Services Development in Luxembourg • 11 May 2010

by jean Marc Rommes on May 13, 2010

This week, on Tuesday 11 May 2010, Nick and myself co-hosted a short workshop on behalf of Luxinnovation on services development for product-centric companies in Luxembourg, with specific highlights on the needs of the logistics sector.

Click through to read about some of the highlights of the discussion and a link to the download of the PDF slide handout.

Some of the highlights of the discussion:

  • Services development, or servitisation as it is often called to the despair of many, is not a new concept. As a specific research topic it has been around for over 20 years.
  • Many product centric companies already have a set of services that they offer concurrently with their products – but often they are not sure how to make them profitable
  • Servitisation as a systematic approach to service integration  into core product lines is most advanced in the US, where studies show that aorund 60% of companies are servitised in one way or another
  • For Europe, these figures are much lower (Germany about 30%; France about 20%). Opinions varied on what the figures might be for Luxembourg, since a large section of the entire economy is already service based; only 10% of total companies can be considered manufacturing companies and it is unclear in how far these have deliberate servitisation strategies
  • The logistics sector in the area may be facing particular challenges since many of the bigger solutions provider are not headquartered in Luxembourg, and some of those that are may still be confined to more traditional transporter roles due to infrastructure limitations
  • While companies seeking to undertake a services development initiative need to have a major rethink around the definition, the vision and long term strategy of their core business, as well as to implement coherent and robust processes that will ultimately deliver on the customer promise, the biggest risk for many lies in underestimating the cultural impact and implications of a redefined strategy: successfully selling and delivering products is just not the same thing as being successful in the sales and fulfilment of services
  • And service development strategy should therefore be considered as a major change initiative.

An animated discussion led to the conclusion that many organisations in Luxembourg and the Greater Region around Luxembourg may still not be quite aware of the sense of urgency to rethink their approach to customers, as well as the right product/service mix for them.

You can download the PDF version of the slides from the event: Services development in Luxembourg 100511.

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