Does servitization require internal structure changes?
Does servitization require internal structure changes?
Another component of the discussion surrounding developing a servitized offering is whether there will need to be significant changes to the existing structure of the organisation.
n some ways, service operations do not need a significant restructure, particularly for those organisations that have already made the move to a more proactive style of service.
However, in certain service organisations, the transition may require some form of redevelopment of the service organisation – for example, the way spare parts are accessed can be changed significantly within a servitized business.
We asked our respondents whether they had, or intended to, change the structure of their service operation either when introducing or when planning a servitized offering.
Amongst those organisations who have established a servitized element within their service portfolio, the response was almost evenly split, with 48% of companies stating they had not changed the structure within their service organisation and 52% stating that they had.
However, amongst those organisations who were currently developing their servitization offering, there was a clearer weighting towards making changes to their service operations, with over two-thirds (67%) stating they intend to do so.
The other side of this conversation is, of course, the changes needed to the sales department. There is a significant difference between product sales and service sales. However, when it comes to servitization and, in particular outcome-based solutions, the sales approach becomes even more complex.
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"Many organisations currently underestimate the additional complexity of selling servitization."
This is very much reflected in the responses to the question we put to those who have already established a servitization element within their service portfolio. We asked, ‘Have you had to change your sales approach to accommodate the servitized offering?
In response to this question, almost three-quarters (72%) of respondents statedthat they had indeed changed their sales approach.
However, when we look at the respondents within the group who have are still currently developing their sales approach, the number of organisations who believe they will have to change their sales approach is actually considerably lower, with less than two-thirds (61%) stating they will be making changes.
There could be a number of reasons for this variance, it could be an indicator perhaps that those organisations later to the party in terms of servitization havealready introduced changes to their sales approach that are more in line with modern service-sales approach and thus are more aligned to proactive service methodology, so there is a smaller adaptation curve.
Alternatively, it could be simply that many organisations currently underestimate the additional complexity of selling servitization. This is certainly an area that we will be investigating further during our follow-up interviews in the qualitative phase of this study.
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