Title: Complexity approach to joint value discovery in service innovation management

Authors: Erik Lindhult; James K. Hazy

Addresses: Mälardalen University, P.O. Box 325, SE-631 05 Eskilstuna, Sweden ' Adelphi University, 1 South Avenue, Garden City NY, USA

Abstract: The paper uses complexity ideas to consider servitisation dynamics in industrial companies. The purpose is to advance complexity modelling in service innovation management and the dynamics of servitisation, an area which has so far spawned only limited research. Service innovation management is modelled as a dynamic process of joint value discovery that increases the potential for radical or architectural innovation through increased marketplace exploration as global industrial firms move from product-based to service-oriented business models. Building on prior servitisation research, this study is an outcome of a three-year process-oriented action research project in two global industrial companies. The study identifies four phases in the transition to servitisation and uses phase transition modelling from complexity science to describe a typology of dynamically stable innovation business models in industrial firms. The model can be used to better understand, predict and guide the process, mechanisms, and outcomes of increased capacity for joint value discovery. The theoretical developments presented are particularly useful in guiding leadership of innovation in broader organisational, networked, and open innovation settings, contributing to the development of new service innovation strategies as well as an approach to systemic leadership of innovation activity more broadly.

Keywords: service innovation; innovation management; complexity theory; complexity modelling; servitisation dynamics; service transition; joint value discovery; cusp of change models; systemic innovation leadership; action research; services; phase transition modelling; business models.

DOI: 10.1504/IJCLM.2016.075046

International Journal of Complexity in Leadership and Management, 2016 Vol.3 No.1/2, pp.115 - 138

Received: 08 Nov 2014
Accepted: 25 Aug 2015

Published online: 01 Mar 2016 *

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