Various manufacturing companies have developed service orientation strategies to improve their competitiveness and performance. But in fact, not all the companies implementing the service orientation strategies can be successful. The “service paradox” explains the phenomenon that substantial investment in developing the service orientation leads to increased service offerings and higher costs, but does not generate the expected correspondingly higher returns. Based on the research of literature about service orientation in manufacturing companies, the paper discusses the potential benefits(including potential financial benefits, marketing benefits and strategic benefits) and challenges (including negative effects, accounting service profits and Managerial motivation) about implementing this strategy in manufacturing companies and organizational arrangements or factors which can weaken or overcome the twitch of the process of extending the service business.