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What cultural changes to expect when shifting to Servitization and EaaS


As companies shift towards service-oriented business models, the move to servitization or EaaS (Everything-as-a-Service) models is becoming increasingly popular. This shift requires significant organizational culture changes, including its mission, values, and incentives, to align with a service-centric mindset. Using the Before-After-Bridge method, this article will explore how organizational cultures change when moving to a servitization model or EaaS.

In a product-centric culture, the focus is on designing, manufacturing, and selling products. Employees are incentivized to design and produce products quickly and efficiently, and customer support leans towards addressing product-related issues and defects. The company measures success by the volume of products sold and the revenue generated.

A service-centric culture focuses on delivering value through services and solutions rather than just selling products. Motivated employees provide excellent customer service, build customer relationships, and develop new services and solutions that meet customer needs. The company measures success by the quality and effectiveness of the services and solutions and the overall customer experience.

Organizations must make significant changes to move from a product-centric to a service-centric culture. Some of the changes include:

  1. Shifting the company mission and values: The company must align with a service-centric mindset, emphasizing customer-centricity, innovation, and continuous improvement.

  2. Developing a customer-centric culture: Employees are empowered to provide excellent customer service, build customer relationships, and identify new opportunities to create value for them.

  3. Implementing new incentives: Incentives must be aligned with the company's new mission and values, focusing on delivering value through services and solutions rather than just selling products.

  4. Encouraging cross-functional collaboration: Teams must work collaboratively to deliver comprehensive services and solutions, breaking down silos between product and service teams.

  5. Investing in employee training and development: Employees must be trained on new processes and technologies to deliver services and solutions to customers effectively.

Moving to a servitization model or EaaS requires well-thought-out organizational culture changes. The focus shifts from selling products to delivering value through services and solutions, which requires a customer-centric mindset and a culture of innovation and continuous improvement. Organizations must change their mission, values, incentives, and employee training and development to make this shift successful. By doing so, organizations can build strong customer relationships, increase customer loyalty, and achieve more stable and predictable revenue streams.

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