TRENDS IN SERVITIZATION: EVIDENCE FROM CROATIA

Servitization of manufacturing is a hot topic with around 180 publications in top peer reviewed journals. This hype is due to the proclaimed benefits of servitization in terms of increased revenues and better competitive position. However, servitization if not performed correctly can even lead to bankruptcy of a company. So it may be safely said that the servitization strategy is risky. The current literature shows inconsistent results, and there is still no prescription on how to servitize. Research in servitization is still in a nascent phase dominated by case based and exploratory studies rather than testing servitization theory. Most research is done in western developed countries with a clear lack of evidence of the phenoemenon in less developed countries. This work contributes to theory by addressing the servitization phenomenon in a less developed country – Croatia. The analysis is performed on three rounds of European Manufacturing Survey (EMS) taken place in years 2009, 2012 and 2015., covering a period of nine years. In this way longitudinal effects of servitization can be researched. So on one side a process of servitization is researched and on the other hand contextual variables leading to servitization are researched in line with open questions in current literature. The results show that Croatian manufacturers follow trends similar to those in developed western countries, except for provision of advanced services. Current literature advises to provide advanced services. However, advanced services cannot be given without base services and there are important risk issues in provision of advanced services. This work presents a ground for further investigation of servitization, showing the current state of servitization in Croatia and future directions for research.