Product-Service System design – an example of the logistics industry

Mariusz Salwin; Karol Nehring; Ilona Jacyna-Gołda; Andrzej Kraslawski

doi:10.5604/01.3001.0016.0820

Authors

Mariusz Salwin Faculty of Mechanical and Industrial Engineering, Warsaw University of Technology, Warsaw Author https://orcid.org/0000-0001-9325-8796
Karol Nehring Faculty of Transport, Warsaw University of Technology, Warsaw Author https://orcid.org/0000-0002-0682-8795
Ilona Jacyna-Gołda Faculty of Mechanical and Industrial Engineering, Warsaw University of Technology, Warsaw Author https://orcid.org/0000-0001-8840-3127
Andrzej Kraslawski Industrial Engineering and Management, School of Engineering Science, Lappeenranta University of Technology, Lappeenranta Author https://orcid.org/0000-0002-8393-1526

DOI:

https://doi.org/10.5604/01.3001.0016.0820

Keywords:

product-service systems, system design, logistic industry, supply chain, order picking

Abstract

Product-Service System (PSS) has been perceived since the 90s as a concept supporting enterprises of various industries in creating a competitive advantage and generating new value for customers by expanding the offer with additional services related to the product. Product-Service System (PSS) draws attention to the life cycle of products and services and the circular economy, which supports sustainable development. All the time, practitioners and theorists report the need to develop new Product-Service System (PSS) for other industries. Until now, a number of practical and methodological aspects related to design remain unresolved. The paper presents issues related to the Product-Service System (PSS) and PSS design. A literature review and gaps in available methods are presented. A conceptual framework for Product-Service System (PSS) design that has been used in the logistics industry is presented. By referring to the design of a selected process from the logistics industry, it was presented how to analyze the process during design and what methods of design support to use. Reference is made to mathematical modeling based on the optimization function and computer modeling with the use of a simulation model. Attention was also paid to the importance of knowledge of the industry and having expert knowledge about the designed processes in the systems. It is also extremely important to have the appropriate data set for a given case. In addition to the general mathematical and computer model, reference was also made to a chosen element of Product-Service System (PSS). The mathematical and simulation model included in the study refer to the process of completing customer orders in a logistics company. It is one of the most laborious and time-consuming processes. The FlexSim simulation environment was used to perform the computer simulation. A total of 15 variants were considered, which differ in terms of the scope of services provided during the process. The scope of services significantly affects the cost, time and profit. The purpose of the constructed model is to find a variant for the adopted data in which the profits will be maximized while maintaining the constraints imposed on the system.

References

Ahmad, A.Hj., Shafaruddin, N., Masri, R., Rahman, N.R.A., Hussin, W.S.W., (2019). Theorizing Servitisation for SME Performance. IJFR, 10, 66, DOI: 10.5430/ijfr.v10n5p66.

Baines, T., Lightfoot, H., (2014). Servitization in the Aircraft Industry: Understanding Advanced Services and the Implications of Their Delivery. In Servitization in Industry, Lay, G., Ed., Springer International Publishing: Cham, 45-54. ISBN 978-3-319-06934-0.

Baines, T.S., Lightfoot, H., Benedettini, O., Whitney, D., Kay, J.M., (2010). The Adoption of Servitization Strategies by UK-Based Manufacturers. Proceedings of the Institution of Mechanical Engineers, Part B: Journal of Engineering Manufacture, 224, 815–829, DOI: 10.1243/09544054JEM1567.

Baines, T.S., Lightfoot, H.W., Benedettini, O., Kay, J.M., (2009). The Servitization of Manufacturing: A Review of Literature and Reflection on Future Challenges. Jnl of Manu Tech Mnagmnt, 20, 547–567, DOI: 10.1108/17410380910960984.

Baines, T.S., Lightfoot, H.W., Evans, S., Neely, A., Greenough, R., Peppard, J., Roy, R., Shehab, E., Braganza, A., Tiwari, A., et al. (2007). State-of-the-Art in Product-Service Systems. Proceedings of the Institution of Mechanical Engineers, Part B: Journal of Engineering Manufacture, 221, 1543–1552, DOI: 10.1243/09544054JEM858.

