Maximising your Services Value

There are numerous ways Services can add value!

A previous post discussed how the value of a service is not just the 'technical solution'. So what's a checklist of other things that can add value to the customer?

The graphic shows 5 areas where value can be added (risk transfer, efficiency, etc). Value-adding features don't always sit just in one area. For instance a feature might be more efficient because it has superior 'output'. (One could also use the word 'performance' instead, remembering that sometimes performance just needs to be as good as asked for and not better.) So as the value-adding areas are sometimes over-lapping and re-inforcing - and in the spirit of London 2012 this year - the 5 areas are shown as interlocking Olympic rings.

The 'running track' shows a list of potential value-adding features. Some are common phrases, such as Sweat Assets. Others are less well known, such as 3PR (3rd Party Revenue, selling excess capacity) or Serial Sell (sell capacity/assets/service to someone else when 1st customer no longer needs it). It might be as simple as selling a service to a customer so that assets employed sit off their balance sheet and on yours or other parties!

There's probably no end of features and combinations that could be used, and they can be every bit as important as the prima-facie solution!

7 Factors for a Successful Service Proposition

Gleaned from experience:




1.  Good revenues: in many industries the underlying revenue driver is the number of people doing Service operations, as people costs dominate and specialist skills can be charged for.
2.  Creating value: you will be doing a high value-added activity, creating value by solving a Customer’s particular problem, and doing it better than they could themselves.
3.  Competitive advantage: using your technology or know-how, you will be doing  the activity better than your Customer/competitors.
4.  Key IPR: your IPR crown jewels is your ‘proven’ cost model – competitors can only speculate how much it costs if you have genuine competitive advantage/superior know-how.
5.  ‘Product/Technology’ performance: the asset/product/technology behind the Service only has to be just good enough!  (Inferior technology could very credibly win the overall service offer).
6.  Service design focus: for competitive pressure and service-focused outlook, should organisationally separate the service and embedded product bidding teams if considering using in-house technology.
7.  Create value through a ‘balanced’ service offer: a competitive Service needs to have a good balance of technical, usability, commercial and financial strength, creating value to the Customer in each of these areas.