Periodic Reporting for period 1 - PLIS (Peer Learning Innovation Services)
Reporting period: 2016-11-01 to 2017-10-31
Servitization is a trend we see in almost all industries throughout the world. This is why it makes sense to title this Design Options Paper (DOP) “All Companies are Service Companies”. This customer demand-driven focus is not new, but it is poorly practiced despite being perceived by leading corporations as the only way to sharpen their competitive position.
Today it’s not enough to generate excellent products or services for customers, it’s about meeting their needs and providing good experiences by offering a customer-focused combination of goods, services, support, self-service and knowledge.
The aim of this DOP is to offer policy makers distilled knowledge and recommendations in order that they can help facilitate their regional industries to embrace a new, service innovation driven, competitiveness logic.
It is recognised by the European Commission and the PLIS partners that Service Innovation can play a key role in maximising the economic impact of SMEs at local, national, regional and international level.
In this sense, the PLIS Design Options Paper titled “All companies are service companies” aims at increasing knowledge and experience on how innovation policies should be designed and implemented in order to:
• Increase awareness of the importance of Service Innovation and how it aligns with other existing innovation support services.
• Support the upgrading and adaptation of the regional industries through a Service Innovation approach.
• Increase operational efficiency amongst innovation agencies in delivering Service Innovation support.
• Increase the number of innovation projects developed by SMEs within a Service Dominant approach and their impact on company competitiveness.
A shift in focus like this has profound implications for both company activities and innovation policies. For the companies, the changes are seen in the demand for new or changed employee competences, the need for new strategies and new ways of collecting insights to develop value propositions that meet customers’ needs. Whereas the implications for innovation policy makers are the need to develop and promote new initiatives that can inform, motivate and support companies to shift their focus from being technology and goods focused towards being focused on the job-to-be-done (JTBD) in order to create customer value.
When developing innovation policies, it is important to follow an integrative approach. The policy response to this new Service-dominant logic (S-D logic) approach is subtle and evolutionary. It requires a cultural shift in policy thinking and action where support is more equitably distributed across more types of innovation and where value that is generated from non-technology and non-product innovation is equally recognised.
It has been difficult to find examples where we (the PLIS partners) have helped a company to work strategically in transforming their business towards S-D logic. Basically, this is because most of the current innovation support provided is still based on an assimilation approach, where Service Innovation is not truly considered from the start, but is viewed as an add on to technology and product development. Therefore, our research has drawn on academic evidence and global examples combined with the knowledge and experience we have about current policy initiatives and tools that are already working to support service innovation in companies.
• Understanding the concept of Service Innovation.
• Identifying different initiatives developed by each partners’ regions that are supporting the transformation and adaption of their industries through a Service Innovation mindset.
• Proposing feasible recommendations based on the existing initiatives.
The only result of the project is D1.1 Design Options Paper.
In order to support the transformation to a Service Innovation dominant environment this DOP has proposed recommendations to help sharpen policies that will support the upgrading and adaptation of regional innovation systems.
These recommendations should not be taken as a blue print. To be most useful each region should reflect on its current situation, capabilities and strategy, select and adapt them to best achieve the transformation in their region.
Among the most important recommendations are (full recommendations in the DoP):
• Lead the movement towards a job to be done approach.
All successful companies will need to become Service Dominant in their innovation approach and must focus on addressing the customer’s job to be done.
• Stop funding based on technology and start funding based on the job to be done.
Technology alone cannot deliver success. Support should drive companies to best extract value from where the value is; i.e. from the market and in co-creation with customers.
• Value a company’s ability to understand its customers, not its ability to develop products.
Companies will struggle if they depend on their technical competences to develop new, desirable solutions – the future will belong to companies who better understand and fully respond to their customers’ needs.
More than ever, successful companies will be those able to solve the problems and deliver with respect to all the needs of their customers. Given this need for Service Innovation, policy makers and innovation agencies must avoid inappropriate use of words like Product and Technology, and phrases such as the now ubiquitous Technology Readiness Levels, if they are to encourage companies to become Service Dominant in their innovation approach.
Exploitation and dissemination actions planned
In the final meeting held in Barcelona on November’17, all partners discussed on how the results could be disseminated. Each partner brought to the table several ideas which turned into the following actions. Note that the following list of actions are preliminary and in any case may change.
• Organizing an EEN decentralized training connected to client centric approach.
• Share Know how with EEN thematic Group Scale Ups and have a common workshop
• Organize an EEN major conference on the topic.
• Post/send an article (PLIS Abstract) for EEN newsletter & website
• Enterprise Europe Network Steering and Advisory Group: Feb 2018 (UK representatives plus DG Grow and EASME)
• EEN UK Annual Conference: 7-8th March 2018 (220 participants including Innovate UK, EASME and DG Grow)
• EEN Annual Conference Vienna: 23-25th October 2018 Vienna
• ENN Sector Group forums
• EEN Thematic Group Forums
• EEN LinkedIn groups