Product-Service Systems for Small and Medium-Sized Manufacturers: The Role of External Partnerships

Abstract: The current patterns of consumption are threatening the availability of natural resources. These natural resources, such as raw materials and biomass, are critical for different economic activities. ProductService System (PSS) has received attention as a solution to drive resource efficiency by extending the life cycle of products. Given the many barriers to shifting from product to PSS-based offering, the literature has acknowledged the importance of partnerships to support Small and Medium-SizedManufacturers (SMMs) during the life cycle of PSS. However, the role played by the partner in supporting the SMM, as well as how are they supporting to overcome existing barriers, remains unclear. To address this gap, the present thesis to aims comprehensively identify the multifaceted role of external partners throughout the life cycle of PSS developed by SMM. The research follows a cross-sectional design to investigate three industry sectors located in Finland, Norway, and Sweden: forestry, farming, and mining machinery manufacturers. Through semi-structured qualitative interviews with CEOs and directors, data was collected and analyzed by thematic analysis. The results show the existence of eight key partners along the life cycle of PSS: Dealers, Suppliers, End Customers, Service Providers, Industry Hubs, Parent Company, New Partners (such as KIBS firms),and Other, such as the ones associated with delivery. These partners were found to support SMMs by co-creation (joint activities involving the exchange of resources between the partner and SMM), education (knowledge sharing from the partner to the SMM), market-related roles (activities associated with the end user, such as sales, marketing, and service provision), and supply chain (roles liked to supply of components and logistics). Partners can drive the shift from current product-oriented PSStowards use- and result-oriented ones, which have a higher potential of creating environmental benefits. The findings of this thesis contribute to the existing literature in many ways. First, it clarifies how partners are supporting SMMs along the life cycle of PSS. Second, it shows that some partners, such as dealers, are more important through the life cycle than other partners. Third, it shows that SMMs opt for different partners to perform the same role. Therefore, it opens the opportunity for future research questions to investigate the causes behind such choices. In terms of practical implications, the thesis support SMMs to optimize and diversify their network of partners by considering partnership alternatives. From the partner’s point of view, it shows the expectations of the SMMs for their partners. Therefore, it can be used to improve the existing solutions aiming to better address the SMMs’ needs.