Exploring how companies can digitalize their processes to achieve a higher level of servitization, considering both obstacles and best practices – DERO GROEP Service B.V.
Overview
| Company Name / Department |
DERO GROEP Service B.V. |
| Contact Person |
Jurjen Bakker – Albert de Jong |
| Location | Alkmaar/Joure |
|
Optional remote work |
Yes – Decided upon with the student depending on the need. |
| Travel expenses (own account or reimbursed by the company) | Can be discussed in case of no student OV. |
| Housing arranged by company | No |
| Housing expenses (how much per month, own account or subsidized by the company) | Own account |
| Internship compensation | €500 per month |
| Study program | |
| ESCF community |
Servitization |
| Start date |
As soon as possible |
Company Description
We are the DERO GROEP. We see ourselves as an enthusiastic group of go-getters with a high level of technical knowledge. As our slogan indicates: “Our drive. Your solution”, we devise tailor-made production automation solutions for every situation. We also supply maintenance for these solution. You can also have a look at our website (https://www.dero-groep.nl), for more information about who we are, what we deliver and what our so-called DERO drive entails.
Project Description
Project description:
Driven by market opportunities and the needs of our customers, we as DERO Group are fully committed to servitization and digitalization. Aware of the risks, however, we run into several challenges.
Organizations used to focus either on providing goods or services. However, in recent decades, influenced by globalization, there has been a shift towards offering so-called “bundles” (service packages), a combination of products, knowledge, service and support. The shift in which organizations adjust their business model and evolve from a product-oriented strategy to a service-oriented strategy has been called “servitization” in the literature.
The shift towards servitization strengthens the customer relationship and creates “resilient” profit streams, increasing barriers to competitors (T. Baines & W. Lightfoot, 2013). In the literature, the shift towards servitization has long been understood as an inevitable trend for any product organization and a prerequisite for organizations to survive. Possibly the best-known example of servitization is Xerox, which changed its business model from supplying office equipment to supplying printed documents with its “pay-per-copy” concept. This example of performance contracts between customer and supplier seems to prove that moving towards servitization is the key to success (Visnjic Kastalli & Van Looy, 2013).
Meanwhile, the discussion is a lot more nuanced. Research shows that some companies deliberately choose “deservitization” (Kowalkowski, Gebauer, Kamp, & Parry, 2017a, 2017b; Valtakoski, 2017). As an example, Xerox chose to divest their organizational unit based on servitization in 2016.
In many cases, the process towards servitization was not fully implemented and not well understood. The costs for the additional service and services provided exceeded the additional revenues (Gebauer, Fleisch, & Friedli, 2005; Gebauer & Friedli, 2005). Because the transition to servitization involves a different business model, large financial risks are taken, which in the worst case scenario can lead to bankruptcy (Benedettini, Neely, & Swink, 2015). Despite these risks, servitization is a popular topic with many companies and, as a result, much is written about it and much is known.
With this subject we want to get a larger understanding of the role of digitalization and how this digitalization should be rolled out to the customer and within the company. What factors play a role in servitization and at what order we should work on digitalizing our processes. This and more inherent on digitalizing is interesting to further understand and create a roadmap for us as a company.
- Exploring how companies can digitalize their processes to achieve a higher level of servitization, considering both obstacles and best practices.
It is important to note that the companies stated here are companies that deliver a physical product and thus have some kind of need to get to its products for service. Making it very hard to centralize all the processes.
In addition to this, we are open to, together with the student, search for a topic (within servitization) that is interesting for the student, our company and that adds to existing literature.
Goals of the project:
Getting a greater understanding of the needed development steps of digitalization software for the next steps in servitization.
Deliverables:
Deliverables can be decided upon later however we can imagine a roadmap, a stepwise program or a do’s and don’ts list.
Essential student knowledge:
Understanding of digitalization and servitization.
More information: escf@tue.nl
