Nowadays, manufacturing firms are increasingly providing services or are even adopting service-oriented business models. By referring to the term servitization of manufacturing, research and practice discuss benefits, barriers and organizational implications of service-oriented growth strategies. In the past, the shift towards services was mainly considered as a strategic response to shrinking product margins in mature industries with cost-based competition. However, by implementing latest technologies like the Internet of Things, manufacturers are increasingly augmenting physical functions with digital and data-based services, making services an inherent part of the product. Thus, in many manufacturing industries, services become more than a reactive strategy for mature product markets. For example, in the medical technology industry, firms increasingly seek to create value beyond the physical function of the device by offering digital services that support healthcare providers to increase efficiency and outcome of care delivery. However, many firms still struggle to develop and commercialize digital services successfully. Several scholars have adopted a capability perspective to study the service transition of manufacturing firms. However, the latest research on the role of digital technologies in servitization mainly discusses required technological competencies but neglects the organizational requirements. This dissertation addresses the gap in the literature by identifying organizational capabilities to facilitate digital service innovation in medical technology firms. Additionally, it provides first insights into organizational and managerial levers to foster digital service innovation. This research is rooted at the intersection of research on servitization and service innovation and addresses the emerging topic of digital service innovation. Following a theory-guided case study approach, the thesis is structured into a conceptual and empirical part. First, by adopting an organizational capability perspective and utilizing insights from the theory of dynamic capabilities, a conceptual research framework is developed. The research framework guided the data collection and analysis by providing a basic understanding of relevant theoretical constructs and their relationship. Second, by conducting multiple case studies with four medical technology firms, the research framework is further refined and critically reflected. Finally, based on the findings of the case studies, a management framework to determine appropriate organizational designs, as well as an exemplary digital service innovation process, are developed. Thus, providing medical technology firms with managerial and organizational levers to support the management of digital service innovation.
