A competitive product development strategy using modular architecture for product and service systems

Many recent studies have shown that it is difficult for manufacturing companies to succeed by selling only standardised products. The product service system (PSS) concept has been widely discussed as a way of satisfying a range of individual user needs and thus improving profits. However, studies have been focused on PSS as a marketing strategy. This paper explores how to improve PSS performance through an analysis of product architecture. We examine two specific cases that exemplify the PSS characteristics that lead to the generation of competitive advantage. We conclude with the suggestion that companies should improve PSS performance by adopting modular product architecture, a strategy that can extend and diversify services and add value to products.