Service Business Model Canvas: A Boundary Object Operating as a Business Development Tool
This study aims to increase understanding of the
transition of business models in servitization. The significance of
service in all business has increased dramatically during the past
decades. Service-dominant logic (SDL) describes this change in the
economy and questions the goods-dominant logic on which business
has primarily been based in the past. A business model canvas is one
of the most cited and used tools in defining end developing business
models. The starting point of this paper lies in the notion that the
traditional business model canvas is inherently goods-oriented and
best suits for product-based business. However, the basic differences
between goods and services necessitate changes in business model
representations when proceeding in servitization. Therefore, new
knowledge is needed on how the conception of business model and
the business model canvas as its representation should be altered in
servitized firms in order to better serve business developers and interfirm
co-creation. That is to say, compared to products, services are
intangible and they are co-produced between the supplier and the
customer. Value is always co-created in interaction between a
supplier and a customer, and customer experience primarily depends
on how well the interaction succeeds between the actors. The role of
service experience is even stronger in service business compared to
product business, as services are co-produced with the customer. This paper provides business model developers with a service
business model canvas, which takes into account the intangible,
interactive, and relational nature of service. The study employs a
design science approach that contributes to theory development via
design artifacts. This study utilizes qualitative data gathered in
workshops with ten companies from various industries. In particular,
key differences between Goods-dominant logic (GDL) and SDLbased
business models are identified when an industrial firm
proceeds in servitization. As the result of the study, an updated version of the business
model canvas is provided based on service-dominant logic. The
service business model canvas ensures a stronger customer focus and
includes aspects salient for services, such as interaction between
companies, service co-production, and customer experience. It can be
used for the analysis and development of a current service business
model of a company or for designing a new business model. It
facilitates customer-focused new service design and service
development. It aids in the identification of development needs, and
facilitates the creation of a common view of the business model.
Therefore, the service business model canvas can be regarded as a
boundary object, which facilitates the creation of a common
understanding of the business model between several actors involved.
The study contributes to the business model and service business
development disciplines by providing a managerial tool for
practitioners in service development. It also provides research insight
into how servitization challenges companies’ business models.
[1] T. S. Baines, H. W. Lightfoot, O. Benedettini and J. M. Kay, “The
servitization of manufacturing: A review of literature and reflection on
future challenges,” Journal of Manufacturing Technology Management,
vol. 20, no. 5, pp. 547–567, 2009.
[2] R. Oliva and R. Kallenberg, “Managing the transition from products to
services,” International journal of service industry management, vol. 14,
no. 2, pp. 160–172, 2003.
[3] R. Wise, and P. Baumgartner, “Go downstream: the new profit
imperative in manufacturing,” Harvard business review, vol. 77, no. 5,
pp. 133–141, 1999.
[4] S. L. Vargo and R. F. Lusch, “Service-dominant logic: Continuing the
evolution,” Journal of the Academy of Marketing Science, vol. 36, no. 1,
pp. 1–10, 2008.
[5] B. Edvardsson, A. Gustafsson and I. Roos, “Service portraits in service
research: A critical review,” International Journal of Service Industry
Management, vol. 16, no. 1, pp. 107–121, 2005.
[6] C. Grönroos, Service management and marketing: a customer
relationship management approach. Massachusetts, Toronto: Lexington
Books, 1990.
[7] J. A. Fitzsimmons and M. J. Fitzsimmons, Service Management:
Operations, Strategy, and Information Technology, 6th ed., New York:
McGraw-Hill, 2008.
[8] P. R. Carlile, “Transferring, translating, and transforming: An integrative
framework for managing knowledge across boundaries”, Organization
Science, vol. 15, no. 5, pp. 555–568, 2004
[9] R. Amit and C. Zott, “Value creation in e-business,” Strategic
Management Journal, vol. 22, no. 6–7, pp. 493–520, 2001.
[10] H. Chesbrough, “Business model innovation: It's not just about
technology anymore,” Strategy & Leadership, vol. 35, no. 6, pp. 12–17,
2007.
[11] D. J. Teece, “Business models, business strategy and innovation,” Long
Range Planning, vol. 43, no. 2–3, pp. 172–194, 2010.
[12] C. Zott and R. Amit, “Business model design and the performance of
entrepreneurial firms,” Organization Science, vol. 18, no. 2, pp. 181–
199, 2007.
[13] H. Chesbrough and R. S. Rosenbloom, “The role of business model in
capturing value from innovation: evidence from Xerox Corporation’s technology spin-off companies,” Industrial and Corporate Change, vol.
11, no. 3, pp. 529–555, 2002.
[14] P. H. Coombes and J. D. Nicholson, “Business models and their
relationship with marketing: A systematic literature review,” Industrial
Marketing Management, vol. 42, no. 5, pp. 656–664, 2013.
