Why service is a strong strategic tool

Mr. Ashera, the VDMA emphasizes how important service orientation is for the competitiveness of German mechanical engineering. Where do companies currently stand on this path, in your opinion?

Ghebrekedus Ashera: Mechanical engineering is positioned differently. There are successful companies that have understood service as a strategic instrument for years and other successful companies that are still on their way there.

In general, it can be said that since the decline in new machine business, the focus has been on after-sales or the entire product lifecycle. This is a positive development, which can be seen through the inquiries and trends in the industry. Especially because there are currently great growth potentials here. 

How digital service solutions can generate profits

Digitized service processes can not only minimize downtime but also unlock new revenue potential. Jochen Pfeil from Vecoplan explains how this works.

Many mechanical engineers are digitizing their products, but only a few manage to take the step to real digital business models. What do you think is needed to ensure that digitization does not end with networking, but actually brings about new revenue models?

Ashera: This is a very positive development that companies are taking the next evolutionary step and digitizing machines and processes. It means that processes improve and accelerate. Furthermore, it also provides new insights into the product and customer needs.

The challenge is primarily to understand the interaction between digital processes, the product itself, and customer needs. Business model development is then an iterative process that requires possible adjustments and improvements in the further course to achieve a successful result.

How to sell digital services in mechanical engineering

Bits and bytes alone do not create added value. Only when digital services measurably improve performance, availability, and quality do data become a real business model. Lukas Schattenberg from Ixon explains the details.

For the mid-sized sector to take off in the service business, know-how, data competence, and suitable framework conditions are needed. What role do politics, education, and association work play in this - and what does the VDMA specifically demand to support this change?

Ashera: The VDMA is actively involved in all areas to create the framework conditions for the successful work of its members. It is important to stay in constant exchange with the members and their challenges and to address them appropriately. For this purpose, we have, for example, representations in Brussels and Berlin. It is especially important to provide constructive proposals for implementation, and that is what the VDMA does.