Servitization as A Tool to Increase Vitality of Ageing Rural Community

Abstract

Recently, the EU policy measures have been widely applied to encourage early retirement from farming. Current age structure of society requires opposite approach. Key challenges for rural development policy aiming to increase quality of life of elder people are dealing not only with traditional help and support measures, but also with the involvement of elder generation into economic and social life. New EU agricultural policy measures should ensure that funding and institutional incentives support extending working and active social life of elder farmers. One of the possible ways to change the approach deals with servitization. However, despite implementation of service-driven business model in agriculture, which opened new possibilities to use knowledge and experience of old generation, the servitization movement is still weak in agriculture. Restricted adoption of service-driven business models in agriculture largely depends on the lack of research on this topic and guidelines for practitioners. The aim of this paper is to conceptualize the organizational model aiming to implement product-service system in agricultural business by joint efforts of elder farmers and beginning gardeners. Case study on innovative servitization initiative "Rent a piece of garden" in rural areas of Lithuania is used as an illustration of innovative business model in agriculture and territorial servitization with multifaceted impact on vitality of ageing rural community and as a source to gain new knowledge on how to organize similar projects.