Service innovation: why is it so difficult to accomplish?

This article discusses the common factors and hindrances of service innovation. Our purpose is to add a managerial perspective on service innovation.

Multiple case studies on international firms that create competitive advantage through service innovation leadership are the main tool of theory development.

This study answers following two strategic questions: What typical deficiencies exist that prevent firms from using service innovation as a source for competitive advantages?, What are the appropriate recommendations for succeeding with service innovation?

The study focuses only on companies in mature markets. The findings are limited to this sector.

The paper assists managers in concentrating on the right triggers for succeeding with service innovation.

Both scholars and managers still tend to be somewhat vague in suggesting detailed recommendations for service innovation. This study identifies five management deficiencies: failure to protect services, lack of clear organizational anchoring, unsystematic innovation process, inadequate customer involvement, and insufficient elimination of bad service ideas. Additionally, the paper offers recommendations for defining, developing, and launching new services.