The value of Health and Safety aspects in Product-Service Systems : A case study based on the manufacturing industry

Abstract: Companies are expected to reduce the impact on society caused by its operations while at the same time, generate profit for its stakeholders. One way to satisfy both parts is by creating shared values. As the trend of servitization becomes more popular the ability of Product-Service Systems (PSS) to deliver additional value to customers arises. PSS provides an opportunity for developing a sustainable business model to benefit both the society and the stakeholders. A sustainable PSS can be based on the Triple Bottom Line dimensions, environment, economic, and social. Since the economic and environmental advantages have already been studied for PSS:s, the social aspect is yet to be studied in detail. This thesis focuses on the Occupational Safety and Health (OSH) theme of the social dimension, for PSS:s. Both the ability to improve the social dimension performance and the role it plays in the value proposition for PSS:s were studied. The thesis has been based on a case study on one company in a Business to Business market. It was found that customers seldom demanded or mentioned health and safety aspects for PSS:s, even when an increase of OSH was achieved by the PSS. However, it could also be concluded that all interviewed thought OSH was important for the company and the employees but there were divided opinions regarding OSH, if it would be put in the value proposition or not. By analysing the customer situation and how it operates, companies should use the customizability of PSS:s to better match their requirements and thus develop the value proposition for the PSS. Cost estimations for accidents have been done which showed that one single accident can cause very high costs. It is a good investment to prevent risks which should be communicated when selling PSS:s. Furthermore, it is important to communicate both internally within the firm, and externally to customers, about what health and safety benefits the PSS will contribute with.