Functional Thinking for Value Creation

The aim of this keynote paper is to demonstrate that with emerging challenges experienced in delivering integrated product and service solutions the adopted techniques for service cost estimation is evolving. Whilst representing the current practice and existing challenges in service cost estimation, through interaction with four major organisations in the defence industry, the paper focuses on the implementation of agent based modelling (ABM) as a possible approach to be adopted more prevalently in the future. Subsequent to presenting a sample agent based model, the paper presents three architectures of ABM that would potentially be considered for service cost estimation, including representations of interaction across organisations, equipments and humans.

As the climate change can be especially traced back to CO

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-emissions, it is a worldwide aim to reduce those CO

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- emissions. Therefore, it is necessary to make use of regenerative energy sources and highly efficient technologies. Besides the reduction of emissions within automotive mobility significant attention is paid to heat- and electricity generation in Germany. The reason for this is that more than half of the consumed energy in Germany is used for heat generation. Besides, large parts of the heating plants are not state-of-the-art. This shows that there is a considerable savings potential in this field. In 2007, German government decided that the percentage of combined heat and power (CHP) in electricity generation is supposed to be increased to 25 % until the year 2020. In order to reach this goal, an annual additional construction of CHP-units with a power output of 700 MW becomes necessary. A contribution to this aim can be achieved by small CHP-units, so-called combined heat and power plants. A combined heat and power plant is a unit in which a combustion engine generates electricity by means of a generator in a highly efficient manner. At the same time, the developing waste heat of the engine is used for heat generation. The joint electricity- and heat generation leads to an overall efficiency which is considerably superior to any conventional heatand electricity generation. In direct comparison, the primary energy input is up to 40% lower. Compared to a coal-fired power plant the CO

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-emissions are even 60% lower in a CHP powered with natural gas. Efficient energy conversion and intelligent control technology are only exemplary requirements, which are important issues in the CHP as well as in the automotive industry and which are mastered by Volkswagen. The Volkswagen combined heat and power unit “EcoBlue 2.0” stands out for a modular and compact design, and shows many similarities to the front part of a vehicle. Power unit, generator, engine control, heat exchanger and exhaust system are only a few examples for those similarities. Additional measures, such as modified valve springs, an optimised camshaft as well as a supplementary oil tank enable a long life-time in stationary operation and generate a product which stands out in competition. Sales as well as the subsequent control of the equipment are effected by the LichtBlick AG. For this purpose, the LichtBlick AG has developed the so-called fluctuating power concept, which implies a control center which can turn the combined heat and power plants on and off at the customer by remote control. The aim is the network connection of thousands of CHPs to a virtual power plant, which is able to close the gap between power requirement and -capacity within a short time and thus is a major advantage compared to the inert large power stations. The combination of the Volkswagen “EcoBlue 2.0” and the innovative fluctuating power concept of the LichtBlick AG is a totally new business model, which enables the introduction of high quantities on the energy market and thus strongly contributes to the reduction of CO

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-emissions.

Knowledge management represents a critical success factor for complex product service systems. Do we know how our product impacts service delivery? Do we understand the interactions between the product design, service design and actual customer utilisation of the two? Can we design a product aligned to our service vision? Relative to original equipment manufacture, the introduction of services brings a significant increase in the range of conceptual concepts and functional specialties that have to be integrated and considered within the design phase. This presentation explores the fundamentals of closed loop service knowledge management in the context of a product service system (PSS) design. What is knowledge in this context? What are the capability building blocks? How do they work together to deliver visible service delivery value? In particular it describes a system engineering approach to the deconstruction of the knowledge management problem.

The aviation maintenance, repair and overhaul (MRO) industry has a long history of developing and applying product service systems and similar service packages. Aircraft operator value the idea of shifting part of the operating risk to service providers by having them guarantee aircraft availability. The revenue model for such services is often based on operated flight hours and thereby closely related to the revenue model of an aircraft operator. Nevertheless, true total care packages for aircraft have not yet prevailed on the market since aircraft operators prefer modular packages that offer them higher cost transparency and more flexibility in deciding what activities to outsource.

