Industry consultant and author Des Evans has told transport firms to adopt a “servitised” approach to business to align themselves with their customers more effectively.
Evans was speaking at the launch of a new book – Servitization Strategy – from Aston Business School, whose authors are working with research agency the Advanced Services Group to help companies including Rolls Royce, JCB, Goodyear Tyres and Caterpillar to improve their business models.
The Advanced Service Group has become a recognised leader in the development of servitisation, helping companies across many industrial sectors with strategy innovations.
Their customers now receive more than just a competitive price for the hardware and in many cases are supplied with a competitive total cost of operation that incorporates many additional services. The new book covers many of the processes that need to be understood and the potential outcomes that are possible.
“Servitization enables organisations to refocus their energies on areas of the business that are important to their customers and in many cases leads to the development of a number of added values services that will deliver a competitive advantage and a significant differentiation,” Evans said.
“Vehicle manufacturers, for example, have moved their focus away from hardware sales towards added value services. Vehicle price has in many cases been replaced by cost per Km or cost per week/month.
“Finance contracts, used vehicles, residual value management, export sales, recycling and re-manufacturing are just a few examples of additional services that vehicle manufacturers must now provide in order to maintain their market share and volume aspirations.”
Asked how transport firms could best introduce a more servitised approach, Evans said it was initially important for them to understand the process, which involves adding services to products or even replacing a product with a service.
“In today’s economic environment, growth and productivity are key topics and a more servitised approach can help many operators in the transport, logistics and automotive sectors achieve these necessary levels of improvement,” he insisted.
“Success will be determined by establishing a coalition amongst collaborative stakeholders and this will require a lot of trust as important data is shared between customers and suppliers. But if the UK is to achieve the necessary economic growth that all political parties are championing then participating in a more servitised approach to business seems to be a very good place to start,” he concluded.
Professor Tim Baines, executive director of the Advanced Services Group agreed, reiterating that competing in today’s market requires more than just offering products.
“It demands delivering outcomes that resonate with customers,” he said.
“Our new book addresses this need by outlining how businesses can transition to outcome-based business models, creating value for customers while enhancing economic productivity and sustainability.
“We expect the book to become a cornerstone resource for executives, professionals and students seeking to drive innovation and enhance customer-centric outcomes in their organisations.”
The book’s authors have also released the “Servitization Playbook” as a practical companion guide. This offers professionals in industrial firms concise directions on developing the agenda to implement the servitization strategy, setting out a programme of key tasks, with timelines and milestones, as well as tips and useful tools.
For more information visit: www.servitizationstrategy.com
