Servitization: Preparing the Manufacturing Industry for What’s Next

Some of the main drivers behind servitization are growing competition at the local and global levels and the commoditization of products. Margins are being squeezed, so new revenue streams are required. Instead of accepting the ‘received wisdom’ that competitiveness can only be achieved by offering cheaper, faster or better products, manufacturers are increasingly seeing themselves as service providers, offering total solutions rather than just products.

Adding service has been found to result in:

  • 5–10% annual increase in service revenue for OEMs
  • Maintenance cost reductions of 25–30%
  • At least 10% reduction in fuel consumption
  • CO2 emissions down by 10–15%

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