Business Potential of Product Lifetime Extension and Modular Product Design Applications

Purpose – Short product lifetimes has led to formation of a so-called ‘throw-away society’ and excessive waste. One of the suggested possible solutions to this problem is the development of new business models based on product lifetime extension. This thesis examines product lifetime in the contexts of strategy formulation and potential of product lifetime extension from the perspective of producers. In addition, it explores how companies pursue modular product design in their strategies in relation to product lifetime extension. Design/methodology/approach – The theoretical part summarizes the literature on product lifetime and obsolescence, strategy formulation and product lifetime extension. To design the research, the conceptual model derived from the literature review is deployed. Further, this thesis explores the expert views towards product lifetime extension stemming from different science fields. Moreover, the case study approach is used to investigate managerial practices and attitudes in three companies that produce durable goods. Findings – The study shows that product lifetime extension driven business models should be based on services, not leading to increasingly excessive waste generation. However, such a service approach is more feasible in B2B context, while B2C companies struggle in finding revenue sources for product lifetime extension. By implementing modular design strategies, B2C companies seek for recurrent revenues and admit that upgradable design aimed at frequent transactions between company and consumers does not lead to more environmentally sustainable business models. Practical implications – The thesis puts forward some recommendations for companies that explore the potential of product lifetime extension. Product lifetime extension should focus on re-thinking customer relationship management, shifting from transactions to relationships. Secondly, upgradable design through modular product lifetime extension represents a solution to deal with ‘psychological obsolescence’ problem. To strategize for product lifetime extension, the company should understand the on-going evolvements of consumer needs and develop upgrade roadmaps. Originality/value – This thesis considers a broader view of product lifetime extension from a strategy perspective.