Servitization : a South African perspective

Abstract

According to Desmet, Van Dierdonck and Van Looy (2003:40) a survey of German and Belgium executives revealed that “over 90 per cent of all manufacturing companies believe the development of services is crucial for maintaining and improving their competitive position”. Seen in the context of a predominately global services economy many manufacturing institutions view services as a means for increasing their revenue stream and gaining a competitive advantage in the marketplace. As a consequence servitization within the manufacturing industry is gaining in momentum. A brief review of the existing servitization literature, however, reveals that few research studies have been undertaken to determine the management implications involved. A literature study was therefore undertaken to gain a theoretical insight into the management processes involved. With the insights gained from the literature research serving as background and as a source of reference, a research study of the servitization process, at a small to medium sized South African manufacturing enterprise, was undertaken. Some of the more pertinent findings emanating from this research study are presented in this paper. It is stressed that this study is restricted in context, scope and content in that it serves as a precursor to a far more in depth study to be undertaken during 2010.