Bertoni, M., (2019). Multi-Criteria Decision Making for Sustainability and Value Assessment in Early PSS Design. Sustainability, 11, 1952, DOI: 10.3390/su11071952.

Beuren, F.H., Gomes Ferreira, M.G., Cauchick Miguel, P.A., (2013). Product-Service Systems: A Literature Review on Integrated Products and Services. Journal of Cleaner Production , 47, 222–231, DOI: 10.1016/j.jclepro.2012.12.028.

Brudlak J., Zakrzewski B., (2013). Methods for Calculating the Efficiency of Logistics Centres, Archives of Transport, 27(3), 25-43.

Chiu, M.C., Kuo, M.Y., Kuo, T.C., (2015). A Systematic Methodology to Develop Business Model of a Product-Service System. The International Journal of Industrial Engineering: Theory, Applications and Practice, 22, 369–381.

Cierniak-Emerych, A., Golej, R., Różycka, H., (2021). Working Conditions and Their Importance for Eliminating Errors in the Order Picking Process, Using an E-Commerce Commercial Enterprise as an Example. Sustainability, 13(23), 13374. https://doi.org/10.3390/su132313374.

Dang V.L., Yeo G. T., (2018). Weighing the Key Factors to Improve Vietnam’s Logistic System, The Asian Journal of Shipping and Logistics, 34(4), 308-316.

Dimache, A., Roche, T. , (2013). A Decision Methodology to Support Servitisation of Manufacturing. Int Jrnl of Op & Prod Mnagemnt, 33, 1435–1457, DOI: 10.1108/IJOPM-07-2010-0186.

Dmytrów, K., (2018). Comparison of Several Linear Ordering Methods for Selection of Locations in Order-picking by Means of the Simulation Methods. Folia Oeconomica, 5(338), 81-96. DOI: 10.18778/0208-6018.338.05.

Engelhardt, G., Hammerl, B., Hinterberger, F., Manstein, C., Schnitzer, H., Vorbach, S., Jasch, C., 2003. Sustainable Products and Services: Guide for the Development of Sustainable Business, Joanneum Research: Graz.

Gaiardelli, P., Pezzotta, G., Rondini, A., Romero, D., Jarrahi, F., Bertoni, M., Wiesner, S., Wuest, T., Larsson, T., Zaki, M., et al., (2021). Product-Service Systems Evolution in the Era of Industry 4.0. Serv Bus, 15, 177–207, DOI: 10.1007/s11628-021-00438-9.

Goedkoop, M., van Haler, C., te Riele, H., Rommers, P., (1999). Product Service-Systems, Ecological and Economic Basics, Report for Dutch Ministries of Environment (VROM) and Economic Affairs (EZ).

Habazin, J., Glasnović, A., Bajor, I., (2017). Order picking process in warehouse: case study of dairy industry in Croatia. Promet – Traffic & Transportation, 29(1), 2017, 57-65.

Halstenberg, F.A., Lindow, K., Stark, R., (2019). Leveraging Circular Economy through a Methodology for Smart Service Systems Engineering. Sustainability, 11, 3517, DOI: 10.3390/su11133517.

Hwang H.-S., (2002). Design of supply-chain logistics systems considering service level, Computer & Industrial Engineering.,43(1-2), 283-297.

Idrissi, N.A., Boucher, X., Medini, K., (2017). Generic Conceptual Model to Support PSS Design Processes. Procedia CIRP, 64, 235-240, DOI: 10.1016/j.procir.2017.03.055.

Jacyna M., (2013). Cargo flow distribution on the transportation network of the national logistic system, International Journal of Logistics Systems and Management, 15(1-2), 197-218.

Jacyna M., Lewczuk K., (2016). Projektowanie systemów logistycznych, Wydawnictwo naukowe PWN SA, Warszawa.

Jacyna-Gołda I., Kłodawski M., Lewczuk K., Łajszczak M., Chojnacki T., Siedlecka-Wójcikowska T., (2019). Elements of perfect order rate research in logistics chains, Archives of Transport, 49(1), 25-35.

