Integrating products and services through life: an aerospace experience

TLDR: In this article, a case study of an international aerospace original equipment manufacturer, referred to as "JetCo", was conducted with key actors involved in the operationalisation of Product-Service (P•S) strategy within defence aerospace and civil aerospace divisions.

Abstract: Purpose – The purpose of this paper is to explore the evolution of “product‐service” (P‐S) strategies in the aerospace sector. Despite the widespread perception that aerospace organisations are advanced in terms of P‐S integration, little is known about the realities of P‐S provision in the sector. Much of the existing literature is normative and prescriptive, focusing upon what organisations aspire to do, but offers little insights into how attempts to integrate products and services occur or the challenges organisations encounter.Design/methodology/approach – This paper presents an in‐depth case study of an international aerospace original equipment manufacturer, referred to as “JetCo”. A total of 18 interviews were conducted with key actors involved in the operationalisation of P‐S strategy within defence aerospace and civil aerospace divisions. In addition, analysis of internal company documentation was also undertaken.Findings – This paper reveals that current P‐S strategy, which builds upon a long h...

Full text

Integrating products and services through life: an aerospace
experience
Author
Johnstone, Stewart, Dainty, Andrew, Wilkinson, Adrian
Published
2009
Journal Title
International Journal of Operations & Production Management
DOI
https://doi.org/10.1108/01443570910953612
Copyright Statement
© 2009 Emerald. This is the author-manuscript version of this paper. Reproduced in accordance
with the copyright policy of the publisher. Please refer to the journal's website for access to the
definitive, published version.
Downloaded from
http://hdl.handle.net/10072/29591
Link to published version
http://www.emeraldinsight.com/0144-3577.htm
Griffith Research Online
https://research-repository.griffith.edu.au

Integrating products and services through life: an aerospace experience
STEWART JOHNSTONE, ANDREW DAINTY, ADRIAN WILKINSON
Stewart Johnstone, Department of Civil and Building Engineering, Loughborough University, LE11
3TU, UK. Email: s.johnstone@lboro.ac.uk
Tel: +44(0) 1509 228799 Fax: +44 (0) 1509 223981
Andrew Dainty, Department of Civil and Building Engineering, Loughborough University, LE11 3TU,
UK. Email: a.r.j.dainty@lboro.ac.uk. Tel: +44 (0) 1509 228742 Fax: +44 (0) 1509 223981
Adrian Wilkinson, Department of Employment Relations, Griffith Business School, Griffith University,
Nathan, QLD 4111, Australia. Tel: (00) 61 7 3735 6792. Fax: (00) 61 7 3735 7177 Email
adrian.wilkinson@griffith.edu.au

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In search of product-service integration: an aerospace experience
ABSTRACT
Purpose
Explores the evolution of ‘product-service’ (P-S) strategies in the aerospace sector. Despite the
widespread perception that aerospace organisations are advanced in terms of P-S integration, little is
known about the realities of P-S provision in the sector. Much of the existing literature is normative
and prescriptive, focusing upon what organisations aspire to do, but offers little insights into how
attempts to integrate products and services occur or the challenges organisations encounter.
Design/methodology/approach
Presents an in-depth case study of an international aerospace Original Equipment Manufacturer
(OEM), referred to as ‘JetCo’. A total of 18 interviews were conducted with key actors involved in the
operationalisation of P-S strategy within defence aerospace and civil aerospace divisions. In addition,
analysis of internal company documentation was also undertaken.
Findings
Reveals that current P-S strategy, which builds upon a long history of service offerings, initially
evolved separately in each division in response to the particular markets in which they operate.
However, there was evidence of a corporate-wide strategy for P-S provision being developed across
divisions to improve co-ordination. This was founded on the recognition that P-S delivery requires the
development of a stronger customer orientation, better knowledge and information management
strategies, and the engagement of employees. A key challenge concerned integrating the product
and service parts of the business to ensure consistent delivery of a seamless value offering to
customers.
Research limitations/implications
The research is limited to a single case organisation in the aerospace sector, and as such the findings
are not necessarily generalisable to other contexts. Nevertheless, the research provides important
insights into the organisational challenges of P-S provision, and as such the findings are of interest to
researchers, managers and policymakers across industries involved in P-S provision.
Originality/value
The paper offers fresh empirical evidence into the development of P-S in an organisation drawn from
a sector often flagged as an exemplar of P-S provision, and provides insights into the complex
realities of P-S implementation and delivery. Notably, it highlights the challenge of attempting to
embed an organisation-wide ‘service culture’ in pursuit of integrated P-S delivery, and questions the
nostrums and overly simplistic models which pervade the current solutions discourse.
Paper Type: Research paper
Keywords: Product-service, through-life management, services, aerospace

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In search of product service integration: an aerospace experience
INTRODUCTION
The growth of services is one of the major trends of recent years. This is reflected in
the changing structures of contemporary economies in the developed world where
services now account for the majority of employment, as well as the bulk of national
output. Nevertheless, ‘service’ is a broad term for a heterogeneous range of
activities. Sasser et.al (1978) were some of the first commentators to use a
characterisation that recognised services as often intangible, perishable, difficult to
standardise, and as not having a separate point of production/consumption. These
are often referred to as the ‘IHIP’ - intangibility, heterogeneity, inseparability and
perishability - characteristics. More recently, however, the differences between
products and services have become increasingly blurred with a number of
commentators questioning the validity of such a definition (Araujo and Spring, 2004;
Vargo and Lusch, 2004; Lovelock, 2004; Lovelock and Gummesson, 2004). Vargo
and Lusch (2004), for example, describe the IHIP characteristics as ‘myths’ which do
not distinguish manufacturing from services, but may simply propagate inappropriate
normative strategies. Nevertheless, the notion of an organisation’s ‘service mix’ can
be perhaps still usefully be thought of as intuitively as a continuum ranging from
‘pure service’ at one end, and ‘pure product’ at the other (Sullivan, 1982).
Since the 1980s service operations have been of particular interest in the field of
operations management (Johnston, 1998), although much of the focus has been
upon services versus product management, as opposed to service delivery in
predominantly product organisations (e.g. Johnston, 2000). Again, this reflects the
view that service operations are different to product operations (see Sullivan, 1982,
212), and may explain why service management is recognised as a specialist area
across management research in marketing, operations and human resources.
However, service and manufacturing operations share the characteristic that they
are both concerned with transforming inputs into outputs through various processes
(Johnston and Clark, 2001).

