Servitization for environmental and social management practices in manufacturing: The role of digitalization as an...

The shift toward sustainable industrial systems requires companies to adopt strategies that enhance environmental performance without compromising competitiveness. Servitization-the integration of services into manufacturing-has been suggested as a business model that could support more sustainable production by increasing resource efficiency and generating value throughout the product's lifecycle. However, there is limited empirical evidence on what drives servitization and its effects on sustainability, especially concerning the role of digitalization and its varied impacts on environmental and social management practices. This study aims to explore how digitalization influences servitization and, in turn, how servitization affects environmental and social management practices. Using data from Spanish manufacturing companies in the 2022 Spanish Survey on Business Strategies, an inverse probability-weighted regression adjustment (IPWRA) estimator corrects for selection bias in servitization decisions. This method was applied to 1469 manufacturing firms, enabling reliable comparisons between servitized and non-servitized companies. The findings reveal that digitalization significantly raises the likelihood of adopting servitization, indicating that digital capabilities are a key enabler of service-oriented business models in manufacturing. Moreover, servitization is positively linked to several environmental management practices, including recycling and reuse of materials, reduced natural resource consumption, and energy savings or shifts toward more sustainable energy sources. However, no statistically significant connection is observed between servitization and companies' social management practices. These results indicate that although servitization offers tangible environmental benefits, its social advantages may take longer to emerge, require additional organizational adjustments, or involve higher service levels. Overall, servitization enhances environmental efficiency but does not automatically lead to improvements in social management practices.