Development of a universal approach for measuring servitization

Baines, Tim and Menon, Raveen and Ziaee Bigdeli, Ali and Schroeder, Andreas and Adem, Anwar and Rathi, Dipti and Rapaccini, Mario and Raddats, Chris (2026) Development of a universal approach for measuring servitization. Production Planning and Control. ISSN 0953-7287

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Abstract

Although interest in servitization is growing, researchers and practitioners lack a universally accepted approach to measure it in industrial firms. In this paper, we develop and empirically validate a comprehensive measurement approach to address this gap. We begin by defining servitization and critically reviewing existing measurement methods. We develop a three-test approach, refined through pre-pilot and pilot studies with industrial executives, followed by a nationwide survey of 701 firms. The approach captures three dimensions: revenue share between products and services, types of services offered, and revenue share from each service. This reduces construct ambiguity and supports more reliable empirical analysis and theory-building in business model innovation. We introduce 'servitization intensity' to quantify a firm’s service footprint and results confirm robustness and reveal variation in adoption. We propose a fourth test to capture scope of service offerings and provider responsibility to offer a richer and more accurate measurement of servitization.