The Effect of Industrial Solution Services (ISS) on Innovation Performance: The Moderating Role of Sustainable Development Goals (SDGs)

Abstract

This article analyzes the innovation performance antecedents of manufacturing firms that implement servitization-based industrial offerings in OECD countries. These servitized offerings can be conducted either digitally (remotely) and/or physically (on-site), and provide a comprehensive solution for industrial settings. Specifically, this article proposes that firms adopting Industrial Solution Services (ISS) in their different forms, namely Digital ISS, Operational ISS and Green ISS, exhibit higher innovation performance. In order to test this assumption, a linear regression model is used to investigate the effect of the different firms’ ISS strategies - Digital, Operational and Green - which are moderated by the Sustainable Development Goal (SDG) Index in the country where the manufacturers operate. The results provide evidence that adopting Digital ISS can lead to higher innovation performance when SDGs are not taken into account. Conversely, Operational and Green ISS strategies are conducive to superior innovation performance in firms operating in countries with higher degrees of SDG accomplishment. These findings have significant theoretical and managerial implications regarding the advantages of ISS strategies for promoting innovation outcomes, particularly in alignment with nationwide SDG objectives.