Think Tank Sessions: Is Servitization Dependent on Being OEM Owned?
Whilst servitization frequently appears, in the context of whole-life support (and revenue), to be an integrated arm of the manufacturer (eg Mercedes Trucks), the reality is that Mercedes dealers, although badged, are not Mercedes Benz. Servitization in such a scenario is therefore not necessarily dependent on being OEM-owned? Or is it?
Servitization consists of two elements, which the OEM seeks to control:
• Brand protection – because the in service experience is as promised
• In life revenue stream- from parts and labour
Revenue can be derived from the classic capex and in-life contracts – or from “up-time” or “in service” models – “assets as a service”. So what do potential OEM and service partner relationships look like? How will service specialists work together with OEM’s for mutual support – and for the optimal customer experience?
Is this polarisation likely? Why and what are the respective defining competencies (& focuses)? How crucial is the initial evaluation and subsequent agreements, in-service performance review of partnerships?
What about the financials? Why and how does the OEM derive revenue from the service relationship in such a model? Also how do we tackle branding vs. white-labeled service? How is all this presented to the customer?
There are many nuanced talking points within this complex discussion, many different viewpoints and equally compelling perspectives. In short, it is the perfect topic for discussion for the Field Service News Think Tank sessions, where we allow our members to push each others thinking as we work towards some common understandings.
In this iteration of the Field Service News Think Tank Sessions, we were joined by service leaders from across Europe to give us their insights into all of these critical topics. As always, the level of insight that came from allowing the group to speak freely behind closed doors was exceptional. In this Executive Briefing report, we have tried to distil some of that excellent conversation into a series of salient takeaways to share with the broader industry.
Think Tank Sessions: Is Servitization Dependent on Being OEM Owned?
Whilst servitization frequently appears, in the context of whole-life support (and revenue), to be an integrated arm of the manufacturer (eg Mercedes Trucks), the reality is that Mercedes dealers, although badged, are not Mercedes Benz. Servitization in such a scenario is therefore not necessarily dependent on being OEM-owned? Or is it?
Servitization consists of two elements, which the OEM seeks to control:
• Brand protection – because the in service experience is as promised
• In life revenue stream- from parts and labour
Revenue can be derived from the classic capex and in-life contracts – or from “up-time” or “in service” models – “assets as a service”. So what do potential OEM and service partner relationships look like? How will service specialists work together with OEM’s for mutual support – and for the optimal customer experience?
Is this polarisation likely? Why and what are the respective defining competencies (& focuses)? How crucial is the initial evaluation and subsequent agreements, in-service performance review of partnerships?
What about the financials? Why and how does the OEM derive revenue from the service relationship in such a model? Also how do we tackle branding vs. white-labeled service? How is all this presented to the customer?
There are many nuanced talking points within this complex discussion, many different viewpoints and equally compelling perspectives. In short, it is the perfect topic for discussion for the Field Service News Think Tank sessions, where we allow our members to push each others thinking as we work towards some common understandings.
In this iteration of the Field Service News Think Tank Sessions, we were joined by service leaders from across Europe to give us their insights into all of these critical topics.
As always, the level of insight that came from allowing the group to speak freely behind closed doors was exceptional. In this Executive Briefing report, we have tried to distil some of that excellent conversation into a series of salient takeaways to share with the broader industry.
