A SERVICE-DOMINANT LOGIC PERSPECTIVE

A Service-Dominant Logic Perspective

A Service-Dominant Logic Perspective

Introduction

At the core of the sustainability debate is the issue of value and what does it mean (Gray, 2006). Value, from a business and management perspective, can be seen from the perspective of at least three schools of thought. Firstly, a traditional economic value approach (goods-dominant logic, GDL), in which the value-in-exchange is the determinant (Vargo et al., 2008). GDL maybe considered as one of the foundations of economics' and can be traced back to Adam Smith (1776). It in turn produced for most developed economies labour and resource efficiencies linked to manufacturing (Vargo et al., 2006). Secondly, a social value approach. Value is based on improvements in the quality of life for the individuals and society (Austin et al., 2006).

For example, most NGO initiatives, in that they deal with societal needs, fall outwith the traditional value in exchange model. However, the distinction between NGOs and traditional enterprise initiatives is now less clear, as enterprises, governments and NGOs combine to create both societal gains and wealth (Austin et al., 2007). Lastly, an emerging school of thought sees value as determined by use rather than exchange (Vargo and Lusch, 2004). The argument is presented by the service science, management and engineering (SSME) scholars, influenced by the service-dominant logic (SDL) debate, that recognises the need to address a world order in which services predominate (Chesbrough, 2005). SDL proponents view the world as service systems, connected internally and externally, by value propositions (Spohrer et al., 2008, p.108, Spohrer et al., 2007).

A Service-Dominant Logic Perspective

The Service-Dominant (S-D) logic of marketing (Vargo and Lusch, 2004) asserts that service experience is what customers aim to buy, anywhere, anytime. There is still service interaction in the tradition of the Nordic School but in addition, and this is the key to the new logic, the goods purchased are seen as service appliances and through interaction, service experience is derived. In effect, service is exchanged for service. The S-D logic shifts strategic marketing attention away from point-of-sale transactions to focus on service and post-sales relationships, and in so doing, it has the potential to encourage innovation and rearrange marketers' notions of efficient resource allocations. The service-dominant logic is a service marketing orientation that has the potential to challenge and change the way marketing is conducted. It is constantly evolving. Umea School of Business is well placed to take a lead role in developing this topic as the first doctoral colloquium in the world on service-dominant logic was held here in 2006.

In the few years since we published the first article on what has become known as “service-dominant (S-D) logic,” “Evolving to a New Dominant Logic for Marketing” (Vargo and Lusch 2004a), there has been substantial concurrence, debate, dialog, and inquiry. These varied responses began with the seven commentaries invited by Ruth Bolton (2004), the Journal of Marketing editor who published the article. Additionally, in the publication of The Service-Dominant Logic of Marketing: Dialog, Debate and Directions (Lusch and ...