Gebauer, Fleisch, Friedli - Service Paradox

Question 1

What is the service paradox ?

Answer 1

High INVESTMENT in EXTENDING SERVICE business leads to INCREASED service OFFERING and HIGHER COST, but does NOT generate the expected correspondingly HIGHER RETURNS

Question 2

Cognitive phenomena that harm managers motivation for servitization

Answer 2

1 - Overemphasis on obvious and tangible environmental features
2 - Scepticism of the economic potential of services
3 - Risk aversion

Question 3

Key managerial recommendations

Answer 3

1 - Establish a market-oriented and clearly defined SERVICE DEVELOPMENT PROCESS
2 - Focus service offers on the VALUE PROPOSITION to the customer
3 - Initiate a RELATIONSHIP marketing
4 - Define a clear service STRATEGY
5 - Establish a separate service ORGANIZATION
6 - Create a service CULTURE.