Data-driven digital capabilities enable servitization strategy--From service supporting the product to service supporting the client

The development of data intelligence provides opportunities for implementing servitization strategies, and the concept of digital servitization is attracting increasing attention. However, there is little empirical evidence concerning the specific types of data-driven digital capabilities that manufacturing firms require, as well as the digital implementation paths and outcomes of different services. Drawing on dynamic capability theory, this study constructs three types of data-driven digital capabilities (i.e., digital collection capability, digital analysis capability, and digital application capability), and develops a research model of the digital servitization process. Structural equation modeling is performed with survey data from 246 Chinese manufacturing firms. The results demonstrate that data-driven digital capabilities positively affect services supporting the product (SSP) and services supporting the client (SSC), thereby indirectly enhancing firm competitiveness. Specifically, digital application capability positively affects both types of services and is the most important of the three focal capabilities. Furthermore, data-driven digital capabilities indirectly affect SSC by influencing SSP. To provide highquality services (i.e., SSC), firms should therefore not only develop data-driven digital capabilities but also further learn from the services that support their products.