Abstract for: Interaction of Product and Service Innovations - An Anaylsis of the Dynamics in Industrial Companies

Industrial companies increasingly rely on services to stand out from the crowd. Alongside direct strategic and economic advantages, these industrial services can also provide impulses for the further development of the producerīs good. Likewise, modifications of the material product may lead to new or advanced service offers. Hence, product modifications may lead to service adaptations, which again lead to product enhancements. Consequently, product and service innovations seem to interact, driving a dynamic loop and accelerating the innovation activities of a company. This article analyzes the causes by means of a literature review. Afterwards a system dynamics model is constructed to describe the assumed interaction system of product and service innovations in industrial companies and show first consequences resulting from this dynamic loop. Finally, the impacts of some drivers are tested, to give some insights into the behavior of this system.