Over the last few years a number of automation vendors have announced various services including outsourced maintenance, system integration, manufacturing and business process consulting, and remote operations. I wonder if an automation vendor can continue to be effective as both a product company and services provider.
To clarify the difference, let’s start by defining what I mean by services and products. By providing services, automation vendors engage with customers to perform labor and knowledge intensive tasks that may include system design, engineering services, system integration, preventative maintenance, remote operations, and other services. By providing products, automation vendors sell something to the customers, system integrators and engineering firms that they will apply to accomplish automation tasks in manufacturing and process environments.
The primary objective of a service company should be to focus on the development a system solution that is uniquely suited to the idiosyncrasies of the client’s business without being tethered by particular product solution offerings. A big part of this is the ability to deploy technologies from appropriate sources using integration and engineering skills to achieve a superior result for the client. Service businesses need to have effective and refined project, personnel, and quality management systems. The growth and effectiveness of these businesses is directly related to adding and managing smart people and this is a unique business proficiency mastered by successful service organizations. Pure service businesses have an advantage of successfully maintaining alliances with a range of product vendors that cannot be logically achieved by product vendors who provide services. This separation positions a pure service business to use best of breed and get the most out of vendors. For comparison, consider you are a smartphone user and the only place to get apps was your phone hardware vendor.