[15] A. Osterwalder and Y. Pigneur, Business model generation. Hoboken:
Wiley, 2010.
[16] M. W. Johnson, C. M. Christensen and H. Kagermann, “Reinventing
your business model,” Harvard Business Review, vol. 86, no. 12, pp.
50–59, 2008.
[17] S. M. Shafer, H. J. Smith and J. C. Linder, “The power of business
models,” Business Horizons, vol. 48, no. 3, pp. 199–207, 2005.
[18] R. F. Lusch and S. L. Vargo, “Service-dominant logic: Reactions,
reflections and refinements,” Marketing Theory, vol. 6, no. 3, pp. 281–
288, 2006.
[19] S. L. Star and J. R. Griesemer. Institutional Ecology, “Translations” and
Boundary Objects: Amateurs and Professionals in Berkeley’s Museum
of Vertebrate Zoology, 1907–39. Social Studies of Science, vol. 19, no.
3, pp. 387–420, 1989.
[20] D. Nicolini, J. Mengis and J. Swan, ”Understanding the role of objects in
cross-disciplinary collaboration,” Organization Science, vol. 23, no. 3,
pp. 612–629, 2012.
[21] L. Doganova and M. Eyquem-Renault, “What do business models do?
Innovation devices in technology entrepreneurship,” Research Policy,
vol. 38, no. 10, pp. 1559–1570, 2009.
[22] F. Hacklin and M. Wallnöfer, “The business model in the practice of
strategic decision making: insights from a case study”, Management
Decision, vol. 50, no. 2, pp. 166–188, 2012.
[23] A. Zolnowski, C. Weiß and T. Böhmann, “Representing service business
models with the service business model canvas – The case of a mobile
payment service in the retail industry”, Proceedings of the Annual
Hawaii International Conference on System Sciences, pp. 718–727,
2014.
[24] A. Viljakainen, M. Toivonen and M. Aikala, “Industry transformation
towards service logic: A business model approach,” Cambridge Service
Alliance, Working Paper Series, Cambridge University Press, 2013.
[25] S. Gregor and A. R. Hevner, “Positioning and presenting design science
research for maximum impact,” MIS Quarterly, vol. 37, no. 2, pp. 337–
355, 2013.
[26] T. Hakanen and E. Jaakkola, “Co-creating customer-focused solutions
within business networks: A service perspecti
[1] T. S. Baines, H. W. Lightfoot, O. Benedettini and J. M. Kay, “The
servitization of manufacturing: A review of literature and reflection on
future challenges,” Journal of Manufacturing Technology Management,
vol. 20, no. 5, pp. 547–567, 2009.
[2] R. Oliva and R. Kallenberg, “Managing the transition from products to
services,” International journal of service industry management, vol. 14,
no. 2, pp. 160–172, 2003.
[3] R. Wise, and P. Baumgartner, “Go downstream: the new profit
imperative in manufacturing,” Harvard business review, vol. 77, no. 5,
pp. 133–141, 1999.
[4] S. L. Vargo and R. F. Lusch, “Service-dominant logic: Continuing the
evolution,” Journal of the Academy of Marketing Science, vol. 36, no. 1,
pp. 1–10, 2008.
[5] B. Edvardsson, A. Gustafsson and I. Roos, “Service portraits in service
research: A critical review,” International Journal of Service Industry
Management, vol. 16, no. 1, pp. 107–121, 2005.
[6] C. Grönroos, Service management and marketing: a customer
relationship management approach. Massachusetts, Toronto: Lexington
Books, 1990.
[7] J. A. Fitzsimmons and M. J. Fitzsimmons, Service Management:
Operations, Strategy, and Information Technology, 6th ed., New York:
McGraw-Hill, 2008.
[8] P. R. Carlile, “Transferring, translating, and transforming: An integrative
framework for managing knowledge across boundaries”, Organization
Science, vol. 15, no. 5, pp. 555–568, 2004
[9] R. Amit and C. Zott, “Value creation in e-business,” Strategic
Management Journal, vol. 22, no. 6–7, pp. 493–520, 2001.
[10] H. Chesbrough, “Business model innovation: It's not just about
technology anymore,” Strategy & Leadership, vol. 35, no. 6, pp. 12–17,
2007.
[11] D. J. Teece, “Business models, business strategy and innovation,” Long
Range Planning, vol. 43, no. 2–3, pp. 172–194, 2010.
[12] C. Zott and R. Amit, “Business model design and the performance of
entrepreneurial firms,” Organization Science, vol. 18, no. 2, pp. 181–
199, 2007.
[13] H. Chesbrough and R. S. Rosenbloom, “The role of business model in
capturing value from innovation: evidence from Xerox Corporation’s technology spin-off companies,” Industrial and Corporate Change, vol.
11, no. 3, pp. 529–555, 2002.
