Conference article

Assessing the potential of business model innovation for investment goods through Life Cycle Costing

J. Van Ostæyen
Centre for Industrial Management, K.U.Leuven, Heverlee, Belgium

J. Duflou
Centre for Industrial Management, K.U.Leuven, Heverlee, Belgium

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Published in: Proceedings of the 2nd CIRP IPS2 Conference 2010; 14-15 April; Linköping; Sweden

Linköping Electronic Conference Proceedings 77:68, p. 527-534

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Published: 2012-10-11

ISBN: 978-91-7393-381-0

ISSN: 1650-3686 (print), 1650-3740 (online)

Abstract

In light of increasing competitive pressure; many manufacturers of investment goods are growing aware of the importance of business model innovation. Alternative business models that put more emphasis on the service content of the value proposition are gaining ground across many sectors. Manufacturers often face the challenge to identify the business model with the greatest earning potential. This paper demonstrates that Life Cycle Costing can be used to identify and quantify the potential for business model innovation. The relevance of this approach is illustrated with the findings of eighteen in-depth interviews with executives of Belgian industrial companies.

Keywords

Product Service Systems; Business Model; Life Cycle Costing

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