Consumable and Expendable Material in the aviation industry is used during all MRO activities especially during airframe maintenance and overhaul. The material scope ranges from standard hardware like nuts, bolts and rivets to liquid consumables such as oils, greases and hydraulic fluids to electrical and electronic parts and small components. All of this material is not suitable for repair processes either because of technological or economical reasons.

Many operators decide to contract the supply of consumables and expendables separately from the actual maintenance activity, breaking up an important link in a normal product oriented service systems. However, the general expectations towards the service providers in terms of availability guarantees and pricing model persist. The provisioning of consumables and expendables in this context is no longer part of product service system of a capital good. It becomes a stand alone service product that is subject to similar expectations as a product service system for a capital good.

This presentation analyses this industry trend and discusses advantages and challenges for such a service products on an overall level as well as for each player in the service system.

Recently, we have seen a rapid rise in expectations that engineering and scientific approaches will bring dramatic improvements in the design and production of services. There is a critical need to establish a method to measure customer satisfaction with services that guarantees certain objectivity and use this information to create services that are better in quality. However, this cannot be achieved by systematically exploiting information or more intense labor. To tackle this problem, we have been focusing our efforts on service engineering since 2001. This paper provides the state of the art in service engineering and the tools for it that we developed.

This paper presents a set of challenges in the transformation of a traditional manufacturer into a product service system provider. These challenges constitute the main elements of change in the transformation. The paper forms part of the development of a transformation model for servitization and advances prior conceptual research on the shift from a product-centric mode to a servitized one. This is qualitative research based on data collected from 41 industry and academic experts. Nine elements of change were identified, which will allow industry practitioners, who take on the journey of servitization to understand, analyse and plan their organisation’s transformation.

This paper begins by consolidating industrial challenges and research issues concerning Product/Service Systems obtained through various activities by the authors. Based on this, it points out the importance of the holistic view in further research in this area so that PSS providers do not fall into local optimization. The intent of this contribution to our research community includes shedding light on interesting issues that thus far have been relatively invisible and with narrower scope.

Industrial product-service systems have become an increasingly researched topic during the last decade. Although product and service components of these integrated systems strongly interact, literature on adaptation of physical goods to the service needs of delivering these product-service bundles is rare. The paper contributes to closing this gap by analyzing expert interviews on industrial product-service systems. Based on this empirical basis, to begin with the diffusion of product adaptation in the capital goods producing industries is discussed. Furthermore, characteristics of product adaptation processes are identified. Motives behind doing so are revealed and challenges for companies are substantiated.

Product life cycle (LC) models are mainly based on the traditional product understanding where the phases from ideation to recycling are sequential steps [1]. Today, products have to be understood as a combination of physical products and related services, so called “extended products” (EP) [2]. A famous example of an extended product is Apples iPhone, a cellular phone as physical core extended by iTunes as access point to software offerings to customize the core with services [3]. LC models addressing the characteristics of the EP concept are rarely discussed in literature [4]. Within this paper, the relationship between product and service LC is discussed to get a better understanding of the extended product LC. It will be shown that there can be both the product as well as the service the incubator for an EP in any phase of their life cycle.

Increasingly, manufacturers become service providers rather than product providers. In this work, a framework based on industrial studies is suggested for developing product service system. The framework is represented by six life cycle phases where three actor categories views are represented. The framework is described using examples from different industries/businesses. The intention is that the framework can be used for both B2C and B2B type of relations. One significant characteristic is that the “traditional” sales phase is replaced by a sales occasion that occur within different life cycle phases depending on which business context/model is used.

The paper proposes an approach to increase the decision makers’ awareness at the gate, when evaluating PSS design alternatives from a lifecycle and value oriented perspective. The paper illustrates a lightweight value visualization tool, running on top of existing CAD systems, supporting value visualization of a given part or assembly, thanks to color coding. Information from value assessment is in this way translated into visual features of the CAD 3D model. Despite the approach is still on a start-up phase, an early mock-up of the tool has been developed and applied to a real aircraft engine component, in order to verify the feasibility of the approach.

