The Market Demand and the Individual Requirement
The assumptions of Goods Dominant (G-D) Logic or the Goods-Centered View were that the goals of economic activity are to manufacture and sell products; the standardized production processes are built for efficiency and production control; products can be stored for future sale when more profit is available. On the contrary, Service Dominant (S-D) Logic or the Service-Centered View’s assumptions were that economic entities use their core competitiveness for the benefit of other entities and their specific requirements. The service production and consumption occur simultaneously, and services cannot be stored (Vargo & Lusch, 2004).
The key distinction of these two views is the difference of the target object. The Good-Centered View’s target object is products, and the Service-Centered View’s target object is the abilities of value creation. The former stores value in products and the latter uses their abilities collaborating with customers, for value co-creation. In a situation focused on service collaboration, more information interaction is required in order to realize customized service production.
Under the Good-Centered view, the product design, manufacturing, and sales are to meet the market demand, so the input information is the general market demand. Under the Service-Centered view, we must first study the general market demand, and accordingly create or optimize the service system, and establish its own core competitiveness. Then, in the service production process, the requirements of specific individual customers are taken as input information, and then carried out in the process of collaboration with the customers.
As a summary, we present Figure 1 and Figure 2 to illustrate these differences.
Figure 1. The “good-centered view”, market demand as the input of product design process
Figure 2. The “service-centered view”, market demand as the input of the service system design process, and specified individual requirements as the input of the service process