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Businesses are transforming from products to services provision

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Remote monitoring and predictive maintenance is becoming ever more important in manufacturing and other sectors.

New service delivery models, the emergence of flexible services marketplaces and demand for new equipment skills are reshaping the way service businesses operate, according to a new global Forrester Consulting study, commissioned by ServiceMax, a provider of cloud-based software for service execution management.

33% of firms that are a product company today say they will be a services company within 5 years.

The Forrester Consulting study, From Grease To Code: What Drives Digital Service Transformation, surveyed 675 digital transformation decision makers across North America, Europe, the Middle East and Asia Pacific that are currently undergoing or have already completed significant portions of their digital transformation. Respondents are in infrastructure roles at global industrial enterprises, including manufacturing, healthcare, utilities and telecommunications industries.

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“The focus on digital transformation has placed companies’ attention on harnessing equipment data for insights, exploring new business models, and implementing digital technologies,” according to the study.

The shift from ‘grease to code’ is well underway, as firms unlock data about their assets. 89% of companies are collecting equipment and service data to drive business decisions, but the digitalization of industrial services requires new skills to operate machinery.

The struggle to find service technicians with the required knowledge and expertise remains an issue. 77% of firms say external contractors are becoming more important, and 80% are interested in using a service marketplace to access suitable freelance talent when needed and source the necessary skills.

The study found that from a financial gains perspective, as-a-service businesses and predictive maintenance models will contribute most of the revenue within 5 years. Offering assets on subscription, enabling preventative maintenance and shifting to as-a-service delivery models is seen as critical for improving customer experience. 39% of companies have already invested in predictive maintenance today, and a further 49% will do so within 3 years.

Stacey Epstein, chief customer experience officer of ServiceMax said: “Digital transformation is driving the pace and adoption of new service models globally, reshaping the way services businesses operate.

“85% of firms say ‘servitization’ is now a high or critical priority, as are outcome-based business models. This shift puts a different lens on the role of service maintenance, support, unplanned downtime, customer experience and revenue generation as companies see smarter use of equipment data, and the adoption of mixed labour models playing an increasingly important role in business performance.”

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Clare Nicholls

The author Clare Nicholls

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