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Page 1: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

Good Service is Excellent Business

30.06.2016, ROERMOND

Page 2: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

SERVITIZATION

“The process by which a manufacturer changes

its business model to provide a holistic solution

to the customer, helping the customer to improve

its competitiveness, rather than just engaging in

a single transaction through the sale of a

physical product.”

Aston Centre for Servitization Research and Practice

Page 3: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

LIMBURG

Specific

Generic

Goods-based Service-based

Innovation vouchers

Startersfonds

Limburg Ventures I

Hoogstarters TechStart

Business Services School

Top Technology Clusters

SILVER

Participatiefonds

Limburg Ventures II

Service Business

Acceleration program

Ecosystem facilitating Service Innovation

Service Innovation

incentive program

Page 4: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

SERVITIZATION OPENS A NEW WINDOW

Page 5: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

WHY

Why invest in Servitization

?

Page 6: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

BUSINESS MODEL ORIENTATION

Page 7: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

SERVITIZATION CREATES HIGER MARGINS

Page 8: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

EXAMPLE: ANIMAL HEALTH

Commoditization

of products

through customer

demand and

market forces

Assimilation of

products through

government

regulations

+

Page 9: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

IoT IN ANIMAL HEALTH

Page 10: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

CLOUD-BASED INVENTORY AND CRM

Page 11: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

THE STRUGGLE FOR DIFFERENTIATION

Page 12: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

THE PAST MARKET

Price

Bene

fits

Page 13: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

THE PRESENT MARKET

Price

Bene

fits

Page 14: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

DIFFERENTIATION AGAINST COMMODITIZATION

0,01 Euro

Diffe

ren

tiation

Price per cup of coffee

0,25 Euro

0,50 Euro

3,25 Euro

Page 15: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

PRODUCTS ARE EASY TO IMMITATE

Page 16: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

EXAMPLE: NOKIA

Page 17: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

EXAMPLE: NOKIA

Page 18: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

EXAMPLE: NOKIA

Page 19: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

INTEGRATION OF SERVICES

Page 20: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

BYING A NOTEBOOK

Page 21: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

PREMIUM EXPERIENCE AS A DIFFERENTIATION STRATEGY

Page 22: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

APPLE’S INCREDIBLE MARGINS

Page 23: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

BUYING COFFEE

Page 24: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

NESPRESSO DIFFERENTIATION STRATEGY

Page 25: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

PRICE PER KILO OF COFFEE

0

10

20

30

40

50

60

70

A B C D

Page 26: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

How to avoid the commodity and easy to imitate traps

?in a b2b context…

Page 27: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

DIFFERENTIATION FROM COMPETITORS

Time

Diffe

rentiation f

rom

com

petition

Product Service

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Page 33: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

HOW WELL CAN WE PREDICT THE FUTURE?

In 1980, McKinsey & Company was commissioned by AT&T (whose Bell

Labs had invented cellular telephony) to forecast cell phone penetration in

the U.S. by 2000. The consultant’s prediction, 900,000 subscribers, was less

than 1% of the actual figure, 109 Million. Based on this legendary mistake,

AT&T decided there was not much future to these toys. A decade later, to

rejoin the cellular market, AT&T had to acquire McCaw Cellular for $12.6

Billion.

Page 34: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

OUR MISTAKE: WE DO NOT THINK EXPONENTIAL

Motorola Dyna-TAC 8000X (1983)Cellular Brick

LBH: 330,2 * 44,45 * 88,9 mm + 200 mm antenna794 grams

Nokia 7820 (2004)Lipstick phone

LBH: 114,3 * 33 * 17,8 mm 85 grams

Apple iPhone 5 (2012)

LBH: 123,8 * 58 * 7,6 mm 112 grams

20 Jaar 8 Jaar

Page 35: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

LINEAR VS. EXPONENTIAL

Page 36: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

FOR HOW LONG HAVE WE SPOKEN ABOUT IoT LIKE THIS?

Page 37: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

WHAT IoT REALLY IS

2016

Page 38: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

APPLICATIONS OF IoT IN EVERY INDUSTRY

Page 39: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

FINDING YOUR HIGHER VALUE PROPOSITION

Page 40: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

WHAT IS YOUR HIGHER VALUE PROPOSITION?

?PRODUCT

Our productWhy do our customers

buy it?Why do they…?

What is the “cozy living

room” for our customer?

Page 41: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

HIGHER VALUE PROPOSITION

CUSTOMER CHALLENGES CORE COMPETENCIES

Page 42: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

KEY TAKE-AWAYS

• Fully understand your customers’ business challenges

• Fully understand and further develop your core competencies

• Expand your value proposition to a higher value proposition

that offers a solution that will improve the competitiveness of

your customer

• Find a match between your customers’ challenges and your

core competencies

• Find strategic partners and build an ecosystem based on

knowledge and data intensive services

Page 43: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

SERVICE SCIENCE FACTORY

Page 44: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

SERVICE INNOVATION DASHBOARD

Page 45: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

SERVICE INNOVATION DASHBOARD

Page 46: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

SERVICE INNOVATION DASHBOARD

Page 47: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

LIMBURG BEST PRACTICES BOOK

“Wij bieden veel meer dan technologie, wij

bieden echt inzicht en kennis”

“Wij zijn volledig overgestapt op de

verkoop van complete pakketten”

“Wij zien onszelf ook niet als een bedrijf

dat producten levert maar als een externe

‘afdeling’ van de klant”

“We zien meer en meer dat we

meerwaarde voor de klant kunnen leveren

op basis van de data die wij uit de

systemen kunnen halen”

Page 48: Good Service is Excellent Business · 30.06.2016, ROERMOND. SERVITIZATION “The process by which a manufacturer changes its business model to provide a holistic solution ... in a

THANK YOU

www.servicesciencefactory.com