Understanding the Benefits of Product-Service Systems for Parties Involved in Remanufacturing

Abstract

Purpose: This study aims to analyse the benefits of PSS for interested parties in remanufacturing, including manufacturing companies, original equipment manufacturers, and customers. Existing studies examining the Product-Service System (PSS) focus on the relationship between two parties, either between Original Equipment Manufacturers (OEMs) and customers, or between remanufacturers with customers. This study attempts to fill a gap by investigating how the PSS benefits OEMs, remanufacturers and customers. Design/methodology/approach: This research used a case study method to examine the practical application of PSS in remanufacturing companies. A qualitative approach was employed to analyse emerging phenomena in the case companies, and the researcher collaborated with the involved parties to create new knowledge. Thus, this research study can offer theoretical as well as practical insights. Findings: All parties involved in PSS consistently gain benefit from adopting the practice. From the perspective of remanufacturers, the major benefit of adopting PSS is that it can help reduce uncertainties regarding the timing, quantity and quality of returned cores. Due to these reduced uncertainties, remanufacturers benefit from higher profitability and more environmentally friendly products. These benefits have multiplier effects on both customers and OEMs. Practical implications: This study offers benefits to remanufacturing managers in the sense that it provides guidance for them to better manage remanufacturing operations so that they become more environmentally friendly and profitable. Originality/value: This study represents the first time that the benefits of PSS in supporting remanufacturing have been viewed from an integrative perspective – i.e. manufacturers, remanufacturers, and customers.