Managing Strategic Service Networks: Contingency View of Integration in the Context of Component Services

The design and management of strategic service networks are key requirements for organizational competitiveness in the modern networked service economy. The understanding of service network management is, however, still in the emergent stages within industrial network and supply chain management research. The study presented here investigates how and why strategic service networks are managed, focusing particularly on the management of integration in component service networks. The research is grounded in the premises of the structural contingency theory, the information-processing perspective, and the value network framework of three ideal types of strategic networks – stable, established, and emerging. The research consists of an in-depth literature analysis of network management and service supply chain management research and a multiple-case study analyzing a total of 15 component service networks in the context of the residential real estate sector in Finland. The conclusions are three-fold. First, the common patterns of integration management in the three ideal types of strategic component service networks are to some extent contingent on the network type characterized by different sources and/or overall level of uncertainty. Second, a further contextualization of integration reveals that the management of integration in stable and established component service networks is contingent on service-, network-, and environment-related characteristics, four of them being general across networks and additional four conditioning spatially complex networks. Third, because emerging networks are inherently continuously evolving, the management of integration and its contribution to network evolution is contingent on both initial and changing levels of uncertainty. The study contributes to industrial network management research by empirically elaborating and refining the original value network framework, thus offering a contingency view of the management of integration in component service networks. The study also advances service supply chain management research by revealing patterns of integration mechanisms in component service supply networks during ongoing service exchange as contingent on the characteristics of the exchanged services, the supply network structure, and the supply environment. In general, the findings support the emerging contingency views of network and supply chain management.