Orchestrating resources and capabilities for platform-based servitization: recommendations for SMEs to overcome tensions

This paper explores how small and medium-sized enterprises (SMEs) can orchestrate internal and external resources and capabilities to achieve platform-based servitization, offering practical recommendations to navigate the tensions and challenges associated with this transformation. The study employs a case study methodology based on 16 in-depth interviews with internal personnel and external actors involved in the digital servitization journey of a SME in the food and beverage sector. The interviews reveal key resources, capabilities, tensions, and solutions associated with the servitization process. The findings reveal that successful digital servitization in SMEs requires a strategic orchestration of internal resources like physical assets and human capital with external contributions from ecosystem actors. Tensions include aligning organizational structures with digital goals, managing financial risks and addressing customer-related challenges. Solutions involve a phased transformation approach, top management commitment, critical assessment of internal resources, leveraging the ecosystem and orchestrating multi-actor collaborations. This paper contributes to the literature on digital servitization by focusing on the under-researched area of SMEs, offering empirical insights and practical recommendations. It highlights the importance of resources and capabilities and ecosystem integration in enabling SMEs to transition to service-oriented business models, providing a valuable roadmap for organizations embarking on a digital servitization journey.