Company
> 5,000 employees
Machine Engineering
Distributor-based Business Models
Problem
The client is a leading manufacturer in its industry and had identified service as one of its strategic growth areas as part of a previous strategy project at group level. The service revenue share was around 15% and was to be expanded to 20% in the coming years. To this end, the very parts-focused service offering was to be supplemented with additional new and value-adding services. We were commissioned to help define the target portfolio and work with the client to develop business cases for all new services in this target portfolio.
Approach
Result
In close coordination with the product management's connectivity strategy, a service target portfolio was developed together with the customer that includes both classic services and innovative new digital business models, for which the connectivity strategy was the enabler.
At the same time, the market approach was also redesigned in order to strengthen sales of the new services to be developed. Among other things, new sales channels that focus on direct customer contact were jointly defined and developed. Previously, services and parts were offered exclusively via dealers. However, this second, already established channel was also analyzed and optimization potential derived in order to strengthen future service sales.
Overall, a growth area of more than EUR 400 million was identified, which was subsequently systematically developed by establishing a separate specialist area. The establishment of the specialist area, including the associated business case, was developed jointly and discussed and approved with the Management Board. This secured the buy-in of the other departments, which are important for the development of this business opportunity, and anchored top management support.
