Article 7 of 14
Once the strategic vision, technological foundation, and service framework for servitization are in place, it’s time to implement. This stage involves structuring physical and organizational resources to support an efficient and scalable product-service system (PSS). From facility layout to organizational roles, setting up the right infrastructure is essential to achieve the agility and customer focus that servitization demands. This article outlines the key steps for SMEs to structure their facilities and organizations effectively, preparing them to deliver consistent, high-quality service.
1. Aligning Facility Layout with Service Delivery Goals
Servitization requires that manufacturing facilities support both production and service functions. Unlike a traditional product-focused setup, a service-oriented layout often includes dedicated spaces for service activities such as maintenance, repairs, and testing.
- Create Dedicated Service Areas: Allocate specific areas within the facility for tasks like equipment servicing, testing, and parts storage. These areas streamline workflow by minimizing time spent moving assets and tools between locations.
- Optimize for Service Flexibility: Ensure that the facility layout can adapt to varying service demands. For instance, multipurpose workstations allow technicians to perform different types of service tasks without major reconfiguration. Flexible spaces also support the scalability of service operations, enabling growth in response to customer demand.
- Invest in Customer-Centric Spaces: If customers visit the facility (e.g., for equipment handovers or service demonstrations), consider setting up customer-focused areas. A dedicated service reception, demonstration room, or product-testing space can enhance the customer experience, providing transparency and reinforcing service value.
2. Establishing a Service-Oriented Organizational Structure
Servitization shifts focus from purely product delivery to continuous service delivery, and this requires a new organizational structure. Key roles, such as service managers, field technicians, and customer success teams, are essential to manage both operations and customer relationships.
- Define Service-Specific Roles: Establish roles and responsibilities tailored to servitization. For instance, a service manager might oversee maintenance schedules, manage contracts, and coordinate field teams. Field technicians focus on performing repairs, maintenance, and installations, while customer success teams ensure service quality and maintain customer satisfaction.
- Integrate Cross-Functional Teams: Servitization benefits from a collaborative approach where sales, engineering, service, and customer support work together. Cross-functional teams ensure that knowledge flows seamlessly between departments, enabling quick responses to customer needs. For example, engineers can collaborate with field technicians to address recurring issues, improving both product design and service effectiveness.
- Create a Service Leadership Role: Designate a senior leader (e.g., Chief Service Officer) responsible for overseeing all aspects of servitization. This leadership role ensures that service priorities are aligned with company goals and that sufficient resources are allocated to service functions. Service-focused leadership also helps embed a service culture within the organization, reinforcing the importance of customer success.
3. Adapting Operational Processes to Support Servitization
Operational processes that worked well in a product-centric model may need adjustment to accommodate servitization. To ensure smooth service delivery, SMEs must develop processes that integrate production, service activities, and customer engagement.
- Implement Standardized Service Procedures: Create service protocols for tasks such as preventive maintenance, repairs, and inspections. Standardization ensures consistency in service quality, especially as operations grow. Documenting procedures also aids in training new technicians, helping maintain service standards.
- Establish Responsive Inventory Management: Servitization often requires quicker access to spare parts and tools. Consider a responsive inventory management system to keep essential parts readily available. This is particularly important for advanced servitization, where customers rely on manufacturers to guarantee uptime. Some SMEs may benefit from on-site “mini-warehouses” that ensure rapid access to critical parts.
- Develop Clear Service Level Agreements (SLAs): SLAs establish performance standards and set customer expectations, specifying metrics such as response times, maintenance schedules, and uptime guarantees. SLAs create accountability within the organization and clarify the level of service customers can expect.
4. Enhancing Communication and Coordination Channels
Effective communication is at the heart of successful servitization, as customers expect timely updates, quick response times, and transparency. SMEs should develop internal and customer-facing communication channels to streamline information flow.
- Integrate Digital Communication Tools: Use digital tools like project management software or service platforms to ensure seamless communication between service teams, technicians, and customer support. For example, customer-facing portals allow customers to request service, check the status of maintenance, and receive updates. Internally, messaging platforms enable fast communication between teams, improving response times.
- Maintain a Feedback Loop with Customers: Servitization thrives on close relationships, and gathering feedback from customers is essential for continuous improvement. Establish regular feedback channels, such as follow-up calls or digital surveys, to understand customer satisfaction and identify areas for service enhancement.
- Coordinate Between Sales and Service Teams: In a servitized model, sales teams play a key role in setting customer expectations. Regular communication between sales and service teams ensures that customer promises are realistic and achievable. Additionally, sales can offer insights into emerging customer needs, guiding service development.
5. Establishing KPIs to Monitor Service Effectiveness
Servitization success depends on consistent quality and customer satisfaction, so tracking relevant KPIs is crucial. SMEs should establish metrics that reflect their unique service goals, providing actionable insights into performance and opportunities for improvement.
- Customer-Centric KPIs: Measure customer satisfaction with indicators such as Net Promoter Score (NPS), customer retention rate, and feedback scores. These metrics reflect the value customers place on service, providing insight into areas where improvements are needed.
- Operational Efficiency KPIs: Metrics like service response time, parts availability, and repair turnaround time measure internal efficiency. For example, tracking parts availability helps ensure service teams are well-prepared, while response times reflect the organization’s ability to meet SLAs.
- Financial KPIs: Tracking revenue from service contracts, recurring income growth, and service cost per asset help assess financial sustainability. These KPIs ensure that servitization is not only valuable to customers but also financially beneficial for the business.
In Summary: Laying the Groundwork for a Service-Oriented Organization
Implementing servitization requires more than adding new service offerings—it requires reshaping the organization, facility, and processes to support a service-first approach. By establishing a well-structured facility layout, creating specialized roles, standardizing operational processes, and enhancing communication channels, SMEs can set a strong foundation for scalable, customer-focused service delivery.
In the next article, we’ll explore how to build a workforce equipped for servitization, covering critical skills, training, and strategies for fostering a team that excels in delivering exceptional service.
