Let's Taco 'Bout Modularity - Investigating the potential fit of modularization in a service context

Abstract: Modularization has been shown to be a way for manufacturing firms to escape the dichotomy between efficiency and effectiveness and achieve a dual competitive advantage. The purpose of this thesis is to investigate to what extent modularization can help service firms achieve the same, by looking at contextual factors affecting the fit of a modular system. To understand this contextual relationship, we have used an adapted version of the theoretical model developed by Schilling (2000) as a tool for analysing our empirics. The empirics have been gathered using a multiple case study of the high-end restaurant industry. In-depth interviews have been conducted with renowned restaurateurs in Sweden, in order to understand the context of the high-end restaurant industry. The findings have been interpreted and analysed to address the entire service industry. The analysis culminates in five theoretical proposals which describe the relationship between observed factors and the fit of a modular system in a service context. Our findings indicate, among other things, that service firms characterized by a differentiation strategy is less receptive to modularization.