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Manufacturing practices and servitization: The role of mass customization and product innovation capabilities

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  • Qi, Yinan
  • Mao, Zhigang
  • Zhang, Min
  • Guo, Hangfei

Abstract

Servitization has been viewed as an important method for manufacturers to gain competitive advantages. The purpose of the study is to empirically examine the effects of lean and agile practices as well as mass customization and product innovation capabilities on the implementation of servitization. The hypotheses are empirically examined using structural equation modeling with data collected from 647 manufacturers. The results show that product innovation capability directly improves servitization. Although the direct effect of mass customization capability on servitization is not significant, it improves servitization indirectly through product innovation capability. The findings also reveal that the direct impacts of lean and agile practices on servitization are not significant. Lean and agile practices affect servitization indirectly through product innovation capability, whereas the indirect effects of lean and agile practices on servitization through mass customization capability are not significant. Therefore, this study draws the conclusions that a manufacturer should develop mass customization and product innovation capabilities simultaneously when implementing servitization. Moreover, a manufacturer should also invest on lean and agile practices and product innovation capability at the same time when transforming to a service-based business model to cultivate their synergies on servitization.

Suggested Citation

  • Qi, Yinan & Mao, Zhigang & Zhang, Min & Guo, Hangfei, 2020. "Manufacturing practices and servitization: The role of mass customization and product innovation capabilities," International Journal of Production Economics, Elsevier, vol. 228(C).
    • Handle: RePEc:eee:proeco:v:228:y:2020:i:c:s092552732030133x
    DOI: 10.1016/j.ijpe.2020.107747
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    References listed on IDEAS

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    3. Münch, Christopher & Marx, Emanuel & Benz, Lukas & Hartmann, Evi & Matzner, Martin, 2022. "Capabilities of digital servitization: Evidence from the socio-technical systems theory," Technological Forecasting and Social Change, Elsevier, vol. 176(C).
    4. Lin, Shunzhi & Lin, Jiabao, 2023. "How organizations leverage digital technology to develop customization and enhance customer relationship performance: An empirical investigation," Technological Forecasting and Social Change, Elsevier, vol. 188(C).
    5. Natalia Szozda & Artur Świerczek, 2022. "Upstream and downstream dyad governance within the network structures: Creating supply chain governance for the customized products," Electronic Markets, Springer;IIM University of St. Gallen, vol. 32(2), pages 873-898, June.
    6. Justyna Kozlowska, 2020. "What Influences the Servitization Process the Most? A Perspective of Polish Machinery Manufacturers," Sustainability, MDPI, vol. 12(12), pages 1-24, June.
    7. Saad Zighan & Moheeb Abualqumboz, 2022. "Dual focus: service-product orientation to manage the change paradox following servitization strategy," Service Business, Springer;Pan-Pacific Business Association, vol. 16(1), pages 29-55, March.
    8. Shen, Bin & Xu, Xiaoyan & Chan, Hau Ling & Choi, Tsan-Ming, 2021. "Collaborative innovation in supply chain systems: Value creation and leadership structure," International Journal of Production Economics, Elsevier, vol. 235(C).
    9. Bhamra, Ran & Hicks, Christian & Small, Adrian & García-Villarreal, Enrique, 2022. "Value, product delivery strategies and operational performance in the medical technology industry," International Journal of Production Economics, Elsevier, vol. 245(C).
    10. Kolagar, Milad & Parida, Vinit & Sjödin, David, 2022. "Ecosystem transformation for digital servitization: A systematic review, integrative framework, and future research agenda," Journal of Business Research, Elsevier, vol. 146(C), pages 176-200.
    11. Gautam Dutta & Ravinder Kumar & Rahul Sindhwani & Rajesh Kr. Singh, 2021. "Digitalization priorities of quality control processes for SMEs: a conceptual study in perspective of Industry 4.0 adoption," Journal of Intelligent Manufacturing, Springer, vol. 32(6), pages 1679-1698, August.
    12. Patanjal Kumar & Sachin Kumar Mangla & Yigit Kazancoglu & Ali Emrouznejad, 2023. "A decision framework for incorporating the coordination and behavioural issues in sustainable supply chains in digital economy," Annals of Operations Research, Springer, vol. 326(2), pages 721-749, July.
    13. Bambang Santoso & Tota Pirdo Kasih, 2024. "Green Lean Concept for Measurement of Sustainable Performance Mediated by Organizational Culture in Oil & Gas and Petrochemical Industry," International Review of Management and Marketing, Econjournals, vol. 14(5), pages 88-100, September.

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