[14] P. H. Coombes and J. D. Nicholson, “Business models and their
relationship with marketing: A systematic literature review,” Industrial
Marketing Management, vol. 42, no. 5, pp. 656–664, 2013.
[15] A. Osterwalder and Y. Pigneur, Business model generation. Hoboken:
Wiley, 2010.
[16] M. W. Johnson, C. M. Christensen and H. Kagermann, “Reinventing
your business model,” Harvard Business Review, vol. 86, no. 12, pp.
50–59, 2008.
[17] S. M. Shafer, H. J. Smith and J. C. Linder, “The power of business
models,” Business Horizons, vol. 48, no. 3, pp. 199–207, 2005.
[18] R. F. Lusch and S. L. Vargo, “Service-dominant logic: Reactions,
reflections and refinements,” Marketing Theory, vol. 6, no. 3, pp. 281–
288, 2006.
[19] S. L. Star and J. R. Griesemer. Institutional Ecology, “Translations” and
Boundary Objects: Amateurs and Professionals in Berkeley’s Museum
of Vertebrate Zoology, 1907–39. Social Studies of Science, vol. 19, no.
3, pp. 387–420, 1989.
[20] D. Nicolini, J. Mengis and J. Swan, ”Understanding the role of objects in
cross-disciplinary collaboration,” Organization Science, vol. 23, no. 3,
pp. 612–629, 2012.
[21] L. Doganova and M. Eyquem-Renault, “What do business models do?
Innovation devices in technology entrepreneurship,” Research Policy,
vol. 38, no. 10, pp. 1559–1570, 2009.
[22] F. Hacklin and M. Wallnöfer, “The business model in the practice of
strategic decision making: insights from a case study”, Management
Decision, vol. 50, no. 2, pp. 166–188, 2012.
[23] A. Zolnowski, C. Weiß and T. Böhmann, “Representing service business
models with the service business model canvas – The case of a mobile
payment service in the retail industry”, Proceedings of the Annual
Hawaii International Conference on System Sciences, pp. 718–727,
2014.
[24] A. Viljakainen, M. Toivonen and M. Aikala, “Industry transformation
towards service logic: A business model approach,” Cambridge Service
Alliance, Working Paper Series, Cambridge University Press, 2013.
[25] S. Gregor and A. R. Hevner, “Positioning and presenting design science
research for maximum impact,” MIS Quarterly, vol. 37, no. 2, pp. 337–
355, 2013.
[26] T. Hakanen and E. Jaakkola, “Co-creating customer-focused solutions
within business networks: A service perspecti
@article{"International Journal of Business, Human and Social Sciences:70916", author = "Taru Hakanen and Mervi Murtonen", title = "Service Business Model Canvas: A Boundary Object Operating as a Business Development Tool", abstract = "This study aims to increase understanding of the
transition of business models in servitization. The significance of
service in all business has increased dramatically during the past
decades. Service-dominant logic (SDL) describes this change in the
economy and questions the goods-dominant logic on which business
has primarily been based in the past. A business model canvas is one
of the most cited and used tools in defining end developing business
models. The starting point of this paper lies in the notion that the
traditional business model canvas is inherently goods-oriented and
best suits for product-based business. However, the basic differences
between goods and services necessitate changes in business model
representations when proceeding in servitization. Therefore, new
knowledge is needed on how the conception of business model and
the business model canvas as its representation should be altered in
servitized firms in order to better serve business developers and interfirm
co-creation. That is to say, compared to products, services are
intangible and they are co-produced between the supplier and the
customer. Value is always co-created in interaction between a
supplier and a customer, and customer experience primarily depends
on how well the interaction succeeds between the actors. The role of
service experience is even stronger in service business compared to
product business, as services are co-produced with the customer. This paper provides business model developers with a service
business model canvas, which takes into account the intangible,
interactive, and relational nature of service. The study employs a
design science approach that contributes to theory development via
design artifacts. This study utilizes qualitative data gathered in
workshops with ten companies from various industries. In particular,
key differences between Goods-dominant logic (GDL) and SDLbased
business models are identified when an industrial firm
proceeds in servitization. As the result of the study, an updated version of the business
model canvas is provided based on service-dominant logic. The
service business model canvas ensures a stronger customer focus and
includes aspects salient for services, such as interaction between
companies, service co-production, and customer experience. It can be
used for the analysis and development of a current service business
model of a company or for designing a new business model. It
facilitates customer-focused new service design and service
development. It aids in the identification of development needs, and
facilitates the creation of a common view of the business model.
Therefore, the service business model canvas can be regarded as a
boundary object, which facilitates the creation of a common
understanding of the business model between several actors involved.
The study contributes to the business model and service business
development disciplines by providing a managerial tool for
practitioners in service development. It also provides research insight
into how servitization challenges companies’ business models.", keywords = "Boundary object, business model canvas, managerial
tool, service-dominant logic.", volume = "9", number = "8", pages = "2857-6", }