Migrating from selling products to providing solutions

 

Servitization is the biggest single opportunity for industrial manufacturing companies since the steam engine. It is a new proven way of thinking and operating that creates competitive advantage.

Servitization is development of innovative solutions to accompany your existing product portfolio. It can range from basic maintenance contracts all the way to selling the functional outcome that your customer looks for in the first place. It’s employed by the world’s most innovative manufacturers, such as WeWork, Rolls Royce Aircraft Motors or Philips, to name a few.

They go beyond selling offices, jet engines or light bulbs to selling work productivity, aircraft power-by-the-hour and hours of light.

Different types of servitization

WHY SERVITIZATION?

  • Boost your long-term revenues: Industrial products often have a long lifecycle. By developing an integrated service line for your customers, you can boost your revenues even after the sale of a product, throughout it’s life span.
  • Beat competition: You will become the provider of an integrated solution (from designing the product, all the way to maintaining and disposing of it). It means that competitors cannot get a hold of your market share, since you control the entire lifecycle of the product and your customer finds it easier to do business with you.
  • Increase customer loyalty: Your customers will love you for it. Their demands are increasingly complex and require integrated solutions. They will be able to enjoy peace of mind that their processes are continuously optimized and you reap the benefits for doing it.
  • Better absorb financial cycles in the long-term: Has the CoVid-19 crisis affected you? Companies that have a servitized business model are better able to cope with financial cycles. Even during economic downturn when product sales go down, they get guaranteed recurring revenues from the fleet of products that they operate for their customers.
  • Easier to find clients: You will make it easier for new customers to do business with you, since you will help them avoid high up-front fixed capital costs. They will pay as they use the product and you will be able to co-create value together with them.

 

KEY TOPICS THAT WILL BE COVERED

• Aftermarket trends impacting manufacturers in 2021.
• What exactly is servitization
• The huge potential of servitization
• How to price your offer
• Q&A

Meet for a 1.5 hour discussion with our colleagues, Sergiu and Alin who are experts in servitization an innovation management. We will share our expertise while putting into perspective use cases for the methodology.