Most of the prior studies on the servitization of manufacturing companies have been actively studied, focusing on the performance and cases of servitization at the single company level. According to the results, most of the servitization at the single company level has been expanded based on the relevance of the company’s core products. However, the form of companies that form a large axis of the Korean economy is a large-scale business group, and these business groups incorporate service affiliates for various purposes, so they show different characteristics from that of a single corporate. In addition, since the purpose of forming a business group is different for each business group, the service relevance between affiliates within the business group is different. Therefore, this study aims to examine the effect of service relevance between affiliates within a business group on the management performance of each business group. To this end, an empirical analysis will be conducted using panel data for 10 years from 2011 to 2020 for a total of 98 affiliates listed on KOSPI and KOSDAQ of 9 domestic business groups. Based on these results, the direction for improving management performance and establishing future servitization strategies for large business groups in Korea will be expected to be made.

The aim of this study is to confirm the gap between customer-perceived value and supplier-perceived value in the manufacturing industry. The author empirically tested a structural equation model in a sample of 42 customers and 42 manufacturers. Findings confirmed the gap in the perception of value between customers and suppliers.

As the technological gap amongst manufacturers decreases, the life cycle of products has shortened, and competition accelerates due to the development of technology, incumbent manufacturing companies face growth limitations. In order to overcome such business issues, manufacturing companies are increasingly interested in changes in business models and innovations, especially in the direction of providing services where they can maintain the competitive advantage of their products. In such context, this empirical study examines managerial leadership, differentiation strategies, and products and services pricing as ‘servitization factors’, which can be driving forces for moving into a new era of growth for Korean SMEs, focusing on the mediating effects of servitization competency. The results are as follows : First, it was confirmed that executive leadership, differentiation strategy, and information & communication technology capability have a direct effect on service sales. Second, the process competency, partnership competency, and ICT competency, which are presented as the service competence of SMEs, were found to play an important role in inducing service sales in managerial leadership, differentiation strategy, product and services pricing. It also emphasized the role of the public policy such as helping to foster SMEs as key partners in the expansion of social facilities and establishing platforms through ICT and data utilization for the convergence of manufacturing services.

As the technological gap amongst manufacturers decreases, the life cycle of products has shortened, and competition accelerates due to the development of technology, incumbent manufacturing companies face growth limitations. In order to overcome such business issues, manufacturing companies are increasingly interested in changes in business models and innovations, especially in the direction of providing services where they can maintain the competitive advantage of their products. In such context, this empirical study examines managerial leadership, differentiation strategies, and products and services pricing as 'servitization factors', which can be driving forces for moving into a new era of growth for Korean SMEs, focusing on the mediating effects of servitization competency. The results are as follows: First, it was confirmed that executive leadership, differentiation strategy, and information & communication technology capability have a direct effect on service sales. Second, the process competency, partnership competency, and ICT competency, which are presented as the service competence of SMEs, were found to play an important role in inducing service sales in managerial leadership, differentiation strategy, product and services pricing. It also emphasized the role of the public policy such as helping to foster SMEs as key partners in the expansion of social facilities and establishing platforms through ICT and data utilization for the convergence of manufacturing services.

The flow of the 4th Industrial Revolution calls for the innovation of the traditional business models of the manufacturers. Servitization is a corporate strategy to respond to changes in the business environment. These days, the value that the market demands can be created on the basis of the product-service integration. Thus the manufacturers must pursue the fundamental innovation of the current strategy and business models. It is necessary to create common values with customers through providing product-service integrated offerings beyond the development, production, and delivery. The purpose of this study is to develop the evaluation indicators for selecting suppliers when the manufacturer who offers the value of product-service integration needs to obtain the resources from outside. The case company in this study is the manufacture firm conducting the retail IoT business as a new business. The Delphi method is used to develop the evaluation indicators for selecting suppliers. This study suggests the academic implications providing the perspective of Servitizaiton by using Delphi method, and the practical implications applying the creating value method of Servitization by collecting the opinions from both value providers and value consumers in the process of developing the evaluation indicators.