In the IPS

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planning phase, defined customer and provider needs have to be considered for the realization of product and service shares. In contrast to a traditional product with add-on services, the service shares are an integral part of an IPS

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. This paper presents the influence of the IPS

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business model on the development of a micro milling spindle. The IPS

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micro milling spindle is a core component for a milling process. An overview of possible solutions of product and service shares for a micro milling spindle under consideration of the IPS

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business model and suitable development methods are presented.

This paper presents an eco-innovative design methodology to support designers in developing product service systems (PSS) by using functional analysis and the TRIZ substance-field model. This paper collects existing PSS cases and identifies the relation between products and services. The defects existing in current PSS models within the relation between products and services are discussed. This paper also analyzes the characteristics of products, services and the environment. By using this method, the designer is able to identify the problems step by step and get some innovative suggestions.

Sustainable business design has gained growing interest recently. However, it is often difficult to clarify which business activities actually contribute to (or harm) the sustainability of the earth due to high complexity of environmental and economical system of our society. In order to help a business to generate sustainable business ideas handling this complexity in a systematic and comprehensive manner, this paper proposes a method to formulate a wide variety of causalities in our society into a cause-effect pattern library, based on which sustainable business case base is constructed. An idea generation method is proposed using the case base.

In recent years serious efforts were directed towards building methodologies for PSS design. Regardless of these efforts, the degree of acceptance in industry for these methodologies cannot be clearly determined. Moreover, any PSS design methodology requires ideative processes and relies on creativity and tacit knowledge of the design team; this cannot be easily formalized within a traditional methodology. This paper approaches these issues by enhancing an already-existing methodology (based on acknowledged tools such as TRIZ and QFD) by adding a support ontology to it. The entire concept is then exemplified on a software-PSS project related to supporting innovation in SMEs.

Customer orientation is one of the key aspects to obtain competitive advantages. Especially in the capital goods industry, the offered Product-Service Systems (PSS) have to fulfill all customer requirements to ensure the performance expected. Today, the development of the product and service portfolio is mostly separate. Thus, the manufacturers are faced with the challenge to configure the “right” solution out of these separate portfolios. Therefore, it becomes necessary to support manufacturers with a systemized configuration, regarding the specification of configuration and the characteristics of PSS. This paper illustrates a framework for a customer oriented configuration of Product-Service Systems.

Offering customized solutions is one of the important characteristics of the integrated provision of a product and a service. Generally, customer requirements for a service might change depending on the environments which customers are facing. In order to meet such changeable requirements and realize a long-term relationship, the key is continual customer-oriented service improvement. This paper proposes an engineering method to support the planning of such customer-oriented service improvement. To be more precise, an optimum resource allocation method using a Genetic Algorithm is adopted to prioritize problems to be solved for the purpose of maximizing the degree of customer satisfaction.

Product service systems are the holistic design of products and services. In product design, traditional customer needs are confined to specific needs of tangible products, which are not appropriate for product service system design that intends to provide more comprehensive and higher level solutions. Thus, a notion of customer value-oriented product service system design was proposed, in which customer value is divided into economic value, functional value, and emotional value. An optimization model dealing with discrete and continuous variables was given to determine appropriate values of functional characters. The approach was applied in a real-world example for fork truck systems.

Manufacturers today are increasingly focusing on services and concepts such as Product Service Systems (PSS) and Integrated Product Service Engineering (IPSE) have been getting more attention. On the other hand, there are various existing methods/systems in companies. Some aim at managing customer value or/and customer satisfaction. Based on some empirical results obtained from an attempt to design PSS at a manufacturer in Sweden Customer Received Value (CRV) is defined as an index to integrate Customer Value Management (CVM) and Customer Satisfaction Management (CSM). The results reveal the benefits of using PSS as an approach to manage CVM and CSM.

