Liiketoimintamallit ja osaaminen teollisuuden palveluliiketoiminnan kehittämistarpeina. Tulevaisuusluotain seminaari
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1 Liiketoimintamallit ja osaaminen teollisuuden palveluliiketoiminnan kehittämistarpeina. Tulevaisuusluotain seminaari Hannu Tuominen, Vaisala Solutions, BestServ Forum
2 Content of presentation Product vs. Service BestServ Forum Transition to Services Business models BestServ Research Program 2
3 Development Trends over the History (Capital Goods) Marketing/ Sales Research/ Development Production/ Assembly Industrial Services Focus on Conceptual Development in the 60/70ies 70/80ies 80/90ies 90/00ies Reference: FIR
4 The role of services in the secondary sector importance of services change in sales volume of services Unimportant Slight Decrease 3% Importa nt 14% 11% 75% Constant Slight Increase 10% 42% 45% Very Important Increase n = 151 capital goods producers View on service-relevance in Germany 4 reference: Expertenbefragung Service, FIR 2002
5 Scope of Industrial Services Spare parts Maintenance & Repair 24-h emergency service Process consultation Project engineering Installation & Startup Machinery options & upgrades Removals & reinstallations Consumables Maintenance & Consultation Contracts Training Financing Build, Operate, Maintain Refurbishment & Resale 5
6 Framework of Industrial Services 6
7 Differencies between Products and Services The main knowledge base of a manufacturingoriented business: Knowledge about products and manufacturing processes The main knowledge base of a Knowledge-Based Service Business: Knowledge about 1) The customers processes and customers value creation; 2) How to support this value creation Reference: Grönroos
8 The Core Competence A manufacturing-oriented business: How to manage manufacturing processes How to manage technology A Knowledge-Based Service Business: How to manage a system for supporting customers value creation (and hence also for supporting the business processes of customers - and often also of their customers) Reference: Grönroos
9 BestServ Forum 9
10 BestServ Forum in Brief Knowledge sharing and learning network in the area of industrial services development Business oriented research and benchmarking First phase organized as a one year feasibility study ( ) Companies, VTT, Technology Industries of Finland Second phase started as a two year research and development project ( ) 20+ Companies Technology Industries of Finland, VTT Researchers, Consultants 10
11 BestServ Forum Members; 2nd phase END CUSTOMERS M-Real Puolustusvoimat Kvaerner Masa-Yards Wärtsilä SOLUTION PROVIDERS Metso Vaisala L&T ABB Service Tamglass TeliaSonera Tietoenator MAINTENANCE Rocla SERVICES KCI KONE SOFTWARE Kemppi MACHINERY CO S INDUSTRY Sandvik M&C Timberjack MATERIAL Patria Normet ELECTRONICS SUPPLIERS Kalmar INDUSTRY CONSTRUCTION RELATED ORGANIZATIONS INDUSTRY Technology Industries of Finland GA RESEARCH & Techvilla JTO VTT HKKK SUPPORT LTY HANKEN TKK 11
12 Motivation for BestServ Forum Industrial Services are in early stages of their evolution path Both short and long term initiatives are needed to capture Industrial Service potentiality Business approach: value based and customer oriented business models are needed Technology approach: integration and architectural approached are needed 12
13 BestServ Mission Promote the competitiveness of Finnish Industrial Service Business in Global Market. 13
14 BestServ Vision World Class industrial service business is a competitive advantage of Finnish Companies in Global Markets. Services boost industries international growth and success. 14
15 Value of BestServ for Participants 1. Assist participants to understand the position of their customer relations. 2. Help participants to further develop their customer oriented business models and value propositions 15
16 Identified Challenges /1 - based on BestServ feasibility study Profitability of Industrial Service business Defining customer value proposition Customer intimacy value discipline Managing the transformation in Industrial Services evolution Synergies between services and machinery Reference: BestServ feasibility study
17 Identified Challenges /2 - based on BestServ feasibility study Mindset of People Organization Customer presence in operations Industrial Service distribution chain Developing new Industrial Service offerings & architecture Technology for Industrial Service business Reference: BestServ feasibility study
18 Transition to Services 18
19 Framefork for transition to value partner: Topical issues in different positions Supplier Competencies Customers business Customers processes Customers operations Customers purchasing Model & Design Educate & organize Product Predict & Adapt Operative Efficiency Make Sense & Solve Listen & Learn Valuate & Price Value to customers customer Plan together Take responsibility Process Business Performance Value Source: Adapted to BestServ Forum 2004 Focus of Customer Relationship 19
