November/December News : It's all about Servitization

veröffentlicht am 06.11.2018

So what is Servitization?

If you only have a few minutes available watch the following videos:

  • What is Servitization? From Advanced Services Group Video
  • Prof. Ulaga focuses on Servitization and its value for B2B companies Video

Both videos give already insights and the huge potential for business, but also the environment! Send me your thoughts, after you watched those!

Link to Event

More time to investigate and explore servitization? Then have a look at those resources!

  • Attend our CFSM/AFSMI Webinar on Servitization at 22nd November at 4pm . If you are interested, please send me an email:
    • Topics will be: Why combination of Servitization, Digitization and Subscription Based Economy will change the service world? What are the drivers, open questions? Outlook on Frankfurt Event
  • Dive into Servitization at the following websites:
    1. ServiceinAction Website from Prof. Kowalkowski and Prof. Ulaga Link
    2. Advanced Services Group: Link

Link to Event

Are you now curious and want to know about challenges and opportunities of Servitization?

You already want to see the challenges, bottlenecks and opportunities of Servitization, then here a couple of articles. I learned a lot about pricing, bottlenecks like Legacy IT or the right mindset of employees. Also about the impact on automotive industry. Interesting to see that acceptance for servitization is highest with new generations (Millenials, Gen X). Servitization will get a boost through IOT as new digital services will be enabled. But without talking the right finance language and ability to sell this to your CFO, you never will exploit the capabilities of servitization!

Link to Event

Here are the articles, I refer to:

Challenges & Bottlenecks

    1. Pricing: A typical challenge is Pricing. Shaun West delivered an excellent summary, how to find the right pricing. ( Slides). The article and podcast "Exploring pricing as the exchange rate for value“ from Stephen Millard Article helped me a lot to rethink value based pricing for digital services not only for SaaS but also growing IOT services.
      Also excellent deep dive Master Thesis from Ayede/Türkoglu around Service Pricing
    2. Legacy IT and the overall mindset described as obstacles in Forbes article, on the other hand Millennials and Gen Z generated will be driver for servitization growth, see Article
    3. Cyber Security: Keeping connected products secure on mid- and long-term support. See article from Mirko Ross
    4. In the automotive industry the challenges of servitization, especially around culture became for me present in this article from (Flecks, Staehle, Wulf, Heimrecht) Article


    1. Increased sales! Subscription based business in general and especially IOT subscription based services has grown faster than overall industry. This is important as most servitization offerings are within annuity / outcome contractual agreements. Please have a look at Link
    2. Leverage new leaders from Millennials and Gen Z as driver for servitization growth, as they experienced this already as a consumer Article
    3. Key benefits of servitization for the customers are Key benefits for the customer are financially reduced CAPEX, higher productivity and more time to focus on his core competence, see our discussions of our regional AFSMI meeting: Link

Finance the Key Success Factor:

  • Finance is key in servitization as CAPEX moves from customer to the vendor in most of the scenarios, so speaking the right language, building the right expectation setting to budget holders internally or externally is key. This is described by TSIA „Swallowing the fish“. Link And TSIA showed in a 37 min Video a summary on growth of XaaS Video

Link to Event