The shift to a service economy is ongoing globally by transforming the social structure. This affects the R&D organization as well. Manufacturing companies are shifting to service business; therefore, the R&D in manufacturing companies needs a transformation to respond the social change. However, macro-level surveys on service innovation do not capture the reality of service R&D activities yet. That is because most of the companies in the service sector do not have R&D, so that they do not recognize R&D activities in service innovation. It would be important to study service innovation in a manufacturing company transforming to service business which has a R&D organization, and to understand R&D activities which contribute to service innovation. Research on service innovation is rooted mainly in product development based on technology trajectory. The modern service marketing introduces service-dominant logic (S-D logic) perspective without separating services and goods, which is based on value co-creation between service providers and customers. In this paper, a new service research model focusing on value co-creation is proposed based on the S-D logic view. A set of hypotheses on service research model for value co-creation is developed and tested using data on research activities of service innovation projects. We find that the technologies developed in the research, and the mutual organizational understanding of service and research contribute to the value co-creation interaction with customers and researchers.