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Developing integrated solutions: the importance of relationships within the network
Linköping University, Department of Management and Engineering. 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: 0000-0002-5427-3560
2006 (English)In: Industrial Marketing Management, ISSN 0019-8501, Vol. 35, no 7, 806-818 p.Article in journal (Refereed) Published
Abstract [en]

Firms that have traditionally focused on selling products, spare parts and services face difficulties with increasing competition and declining margins. They are therefore turning to new strategies where products and services are integrated into so-called integrated solutions. Research on the challenges this presents is sparse, but there is evidence that internal factors as well as external relationships play an important role. In this paper we investigate the relationships within the business network in order to uncover some of the complex issues related to integrated solutions, including how and to what extent these relationships facilitate or impede the development of integrated solutions. Two case studies of one more and one less successful initiative within the same firm are used to illustrate challenges and possible success factors for the development of integrated solutions in the capital goods industry.

The paper identifies the following six factors as important when developing integrated solutions: the strength of the relationships between the different actors involved, the firm's position in the network, the firm's network horizon, the solution's impact on existing internal activities, the solution's impact on customers' core processes, and external determinants. It shows that inter- and intra-firm relationships can both enable and obstruct the development of integrated solutions. For the firms involved in the development of integrated solutions, it becomes crucial to manage this duality.

Place, publisher, year, edition, pages
2006. Vol. 35, no 7, 806-818 p.
Keyword [en]
Integrated solutions; Relationships; Network theory; Capital goods
National Category
Engineering and Technology
Identifiers
URN: urn:nbn:se:liu:diva-14482DOI: 10.1016/j.indmarman.2006.05.010OAI: oai:DiVA.org:liu-14482DiVA: diva2:23575
Available from: 2007-05-21 Created: 2007-05-21 Last updated: 2015-03-04
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

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Windahl, CharlottaLakemond Ebbers, Nicolette

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