Is This the End of the Product-Based Economy?
Once upon a time, there used to be products, and there used to be services. The former was a thing you could touch, the latter was something you couldn’t. However, that distinction, particularly in industrial settings, is rapidly dissolving.
According to global research conducted across the globe including in the UAE, Saudi Arabia, and Turkey, seem to be witnessing the end of the product-based economy. Instead, there is an increasing trend to bundle services with products through outcome-based contracts and business models.
Reinforcing that point, 77% of those surveyed in the study believe Gen Z will be the last generation to experience an economy dominated by products alone without any embedded services or outcomes.
The study, commissioned by GE Digital, found that this shift to blend products and services is delivering economic benefits to companies. For example, companies can expect to boost revenue by more than 14% simply by automatically collecting and analyzing service data related to industrial assets.
The research, “The Rise of Asset and Service Data Gravity,” was conducted by Vanson Bourne, a UK-based research firm. The study shows that for every US$1 spent on successful service data collection and usage, companies expect a return of US$4.44
“Businesses are moving to outcome-based models where monetizing service – and harnessing field service data – is critical to success,” said Ali Saleh, Chief Commercial Officer for GE Digital Middle East, Africa & Turkey.
This integration of product and service helps deliver increased uptime and availability, mitigates downtime, and offers asset estate insight, performance metrics, and supply chain improvements.
As an important piece of digitization, service data holds untapped insights for almost every line of business – from sales, R&D, IT, finance, and marketing. It also has a huge impact on overall equipment effectiveness in terms of performance, capacity, quality, and uptime.
The report surveyed 600 IT decision makers and field service management leaders across manufacturing, energy and power, oil and gas, transportation, distribution and logistics, telecoms and healthcare. Internationally, the study was conducted in the United States, the United Kingdom, France, and Germany in addition to the UAE, KSA and Turkey.
Read more stories here about GE Digital’s work to support customers across the Middle East, North Africa, Turkey and Pakistan.