Ericssons services

I am starting to learn what different kinds of services different companies are offering. I will collect and come back soon. But until then please look at the services that Ericsson offers.

These are the services that Ericsson is offering.

• Application Development and Maintenance
• Consulting and Transformation
• Learning Services
• Managed Services
• Network Design and Optimization
• Network Roll-Out
• Support
• Systems Integration

http://www.ericsson.com/ourportfolio/services

How do I do the transformation to services

The transformation journey to services is as we have mentioned before long. The companies that have been successful have a lot of lessons learned on how they made the journey so successfully. Research at Cambridge Service Alliance have together with Pearson North America, IBM, Caterpillar, BAE Systems and Zoetis distilled those learnings in a report called "Seven Critical Success Factors in the Shift to Services". The report is available here.

In the report the seven most important Critical Success Factors (CSF) for doing the journey towards developing a scalable, repeatable and profitable service business. For each CSF there are defined actions that has to be made to successfully do the shift to services. The report can be used as a guide in your company's transformation journey.

I have copied the picture below from the Cambridge Service Alliance report.

Seven Critical Success Factors in the Shift to Services

Make Your Dealers Your Partners

An old Harvard Business Review article talks about how Caterpillar survived the fierce competition from Japan through their relationship with their dealer (or distributor) network. I think this article still gives a lot of good ideas about how to work together with your distributor network.

 This quote from the article summarized the essence of the article.

"The quality of the relationship between a company and its dealers is much more important than the contractual agreements or the techniques and tactics that make the relationship work on the surface. What matters is mutual trust, and that is fostered by observing a few simple rules: Share gain as well as pain; strive for continuity in relationships and consistency in policies; and communicate constantly. For a company that relies on independent dealers to present one face to its customers around the world, it must have uniform practices and performance standards for dealers and treat them all with equal consideration while recognizing that they are independent and unique in many ways."

Servitization is definitely trending!

Look at the graph from Google trends of how the searches of servitization have increased since 2007!

It very often takes a long time to succeed with services

It very often takes a long time to succeed with services. As a reference it took, according to Cambridge Service Alliance, Man Truck & Bus respectively ICI Explosives ten and twenty years to develop a sustainable service business model. But you do not need to take this long time in your transformation to services. By using the knowledge and learnings from companies that have already done the service transformation journey it could go quicker. There is a step by step guide to develop a scalable, repeatable and profitable business model. So there is no use to redo the mistakes that have already been done!

Make Your Distributors Your Partners

Gallup have done a valuable work on how to treat distributors of products.

They recognize the challenges and the different goals of suppliers and distributors. This makes the relationship between suppliers and distributors very often have a trust issue.

• Distributors exist to offer a market basket of supplier products to customers, but fear that manufacturers would rather market directly to customers. 
• Suppliers are dependent upon distributors for market access, but often question the margins earned by distributors.

At the same time 

• The Industrial Performance Group finds 82 percent of manufacturers and 92 percent of distributors say profitability is suffering because of problems in their working partnerships.

Why do we talk about this here?

For services it is of outmost importance for the service provider to have a direct relationship with the consumers. They are the ones that can tell us if the service gives value or not. So please read this! This is why you need to value the relationship with your distributors and treat them as both employees and customers. Or as close partners!


http://www.gallup.com/businessjournal/161555/suppliers-manage-distributors.aspx

What is Servitization!

In essence servitization is a transformation journey - it involves companies developing
the capabilities needed to provide services and solutions that either supplement
or replace their traditional product offerings. Recent technological advances such
as cloud computing, big data analytics, mobility and social media have enabled the
Servitization trend.

Definition of a service

A service is the means of delivering value to customers by facilitating outcomes customers want to achieve without the ownership of specific costs and risks.

ITIL defines services this way. It basically means that the customer gets something they want without having to bother about the supplier’s efforts to provide it. Services are stand-alone offerings, but could as well be offered with a product as a supplement.