By adding digital services to a physical product - digital servitisation - you can build a long-term relationship with your customers and create value for your company and for your customers.
Economic value for your business
Servitisation is also a proven way of continuing to generate economic value for your business beyond the one-off sale of your product: you sell a product and you couple services to it, which means you are tying customers to you for the lifetime of your product (and possibly even longer).
However, there are a few things you need to know. The extra services you add to your product are in most cases difficult to scale. They also require a customer support team, or at least staff who are fully dedicated to supporting customers who use the services.
However, many companies outsource this support because it is not part of their core business. As a result, the economic value created through servitisation is distributed among different players, often in the local market. The problem with this is that not only the value of the product is distributed, but you also lose direct contact with your customers.
Creating a feedback loop with digital servitisation
That is precisely where there is a lot of value to be gained. Indeed, with the advent of digital technologies such as Internet-of-Things, cloud services and data science, it is becoming possible for businesses to reclaim this value without the problem of scalability, lost customer contact, the cost of outsourcing support, etc.
After all, you can now offer services digitally and this creates a 'feedback loop'. Digital services generate a lot of data that give you an insight into the use of your product and make you understand what your customers really want and need. You can then use these insights to offer new digital services and better adapt your current offering to the needs of your customers in order to provide them with more value.
Many companies are experimenting with digital servitisation and are succeeding in offering real added value to their customers by not only selling them a decent product, but also linking it to digital services.
In our casebook 'Digital Servitisation', we highlight some cases of companies that have taken the plunge. You can read why they opted for digital servitisation, what challenges they encountered along the way and what it finally brought them and their customers.
Here are two inspiring examples.
I-care
I-care is a European company that provides global monitoring and reliability solutions for industrial customers in various sectors. The overall goal is to optimise the industrial efficiency of processes and machines at customers sites.
I-care found that companies needed quality monitoring and reliability hardware that they could control remotely. That is why it developed Wi-care, an IOT solution for the acquisition and processing of condition monitoring data. With easily configurable sensors, Wi-care automatically monitors critical installations. The data generated in this way is visualised and analysed on the I-See platform.
You can find more about these and other cases in our casebook 'Digital Servitisation'.
Hilti
Hilti is an international company that provides tools and services to construction companies. It saw that its customers needed a handy tool to help them better manage fixed and rolling stock (machinery). In an ideal scenario, Hilti's customers will know at any time where tools are located and whether they are actually being used. After all, this knowledge can bring about major indirect cost savings.
Hilti developed ON!Track, an app and website that allows customers, for a monthly subscription fee, to manage their equipment perfectly. The equipment, tools, vehicles, etc. are fitted with vibration sensors. This makes it immediately visible in the app when they are being used.
You can find more about these and other cases in our casebook 'Digital Servitisation'.
Sirris helps you on your way to digital servitisation
When you switch to digital servitisation, you confront the entire organisation with a multitude of choices to be made and decisions to be taken. By supporting companies both technologically and organisationally, Sirris helps companies through this phase and helps them take the next steps.
Wondering what Sirris can do for your company? Feel free to contact us!
