In Ugebrevet Mandag Morgen, PA manufacturing, consumer and strategy expert, Nicolai Broby Eckert, discusses the key findings from PA’s new research on servitization. The research finds that three out of four industrial companies expect service offerings will become a significantly bigger part of their business in the next three to five years, and that companies who have already adopted servitization report up to 35% profit margins on services. Still, only one third of companies have a servitization strategy in place and this could potentially hurt their ability to grow and compete in the future.
"Servitization should be part of the business growth agenda. A yearly growth of 5 to 10 percent within service may sound reasonable but it´s possible to realise much higher growth rates if companies keep a dedicated focus on their service offerings. It´s a big change for most organisations but if they fail to react, others will seize the market share and they could be left entirely out of the market,” Nicolai explains.