In these early stages of PSS research, it is necessary to define a holistic problem definition for designing productservice systems (PSS). In this paper, the current industrial practice of the problem definition within PSS is analyzed and presented. This analysis has lent itself to a classification of the steps involved in the problem specification stage into developing the Customer Specification (what the customer wants) and the Customer Demand (how the customer wants it) stage. Also it summarizes the important parameters considered in the problem definition. These results help to identify methods required to solve the industrial problem definition of PSS.

Eco-efficient PSS innovations represent a promising approach to sustainability. However the adoption of such business strategies is still limited because often involves significant corporate, cultural and regulatory barriers. Changes in basic belief, values, and interpretative frames (in other words higher order learning) are required. One way to facilitate this type of learning is through socio-technical experiments. Starting from these considerations, and bringing together insights from innovation sciences, the paper investigates the potential contribution that a strategic design approach can have in designing small scale socio-technical experiments as a way to stimulate and favor the adoption and diffusion of eco-efficient PSS.

Many current sustainability considerations in industry constrain design space by emphasizing reduced material and energy flows across product life cycles. However, there are also opportunities for sustainability awareness to extend design space and drive innovation. Product-service systems (PSS) in particular can be a vehicle through which sustainability-driven innovation occurs. A framework for strategic sustainable development, including a backcasting approach, provides the basis for understanding sustainability in this work and provides insight into how incremental and radical approaches could be aligned within product innovation. This work explores how sustainability considerations can be better integrated into existing product innovation working environments, with an emphasis on opportunities that occur as sustainability knowledge leads to innovation through a product-service system approach. It is demonstrated and ideas are discussed around how sustainability can be used to

drive

innovation processes through product-service systems that companies rely upon, while also supporting global society’s movement toward sustainability.

Product Service System (PSS) has become a widely-accepted concept in the business world. The user task model traditionally used in user-centered design is employed in analyzing user’s goals to drive the PSS conceptual design. The proposed PSS conceptual design approach has three models: user task model, function model and conceptual service blueprint. The conceptual service blueprint is proposed to model the PSS concept. PSS concept is constituted by service activities and product modules. Product behavior is introduced to bridge the gap between function and physical module. A case study is carried out to demonstrate the effectiveness of the approach.

This paper presents a new PSS design process and associated design support systems being developed by the PSS Design Project Consortium sponsored by the Korean Ministry of Knowledge Economy. Six procedural steps are included in the PSS design process. For design support systems, the activity modelling system is developed for a complete description of activity with context elements. The PSS function modelling system can support the definition of functions and service providers/receivers and their decompositions. The modified service blueprint system is also developed to address relations among activities and functions. Finally, the PSS DesignScape is used to capture and visualize the PSS design process. Sample case example is presented to show the effectiveness of the PSS design support systems.

Product-Service Systems are characterized by the integration of technical products and services along their lifecycle. To generate principle solutions of a PSS that meet customer-specific requirements, it is important to consider interdependencies between products and services already at an early phase of development. Thus, a suitable model-based approach for conceptual PSS development has been developed. Due to the complexity of this modelling approach, deficiencies regarding its practical usability could be revealed. This contribution aims at presenting initial requirements and optimization objectives concerning the practical usability of the modelling approach. Therefore, two PSS scenarios with practical relevance have been analyzed.

Growing from data collected within a major EU research project in the aerospace domain, the paper proposes a candidate approach to assess the value of Product Service System design alternatives in a preliminary design phase. A framework composed of six main families of value criteria is proposed to support the product/service development team in evaluating the responsiveness and trade-off between alternative designs that target lifecycle commitment, with respect to the impact on perceived values and stated needs and expectations. A visualization approach is also proposed to quickly communicate the value contribution of the design alternatives at the decision gate.

