26th International Association for Management of Technology Conference - IAMOT 2017

Due to the global convergence of producers and consumers as well as of the consistency and homogeneity of product qualities and technologies, consumer products (hardware and software) are becoming increasingly similar and, thus, interchangeable. Differentiation merely by products has become highly complex and difficult. Additionally, producers from low-cost regions are increasingly able to produce at similar quality levels to Europe. Service Engineering is one solution for restoring or strengthening differentiation in the market by means of expanding existing products with specially tailored services (hybrid products) in order to achieve a sustainable competitive advantage. The purpose of this paper is to clarify the topics of service engineering in theory and practice, as well as to underline the importance of digitization and Industry 4.0 for service engineering. Therefore, a thorough discussion of the concept of service engineering is provided, focussing on the redesign and further development of services within the framework of interdisciplinary strategy and creative processes with the help of engineering principles and methods. Besides, it entails the model-based and practical implementation of existing and new service solutions. The necessary know-how concerning procedures and methods forms the basis for determining customer needs, such as finding ideas and developing new services. In a six-step-maturity-model, companies can classify their service portfolios and, thus, determine their current status quo. In a target setting, they can expand and derive their offers by developing services from the above levels. Due to the rapid rate of digitization, industrial machines and systems have become increasingly equipped with digital components and data connections to internal and external networks. Consequently, there are new possibilities to offer innovative services by making use of these new technological possibilities. Based on this discussion a practical concept with concrete service applications is presented, which has been developed in close cooperation with industrial partners from the sectors of mechanical and plant engineering, as well as logistics service providers and universities. Additionally, the status of service development in Austrian companies is assessed, revealing that new services are often not developed as systematically as necessary and that companies often lack the required know-how (Richter et al. 2017). Finally, a roadmap for offering hybrid products should represent a theoretical model to apply Service Engineering. It consists of different stages: firstly, starting or enlarging the branch of services which could be useful for customers; secondly, establishing a systematic process for identifying a customer´s specific requirements and needs; thirdly, the fusion of products and specially geared services aligned as mentioned in the previous stage. Consequently, the major benefit of this paper consists of providing a comprehensive view on Service Engineering including conceptual as well as practical approaches supported by empirical data.