An integrated framework for managing knowledge-intensive service innovation

This paper develops a service innovation framework that takes into account both industry- and firm-level strategies. The main emphases in the industry level are value proposition – identifying potential industry demand and earnings, value deployment – positioning the firms in the value networks to expand value and value appropriation – exploiting resources and capturing the benefits of service innovation (i.e., the 3V Innovation Model). At the firm level, the key processes are new service design, development and delivery (i.e., the 3D Innovation Model). The 3V Innovation Model provides a guidance to assist firms in identifying and securing their product-market positions, defining the supply chain and network relationships, and appropriating the gains from service innovation. The 3D Innovation Model presents firms with specific processes for implementing service innovation. Business model innovation serves as a linkage between the industrial-level 3V and firm-level 3D models for implementing and realising the economic value from service innovations.