Of four stages strategic planning idea generation and

of four stages, “strategic planning”, “idea generation and selection”, “service design”, and “product
development”. Between every stage, an intermediate evaluation and back-loop scheme using the
results of intermediate evaluation is applied like Cooper et al. ’s five gates. Contrary to the previous
sequential processes, the proposed process is a hybrid of sequential and parallel processes, because
PSS development includes product development as well as service development. The planning and
idea generation for PSS development are carried out sequentially and service design proceeds in
parallel with product development.
As shown in Figure 1, the service-oriented PSS development process has two layers, a service
provider layer and product partner (manufacturer) layer, which show the participants for each stage.
Service-oriented PSS development is initiated by the service provider, hence the first stage, “strategic
planning” is carried out by the service provider alone. The next stage, “idea generation and selection”
is performed by the service provider and the product partner selected in the previous stage. Together they
generate detailed ideas for planned PSS development. Subsequently, the third and fourth stages,
“service design” and “product development”, are conducted concurrently by the service provider and
the product partner, respectively. At this time, the key aspect to successful PSS development is to
achieve consensus on the service and product through effective communication and interaction
between the two actors. To this end, the results of service design should be delivered to the product
partner in order to verify the technical feasibility of the required service functions, and the pilot
product should also be delivered to the service provider in order to judge the suitability of the design
and functions. These collaborations are expressed as arrows between “service design” and “product
development” in Figure 1. Here, a service-oriented PSS can be developed from the open innovation
concept of Chesbrough [37]. From a service-centered point of view, product partners can be

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considered as external; i.e. , the use of purposive inflows and outflows of knowledge is to accelerate
internal innovation and expand the markets for external use of innovation. Actors and key features for
each stage of the service-oriented PSS development process are summarized in Table 1.
Figure 1. Service-oriented PSS development process.
Table 1. Actors and key features for each stage of the service-oriented PSS development process.
Stage Actor Key Feature
Strategic Planning Service Provider
The service-oriented PSS development
is initiated by the service provider,
and a product partner is selected.