Framing service as ideology and practice - Cognitive underpinnings of service transformation in Finland’s residential sector

Service transformation describes organization-level change from goods- to service-centric value creation. While considering the aspects of strategy and organization structure, existing research pays little attention to the cognitive basis of service transformation. Integrating perspectives from three theoretical backgrounds – service-dominant logic, institutional theory and organizational cognition – this dissertation develops new knowledge of how framing influences service transformation. Frame is defined here as an organization level schema of interpretation that embodies a particular interpretation of the organization in its environment, guiding how the members of the organization engage in value cocreation. Adopting a qualitative research approach, this dissertation studies service transformation in Finland's residential sector, in which organizations are increasingly adopting resident-focused and service-centric forms of activity to complement the asset-centric logic of operations. This dissertation consists of two empirical studies. The first study examines how organizations perceive and respond to the transformation toward increasingly resident-centric service provision in the residential sector, and identifies four logics of value creation. The second study adopts a multiple-case study design to understand how framing influences service transformation in seven organizations. The findings present four archetypical ways of framing services – as profit generation, organizational reorientation, basis of business, and expression of values – which rest on two underlying dimensions: Argument diversity describes whether an organization relies on business-centric rationales or multiple interrelated rationales in legitimizing resident services; identification with resident-centric service provision distinguishes between instrumental views of resident services and resident services as the constitutive logic of the organization. The findings link the archetypical frames to different tactics by which managers build their legitimacy within the organization, and identify different managerial orientations to facilitate change at the level of activities, organization design, and culture. Finally, the findings link these to different directions of service transformation. The findings contribute to service literature on by theorizing the cognitive underpinnings of service transformation, emphasizing service not only as operative-level activity but also as organization-wide ideology to value creation. The findings also complement organizational literature by examining service transformation as organizational hybridization, as well as by elaborating the role of framing in organizations responding to institutional processes.