(PRWEB) November 2, 2005
Pioneers in smart-service-providing are already achieving more than 50% of their margin from these new services. Pre-emptive maintenance and smart services will be the prime buzz words of product-centric companies by the end of this decade.
My company provides top level training and business advice to senior managers, says James Mandeville. Many of our British clients are still talking to us about ways of wrapping services around their products and I have to tell them every time that they are already one jump behind.
One of our European clients, an engineering consultancy, by aggressively entering the smart-service-provider market is deriving 50% of their revenue from smart services. They won a valuable contract by changing their customer’s equipment from stand-alone to “connected” free of charge. Their package includes pre-emptive maintenance, stock replenishment and operating statistics. Technical service reps from the original equipment supplier cannot even get through the customer’s front door.
For smart services to work, products have to be intelligent, which is relatively inexpensive and easy to do in most cases. Intelligent products have sophisticated monitoring and networking capability built in, so large packets of data can be sent to a remote computer that can perform real-time analysis of machine performance enabling pre-emptive maintenance. This sort of software expertise is not very evident in British manufacturing companies.
Pre-emptive maintenance stops nasty surprises and enables customers to save thousands of Euros by preventing line down-time. Correspondingly, whereas traditional service calls can bring in revenue of €100 per hour (tops) for technical support — by using remote monitoring, smart service providers can charge €500-600 per hour.
The message is clear: If British manufacturers do not enter into the ring at this pioneering stage fit for fight, they will take so many body-blows that they will end up as spectators when it comes to the World Championships. The service revenues will be snatched away by smarter competitors or predatory, independent smart-service-providers able to put the whole smart services package together.
About James Mandeville:
James Mandeville is the managing director of 21st Century View Ltd., he specializes in providing a mentor/sparring partner service to key executives and is an expert on change management. He is a graduate chemist with post graduate degrees in marketing, clinical psychology and an MBA. His 24 years business’ experience includes international auditing for a multinational company, experience in takeovers, mergers and management buyouts and working as the sales director of an international company before he became a training and business consultant in 1984. A British citizen, James lives in Denmark. He acts as mentor and sparring partner to several key executives in Europe and runs workshops for senior managers in the UK.
21st Century View Ltd
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