Modeling the transition to a provider–customer relationship in servitization for expansion of customer activity cycles Tatsunori Hara a, *, Keita Sato b , Tamio Arai (1) c a RACE (Research into Artifacts, Center for Engineering), The University of Tokyo, Chiba 277-8568, Japan b DENSO CORPORATION, Tokyo 103-6015, Japan c Center for Promotion of Educational Innovation, Shibaura Institute of Technology, Tokyo 135-8548, Japan 1. Introduction Servitization is defined as ‘the innovation in an organization’s capabilities and processes to better create mutual value through a shift from selling products to selling Product-Service Systems (PSS)’ [1]. Since the PSS is ‘an integrated product and service offering that delivers value in use [2],’ a servitized organization designs, builds, and delivers an integrated product and service offering that delivers value in use. Servitization requires manufacturers to understand customer activity cycles in use phases and design a PSS that facilitates use processes. Manufacturers must delve further into a holistic daily user experience for B2C models and the broader business activities of customers for B2B models [3]. This use-centered viewpoint contrasts with the traditional engineering viewpoint of a product lifecycle consisting of sequential phases, such as design, develop- ment, manufacturing, sales, use, maintenance, and disposal. Vandermerwe elaborates on how companies may focus on customer relationships through a methodology called ‘customer activity cycles (CAC) [4].’ It focuses on activities that customers do to benefit from the products and services offered. A customer activity cycle consists of three stages: what goes on before the customer achieves the result, while the customer derives the core benefit, and after the experience. Customer activity cycles represent various customer activities related to using products and receiving services. This study aims to develop a method to expand servitization in manufacturing into deeper customer activity cycles. The remainder of this study is organized as follows. In Section 2, we describe an actual auto-parts supplier setting to analyze customer activity cycles, using an actor network. Then, we obtain the issues required for servitization. Section 3 proposes a model of servitization processes in the context of construction equipment manufacturers. The provider–customer relationship in terms of knowledge transfer is a key to capture the servitization process. A technical tool for design-in-use activities of customers is crucial to transform servitization into the next phase. Section 4 concludes the study. 2. Analysis of customer activity cycles 2.1. Trends of AUTOSAR in the automotive industry The ratio of software to electronic control unit (ECU) develop- ment has been increasing due to the advancement of electronic control in automobiles. In 2003, a new standard called AUTomotive Open System ARchitecture (AUTOSAR) was established by integrat- ing old standard specifications. AUTOSAR provides a set of specifications that describe basic software (BSW) modules, define application interfaces, and build a common development method- ology based on the standardized exchange format. The slogan of AUTOSAR is ‘cooperate on standard, compete on implementation.’ BSW modules made available by the AUTOSAR layered software architecture can be used in vehicles and electronic components of different manufacturers and suppliers, thereby reducing expendi- ture on research and development and gaining expertise in the growing complexity of automotive software [5]. Further, AUTOSAR is expected to drive open innovation and development of new ecosystems in the automotive industry, involving multiple car manufacturers and ancillary suppliers. CIRP Annals - Manufacturing Technology 65 (2016) 173–176 A R T I C L E I N F O Keywords: Design Knowledge management Servitization A B S T R A C T Servitization requires that manufacturers shift their organizational capabilities and processes from sales to product-service systems and recognize the broader business activities of customer service companies. This study models the knowledge-based transition to the provider–customer relationship, using an actor network model for an auto-parts manufacturer as an example. We propose a model chain that explains the servitization process for construction equipment. A technical tool for design-in-use activities of customers is crucial to transform servitization into the next phase. Interconnections among activity cycles of providers and customers result in the transformation of the functional structure through service provision and knowledge transfer. ß 2016 CIRP. * Corresponding author. E-mail address: hara_tatsu@race.u-tokyo.ac.jp (T. Hara). Contents lists available at ScienceDirect CIRP Annals - Manufacturing Technology journal homepage: http://ees.elsevier.com/cirp/default.asp http://dx.doi.org/10.1016/j.cirp.2016.04.094 0007-8506/ß 2016 CIRP.