Five things we learned from the World Servitization Convention 2021
This year’s World Servitization Convention took place virtually between September 14-16 and was run by the Advanced Services Group, part of Aston Business School. The event saw more than 630 manufacturing organisations, big and small, come together to watch more than 30 interactive presentations from over 80 leading academics specialising in the transition from product-based business strategies towards service-based operations.
In addition to enabling businesses to put their questions to firms that have already implemented servitization strategies and providing a networking forum, the event also helped manufacturing SMEs from across the West Midlands and beyond to learn more about the steps they need to take in order to move to a servitized business model. Here is a round-up of just five of the interesting discussions that were held:
1) No business is too big or small to servitize
One of the great elements of The World Servitization Convention was the breadth of businesses that attended, from small manufacturing SMEs to huge, global corporations. It meant we had businesses such as Spiers Engineering and Tactile Technology sharing best practice with the likes of Rolls Royce, Xerox and Goodyear. We also had delegates from as far away as Ohio and the Philippines, proving that servitization can apply to any manufacturing businesses regardless of their size and location, if they get their strategy right.
2) Servitization can boost resilience
During today’s challenging business climate, every manufacturing organisation is looking at ways they can become more resilient and we heard several stories from businesses that have utilised service-based business models to do just that. Whether it was AE Aerospace pivoting production to help create ventilators when normal business was paused, or businesses that have been able to continue some form of business during lockdown thanks to their mission-critical field service teams, servitization has helped make manufacturers more flexible and resilient. Furthermore, according to Professor Tim Baines, Executive Director of The Advanced Services Group at Aston Business School: “Covid-19 has not changed the forces shaping industry, it has accelerated them…and Servitization is the response.”
3) Servitization has a role to play in sustainability
We heard several stories from businesses that have inadvertently reduced their carbon footprints through their servitization strategies. For example, those firms that are using advanced services to monitor machine performance on an ongoing basis now only have to send an engineer out when absolutely critical, rather than having vans on the road intermittently, performing on-site maintenance at scheduled times. As the business community moves towards more sustainable policies and transitions to net zero processes, servitization can make a significant impact.
4) Servitization increases productivity
Several stories were shared at the convention, detailing how servitization has enabled greater productivity. In most cases, it has added a focus to other services and enabled manufacturing businesses to focus on how they deliver value to a customer. By throwing resources and capacity around this value driver, they have been able to eliminate unnecessary waste in their organisation, both in terms of material waste and administrative time.
5) There is no one-size-fits-all solution to servitization
No two businesses have an identical servitization story. We heard during the convention about how Mazak’s servitization strategy is focused around innovation; Goodyear’s around moving closer to customers; and Xerox’s is about improving long term customer retention. It’s clear that every business has a different interpretation of servitization and it plays a different role for different businesses. That’s why it helps to work with a specialist such as the Advanced Services Group and its SME Partnership to build your servitization strategy around your individual business needs and objectives.
Iain McKechnie, Director of Strategic Programmes, The Advanced Services Group at Aston Business School, said: “The World Servitization Convention was an opportunity to show the ‘art of the possible’ with regards to transforming businesses through advanced services. The manufacturing firms came together to demonstrate how far they had progressed on their servitization journey – the convention was opportunity for firms to show-off how far they have come.”
As we begin to work on next year’s World Servitization Convention, The SME Partnership is currently recruiting its next cohort of manufacturing SMEs from Birmingham, Solihull and the Black Country to take part in a fully funded programme.
This is designed to help your manufacturing SME make the transition from making and selling products to embracing servitization and a move towards advanced services. For more information, contact The SME Partnership by clicking here.