Theory Development and Hypotheses
4.3. Summary of the overall model
While the demand for the service solutions offered by PSF has dramatically increased, the question on which processes are critical to the design and delivery of superior service solutions is still unanswered. The theory presented here is developed to scrutinise what are the critical inputs into the service solution provision process. Having the specific characteristics of PSFs in mind, including their extensive interaction with customers, highly educated employees, application of expert knowledge, highly customised service offerings, and the high credence quality of offerings, the most important inputs into the process of design and delivery of superior service solution were identified as people-management processes and knowledge-management processes. Further, specific attention was given to brand equity as the output of the service solution superiority. The theory development resulted in the final research model called “B2B Professional service firms service solution model” as the theoretical framework of the study. The final research model is shown in Figure 4.5, where the blue rectangles illustrate people-management processes, green rectangles indicate knowledge- management processes, and yellow rectangles represent brand equity.
In the people-management processes shown in Figure 4.5, the focus was on branding activities of the PSF with the focus on brand specific transformational leadership, employee brand building behaviour, and CCSP. Three hypotheses were developed to address the role of leaders, employee behaviour, and the PSFs ability to work with customers to provide service solutions which are superior. The theory developed related to people management processes section was based on the assumption that the leader with BSTFL style has the ability to motivate and manage
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employees to engage in brand supportive behaviours in their work activities. As such, the PSF extends the extent they cooperate with customers, because employees provide the inputs into the CCSP that are consistent with the brand’s values.
In the knowledge-management processes shown in Figure 4.5, customer knowledge and technical knowledge were considered as two important types of knowledge that drive the firms’ CCSP process and service solution superiority. The focus of knowledge on both technical and customer knowledge were on deep and broad technical and customer knowledge. Further, as shown in Figure 4.5, knowledge assimilation was identified as playing a critical role in enhancing the effect of knowledge on service solution superiority. This contention was advanced because is not knowledge per se that improves service solutions, but specific knowledge assimilated into the PSF. On this point, the premise was put forward that knowledge assimilation is more effective in dealing with broad knowledge compared to deep knowledge in both customer and technical knowledge.
Finally, as discussed in this chapter the yellow rectangles in Figure 4.5 represent brand equity. Through the discussion in Section 4.2.4 it was theoretically demonstrated
Figure 4.5
B2B Professional service firms service solutions model
Technical Knowledge . Deep . Broad H4a& b H5a& b H6b H3 H6a Customer Knowledge . Deep . Broad Knowledge Assimilation Service Solution Superiority CCSP
Source: developed for this research Note: blue rectangles represent people management processes Green rectangles represent knowledge management processes
Yellow rectangles represent brand equity
Brand specific transformational leadership Employee brand building behavior H1 H2 Customer Commitment (CBBE) Market Effectiveness (FBBE) Profitability (FBBE) H7 H7b H7
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that if the PSF designs and delivers superior service solutions, they can enhance the brand equity in two forms of customer based brand equity and firm based brand equity. In the final component of the model customer commitment represents customer based brand equity and market effectiveness and profitability represent firm based brand equity.
4.4. Conclusion
Consistent with the increasing demand for service solutions, providing a superior service solution is considered to be a strategic weapon in the quest by PSFs to establish a superior competitive market position. The research framework developed here aims to bring attention to the issues of developing strong brand equity in the B2B PSF context. The framework focuses on processes that help PSFs to maintain a superior competitive market position through providing superior service solutions. To develop the theory the key characteristics of PSFs, especially the application of knowledge, extensive level of CCSP (Jaakkola and Halinen 2006; Løwendahl 2005; Maister 1993), and a credible brand (Amonini et al. 2010) were taken into account as a key foundation for theory development. Building on the special characteristics of PSFs and the service solution they offer to customers, the theory developed here revolves around people management processes and knowledge management processes. These processes are argued to provide appropriate inputs to develop superior service solution and maintain brand equity.
Focusing on people management processes, the theory illustrates the connection between people inside and outside the PSF and their contribution in providing superior service solution. To build a beneficial connection between engaged people to provide superior service solution brand values was used as the glue that bring these people together and enhance superiority of the service solution. Focusing on knowledge management processes the argument raised here is that PSF should expand their knowledge pool and develop broad knowledge in both technical and customer domains. As the broad knowledge is more difficult to understand and is associated with high risk, the PSFs are supposed to use knowledge assimilation to take the most benefit of customer knowledge and technical knowledge to provide superior service solutions. The consequences of providing a superior service solution drives brand equity in two forms - customer-based brand equity and firm-based brand equity.
While researchers agree about the importance of brand equity in industrial markets (Bendixen et al., 2004), Leek and Christodoulides (2012) contend research so far has produced mixed results regarding the composition and drivers of industrial brand equity. Picking up on this point, this study developed a theory of PSF and argues that a
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superior service solution which is provided based on the well-developed brand oriented people processes and rich knowledge pool are in a better position to establish strong brand equity in B2B PSFs markets. The methodology developed in Chapter Five introduces approaches that facilitate testing the developed theory.
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