Innovation in Service Sector: Theoretical Framework and Case Studies of Japanese Services Firms (Preliminary Discussion)

This study aims to investigate the innovation process in services firms. As there are increasing contributions of service sectors to the economies of both developed and developing countries, there are calls for detailed studies of innovation in service firms. While the arguments on typologies of services and innovation in services cannot gain a consensus at the moment, recent research investigated the drivers of service innovation. However, the innovation process, especially, how the innovation in service is created has not been fully addressed. Though there is increasing emulation between the service and manufacturing organization of production, the difference between the two sectors regarding the outcome of the production/conversion process remains. Thus, attempts to scrutinize large scale, well-established Japanese service firms that represent both the restrict-service model (adopting manufacturing logic of production) and the full-service model (adopting manufacturing logic of production is difficult if not impossible) regarding innovation activities might contribute to better understanding of the innovation process, especially the sources of innovation in service firms. However, this paper is a preliminary discussion on the topic and will need further interviews for case studies as the next step in the study.