Restructuring towards a Service Orientation: The Strategic Challenges

Abstract

Reports results from in‐depth interviews with 80 senior managers in 16 US‐based multinational firms and from group discussions with 388 senior‐level executives from 241 firms. The results indicate an attempt by the majority of firms to move from product dominance towards a service orientation. Identifies two major strategic hurdles: a rethinking of the client′s role as co‐producer, including measurements of client productivity; and the design and management of a new service development process. The study identifies the client productivity measurement issue as a major strategic hurdle and the authors suggest that techniques used internally (such as behaviour modification, training, and self‐motivation) be turned externally onto the client to increase productivity. The area of new service development (NSD), another significant strategic hurdle, is an emerging and relatively untouched subject. Identifies differences between new service and new product development.

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