Services - successful through customer orientation and business model

80% of industrial companies believe they offer great services, but only 8% of customers agree.

The trend to offer smart services - apart from hardware products - has also reached traditional industrial companies. Unfortunately, many companies are trying to transfer the same business models and requirement processes that they have been using in the market for their hardware products linearly to the new service offerings. However, many service projects fail with this approach due to lack of customer interest or due to high costs and low returns.

The keys to a successful service offering are customer- and need-oriented processes (CX, UX), meaningful integration of modern technologies, as well as creative business models that are tailored to these services.

Focus on needs and people

All in-depth business relationships are built between humans.

Therefore, a company's services must always be geared to the needs of people who either want to contribute along the service chain or who want to benefit directly or indirectly from the services provided.

Before offering a service, it is therefore necessary to be aware of the tasks, problems and results of the various customers, partners and employees within the service chain. Usually, design thinking methods are also used in service processes to analyse the needs along the service process. A design thinking process is subdivided into the following steps, some of which are run through several times after iterations.

When developing the value proposition of the service, one must focus on problem-solving qualities and increasing the benefit for the stakeholders involved.

The expectations of the stakeholders must become a positive experience during the provision of the service, which should lead to satisfaction.

The participants in the value chain of a service are usually

  • the customer who pays for the service,
  • the user navigating in the software of the (electronic) service and
  • the employee who supports the service in his or her own company.

Each of these participants perceives the handling of the service individually. This perception is essentially assessed according to emotional (feel), informal (look) and functional (use) criteria.

The overall perception (feel, look and use) within the service process is called ʺExperienceʺ.

Thus, we can distinguish in

  • Customer Experience (CX)
  • User Experience (UX) and
  • Employee Experience (EX).

A good service must deliver positive perceptions/ experiences at all three levels.

Secure processes and technologies

Processes and technologies play an important role in the value chain of services.

Depending on the added value and the volume, service processes can be either an administrative mass service process or an individual consulting service. Depending on their nature, greater attention must therefore be paid to complexity or repeatability.

In order to offer good service, automated processes must work smoothly and reliably. In order to provide first-class services, however, it must be ensured in the event of process deviations that the needs of the customer are still met even in this exceptional case. To ensure this, the automated process is preferably supported by service-oriented customer advisors. Despite the increased need for personnel, this resource expenditure is worthwhile in order to recognize changes in the needs of customers and users at an early stage and to optimize the service process.

Nowadays, technologies in the service sector are very strongly oriented towards modern IT technologies. Despite all enthusiasm for new technology, one should focus during the technology selection on customer benefit and security of the processes. Because what can be gained from a fancy ʺAppʺ that is of no use to anyone?

Useful tools and accessories

Website: A central tool for services is of course the company's own website. For specific service topics, ʺMicrositesʺ speeds up navigation.

Social media: Another important building block is the company's own social media presence, which on the one hand contributes to the marketing of the services, but on the other hand also serves as evidence of the quality of the service through customer evaluations. Furthermore, target group-specific PR (Public Relations) can be carried out in target-group-specific communities.

Online platforms: Online marketplaces offer web-based topic-specific trading opportunities to bring supply and demand together. For customers and suppliers, participation on such platforms is relatively easy and quick. However, before they can be used, contractual issues, financing strategy and trading margins of the platform provider should be clarified seriously.

Complementary services: Services that support existing products aim to o provide the broadest possible performance spectrum.

Examples of complementary services are

  • Online catalogue with suggestions for complementary articles, wear and spare parts.
  • Templates to facilitate the planning/tendering process.
  • Cost/benefit comparison calculator.
  • Webinars on repair solutions.

Which tools are used as ʺDigital Touchpointsʺ should in turn be oriented towards customer benefit in the various phases of the entire service process.

Creative business model

In addition to the benefits for the customer and customer satisfaction, it is important for the company that the cost-intensive provision of the service also generates a tangible financial benefit.

In order to guarantee this, one must become clear about the appropriateness of the business model before marketing the service. A transparent method for the illustration of the business model represents the ʺBusiness Model Canvasʺ. With this method drafts can be simply discussed and creatively optimized involving the different interest groups.

I would appreciate, if this article could give you some suggestions for the development of services and hope that the following advertising slogan will also apply to your company: ʺGood Service is good businessʺ.

I look forward to your comments or contact me directly, if I can support you in the areas of service design, innovation management or design thinking for products/services.