Designing smart services: A system dynamics-based business modeling method for IoT-enabled maintenance services

Abstract

This paper reports on a design science research project aiming to develop a method to support business decision-making regarding IoT-enabled maintenance services for Original Equipment Manufacturers (OEMs). Often, these OEMs remain reluctant to make full use of recent advances in the Internet of Things (IoT), sensor technologies and data analytics for providing services on installed equipment with Asset Owners (AOs). These new developments allow them to advance on their servitization journeys from selling products to selling product-centered services. The method is based on System dynamics (SD), a powerful modeling methodology to capture all these complexities in an integral, coherent and visible manner with all stakeholders. It also allows for a quantitative analysis of the business case for “smart maintenance services”. The paper describes servitization, smart (i.e. digitally enabled) maintenance services and then the method itself. A case study illustrates the application of the method for an OEM in the semiconductor industry.