Servitization meets sustainability
DOI:
https://doi.org/10.24023/FutureJournal/2175-5825/2018.v10i2.370Keywords:
Service management, Servitization, Operations management, Brazil, SustainabilityAbstract
Companies that have traditionally sold physical products have begun to increase “services” offered alongside the product. Sometimes businesses have even gone to the extreme of selling only the “benefit” of the physical good as a service, while retaining ownership of the service-supporting good, such as the Xerox copier in your office. This movement is frequently referred to as “servitization” (Baines et al. 2009), which is sometimes illustrated by the popular saying: “people don't want to buy a quarter-inch drill. They want a quarter-inch hole.” We argue that, with servitization, because the supplying company retain ownership of the physical good supporting the service provided, the company is incentivized to put increased efforts, from design to disposal of the physical good, into designing in processes that will maximize the value that can be recouped from the good after the end of its economic life. This would be consistent with efforts toward increased sustainability in supply chains. In the traditional transactional sale of physical goods companies does not have an incentive to make decisions aimed at keeping the value of the product throughout its economic life. Companies would not be interested in extending its economic life either, or even being concerned about how reusable, remanufacture-able, refurbish-able or recyclable the product is. This has implications for the level of environmental sustainability achieved.
Downloads
References
Baines, T.S., Lightfoot, H.W., Benedettini, O., Kay, J.M. (2009). The servitization of manufacturing: A review of literature and reflection on future challenges. Journal of Manufacturing Technology Management, 20(5).
Braungart, M. and McDonough, W. (2002). Cradle to Cradle: Remaking the Way We Make Things. North Point Press, New York.
Brundtland Report (1987). Report of the World Commission on Environment and Development: Our Common Future. United Nations. http://www.un-documents.net/our-common-future.pdf Accessed on 05/04/2018.
Corrêa, H. L. and C. A. Corrêa (2006). “A critical analysis of the product-service dichotomy in operations management.” Latin America Business Review. 6(4)
Corrêa, H. L. and C. A. Corrêa (2017). Administração de Produção e Operações. 4th edition. Atlas/GEN, São Paulo, 2017.
Corrêa, H. L., Ellram, L., Scavarda, A. and Cooper, M. (2007). An operations management view of the services and goods offering mix. International Journal of Operations & Production Management, 27(5).
Elkington, J. (1994). Towards the sustainable corporation: win–win–win business strategies for sustainable development. California Management Review 36 (2), 90–100.
Elkington, J. (1998). Cannibals with Forks: The Triple Bottom Line of the 21st Century. New Society Publishers, Stoney Creek.
Heskett, J.L., Sasser, W.E., Schlesinger, L.A. (1997). The Service Profit Chain. The Free Press (Simon-Schuster), New York.
Murray, A., Skene, K. & Haynes, K. (2017) The Circular Economy: An Interdisciplinary Exploration of the Concept and Application in a Global Context. Journal of Business Ethics. 140(3)
Prahalad, C.K., Hamel, G. (1990) The core competence of the corporation. Harvard Business Review. May-Jun.
Wandermerwe, S. and Rada, J. (1988) Servitization of business: Adding value by adding services. European Management Journal, 6(4), winter, Elsevier.
Downloads
Published
How to Cite
Issue
Section
License
Authors who publish with this journal agree to the following terms:
1. Authors who publish in this journal agree to the following terms: the author(s) authorize(s) the publication of the text in the journal;
2. The author(s) ensure(s) that the contribution is original and unpublished and that it is not in the process of evaluation by another journal;
3. The journal is not responsible for the views, ideas and concepts presented in articles, and these are the sole responsibility of the author(s);
4. The publishers reserve the right to make textual adjustments and adapt texts to meet with publication standards.
5. Authors retain copyright and grant the journal the right to first publication, with the work simultaneously licensed under the Creative Commons Atribuição NãoComercial 4.0 internacional, which allows the work to be shared with recognized authorship and initial publication in this journal.
6. Authors are allowed to assume additional contracts separately, for non-exclusive distribution of the version of the work published in this journal (e.g. publish in institutional repository or as a book chapter), with recognition of authorship and initial publication in this journal.
7. Authors are allowed and are encouraged to publish and distribute their work online (e.g. in institutional repositories or on a personal web page) at any point before or during the editorial process, as this can generate positive effects, as well as increase the impact and citations of the published work (see the effect of Free Access) at http://opcit.eprints.org/oacitation-biblio.html
• 8. Authors are able to use ORCID is a system of identification for authors. An ORCID identifier is unique to an individual and acts as a persistent digital identifier to ensure that authors (particularly those with relatively common names) can be distinguished and their work properly attributed.