Jacyna-Gołda, I., Kłodawski, M., Lewczuk, K., Łajszczak, M., Chojnacki, T., Siedlecka-Wójcikowska, T., (2019). Elements of perfect order rate research in logistics chains. Archives of Transport, 49(1), 25-35. DOI: https://doi.org/10.5604/01.3001.0013.2771.

Jaghbeer, Y., Hanson, R., Johansson, I.M., (2020). Automated order picking systems and the links between design and performance: a systematic literature review, International Journal of Production Research, 58(15), 4489-4505. DOI: 10.1080/00207543.2020.1788734.

James, P., Slob, A., Nijhuis, L., (2001). Environmental and Social Well Being in the New Economy: Sustainable Services – An Innovation Workbook, University of Bradford.: Bradford, United Kingdom.

Khan, M.A., Wuest, T., (2018). Towards a Framework to Design Upgradable Product Service Systems. Procedia CIRP, 78, 400–405, DOI: 10.1016/j.procir.2018.08.326.

Kozlowska, J., (2020). What Influences the Servitization Process the Most? A Perspective of Polish Machinery Manufacturers. Sustainability, 12, 5056, DOI: 10.3390/su12125056.

Kusumaningdyah, W., Tezuka, T., McLellan, B.C., (2021). Investigating Preconditions for Sustainable Renewable Energy Product–Service Systems in Retail Electricity Markets. Energies , 14, 1877, DOI: 10.3390/en14071877.

Liao T.-Y., (2018). Reverse logistics network design for product recovery and remanufacturing, Applied Mathematical Modelling, 60, 145-163.

Luiten, H., Knot, M., van der Horst, T., (2001). Sustainable Product-Service-Systems: The Kathalys Method. In Proceedings of the Proceedings Second International Symposium on Environmentally Conscious Design and Inverse Manufacturing, IEEE Comput. Soc: Tokyo, Japan, 190–197.

Maleki, E., Belkadi, F., Bernard, (2017). A. Systems Engineering as a Foundation for PSS Development Project: Motivations and Perspectives. Procedia CIRP, 64, 205–210, DOI: 10.1016/j.procir.2017.03.031.

Marques, P., Cunha, P.F., Valente, F., Leitão, A., (2013). A Methodology for Product-Service Systems Development. Procedia CIRP, 7, 371–376, DOI: 10.1016/j.procir.2013.06.001.

Mont, O.K., (2002). Clarifying the Concept of Product–Service System. Journal of Cleaner Production, 10, 237–245, DOI: 10.1016/S0959-6526(01)00039-7.

Nehring K., 2021. Wykorzystanie zaleceń Normy ISO 9001 podczas audytu i weryfikacji bezpieczeństwa w przedsiębiorstwie logistycznym (PL), Bezpieczeństwo Transportu i Logistyki (ed.: Waśniewski Tomasz Remigiusz), 76-92.

Nehring K., Kłodawski M., Jachimowski R., Klimek P., Vasek R., (2021). Simulation analysis of the impact of container wagon pin configuration on the train loading time in the intermodal terminal, Archives of Transport, 60(4), 155-169.

Reim, W., Parida, V., Örtqvist, D., (2015). Product-Service Systems (PSS) Business Models and Tactics – a Systematic Literature Review. Journal of Cleaner Production, 97, 61–75, DOI: 10.1016/j.jclepro.2014.07.003.

Sakao, T., Birkhofer, H., Panshef, V., Dorsam, E., (2009). An Effective and Efficient Method to Design Services: Empirical Study for Services by an Investment-Machine Manufacturer. IJIMS, 2, 95, DOI: 10.1504/IJIMS.2009.031342.

Salwin, M., Gladysz, B., Santarek, K., (2018). Technical Product-Service Systems-A Business Opportunity for Machine Industry. In Advances in Manufacturing, Hamrol, A., Ciszak, O., Legutko, S., Jurczyk, M., Eds., Springer International Publishing: Cham, 269–278 ISBN 978-3-319-68618-9.

Salwin, M., Kraslawski, A., (2020B). State-of-the-Art in Product-Service System Classification. In Advances in Design, Simulation and Manufacturing III, Ivanov, V., Trojanowska, J., Pavlenko, I., Zajac, J., Peraković, D., Eds., Lecture Notes in Mechanical Engineering, Springer International Publishing: Cham, 187–200 ISBN 978-3-030-50793-0.

