Intangible services and tangible products
When
applying a true PSS there is typically some existing business already running.
That business an be service oriented or product oriented. If these are to be
translated into a new model of Product-Service-Systems, there usually is
simultaneous servitization and productization project ahead.
The
intangible service side of
the offering must be packaged into an easy
understandable format.
This is to be done throughout, the intangible service
should be easy to communicate and sell, easy to use and for most easy to buy.
The buyer must know what he will get when making the purchase order. This
increases the role of communication but it is not just communication – it is
the total user experience. Some companies talk about the service design (https://www.kreapal.fi/) and sell their
expertise to help other businesses to gain more business. The offering must be
easy to understand and buy - the fear or inconvenience feelings related to
purchase decision are probably one of the worst enemies of salesmen. Equally
when the tangible products are servitized, the same basics are on the
background – how to make the purchase easy and less inconvenient, how to
communicate the value in effective understandable way and how to package
everything.
Both
productization and servitization are part of the process towards PSS. If a
company decides to change their strategy from traditional model to PSS type of
a business, it is critical to make sure that there is enough training and
information in place because the effects internally are great as well. In Figure 1 the cornerstones of the
productization (or servitization) are presented. This figure gives an idea of
what are the main points to remember internally when going into a project
aiming to PSS offering.
The PSS
offering is demanding but rewarding. Everything is dependent on customer
success which again is dependent on your ability and capability to deliver.
Thus these cornerstones must be in place and well documented – throughout the
whole personnel.
Very often
in PSS models the contract is
based on some act or a product availability.
To
maximize the points declared in the contract you should have the offering well
packaged. That helps in sales like discussed previously. All parts of your
offering but also production should be well documented. That is to give your
customer an easy to understand picture of what are you going to deliver but to
also for your staff simple guidelines how to act in all situations. The
documentation is also part of your safety net – people tend to change their
jobs relatively easily and you do not want too much knowledge to transfer with
them.
As the
contracts often have some time related points, the processes internally should
be well known, understood and in use. In some industries the response time for
customer claim is short. The processes of how the cases are handled should be
well in place when going into these contracts with some service level
agreements etc. The details should be defined in contracts to gain mutual
understanding of what is the meaning of reaction time. This is to avoid
conflicts with customers but also for internal use so that everyone knows your
way and processes on how to handle different cases. But when binding into these
kinds of deals with possible sanctions, you must have modularity in your
offering. If there is no preplanned modules in your offering you easily end up
selling tailor made solutions and then it is difficult for your crew members to
handle cases when every case has a different contract as backbone. Couple
of different modules will keep your cards in order.
As a
conclusion, for both tangible and intangible products, there must be a clear
understanding of how the products look and feel like. Also, the process of
making the product or producing the intangible service is clear and has no
holes. That is, the basics are the same, message for the customer is clear and
simple enough to understand very quickly. This reflects also to the sales as a process
which will be discussed in later posts more in detail.
