Unit 1 Concepts in Product-Service Systems (PSS)

Product-Service Systems are based not on the sale of simple product, but on the offer of services connected with a product. This approach, by its very nature, forces product manufacturers to extend the life of their products, thus saving natural resources.

Product-Service Systems can be divided into three different types or main categories:

  1. Product-Oriented Systems,
  2. Use-Oriented Systems, and
  3. Result-Oriented Systems.

Here you can see a diagram about the difference between Traditional Business Models and Product–Service Systems (PSS) Business Model. The Traditional Business Models include the conflict between the needs of producer and those of customer. Producer has no interest to produce products with long time usability because (s)he wants to sell new products. PSS business model does not include this conflict. When producer bears costs connected with the operation of his/her product, (s)he wants to decrease them and produces the product with long lifetime and of a high quality without service or maintenance costs.

Source: CMS Industry Report (2000).

Take a look at this explanatory video to see some facts about the Product as a Service and Circular economy business models: