Servitisation through structural adaptation

Abstract

PurposeThe purpose of this study is to investigate the structural changes needed for project-based organisations (PBOs) to synthesise their project operations and services following the servitisation strategy. It addresses the question of how PBOs should change their organisational structure fitting with service provision strategy.Design/methodology/approachThis study followed an exploratory research method using a single in-depth case with evidence collected from 51 project managers from five different industry sectors: construction, oil and gas, IT, logistics and health careFindingsCapitalising on organisational design theory, it has been found that successfully extending PBOs' outcomes into a system of both project output and extra services requires an adjustment of organisational structure that creates greater value for both companies and customers. This required adjustment has been divided into five main categories: (1) collaboration cross-project and customers; (2) flexible workflow, (3) decentralised decision-making, (4) wide span of control and (5) project governance. However, the findings indicate that success can only be ensured by particular mutually coordinated organisational designs with a suitable balance of products and servicesPractical implicationsThis study presents vital indicators to PBOs practitioners when deploying servitisation within their operational strategy by adjusting the organisation's design.Social implicationsServitisation could add both economic and social values for a diverse set of project stakeholders. However, the sustainability performance of servitisation in servitised project-based organisations is an outcome of reducing the discrepancy between project operation and service provision activities.Originality/valueThis study contributes to the body of knowledge and proposes a structural alteration process in PBOs to help align project operations and service provision activities. It explains how project-based organisations reconfigure their resources to provide services.