How To Be Successful

Transcription

1 Transition from product based offerings to service based offerings Stockholm, June Peter Berggren Vice President, Soft Products 2 June 14, 2010

2 is one of the world's leading suppliers of transport solutions for commercial use Volvo Trucks Renault Trucks Mack Trucks UD Trucks Buses Construction Equipment Volvo Mack Trucks Penta Volvo Aero Financial Services 3 June 14, 2010

3 Definition of Soft Products Definition Soft Products are all products and services sold to a customer that enhance the customer s experience and satisfaction other than the sale of new vehicles / equipment / engines 4 June 14, 2010

4 Relevance of Soft Products Get closer to our existing customer Attract new customers and segments Increase the sales of higher margin products and services Add more life cycle value on gradually commoditized hard products Succeed with business cycle management with less cyclical revenues 5 June 14, 2010

5 Snapshots from Q3 reports Service transition leaders perform well IBM Operating profit rose 14% Our long-term strategic shift to higher-value businesses again enabled us to deliver outstanding margin, earnings and cash flow growth in the third quarter Kone Operating profit rose 9 % HP The service business and operational excellence are key priorities for us in the current weak economic environment. I am pleased with our good development in these areas. These have contributed positively to our profitability and cash flow Services generate record profits, 15.2% operating profit Record profit in Services, double-digit revenue growth in China, and solid cash flow demonstrate HP s ability to execute Caterpillar Still in black, significant focus on Integrated services Best products get you a seat at the table, best services move you to the head of the table Ericsson Nokia Services now 40% of total revenue - The strong development in Professional Services continued, +9% year on year Profits down, share price down 14% at Q3 results Nokia announced the formation of Solutions, a new unit responsible for driving Nokia s offering of solutions, started operating on October 1, June 14, 2010

6 Building the Soft Products business A way forward Professional solutions and services Operational services Customer process oriented Dynafleet/Optifleet/UD Telematics ITS4U CareTrack Fuel Management Training Safety and security solutions Safe port Managing operations Workshop integration Aero Services Outsourcing services Product oriented Product related products and services Spare parts Workshop Remanufacturing Used Maintenance and financial services Service contracts Financing Rental Insurance Breakdown service Transactional Relationship 7 June 14, 2010

7 The Transport Industry in 2020? Intelligent transport solutions A brand new world Center of gravity Most likely to happen according to references Slow evolution Asian entrants 8 June 14, 2010

8 Building our Soft Products business The way forward Professional solutions and services Operational services Customer process oriented Dynafleet/Optifleet/UD Telematics ITS4U CareTrack Fuel Management Training Safety and security solutions Safe port Managing operations Workshop integration Aero Services Outsourcing services Build Transport Solution and Services business Product related products and services Maintenance and financial services Product oriented Spare parts Workshop Remanufacturing Used Our customer s Best Partner in Aftermarket Service contracts Financing Rental Insurance Breakdown service Transactional Relationship 9 June 14, 2010

9 Complex Transport Solutions I-710 Project of National Significance To improve Air Quality, Mobility and Safety POLA/POLB 5 th busiest Ports in the world 40% of US cargo comes through the Ports Receive 60% of all Asian cargo entering the Nation Project will accommodate existing and projected growth of ports (approximately 43 million TEUs per year by 2035) Currently 35,000 trucks per day from the two ports Up to 92,000 trucks per day by year ,000 trucks and 250,000 trucks and cars per day on the I-710 south of I-405 in June 14, 2010

10 Insights Massive mindset shift Structure, processes, decision making Competencies and attitude 11 June 14, 2010

11 How do we manage the change? Best in Aftermarket Explore Transport Solutions Innovation and Business Development Governance and Communication 12 June 14, 2010

12 First phase has been successful Soft Product sales in 2009* ~80 BSEK (~40% of the ) -3% growth vs Soft Product sales YTD April 2010* ~27 BEK (39% of the ) +6% growth vs Soft Products True Commercial Transport Solution Provider * Excluding Volvo Financial Services 13 June 14, 2010