Services, industry evolution, and the competitive strategies of product firms
Article first published online: 3 MAR 2014
Copyright © 2014 John Wiley & Sons, Ltd.
Strategic Management Journal
Volume 36, Issue 4, pages 559–575, April 2015
How to Cite
Cusumano, M. A., Kahl, S. J. and Suarez, F. F. (2015), Services, industry evolution, and the competitive strategies of product firms. Strat. Mgmt. J., 36: 559–575. doi: 10.1002/smj.2235
- Issue published online: 3 MAR 2015
- Article first published online: 3 MAR 2014
- Accepted manuscript online: 20 JAN 2014 10:35AM EST
- Manuscript Accepted: 9 JAN 2014
- Manuscript Revised: 8 JAN 2014
- Manuscript Received: 27 APR 2012
- services; strategy; industry evolution; industry lifecycle
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. Copyright © 2014 John Wiley & Sons, Ltd.