Many manufacturers are considering the adoption of a business model in which the use or the function of a product is sold instead of the product itself, namely a Product Service System (PSS). This paper presents the first two phases of a generic method to design a PSS business model for a manufacturer of investment goods. The first phase consists of the analysis of the company’s current business model, its competitive environment and the function provided by the investment good under consideration. The second phase focuses on the generation of PSS business model options, based on the formulation of value creation options over the life cycle of the investment good in some specifically chosen customer segments. The method presented is illustrated with a case study conducted for an elevator manufacturer. It is demonstrated that, in the two first phases of this PSS design method, it is essential to have a correct representation of the customer segments and to create within each segment an understanding of customer specific requirements related to the function of the product.

A multitude of PSS design methods has been published but industrial application is sparse. The paper introduces a new case of integrated product-service offerings in the construction business. Then, we apply the PSS Layer Method developed earlier to evaluate this method further on and to publish new experiences. We show that the method is a helpful tool to describe integrated offerings, thus product-service systems, holistically. Generalized findings on what industry is not addressing enough in PSS development will be given.

Concerning Industrial Product Service Systems (IPS

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) in machine engineering, the challenge for the supplier exists in the determination of the expenses for the provision of the included services over the life cycle of the IPS

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before the start of contract. Thus, in this paper an approach is presented which explains how a supplier of an IPS

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, which consists of a machine together with a warranty of availability, can determine his expenses for the warranty. In doing so, the underlying actual operating- and load-dependent failure behavior is taken into account to estimate the supplier’s serviceability to provide the warranty.

Industrial Product-Service Systems (IPS

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), combined with a flexible planning and scheduling process, represent a longterm competitive advantage. The value provision via IPS

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comprises several degrees of freedom, such as the partial substitution of product and service shares, as well as the integration of customers’ resources. Thus, the IPS

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scheduling represents an optimization problem, flexibly considering the relevant aspects of the current business model. The article first describes the scheduling approach for IPS

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which considers the IPS

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potentials for optimization. Furthermore, the correlation between the individual specifications of the business model features and the planning procedure is described in detail.

Especially for Industrial Product Service Systems (IPS

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) which are very new and can therefore be classified as Really New Products (RNPs) the stability of customer preferences is a crucial success factor. Against this background it is essential to identify forms of knowledge transfer which enable customers to learn about IPS

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and help them stabilize their preferences. In this study, we set up a large scale practitioner experiment to test the effect of combinations of information and learning mechanisms on preference stability. We use an innovative device for remote service provision. Our results indicate the importance of conveying information combinations for learning about IPS

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. We therefore conclude, that only by regarding both, information and learning mechanisms, and determining appropriate information strategies can effects on customer preferences really be controlled for in the best possible manner.

Many successful companies employ Product Service Systems (PSS) into their business model mainly due to an economic incentive. However, there is no simple and structured approach to ensure an improvement of PSS’s environmental performance at an early decision making stage in lieu selling product. This paper presents a preliminary simplified decision making model for manufacturer’s view to design service parameters of a potential PSS strategy at an early planning stage. The model based on Life Cycle Assessment, Life Cycle Costing, hierarchical clustering and goal programming optimisation methods. Two forklift case studies demonstrated the model applications for leasing and renting strategies.

As location-related technologies and devices have become increasingly available, service offerings based on locationcontext information are gaining much attraction. This paper describes a new location-based service model, Indoor Location Analytics, a network-based service that helps store owners or building managers of a structure or a shopping mall, to analyze the traffic information of customers. Just as existing web analytics services benefit website managers, Indoor Location Analytics benefit store owners, building managers, and shoppers by providing a common data platform service.

Development processes in product and service engineering are foremost carried out as projects. One characteristic of projects is their uniqueness. As Product-Service Systems (PSS) are intended to be customized solutions, unique development projects are natural for PSS. Nevertheless, there is no specific approach to support an integrated management of product and service development projects. In our paper, we focus on opportunities, a solution approach, and software support for PSS development project management. We provide a set of opportunities how to adapt existing approaches or how to develop new methods for the purpose off fully integrated project-based PSS development.

