growing service solutions business marketing association january 17, 2012 center for services...

Growing Service Solutions

Business Marketing Association

January 17, 2012

Center for Services LeadershipW.P. Carey School of Business

Stephen W. [email protected] http://wpcarey.asu.edu/csl/

Copyright Stephen W. Brown, 2012

The Roadrunner and the Eagle

2Copyright ASU Center for Services Leadership



January 17, 2012




Product-dominant Companies Have Always offered Services:

• Entitlement Services

• Service Solutions in Support of Customers

4

So What's New?

Copyright ASU Center for Services Leadership 2012

SERVICES

FINANCING

SOFTWARE

Pretax Income Mix Revenue Growth by Segment

Gerstner decidesto grow service

B2B Service Projects: IT (data center, call centers) & business process outsourcing/reengineering, systems integration, organizational change, etc.

HARDWARE

5Copyright ASU Center for Services Leadership 2012

Outline

What are key success factors in growing service solutions?

What challenges must be overcome to grow service solutions?

Why has delivering value through service solutions become a big deal?


Why has delivering value through service solutions

become a big deal?

Question

One:


Companies across industries want to grow through services

• Retailers

• Distributors

• Manufacturers

• Consumer Goods Companies


http://www.mrcleancarwash.com/index.html

9

Growth and Profits Through Service Innovation

http://petshotel.petsmart.com/tour/index.shtml


http://petshotel.petsmart.com/tour/index.shtml

Why has Delivering Value Through Service Solutions

Become a Big Deal?External Drivers

Internal DriversServices Growth


Where’s the Money?Locomotives

yard operations, railroad administration, other

train operations

infrastructure

freight car services

locomotive services

locomotives

Total expenditure: 21 x product costs


What challenges must be overcome to grow service

solutions?

Question

Two:


Engineering/Technical Logic- Focus on Products

Service Logic- Focus on Customers

Cultural Challenge


Major Research Project

14

What challenges do companies need to overcome in growing service solutions?


15

Research Team – Other Members

Mary Jo Bitner, PhD

Valarie Zeithaml, PhD

Jim Salas


Services supporting customersServices supporting products

Call Center

Maintenance

Asset Management

Value Added Services

Managed Services

Software as a Service

Warranty

E-Support

Break Fix

Spares Management

Installation

Business Process Outsourcing

Advisory Services

Integrated Product-ServiceSolutions

The Service Infusion Continuum

SmartServices

Entitlement Services Service Solutions

Copyright: Zeithaml, Brown, and Bitner 2012 16

Positions on the Service Infusion Continuum

Services Supporting

Customers

Services Supporting

Products

Asset Management

Value Added

ServicesManaged Services

Value AddedSupplementary

Services


Advisory Services

Integrated Product-Service

Solutions

SmartServices

EntitlementServices

Business Process Outsourcing includes service processes that one organization takes over and provides in full to another for a fee. Typically, these are single, identifiable service support processes such as network maintenance, mail services, or travel scheduling.

Value-added Supplementary Services represent stand-alone service offerings that have independent revenue streams associated with them. This could include standard services such as financing or more innovative services associated with the customer's products or activity streams.

Managed Services involve transferring high-level strategic management activities in a particular area to another firm for improved effective and efficient operations--for example, transferring supply chain management, knowledge management or a similar strategic function to another firm.

Advisory Services are professional consulting or strategy services. Integrated Product-Service Solutions involve a deep understanding of customer requirements; customizing

and integrating the provider’s set of goods and services to achieve customer outcomes/requirements; deploying these goods and services; and providing customer support post-deployment.

17Copyright: Zeithaml, Brown, and Bitner 2012

Customization

Capabilities

Challenges

Changes in Organizational Structure

Collaboration with Customers

Culture


18

Services Supporting

Customers

Services Supporting

Products

Asset Management

Value Added



Services


Advisory Services


Solutions

SmartServices

EntitlementServices

Copyright: Zeithaml, Brown, and Bitner 2012

Major Research Project

19

What challenges do companies need to overcome in growing service solutions?


What are key success factors

to grow service solutions?

Question Three:


Customization

Capabilities

Challenges



Culture

Key Success Factor – Customization

21

Services Supporting

Customers

Services Supporting

Products

Asset Management

Value Added



Services


Advisory Services


Solutions

SmartServices

EntitlementServices



22

Customization

Standardization



23

Customer - Facing

SM-A

SM-C

SM-B SM-E

SM-D

SM-F

Back - Office


Capabilities

Customization

Challenges



Culture

Key Success Factor – Capabilities

24

Services Supporting

Customers

Services Supporting

Products

Asset Management

Value Added



Services


Advisory Services


Solutions

SmartServices

EntitlementServices


25


Sales


26


Service Delivery


27

Channel Partners



Condition-Monitoring

Industrial SealingAugust 2006 - Acquisition of

Economos Austria GmbH

Lubrication SystemsAugust 2004 – Acquisition of

Willy Vogel AG

VibrationAnalysis

28

Key Success Factor


http://www.skf.com/skf/campaign/magic_box_micro_site

http://www.skf.com/skf/campaign/magic_box_micro_site


Capabilities

Challenges


Customization

Culture

Key Success Factor – Collaboration with Customers

29

Services Supporting

Customers

Services Supporting

Products

Asset Management

Value Added



Services


Advisory Services


Solutions

SmartServices

EntitlementServices


30

Voice of the Customer (VOC)


Advisory Boards

C-SAT

Focus Groups

Personal Interview

s

User Groups


31

Little evidence of Service:


Co-delivery

Co-production

Co-development

Co-design


IKEA

• Customers and company understand each others’ roles

• Expectations are managed throughout the process

• All communication elements reinforce these mutual expectations

32



Business Process

Consulting

Supply Chain Management

Chemical &

Inventory Manageme

nt

Instrument

Calibration

Equipment

Maintenance

34

Asset Manageme

nt

Miscellaneous (glass washing, mail room, etc.)


What are the session’s key take-aways?Why delivering value through

service solutions has become a big deal

What challenges must be overcome to grow service solutions

What are key success factors for growing service solutions


Customization

Capabilities

Challenges



Culture


36

Services Supporting

Customers

Services Supporting

Products

Asset Management

Value Added



Services


Advisory Services


Solutions

SmartServices

EntitlementServices


ASU/CSL Resources

Copyright ASU Center for Services Leadership 2012 37

• Webinar – Thursday, January 19, 11:00 am“Service Infusion Study Results”

• White Paper“Service Logic: Transforming Product-

focused Businesses”• Workshops

“Growing Service Solutions”• Keynote Speaking

“Growing Service Solutions”



January 17, 2012




growing service solutions business marketing association january 17, 2012 center for services...

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