Insightful research and collaborative practice next steps Service Day 29.5.2012 Marja Toivonen
2 Topical issues Service economy From antagonisms to integrated concepts The phenomenon of kibsification as a central trend Opening the concept of productivity Deeper understanding of services internationalization Service innovation Users as innovators Combining user-driven and employee-driven innovation Service innovations linked to social and system innovations The challenge of rapid innovation
3 From antagonisms to integrated concepts Antagonisms between manufacturing and services, production and consumption, B-to-B and B-to-C have for long characterized both research and practice and slowed down deeper insights. During the last decade, synthesis views that look for a common framework have gained ground among service researchers. Service-dominant logic has been one of the central approaches that have paved the way for the removal of antagonisms. SDL highlights mutual value creation in actor-to-actor relationships and in this way enables much more comprehensive inclusion of all possible contributions available for innovation than produceroriented innovation models. The concept of resource integration central in SDL tackles an important problem in today s innovation practice: the focus on individual products does not reflect the users world in which benefits emerge from inter-linkages and wholes.
4 The phenomenon of kibsification as a central trend Knowledge-intensive business services (KIBS) have been a service sector that has aroused much interest among researchers. Particular interest has been shown towards the role of KIBS as sources, carriers and facilitators of innovation. At the same time, the relativity of the concept knowledge-intensive has become more and more apparent. Many companies that are not specialized in expert offerings resemble KIBS. Kibsification is an important phenomenon in servitizing industrial companies, for instance. Thus, research should focus on different phenomena reflecting the increasing knowledge-intensity in the present economies. The interplay between the generic knowledge accumulated by experts and the tacit knowledge buried in the daily practices of organizations is an essential topic here.
5 Opening the concept of productivity Low productivity in service sectors has been a traditional concern among economists and policy makers. In these discussions, limiting the perspective to the producer has been the selfevident starting point. The focus has been on the ability to generate the expected outcome with the minimum usage of resources. The joint value creation with the customer challenges this view. It highlights the importance of those research efforts that aim to take into account, not only the benefits for the producer (efficiency), but also the impacts and benefits to the customer (effectiveness).
6 Deeper understanding of services internationalization The central role of ICT partial breaking of the simultaneity of production and consumption in wired exports The importance of preliminary and supporting forms of international activities in service business The increasing number of born global companies The application of different models of international business in different countries and in different stages of internationalization Service as embedded in different cultures, but demystifying cultural differences
7 Paths to international markets in services following a client to international markets service company A client/clients draws/draw the service provider to client international markets. Target countries and forms of company operation depend to a greater or lesser extent on the needs of the client(s). service company independent gradual internationalisation Stage 1: Stage 2: Stage 3: development small-scale extension from a local activities in of activities to a national neighbouring more broadly actor countries to foreign markets the born global -path service company The company is established to carry out international business right from the start. Internationalisation takes place in several forms. Focus on a niche sector, where predecessors throughout the world are attracted as clients.
8 Users as innovators User-based approaches have become popular among both researchers and practitioners. However, the usual focus is still on the activities of the provider: acquisition of user information and its elaboration to user understanding. A problem is that users are expected to be able to list their needs to the provider. When this does not realize, the conclusion is that going back to technology push is a more effective approach. Understanding the interaction between the provider and the user as a mutual learning process is gaining ground gradually. It is leading to the adoption of coinnovation practices seeing both the users and the providers as innovators. The further development of novelties during the use is a particularly important aspect recognized in research.
9 Developer vs. user Developer User Helminen, Hämäläinen and Mäkinen (2010)
10 Combining user-driven and employeedriven innovation Employee-driven innovation is gaining significance in the recent innovation literature. The background is in the perception that the creative potential of shopfloor workers and front-line service employees has been largely under-utilized. This approach highlights that managers and professional designers do not posses all creativity in organizations. In addition, their number is small compared to the employees who often are involved in customer interaction on a daily basis and receive customer information directly. Employee-driven innovation means thebinvolvement of employees in the renewing of products and services and is linked to the idea of user-based innovation: innovation with users should include front-line workers as well as.
11 Service innovations linked to social and system innovations In recent years, it has become apparent that the current social, economic, and environmental challenges are too big to be solved via individual product and service innovations created in individual organizations. Thus, a broader perspective is needed: research has to tackle the issues how to combine various innovations effectively and disseminate them rapidly on the basis of continuous interaction of different organizations. In other words, we have to examine and develop innovations at the systemic level. Systemic innovations are interlinked with social innovations. The concept social includes two different aspects: 1) the prominent challenges are societal, concerning environmental and social sustainability in the first place, and 2) participatory and networked processes are essential. Open innovation practices are embedded in social innovation.
12 The challenge of rapid innovation Models based on in-house R&D have dominated the discussion about the innovation process. The ideal has been a sequence of stages: idea generation, screening, commercial evaluation, development, testing and commercialization. This focus has systematized the form of innovation processes, resulting in the increase of visibility of innovation efforts. The visibility has facilitated the development of innovation indicators based on the resources allocated for R&D. However, is a strong focus on planning an effective way to tackle the unknown: does it lead to small improvements only, instead of more radical novelties? Merging the planning and implementation is an emerging alternative. Here, the core is interactive learning: the creation of shared experience of the object to be developed. The starting point is not a fixed goal but framing and contextualizing a problem and available resources that are accumulated during the process.
13 Need for continuous collaboration between research and practice Practical problems Translating the problems into research issues Practitioners Researchers Feedback on the applicability of the findings Dissemination of findings
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