‘Cloud computing’ enables system integrators to develop business platforms from existing system by combining software and hardware functions provided by virtualized servers and resources. This functional substitution is the essence of cloud computing and it is the embodiment of the concept of Product-Service Systems in the IT industry. Bearing this in mind, this paper proposes design methods for cloud-based business platforms. By applying Axiomatic Design, Design Structure Matrix and Design-for-X, these design methods can be streamlined, thereby identifying better alignment/separation of functionalities and allocating them to physical servers and resources. Accordingly, the methods will facilitate the shift to service-based business in the IT industry.

An extension towards service provision takes place in manufacturing industry. Inclusion of softer service aspects indicates that the common view on knowledge management to control and monitor a technical process have limitations. Sharing expertise is an additional way of managing knowledge particularly with the intentions to make experience based knowledge organizational available. By studying product developers’ daily work, especially how they perceive that they apply and share knowledge, we problematize knowledge activities in product-service development to discuss the established knowledge management activities. The paper suggests some considerations to support the development of a knowledge base for product-service design.

This paper reports on a qualitative study, carried out at a Swedish aero engine manufacturer. The study was initiated to explore key indicators related to innovation capability in a Product-Service System (PSS) context. Developing PSS changes the dynamics of collaboration, since the offering of such systems usually involves a network of partners sharing the responsibility for a delivered function over a full lifecycle. In particular, this paper focuses on describing aspects related to external and internal collaboration, and it further discusses how to measure the company’s collaborative performance, taking into account both activity and effect measures.

The product structure plays a major role in the PLM as an integral design element for coping with product complexity. As a prerequisite for enabling product structuring, a descriptive model of the product is needed, a product model. Product models for the service industry have been subject for scientific examination nowadays, but so far a general and practical definition, as for tangible goods, is still missing. This paper proposes a general product architecture for services in the telecommunication industry by reflecting on existing work from the manufacturing industry. These theoretical findings have been evaluated by an international study to provide indications for its adequacy.

In order to cope with the increased complexity of the integrated IPS

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development, an IT based assistance system aids the developer during the entire process. It facilitates defining configurations of product and services fulfilling customer needs and business promises. To ensure an efficient development and to provide decision support, existing knowledge or experience from previous developments and IPS

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provision phases should be used. This knowledge can be automatically generated by the Virtual Life Cycle Unit from the spatially and temporarily distributed data along the IPS

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lifecycle. This paper introduces feedback mechanisms and concepts of the knowledge generation to support the development processes and its influences.

Despite the emergence in literature of novel contributions in the Product-Service Systems (PSS) Engineering, there is still a lack of systematic knowledge in this area. Most of the proposed methodologies are mere adaptation of traditional engineering approaches to the PSS domain. In this context, one of the most analysed methods is the theory of inventive problem solving (TRIZ). Purpose of this paper is to propose a way to use the Laws of Technical Systems Evolution (LTSE) and the Evolution Trends to predict what are the most likely improvements that can be made to a given PSS. A case study makes evidence of the potential behind the adoption of the LTSE.

Industries are transforming their business strategy from a product-centric to a more service-centric nature by bundling products and services into integrated solutions to enhance the relationship between their customers. Since Product- Service Systems design research is currently at a rudimentary stage, the development of a robust ontology for this area would be helpful. The advantages of a standardized ontology are that it could help researchers and practitioners to communicate their views without ambiguity and thus encourage the conception and implementation of useful methods and tools. In this paper, an initial structure of a PSS ontology from the design perspective is proposed and evaluated.

Functional Products (FP) and Product Service Systems (PSS) may be seen as integrated systems comprising hardware and support services. For such offerings, availability is key. Little research has been done on integrating Data Stream Management Systems (DSMS) for monitoring (parts of) a FP to improve system availability. This paper introduces an approach for how data stream mining may be applied to monitor hardware being part of a Functional Product. The result shows that DSMS have the potential to significantly support continuous availability awareness of industrial systems, especially important when the supplier is to supply a function with certain availability.