20 Assume Responsibility Sell Operate Overall responsibility by customer Direction Overall responsibility by producer Technical Risks Product Risks Market Risks Customers demand for further risk taking from the producer 20
21 Increasing Distance from the Core Business Internal Services Product Induced Services Accompanying Services System Solutions! R&D! Maintenance!...! Help Desk! Operator! Warranty!...! Commissioning! Reconstruction! Spares!...! Plant Engineering! Financing!... Distance from the Core Business Due to the increasing focus on core competencies more companies demand for system solutions 21
22 Business model transition - dynamic development needs Service continuum: Transition towards servicing the client - not the product current position target position Importance of tangible goods is high Service is add-on Current business model New business model Importance of Services is high Tangible goods become add-on changes realized current plans 22
23 Business models 23
24 Value Creation logics: Value chain and Value shop The value chain The value shop Infrastructure Human Resource Management Technology development Procurement Support Activities Infrastructure Human Resource Management Product development Procurement, Contracts Margin Problem Finding & Acquisition Primary Activities Problem Solving Support Activities Choice Primary Activities Operations Marketing & Sales Service Control / Evaluation Execution Organis ational Relational Physical Physical Monetary Human Organis ational or Human Monetary - process focused - balancing of demand chain - solution is mass customization in factory Source: Porter, M.E. 1985: Competitive Advantage; Creating and Sustaining Superior Performance - starts from acquiring right to solve customers problem - several alternatives are presented to customers -> co-selection (customer becomes owner of the solution) - the basis is customer relationships and competent people 24
25 Content of Business Model Customer Value What is the value proposition (what do you offer of value to thecustomer) Scope What is offered to which customers? Price How does the firm price the value? Revenue Sources Where do the $ s come from? Connected Activities What set of activities does the firm choose to perform to offer the value? Implementation Org. structure, systems and people? Capabilities Capabilities, resources and distinctive properties? Sustainability How will the firm keep on making money? Reference: Fjeldstadt
26 Example: Alternative Business Models reference: Fjeldstadt
27 Example: Alternative Business Models Value creation logic Chain Shop Network Transformation of inputs into products Solving customer problems Linking customers Manage Products Projects Networks Problem-finding and Inbound logistics, Primary activity acquisition, Problemoperations, outbound categories Solving, Choice, logistics, marketing, Execution, service Control/Evaluation Scale gives Cost efficiency Competence mobilization Network promotion and contract mgmt, Service provisioning, Infrastructure operation Connectivity Perceptual realestate Brand Reputation Netspectations reference: Fjeldstadt
28 Example: Vaisala Business Models Customer and his application Customer and his application Approach Two different strategic positionings in our business models Solution business Solution business Information business Information business From customer concerns to solutions Needs based positioning Instrument business Instrument business Measurement system business Measurement system business From phenomena to data Variety based positioning Approach Phenomena Phenomena 28
29 BestServ Research Program 29
30 BestServ Research Program O. Business Transformation Process 1. Business Models and Life Cycle Management 2. Organization Models and Management of Competence Customer Focus Enterprise Intent 3. Service, Product and Technology Architectures 4. Operational Excellence 5. Enabling Technologies and Infrastuctures 30
31 Conclusions Service business is one of the main industrial development trends at the moment There are several different kind of possibilities to earn money from services, but the value of services has to be communicated to the customers Focus should be on supporting customer processes " creation of customer value Business model is crucial, technology is enabler Many new competence requirements are created 31
32 BestServ Contacts Hannu Tuominen, Vaisala Petri Kalliokoski, VTT Forum Chairman Forum Coordinator
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