While the portion of manufacturing in the global economy has steadily decreased for past a few decades, that of the service sector has steadily increased. Manufacturing industry needs to have a more competitive strategy in a hyper-competitive environment. More recently, the concept of servitization based ICT has emerged, which is the strategy to increase effectiveness and efficiency of products or services. Servitization is defined as “the offer of integrated packages of products, services, support, self-service, and knowledge to add value to the company’s core business,” according to Vandemerwe and Rada (1988). Servitization is to add the new service function to the existing equipment or the hardware-oriented product in the aspect of a product. Productization is to complement the limitations such as intangibility, inseparability, perishability, variability in the element of service. The two concepts have been regarded as distinctive concepts. In recent years, however, these two ideas have been integrated into a single idea of servitization. Good-dominant logic is based on the idea that the product provides customers with the value which they desire. In the vein, manufacturing products is a productive activity that creates value and increases the wealth of the nation. Therefore, the service may be perceived as being less productive. Service-dominant logic, however, is not a value-in-exchange between a company and a customer but a value-in-use which means “the evaluation of the service experience (i.e., the individual judgment of the total of all the functional and emotional experience outcomes).” In service-dominant logic, service is shown as the means of innovation through systematic methodological procedures including organization, people, and information technology by knowledge. As the concept of customers became more and more important, the product needs to be integrated with service. The research on servitization is expanding to various similar concepts such as product-service system, service science, servicing, and so on. Most of the previous research is focused on service type classification at the strategic level or service at the enterprise level. Moreover, most of them are exploratory research. Despite the need for a deeper understanding of customer needs, the research on servitization in the light on customers is sparse. The purpose of this study is as follows: First, define the concept of servitization experience and develop a tool to measure the servitization experience. Second, in order to verify the construct validity of the servitization experience, we examined whether the servitization experience affects the outcome variables such as value, commitment, retention intention. In order to develop a measurement tool for the servitization experience, the following process was carried out. First, concept and questionnaire items were derived from related studies. Second, field expert interviews were conducted to verify questionnaire items. Third, interviews with academic experts were conducted to verify whether they could be used as actual questionnaire items. Fourth, the questionnaires were collected and the collected data were analyzed to verify the reliability and validity of the measurement tools. The sample for empirical analysis was college students in their 20s and 30s, and a total of 150 responded to the questionnaire. First, reliability analysis and validity analysis were conducted to refine the questionnaire items. Structural equation modeling was performed using the refined Servitization experience questionnaire and a model was constructed using the servitization experience as an exogenous variable, with value, commitment, and retention intention as endogenous variables. As a result of the empirical analysis, it is confirmed that the sub - factors of servitization experience consist of four types of integrated product and service, customized servitization, relational servitization and playful servitization. Reliability and validity were satisfied. Through this study, we can contribute to the empirical study of servitization by developing a scale to measure servitization experience. Thus, the purposes of this study are to identify the servitization experience factors that companies should consider in marketing strategy, to grasp the relationship between servitization and customer retention.

Research in the Servitization of Manufacturing has become focused more on cases than concepts over the past decade. This is because governments have emphasized some practical research with policies to support their industries. Manufacturers need differentiated strategies to gain competitiveness by servitization in the global market. They should examine how common servitization has become in the same industries and markets. They should also make sure how it works and for what purpose it is done since it is necessary to make the best decision to be able to distribute the limited resources most effectively to defeat the global competitors. South Korea has the sixth largest trade volume in the world, but Korean SMEs’ marketing capabilities fall short compared to that of major global companies. This paper seeks to develop the proper model and its application for the servitization with global cases which are recommended for Korean SMEs. They need to check the urgency in servitization according to their products, industries and target markets. In addition, factors such as purposes, time and types of the servitization are examined to see how they are related each other. The most significant implication of this study is that the processes for early-stage companies in servitazation are modeled to help them make the best choices.

Introduction The concentration of manufacturing factories in China signals a significant change in the global economy. Manufacturers in countries that are not price competitive feel a sense of crisis and use servitization in the manufacturing industry as a countermeasure. In particular, with the recent rapid development of IoT and AI, service methods are becoming faster and more diverse resulting in increased research on servitization. Vandermerwe and Rada (1988), who first mentioned the term servitization, define it as providing customer-focused products, services, support, self-service, and knowledge, all bundled together. Despite numerous studies on servitization few consider the customer’s perspective, although many consider the producer’s point of view. So far existing research only explored on how consumers accept value-in-use based on an accurate understanding of consumers' needs from the consumer perspective in servitization, based on expectation-confirmation theory. This study examines how customers accept servitization and links it to customer satisfaction. Literature review Servitization Ren and Gregory (2007) defined servitization as a strategic change in which manufacturing companies develop service-oriented or better services to satisfy customers, gain competitive advantage, and improve corporate performance. Raja et al. (2013) examined servitization to find the most important attributes of value-in-use for customers using servitized products and classified them into seven attributes. This study is based on the seven attributes identified by Raja et al. (2013). Perceived Usefulness, Confirmation, and Customer Satisfaction Bhattacharjee developed the Continuance Use Model based on the expectation-confirmation theory and conducted empirical studies for verification (2001b). Our study analyzes the correlation between customer acceptance process and customer satisfaction based on the Expectation-Confirmation model by Bhattacharjee (2001b). Research method We conducted surveys and analyzed the data of 50 Korean university students and members of the public using Smart Pay (Samsung Pay, Apple Pay etc.). The reliability of the questionnaire was verified by using the Cronbach’s alpha values and exploratory factor analysis. The seven variables of the value-in-use attributes of servitization identified by Raja et al. are as follows: relational dynamic, accessibility, range of product and service offering, knowledge, price, delivery, and locality. We measured three additional variables: perceived usefulness, confirmation, and customer satisfaction. Contributions Academic contribution This study provides a theoretical basis for examining the relationship between variables and the influence of the value-in-use attributes of servitization on customer acceptance and satisfaction. Practical contribution We present implications for customer satisfaction in the servitization process of manufacturing companies by explaining how customers accept the value-in-use attributes of servitization.