (Archive number)6589 (OAI)
Available from: 2009-10-07 Created: 2009-10-07 Last updated: 2013-11-27

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Windahl, CharlottaAndersson, PierreBerggren, ChristianNehler, Camilla

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