Both Product-Service System (PSS) literature and industry express a need to close the design loop by feeding productin- use data to conceptual design. Nevertheless, how to actually accomplish this for PSS Conceptual Design is largely absent. This paper uses the literature and findings from interviews with industry as the basis for a system which could utilize product-in-use data from the sensors of large, capital-intensive, technical assets along with in-service records as well as receiver and provider needs to aid the creation of PSS Business Models at the PSS Conceptual Design stage.

The automotive industry is confronted with an increasing servitisation and rising mobility needs. At the same time the rapid development in information technology sets up new possibilities to create telematic solutions and to strike new paths in the development of mobility concepts.

This paper points out the developments in individual transport of passengers and the progress in information technology development and telematics. These two lines of development are merged into the development of mobility as a system of products and services. Using the method of cladistics, the relationship between various mobility enablers, and telematic solutions is explored. The results of the mutual impacts and co-evolution are analysed.

This paper proposes an evaluation scheme for PSS with a focus on constructing evaluation criteria. The proposed scheme has a four-layered hierarchical structure. The four layers refer to perspectives, dimensions, categories, and aspects. The sustainability and customer value perspectives are considered. The sustainability perspective consists of 3P dimensions, while the customer-value perspective consists of quality and cost dimensions. Each dimension is further classified into categories, and finally into more detailed aspects. The scheme has 5 dimensions, 24 categories, and 87 aspects in total. The PSS evaluation scheme can serve as an effective aid in designing as well as evaluating a PSS.

IPS

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flexibility as the ability to adapt a manufacturing system to changing requirements is an important tool for assuring the profitability of the long-term relationship between the supplier and the customer of an IPS

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. In order to reveal the economic relevance of IPS

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flexibility, the paper first identifies the most relevant drivers of IPS

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flexibility, then discusses its various dimensions and economic impact and finally concentrates on the calculation of the profitability of IPS

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flexibility from different perspectives.

Evaluating customer satisfaction is a key factor in service design. Therefore, some studies of customer satisfaction have been carried out in the field of service engineering. In these studies, customers’ expectations of service have generally been regarded as being shaped before service delivery. However, expectations of some components of service tend to be formed in the process of service receiving. To analyze service from the view of custoemer satisfaction, expectation that changes while customers are receiving service need to be considered. Therefore, we aim to develop the methodology to support designing services in a way that relates to the formation of customer expectations. In this paper, a model of shaping expectations in service receiving is examined and its effect on customer satisfaction is analyzed.

Human activities generate local environmental impacts (on the quality of water, air and soil), as well as global impacts affecting the ecological carrying capacities at world level.

The proposed methodology aims at representing both local and global impacts of a given activity, taking into account both direct and indirect impacts. The final objective is to establish an environmental dashboard based on a set of relevant indicators, in order to assess local and global environmental impacts caused by a given activity.

This paper will present the details of this methodology.

The contributions of automotive manufacturers to decrease environmental impacts of vehicles can be pursued through technical development. Additionally, eco-services in the phases of the life cycle can make a major contribution to increase resource- and energy efficiency in vehicles.

For automotive manufacturers it is essential to estimate customer requirements and acceptance of eco-services. In this paper a market research is presented, in which the acceptance and the application of eco-services in the group of commercial customers has been analysed in Germany. Selected industrial sectors with a relevant use of vehicles have been consulted and analysed regarding their attitude to eco-services.

The spare parts business is especially in the automotive industry of high relevance because of its high profit margin and its stability. Yet changing conditions pose new challenges to the spare parts management. Examples are the deregulation of the spare parts market or the increasing use of electronic components. To cope with these challenges, the protagonists need to find a convenient strategy and to pursue it consequently. For this purpose different scenarios for the spare parts market in 2030 have been created. In the paper the scenarios, the most important influence factors and possible approaches are described.

The productivity development for rail and road infrastructure has been weak a long time; and explanation can be found in the traditional contracts used, with little room for incentives for innovation. This literature study investigates the use of the few realized PSS contracts within the rail and road infrastructure. The descriptions and the scientific reports are on a synoptic level and a majority of the reports are funded by the involved actors, showing that there is an interest for PSS contracts in the industry and indicating significant potential for further research in the area.

