Has your organization started offering outcome based services?
Outcome based services, or servitization is based on the premise that by integrating services with products, you can create bundles that are of greater value than products alone. As manufacturers move from being purely product providers to becoming service providers as well, it adds value to their products and generates additional revenue. In other words, service-based outcomes take you out of competing on price alone.
According to the Advanced Institute of Management, one third of large manufacturing firms are now ‘servitized’. In the US, that figure is nearly twice as high at 60%. And here in the UK, where 99% of business is generated by SMEs, around 40% of manufacturing companies are now thought to be servitized.
I talk about this in this article in ConnectedIndustry.com going into some specific companies who are shifting to selling services and studies that show the profitability of adoption of these models.
I'd like to hear from you, ServiceMax customers or not! Has the trend of outcome based service entered the conversation? Partners, are you talking to clients about how to implement programs that enable field service teams to deliver service packages?