Abstract: Under the background of intellectualization and servitization, smart product service system has become an important direction of transformation and upgrading of manufacturing enterprises. The “smart” and “connected” characteristics of products not only have an impact on product development, but also on maintenance services. Considering the pre-sale and after-sale two stage operations, how to jointly optimize product R&D and maintenance services is a new problem faced by smart product service system. Facing the new changes of products and services in smart product service system, how to cooperate between the manufacturer and the distributor in supply chain is a new problem to be studied in smart connected product service supply chain. Considering the influence of “smart” and “connected” characteristics of products on the demand and cost of products and services, a two-stage dynamic game model of supply chain is constructed. The optimal operation behavior of supply chain under decentralized decision-making and centralized decision-making is described. By comparing the optimal profits of the manufacturer, the distributor and supply chains in smart connected product service supply chain and smart connected product supply chain, the influence of smart service on supply chain is analyzed. By comparing the decision-making results of product service supply chain under smart-connected environment and non-smart-connected environment, the influence of the “smart” and “connected” of product on product service supply chain is analyzed. Based on product revenue and service revenue, a supply chain coordination contract of “dual revenue sharing” is proposed. With the goal of centralized decision-making, the conditions for realizing supply chain coordination under the “dual revenue sharing” contract are obtained. Finally, the numerical examples are simulated. The results show that the integration of services in smart connected product supply chain can’t always increase the profit of supply chain, which manifests the existence of “service paradox”. After the product is smart and connected, the smart and connected feature strengthens the integration of products and services, and greatly improves the profits of all parties in the supply chain. Dual revenue sharing contract can’t only realize Pareto improvement in supply chain, but also improve consumer surplus. The research has scientific guiding significance for people to understand the new changes of product and service integration under the “smart” and “connected” environment, and has important reference for further studying the operation behavior and cooperation mechanism of smart and connected product service supply chain.

Key words: smart connected products; product service supply chain; smart level; coordination contract