Article: Service-dominant logic: continuing the evolution

Authored by: Stephen L. Vargo & Robert F. Lusch

Summary by: Ahsan Naeem Lone
Program: PhD Management
I.D: 14007051008
The theoretical paper aims to extend the debate on Service Dominant Logic (SDL)
which was initially started by the same authors in their now well renowned research
paper Evolving to a new dominant logic for marketing. As such, the authors in this
paper focus on how SDL has evolved over time owing in due part as to how it has been
received in the academic community. The authors focus on answering certain key
issues which have been brought up by those academicians who have either questioned
the new logic that was proposed or who have brought their own perceptions of what
exactly the new logic. As such, both of these main issues have been addressed by
providing more reasoning as to why they said what they had said in their seminal work.
Furthermore, acknowledging certain critiques, the authors have also updated some of
the original foundational premises (FPs) and have also added a new FP as well. The
proceeding part of this summary will provide further detail on the aforementioned
issues.
The 2004 article of new logic prompted a huge response from the academic community
and not only from those belonging to the discipline of marketing but from other
disciplines as well. While most of the feedback that was generated was positive in
nature, there was a sizeable voice which provided skepticism to the debate and dialog
which had begun surrounding the origin and continuing development of this new logic.
The reason which the original authors provide for this rather overt skeptical response
from these individuals stems from a misunderstanding of the proposed logic. However,
the authors also acknowledge certain proposed revisions by other academics. Mostly
these issues emerge from the fact that the new logic contests many areas of marketing
theory and practice that have been in place for the past 150 years or so. These past
theories form the old logic or what is more accepted as the Goods Dominant Logic
(GDL). Because of the richness of the literature present in GDL, at the time when the
original article of new logic was written, the authors struggled in either developing or
acquiring terminologies which better explained the new logic. Because of this, terms
such as producer, production, consumer etc. (terminologies of the old logic) were
used to elaborate the idea of the new logic. Thus, this created a critical debate amongst
academics who stated that using the old lexicon to establish the new logic was
counterproductive. The authors respond by highlighting that these lexicographic slips
have been modified over time; either by using neutral terms or creating new ones.
Other issues which have been considered form part of the natural evolution of the
discussion regarding SDL. These pertain to ideas such as that the original article did not
explicitly discuss the interactive and networked nature of value creation (an argument
stemmed from the debate on service science) and the phenomenological nature of
value creation. The authors in that regard provide their view that the interactive nature

of value was an implied notion in the original article and that using the terms experience
held closer to the explanation of SDL than the original terminology which they had used
which was service provision.
Now while the generation of the issues arose from an appreciation of the proposed logic
and that these academics wanted to expand upon the emerging debate, certain other
arguments were presented; which the authors argue arose from a misunderstanding of
the new logic paper. One particular misunderstanding which the authors highlight is that
certain critics find SDL to be just an extended debate within services marketing
literature, thus not warranting to be considered as a new logic on its own merit. The
counter to this argument is provided that the idea of a services economy itself is a relic
of the goods centered logic which focuses on what firms can produce rather than how
firms can serve. The distinction marks a major difference in the way how firms think
about business and the marketplace in general. Another misunderstood notion is that
SDL is dyadic in nature and only focuses on the firm/customer interactions. The
correction is provided that SDL focuses on all those aspects of business which are
concerned with value creation, not only the ones between the firm and the customer. In
this, SDL is taking into account all those stakeholders who are involved in the cocreation of value. The final misunderstood notion is that SDL does not take into account
social and nonprofit marketing and ethics. The correction is provided that SDL operates
on the idea that the mechanism of exchange should be mutually beneficial to those
involved in this business. This fact ultimately provides a more holistic overview of how
ethics should be a part of any market based activity, rather than being an afterthought in
the old logic.
Conclusively, understanding that the continuing debate on SDL merits that some
changes be made to the original FPs provided in the original new logic article, the
authors explicitly make said changes in this paper. Most of the changes that are made
generally consist of minor revisions to the FPs. These revisions are done in order to
remove the terms which are generally considered being more GDL centered and to
ultimately introduce terminologies which are SDL specific. The new FP which is
proposed by the authors states that value is a phenomenological occurrence and that its
realization is unique to the one who is benefitting from it. This again marks the
distinction of SDL from GDL as within the latter value was something that was ingrained
in the firm offering while in the former value is ingrained in the phenomena or the
experience.