Navigating disruptive crises through service-led growth: The impact of COVID-19 on Italian manufacturing firms

https://doi.org/10.1016/j.indmarman.2020.05.017Get rights and content
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Highlights

  • The COVID-19 lockdown impacted both product and service businesses, but service businesses are showing higher resilience.

  • The impact on business largely depends on market segments and industries.

  • The impact on service business varies depending on the extent of servitization.

  • Firms need to master four elements of resilience: preparedness, agility, elasticity, and redundancy.

  • Digitalization and digital servitization are expected to further accelerate.

Abstract

This study draws on an extensive survey and interview data collected during the COVID-19 pandemic. The respondents were executives of industrials firms whose factories, warehouses, and headquarters are located in Northern Italy. This is undoubtedly the European region first and most extensively affected by the pandemic, and the government implemented radical lockdown measures, banning nonessential travel and mandating the shutdown of all nonessential businesses. Several major effects on both product and service businesses are highlighted, including the disruption of field-service operations and supply networks. This study also highlights the increased importance of servitization business models and the acceleration of digital transformation and advanced services. To help firms navigate through the crisis and be better positioned after the pandemic, the authors present a four-stage crisis management model (calamity, quick & dirty, restart, and adapt), which provides insights and critical actions that should be taken to cope with the expected short and long-term implications of the crisis. Finally, this study discusses how servitization can enhance resilience for future crises—providing a set of indicators on the presumed role of, and impact on, service operations in relation to what executives expect to be the “next normal.”

Keywords

COVID-19
Coronavirus
Servitization
Digitalization
Service operations
Solutions
Resilience

Cited by (0)

Mario Rapaccini is Associate Professor of Entrepreneurship and Innovation Management at University of Florence. He is also in the faculty staff of Scuola Sant’Anna in Pisa. His main research interest deals with digitalization and servitization of industrial firms. He serves in the board of ASAP Service Management Forum (www.asapsmf.org), and he is member of the IFIP WG5.7 ‘Advances in Production Management Systems’ and of the joint doctoral course of Universities of Pisa, Firenze and Siena on the topic of ‘Smart Industry’.

Nicola Saccani is Associate Professor at the Department of Industrial and Mechanical Engineering at the University of Brescia (Italy), where he is part of the RISE laboratory (Research and Innovation for Smart Enterprise, www.rise.it). He is member and past coordinator of the ASAP Service Management Forum, a community involving academics and practitioners to develop the culture and excellence in service management and servitization (www.asapsmf.org). His research activities concern service and supply chain management, with particular reference to the impact of phenomena such as the digital transformation, servitization, and circular economy on business models, supply chain configuration and operations management. He is author of several scientific publications in such fields. He has also taken part to several company transfer projects on such topics.

Christian Kowalkowski is Professor of Industrial Marketing at Linköping University, Sweden. Before he was Assistant Professor of Marketing at Hanken School of Economics in Helsinki, Finland. His research interests include service growth strategies, service innovation, and solutions marketing, and his work has been published in journals such as Industrial Marketing Management, Journal of Business & Industrial Marketing, Journal of Business-to-Business Marketing, Journal of Business Research, and Journal of Service Research. Christian is the servitization editor for the Journal of Service Management, associate editor of the Journal of Services Marketing, and advisory board member of Industrial Marketing Management. He is the author of Service Strategy in Action (www.ServiceStrategyInAction.com; Service Strategy Press, 2017), the leading book for industry executives on how to navigate the transition from a goods-centric to a service-savvy business model.

Marco Paiola is Associate Professor of Business Strategy and Service Management at the University of Padova. He received his Ph.D. in Business Strategy at Bocconi University, Milan. His current research interests are in the areas of the impact of IOT on business models, digital servitization in manufacturing and innovation and knowledge management in advanced business services. His work has been published in journals such as Industrial Marketing Management, European Management Journal, Journal of Business-to-Business Marketing, The TQM Journal, Journal of Intellectual Capital, Knowledge Management Research & Practice. His has been awarded by Elsevier (Highly Cited Research Award, 2016) and Emerald (Highly Commended Paper Award, 2014). He coordinates the Digital Transformation Lab of the department of Economics and Management at the University of Padova.

Federico Adrodegari is postdoc researcher at the Department of Industrial and Mechanical Engineering at University of Brescia, where he teaches in the operations management area. Holds a master’s degree in industrial engineering in 2010, achieved in 2015 a Ph.D. in Design and Management of Logistic and Production Systems. Since 2011 he is a member of the RISE Laboratory (www.rise.it). His research activity concerns the areas of Supply Chain Management and Service Management, in particular the servitization and digital servitization fields. He is author of numerous of scientific publications on national and international conferences and journals. He is currently the national coordinator of the ASAP Service Management Forum, an industry-academia community about servitization and product-service systems, performing research transfer projects with companies and dissemination activities in these fields.