Abstract/Summary

Purpose: The purpose of this paper is to explore the interplay between firm boundary decisions and the management of both-and efficiency and flexibility and the implications this has for modular design in the provision of advanced services. Design/Methodology/Approach: A single case study in the defence industry employs semi-structured interviews supplemented by secondary data. Data is analysed using thematic analysis. Findings: The findings provide a process model of boundary negotiations for the design of efficient and flexible modular systems consisting of three phases; boundary ambiguity, boundary defences and boundary alignment. Practical implications: The study provides a process framework for boundary negotiations to help organisations navigate the management of both-and efficiency and flexibility in the provision of advanced services. Originality/Value: Drawing upon modularity, paradox and systems theory, this article provides novel theoretical insight into the relationship between firm boundary decisions and the management of both-and efficiency vs. flexibility in the provision of product upgrade services.