How is servitization being implemented?
How is servitization being implemented?
We asked our respondents what approaches they took in terms of
strategically developing their servitized solution.
When looking at those companies with an existing servitization element within their service portfolio, just under a fifth (17%) of companies devised the solution internally with their existing team.
The most common approach, however, was to seek guidance from external third-party consultants, which just over two-fifths (41%) of companies did.
A small number of companies (9%) devised their strategy internally after hiring key staff with servitization experience. While this is too small a section to draw a meaningful and robust conclusion from it is also worth noting that these organisations all developed their servitization projects in less than a year.
The final section of this group, which was the second largest section in the subset of those companies who have developed a servitized element in their service portfolio, was those who devised the strategy in partnership with a customer – which was a third (33%) of the response set.
When we look at those who are currently developing their servitization strategy, a similar percentage of companies (29%) are also working with their customers. This is an important trend to identify as the concept of co-creation between service provider and customer has been the hallmark of successful servitization case studies, as we referenced earlier in this report.
In terms of comparison between those who have already developed their servitization offering and those currently working on the development of such projects, the biggest variance is shown in organisations currently developing their solutions who are devising their strategy internally with their existing team. Amongst those who are currently developing their strategies, this equates to well over two-thirds (38%) of respondents.
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"It is interesting to see more companies essentially seeking to develop their servitization solutions internally at this stage."
The number of organisations that were turning to third-party consultants is reduced amongst this response set, with slightly over a quarter (27%) of companies in this group doing so. The number of companies hiring key staff with servitization experience is also very slightly reduced, with just 6% of companies doing so.
It is interesting to see more companies essentially seeking to develop their servitization solutions internally at this stage – whether this is a result of the concepts being better understood as the conversation has become more mature is certainly an area we shall be exploring in our follow-up interviews within the qualitative phase of this study.
As we saw in both groups, many companies were developing their servitization offerings with an existing customer. However, for those who didn’t or are not currently taking this path, what are the plans for their servitization offering?
We asked both groups if they were developing this solution for a specific subset of clients or if they believed this solution would be suitable for all clients.
Amongst those organisations that had already developed a servitized offering, over two-thirds (67%) of respondents stated that they felt their servitization solution was only suitable for a select group of clients, while 33% stated they would be aiming to move all clients to their servitized offering.
When we look at the data from those in the group currently developing their servitization offering, this was very closely mirrored (64% to 36%), which would indicate that the majority of organisations who have either introduced or are introducing servitization into their service portfolio see their servitized offering as something that sits adjacent to and in addition to more traditional service offerings.
This is also reflected in how organisations approach rolling out their servitization offerings as commercial offerings.
Amongst those organisations with an existing servitized element within their service portfolio, just under a quarter (23%) of companies initially made their servitized offering only available to a select number of clients, while just over a quarter (27%) made their servitized offering available on a single product line only.
A third (33%) of companies in this group took a regional approach to deployment, which was marginally the most common of the approaches we saw in this study.
Meanwhile, the least common was to take the ‘big bang’ approach that saw a complete rollout of the solution to all customers in all regions across all product lines, which was the approach just under a fifth (17%) of companies in this group took.
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