Services, industry evolution, and the competitive strategies of product firms

Services of different types have become increasingly important for product firms. While these firms mainly focus on products, managers and researchers lack a comprehensive framework to understand when to make significant investments in particular kinds of services. We identify three categories of pr...

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Bibliographic Details
Published in:Strategic management journal 2015-04, Vol.36 (4), p.559-575
Main Authors: Cusumano, Michael A., Kahl, Steven J., Suarez, Fernando F.
Format: Article
Language:English
Subjects:
Competitive advantage
Customer services
Customers
Enterprises
industry evolution
industry lifecycle
Investment
Management theory
Products
Service industry
services
services
strategy
industry evolution
industry lifecycle
Strategic management
Strategic planning
strategy
Studies
Substitution products
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Summary:Services of different types have become increasingly important for product firms. While these firms mainly focus on products, managers and researchers lack a comprehensive framework to understand when to make significant investments in particular kinds of services. We identify three categories of product-related services from a product firm—smoothing and adapting services, which complement products, and substitution services, which enable customers to pay for the use of a product without buying the product itself We develop propositions about the relative level of these different kinds of services vis-a-vis industry evolution, as well as suggest how these services affect industry structure. We draw upon various literatures, though we conclude that the relationship between products and services is more complex and richer than any one literature suggests.
ISSN:0143-2095
1097-0266
DOI:10.1002/smj.2235