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– The purpose of this paper is to explore the role of innovation modes in understanding challenges of integrated NSD and NPD, and the use of structured NSD processes in manufacturing firms.

– The research is based on a two-stage multiple case study. The first stage is an interview study of 17 key informants representing manufacturing firms in the machine industry. The second stage is an in-depth study of three service innovations at three manufacturing firms based on 16 interviews with key informants.

– The results of the study show that NSD processes are often more structured if the service is developed separately from the product. The fact that different innovation modes benefit from varying degrees of structure in the development process means that integrated service development …