Ramp-up and ramp-down dynamics in digital services

Akkermans, H, Voss, C A and van Oers, R (2019) Ramp-up and ramp-down dynamics in digital services. Journal of Supply Chain Management, 55 (3). pp. 3-23. ISSN 1523-2409

Abstract

Volume ramp-ups are notoriously difficult in digital services, where market pressures can lead to ramping up too soon and too rapidly which in turn can lead to the need to ramp-down. This paper addresses the challenge of taking innovation to scale in an established firm by enhancing our understanding of the nature of service ramp-ups and ramp-downs. Digital service ramp-ups differ substantially from production ramp-ups as the speed is much greater, and problems are visible to customers. However there are similarities between service ramp-downs and product recalls and an important contribution is exploring the nature of ramp-downs their processes and possible causes. Using an engaged research approach, longitudinal data from three consecutive ramp-ups in a European telecom operator were collected. Through analyses of cases, qualitative and quantitative case data, and using a system dynamics model, we identified a set of issues that affect service ramp-ups and ramp-downs. These include the need to ramp up the service supply chain, biases leading to unrealistic assumptions about scalability and problem-solving, decision biases in various functions, launching digital services in beta form, a lack of transparency of capacity and lack of learning from previous ramp-ups. We show that if these problems are not addressed or resolution is delayed, this can lead to cycles of delay, backlogs and productivity problems and the inevitability of a ramp-down. We explore reasons and importance for such delays that lead to service ramp-downs.