Salwin, M., Kraslawski, A., Lipiak, J., (2020C). State-of-the-Art in Product-Service System Design. In The 10th International Conference on Engineering, Project, and Production Management, Panuwatwanich, K., Ko, C.-H., Eds., Lecture Notes in Mechanical Engineering, Springer Singapore: Singapore, 645–658 ISBN 9789811519093.

Salwin, M., Kraslawski, A., Lipiak, J., Gołębiewski, D., Andrzejewski, M., (2020A). Product-Service System Business Model for Printing Houses. Journal of Cleaner Production, 274, 122939, DOI: 10.1016/j.jclepro.2020.122939.

Salwin, M., Santarek, K., Kraslawski, A., Lipiak, J., (2019). Product-Service System: A New Opportunity for the Printing Industry. In Advanced Manufacturing Processes II, Tonkonogyi, V., Ivanov, V., Trojanowska, J., Oborskyi, G., Grabchenko, A., Pavlenko, I., Edl, M., Kuric, I., Dasic, P., Eds., Lecture Notes in Mechanical Engineering, Springer International Publishing: Cham, 83–95 ISBN 978-3-030-68013-8.

SDoGDP, 2019. Statista Distribution of Gross Domestic Product (GDP) across Economic Sectors Worldwide from 2007 to 2018 Available online: Distribution of gross domestic product (GDP) across economic sectors worldwide.

Szczepański E., Jacyna M., Jachimowski R., Rostia V., Nehring K., (2021). Decision support for the intermodal terminal layout designing, Archives of Civil Engineering, 67(2), 611-630.

Tukker, A., (2004). Eight Types of Product–Service System: Eight Ways to Sustainability? Experiences from SusProNet. Bus. Strat. Env., 13, 246–260. DOI: 10.1002/bse.414.

Tukker, A., (2015). Product Services for a Resource-Efficient and Circular Economy – a Review. Journal of Cleaner Production, 97, 76–91, DOI: 10.1016/j.jclepro.2013.11.049.

Tukker, A., Tischner, U., (2006) Product-Services as a Research Field: Past, Present and Future. Reflections from a Decade of Research. Journal of Cleaner Production, 14, 1552–1556, DOI: 10.1016/j.jclepro.2006.01.022.

Van Gils, T., Ramaekers, K., Caris, A., De Koster, R.B.M., (2018). Designing efficient order picking systems by combining planning problems: State-of-the-art classification and review. European Journal of Operational Research, 267(1), 1-15. DOI: 10.1016/j.ejor.2017 .09.002.

Van Halen, C., Vezzoli, C., Wimmer, R., (2005). Methodology for Product Service System Innovation: How to Develop Clean, Clever and Competitive Strategies in Companies, Koninklijke Van Gorcum: The Netherlands. ISBN 978-90-232-4143-0.

Vandermerwe, S., Rada, J., (1988). Servitization of Business: Adding Value by Adding Services. European Management Journal, 6, 314–324, DOI: 10.1016/0263-2373(88)90033-3.

Vasantha, G.V.A., Roy, R., Lelah, A., Brissaud, D., (2012). A Review of Product-Service Systems Design Methodologies. Journal of Engineering Design, 23, 635–659, DOI: 10.1080/09544828.2011.639712.

Wang, M., Zhang, R-Q., Fan, K., (2020). Improving order-picking operation through efficient storage location assignment: A new approach. Computers & Industrial Engineering, 139, 106186. DOI: 10.1016/j.cie.2019.106186.

Wolfenstetter, T., Basirati, M.R., Böhm, M., Krcmar, H., (2018). Introducing TRAILS: A Tool Supporting Traceability, Integration and Visualisation of Engineering Knowledge for Product Service Systems Development. Journal of Systems and Software, 144, 342–355, DOI: 10.1016/j.jss.2018.06.079

Yudiansyah, A., Ayu, S.D., Keke, Y., Veronica, (2020). Can the mobile robot be a future order-picking solution?: A case study at Amazon fulfillment center. Global Research on Sustainable Transport & Logistics 2020. Advances in Transportation and Logistics Research papers, 800-806.