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Though the distinction between products and services has never been clear, the
blurring of the boundaries between products and services is becoming increasingly
apparent in traditional engineering organisations where the provision of services to
clients has often been thought of as a low value, low status activity (Lester, 1988;
Marceau et.al, 2002). Though services of some description have almost always
been offered, they have normally been concerned with routine and reactive
maintenance to support the product (Bowen et.al, 1989). Indeed, service
arrangements may even have been given away ‘free’ in order to secure a potential
product sale (Lele, 1997). However, it has been argued that this view is changing, as
traditional ‘product-dominant’ organisations revise their business models in an
attempt to develop their service operations into strategically important, lucrative profit
centres in their own right (Lele, 1997; Oliva and Kallenberg, 2003; Wise and
Baumgartner, 1999). Similarly, in the field of operations management, Spring and
Darlrymple (2000) trace the development of manufacturing strategy ‘competitive
criteria’ and note how it has gradually evolved from a focus on cost, quality and
delivery reliability in the 1960s, towards flexibility and innovativeness in the 1980s,
with service gaining status as a potential ‘order winner’ in the 1990s. The most
extreme manifestation is traditional ‘product’ organisations attempting, or being
urged to attempt, to provide integrated product and service offerings to customers
known as ‘solutions’ or ‘product-service systems’ (Baines et.al, 2007; Neely, 2007).
It is the investigation of the strategies enacted to realise this vision that form the
subject of this article.
The paper explores the evolution of ‘product-service’ (P-S) strategies in the UK
aerospace sector. The sector is characterised by high technological requirements,
stringent regulation, complex products, extensive research and development, and
intense global competition. The UK also constitutes the largest aerospace industry
in Europe and produces a wide range of aerospace technology including flight and
fuel systems, avionics, communications equipment, landing gear, and jet engines.
As a well-established and successful component of British manufacturing, which also
has a long history of service provision, we suggest that it provides an excellent test
of P-S in action. Moreover, despite the widespread perception that aerospace
organisations are advanced and even pioneering in terms of P-S integration

Frequently asked questions

Q1. What are the contributions mentioned in the paper "Integrating products and services through life: an aerospace experience author" ?

Nevertheless, the research provides important insights into the organisational challenges of P-S provision, and as such the findings are of interest to researchers, managers and policymakers across industries involved in P-S provision. The paper offers fresh empirical evidence into the development of P-S in an organisation drawn from a sector often flagged as an exemplar of P-S provision, and provides insights into the complex realities of P-S implementation and delivery. 

Q2. What are the future works mentioned in the paper "Integrating products and services through life: an aerospace experience author" ?

There is a clear need for further research in this area and for critical debate around the current operationalisation and implementation of P-S strategies. 

Q3. What were the challenges in the aerospace sector?

Several challenges emerged in the context of the aerospace sector including the context of increasing organisational complexity, lubricating relationships between the products and service businesses, and reviewing management practices to support an aligned product-service business model. 

Q4. What was the proposed requirement for providers to be responsive to new market opportunities?

In the Civil Aerospace sector it was proposed that providers had to be responsive to new market opportunities linked to the launch of new airframes. 

Q5. How many interviews were conducted with key actors involved in the operationalisation of P-S strategy?

A total of 18 interviews were conducted with key actors involved in the operationalisation of P-S strategy within defence aerospace and civil aerospace divisions. 

Q6. What was the first issue raised by almost all respondents?

The first issue, which was raised by almost all respondents, concerned the development of an appropriate customer orientation in order to deliver world-class service. 

Q7. What was the need for more innovative recruitment strategies?

There was also a need for more innovative recruitment strategies in order to attract the right people to cope with growth in the operations room, customer business, engineering, service engineering and repair engineering. 

Q8. Why did they provide MRO during the initial warranty period?

Often OEMs provided MRO during the initial warranty period with airline MRO providers taking over as main providers because of their large inventories and global service presence. 

Q9. What were the implications across the various aspects of P-S?

There were implications across HR including work organisation, employee involvement, training and development, and recruitment and retention. 

Q10. Why was the Aerospace division more attractive to P-S?

Another factor was that aftermarket development became attractive in Aerospace earlier partly to counter the highly cyclical nature of the product sales business, while these waves of demand are less significant in the Defence division. 

Q11. What is the key criterion for becoming solutions focused?

a key criterion for becoming solutions focused is that the creation of value must be understood through the eyes of the customer (Brady et al 2005a). 

Q12. What is the extreme manifestation of the concept of product service?

The most extreme manifestation is traditional ‘product’ organisations attempting, or being urged to attempt, to provide integrated product and service offerings to customers known as ‘solutions’ or ‘product-service systems’ (Baines et.al, 2007; Neely, 2007). 

Q13. What does the study suggest is a flawed idea?

The authors suggest this renders universalistic notions of ‘best practice for product-service’ found in the current literature – which fail to take account specific issues such as industry context and sectoral dynamics - deeply flawed.