Supply Chain as a Service: Building Supply Chain Capability as a Business Model (CEIBS Working Paper, No. 003/2020/POM/MAN/STR)

With the trends towards servitization and digital innovations in supply chains (SCs), a number of SC leaders have started to commercialize their SC capabilities as services provided to business customers. In order to efficiently organize multiple suppliers’ resources and customize the service offerings, some of these leaders have developed a “supply chain as a service” model (hereafter SCaaS), in which different functions of a SC, are grouped into service modules to enable plug-and-play agility in meeting the varying needs of business customers. Although SCaaS is emerging as an evolution of the market for cloud services (as with other “X as a service” models like Software as a Service, Platform as a Service, and Infrastructure as a Service), supply chain management (SCM) researchers have not systematically studied the SCaaS phenomenon, which has evolved from a cloud computing application to a new business model at the ecosystem level. This study explores how a SCaaS has emerged and how it works by instigating three complementary research questions: (1) how do a firm form its SCaaS through the interactive implementation of supply chain innovations (SCIs) and business model innovations (BMIs) over time; (2) what are the roles and activities that SCaaS incorporate, and how these roles and activities are organized to serve the business customers; and (3) what is the detailed service operation process of SCaaS for satisfying a specific customer demand. To address these questions, this study adopts a longitudinal case study approach to investigate a SCaaS formed by Haier COSMO, a company which connects together customized orders, third-party R&D solution providers, intelligent manufacturing factories, and other SC service providers, to provide mass customized SC services to business customers. This study makes contributions to both the SCM and the service innovation literature. It expands our knowledge of SCI-driven BMIs and echoes with recent calls to refocus SCM on the perspectives of value co-creation and service ecosystem. The study also reveals new insights into how to apply digital technologies to enhance SC capabilities, and how to apply these SC capabilities to support new business models. The findings provide important managerial insights for firms to design and implement new business models in today’s trends towards open innovation and value co-creation with ecosystem participants.