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Saturday 18th September 2021 01:08 AM

Three Things OEMs Need to Know as They Make the Switch


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Servitization — where companies shift from totally new product sales to instead selling the outcome a product delivers — and change go hand-in-hand. And, we all know that no matter the the circumstances, change can be unnerving. The manufacturing industry in specific has remained relatively unchanged for decades, but this new era is in need of original equipment manufacturers (OEMs) to entirely upend the status quo. 


For several years, the onus has been on end-users to absorb the brunt and costs of continual maintenance and repairs. Due to the boom in servitization however, it is now the OEMs that have to dominate the responsibility of making sure equipment is up-and-running as much as possible — causing an increased focus on enhancing product uptime and pre-emptively repairing equipment before it ever fails.


This has specific upsides, as the OEM is in the best position to make certain the products are designed and manufactured in the best way to maximize uptime. At the same time, this shift also means that OEMs are not necessarily making money on selling highly expensive spare parts — but rather that the equipment works and deliver its output. This means the total business logic and incentive structure changes dramatically and will require OEMs to redefine the way they operate.


Here are three key things OEMs need to do as they shift to a servitization-centered business model:


Invest in workforce training.

Most of companies have a tendency to prioritise speedy onboarding versus comprehensive workforce training. However, the companies that trade in hurried, one-off onboarding and center on constant training and development will have a competitive edge. People are a company’s best asset. So, taking the time to provide comprehensive training purely makes sense to help them feel comfortable, thrive and achieve the results that a company is aiming to through this new business model.


Bring in far-reaching service technology.

Some after-sales service businesses still manage their service parts supply chain efforts through time and labor-intensive processes. In the shift to servitization, however, OEMs will have to take an increasingly comprehensive look at their operations and invest in the proper technology that can help them manage the real-time service needs that arise in a servitization-centered world.


Always question.

Why are we doing things this way? Are the processes we have in place delivering the results we need? Are they helping us to be in the best position to tackle the problems of tomorrow? These are concerns that leaders at global OEMs should be requiring themselves every day. Only because a certain method has worked for years, doesn’t actually mean it’s the right way today – or especially for the future. It is relevant to always keep thinking seriously about what can be done to improve and to empower other team members to question and deliver new, more effective solutions.


Servitization brings with it several exciting opportunities, but that doesn’t simply mean the transition is easy. Irrespective of any apprehension to change, OEMs can begin taking small steps today to lay the foundation for a successful servitization-centric approach, and even more important, situate their businesses for the next iteration of the manufacturing industry.


This article is originally posted on manufacturing.net


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Posted on : Saturday 18th September 2021 01:08 AM

Three Things OEMs Need to Know as They Make the Switch


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Posted by  Tronserve admin
image cap

Servitization — where companies shift from totally new product sales to instead selling the outcome a product delivers — and change go hand-in-hand. And, we all know that no matter the the circumstances, change can be unnerving. The manufacturing industry in specific has remained relatively unchanged for decades, but this new era is in need of original equipment manufacturers (OEMs) to entirely upend the status quo. 


For several years, the onus has been on end-users to absorb the brunt and costs of continual maintenance and repairs. Due to the boom in servitization however, it is now the OEMs that have to dominate the responsibility of making sure equipment is up-and-running as much as possible — causing an increased focus on enhancing product uptime and pre-emptively repairing equipment before it ever fails.


This has specific upsides, as the OEM is in the best position to make certain the products are designed and manufactured in the best way to maximize uptime. At the same time, this shift also means that OEMs are not necessarily making money on selling highly expensive spare parts — but rather that the equipment works and deliver its output. This means the total business logic and incentive structure changes dramatically and will require OEMs to redefine the way they operate.


Here are three key things OEMs need to do as they shift to a servitization-centered business model:


Invest in workforce training.

Most of companies have a tendency to prioritise speedy onboarding versus comprehensive workforce training. However, the companies that trade in hurried, one-off onboarding and center on constant training and development will have a competitive edge. People are a company’s best asset. So, taking the time to provide comprehensive training purely makes sense to help them feel comfortable, thrive and achieve the results that a company is aiming to through this new business model.


Bring in far-reaching service technology.

Some after-sales service businesses still manage their service parts supply chain efforts through time and labor-intensive processes. In the shift to servitization, however, OEMs will have to take an increasingly comprehensive look at their operations and invest in the proper technology that can help them manage the real-time service needs that arise in a servitization-centered world.


Always question.

Why are we doing things this way? Are the processes we have in place delivering the results we need? Are they helping us to be in the best position to tackle the problems of tomorrow? These are concerns that leaders at global OEMs should be requiring themselves every day. Only because a certain method has worked for years, doesn’t actually mean it’s the right way today – or especially for the future. It is relevant to always keep thinking seriously about what can be done to improve and to empower other team members to question and deliver new, more effective solutions.


Servitization brings with it several exciting opportunities, but that doesn’t simply mean the transition is easy. Irrespective of any apprehension to change, OEMs can begin taking small steps today to lay the foundation for a successful servitization-centric approach, and even more important, situate their businesses for the next iteration of the manufacturing industry.


This article is originally posted on manufacturing.net

Tags:
servitization strategy original equipment manufacturers original equipment industrial equipment equipment manufacturer