Laptop computers are a popular electrical product. Since the technological progress of the product is rapid, after several years, consumers may face the decision whether they should purchase newer products. However, offering an upgrade service may help to reduce environmental burden of production. In this paper, the environmental impact of the components’ production stage and other lifecycle stages are estimated based on a disassembly. The paper tries to tell which components are suitable for upgrade. As a result, it is concluded that components with a relatively small environmental impact of the production and a fast technical progress are suitable for upgrade.

Proper combinations of products and services are recognized to the keys in establishing sustainable society. In this paper, we try to analyze efficiency to offer value to customers under a certain payment. As a case study we choose water purifier and compare different business options in the water purifier sales. We applied our value quantification method based on weighting of different functional requirements, and integral of value throughout the lifecycle. The paper tries to clarify the suitable combination of product and service that is effective in enhancing the value creation efficiency of business, in the aspect of cost-efficiency and eco-efficiency.

The problem of component degradation in aero-engines has become a matter of great interest in the context of Life Cycle Cost (LCC) for Original Equipment Manufacturers (OEMs). On root causes of cost incurred in the operational phase is the uncertainty around component degradation, leading to service support inefficiencies such as under or over capacity in the maintenance network. Different life prediction approaches are available; each has varying applicability to different degradation mechanisms, data quality and availability. This paper considers the necessity of degradation modelling capability for aero-engines LCC and reviews the different approaches found in literature and their underlying concepts.

The integrated consideration of product and service within Industrial Product-Service Systems (IPS²) leads to new chances and challenges across various planning levels: All services, sold with the machine, have to be planned during the entire life cycle. The article first describes the strategic positioning of IPS² business model dynamics in the course of the IPS² life cycle.In an economic point of view, also strategic aspects of complexity and uncertainty have to be considered. Furthermore the scheduling approach for IPS² is described handling complexity and flexibility in short term tasks.

This paper validates the assumption that customer participation in mass customization, based on modularization, inspection, and configuration, is effective in the design and production of a service. This validation is based on interviews conducted with a number of industrial companies. These companies included a tour agent, an airline company, and an elevator maintenance company. The interview results showed that the current level of customer participation is insufficient. This study concludes that there are significant opportunities to apply modular and masscustomization methodologies to support customer participation and to realize customer-oriented service design and production.

In modern manufacturing landscape, companies are increasingly relying on product service systems i.e. bundling of products and services together in order to gain a competitive edge. In this article we present the Smart Real-Time Factory, a smart digital manufacturing environment that can transform the process of production into an informational service for the customers. The different components of the smart factory are discussed at length along with a discussion of the different services that can be offered by the smart factory.

Companies are seeking for new ways to do business. The Product-Service System concept can be a potential option since it meets requirements regarding sustainability and also introduces a type of business in which the focus is placed on delivering function instead of providing value thought tangible products. However, the deployment of PSS involves a reassessment of companies’ business models. Therefore, this paper identifies and classifies the characteristics of the PSS business model that need to be addressed for its implementation, which was carried out using literature review and considering three types of PSS and nine elements of a business model.

Compared to common selling processes of machines, selling processes of IPS² seem to be more complex. The two responsible causes are: (i) the higher degree of newness, and (ii) the risk associated with the IPS² buying situation. Among other things the complexity is reflected in the fact that more people are involved in the buying decision. This characteristic will be the focal point of this paper. The aim is to figure out to what extent the buying behavior in case of an IPS² differs from organizational buying behavior of non-IPS² settings and how customers should be convinced of IPS² advantages.

While small dynamic firms propose PSS applications based on new technologies quite easily, large infrastructures are often required. SMEs don’t have the capacity to do this alone. For complex systems, different SMEs combine efforts to build an efficient infrastructure. Other SMEs can join and propose other PSS, creating a network. As networks grow the SMEs must understand their place within the structure and how they interact with other members. A tool is proposed to visualize relations between partners and illustrate the construction of the service chains composing the PSS. The tool is then applied to the case of urban PSS.