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Related Experiment Videos

Beyond products: services-based strategy.

J B Quinn1, T L Doorley, P C Paquette

  • 1Tuck School, Dartmouth.

Harvard Business Review
|February 8, 1990
PubMed
Summary
This summary is machine-generated.

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Sustainable competitive advantage increasingly stems from core service skills and strategic outsourcing. Companies must focus on key capabilities, leveraging technology to enhance value and reduce costs through external providers.

Area of Science:

  • Business Strategy
  • Service Management
  • Technology Impact

Background:

  • Service technologies are transforming competitive landscapes across industries.
  • Traditional advantages like vertical integration or superior products are diminishing.
  • Technology enhances service activities, increasing value from design and image over production.

Purpose of the Study:

  • To analyze the impact of service technologies on business strategy.
  • To provide guidelines for identifying core competencies and outsourcing opportunities.
  • To explore the risks and rewards associated with strategic outsourcing.

Main Methods:

  • A three-year study examining the service sector.
  • Analysis of competitive strategies in leading companies (e.g., Apple, Honda, Merck).

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  • Development of a framework for activity-focused competitive analysis.

    • Main Results:

    • Sustainable advantage is derived from superior core service skills and strategic outsourcing.
    • Technology enables independent enterprises to offer world-class services at lower costs.
    • Focused organizations with highly developed capabilities and outsourced non-core activities achieve competitive success.

    Conclusions:

    • Managers must restructure organizations around core service capabilities.
    • Strategic outsourcing is crucial for competitive success in the modern business environment.
    • Adopting an activity-focused strategy is key to navigating technological changes in the service sector.