Creativity
and innovation are crucial to success in an industry, particularly in the new era of highly
connected businesses and network economy (e.g. global supply chains and cable/wireless ICT
systems).
As the importance
of the primary and secondary sectors declines, the success of so called Product
Service System (PSS) strategies can be observed as part of an overall trend towards a service-
based society that is increasingly knowledge and information based. The development of a Product
Service System (PSS) can be defined as the result of an innovation strategy focused on designing
and selling a system of products and services which are jointly capable of fulfilling specific client
demands.
Today, market
pressures are huge and often coming from unexpected new competitors. Only the
‘adaptive enterprises’ will survive over the long run. PSS thinking can act as a change
agent and
create access to superior strategies, often value propositions that directly fulfil the needs of clients
(in terms of place and time). The successful companies of the future will be able to operate
dynamically and in close symbioses with their clients. This way they can create a strong client base,
a good brand, and rapidly growing their business. The key success factor for PSS is a direct
satisfaction of clients’ needs. Logistics should be client-driven. The logistic chain can even
be
completely inverted as has been shown by Dell computers.
Product-service
systems offer a promising strategy to unlink value creation and resource
consumption. They can open out-of-the-box thinking in terms of alternative organisation models,
often resulting in less material- intensive solutions that satisfy customer demands directly.
Surprising new business perspectives can be derived by shifting the commercial focus from selling
products to providing solutions for a given problem.
Although
it should be emphasised that PSS is a commercially driven business concept, literature on
PSS often identifies a relationship between PSS and sustainable development. The reason that PSS
may be described as a potential eco-efficient innovation strategy is the holistic attitude that is
stimulated. PSS aim at a cultural change from 'product oriented' to 'service oriented' consumer
patterns. The need underlying consumer demand is taken as a focus point. The planning and design
of PSS facilitates the reorganisation of the consumption process and provides potential
opportunities for improved eco-efficiency. Often, consumption and production are much more
integrated than in traditional product-based business models. Consequently, PSS strategies can
result in clean, clever and competitive business opportunities.
Although
PSS strategies and sustainable development paths often coincide, there is no universal
rule. PSS need to be well-planned and developed to fully release their sustainable development
potential and to avoid negative side effects. Indeed, PSS can also result in negative environmental
impacts. For example, they can create extra transportation or packaging for the individualised
delivery of goods/services, or induce ‘rebound effects’ such as the creation of increased
consumption volumes.
PSS strategies
invite industries to rethink and redesign their role in the value chain. The factors
that determine success are strongly dependent on the category of the PSS and the sector (i.e.
business to business, business to consumer). Companies have to analyse the roles, competences
and motivating factors for all actors involved in the value chain, the size, geographical character
and maturity of the market, and the strengths of competitors.
A profound
understanding of the market system in question is an important requirement and often
a starting point in PSS innovation planning. Identification and selection of the relevant variables
in
the system, and the stakeholders involved in the development and implementation process are
essential for a targeted design of the PSS proposition.
Cees van
Halen
Carlo Vezzoli
Robert Wimmer
