Offer Services With Products To Boost Building Manufacturing

Folkert Haag

Discrete manufacturers that create building products are facing challenges from industry competitors that have gone through a digital transformation. The companies that don’t follow suit and digitalize the business will fall behind. In an IDC white paper, authors Kimberly Knickle, Heather Ashton, and Jeffrey Hojlo stated that “by 2018, nearly one-third of [discrete manufacturing] industry leaders will be disrupted by competitors that are digitally enabled.”

One main way discrete manufacturers are moving forward is by integrating services with current product offerings. This combination is tied in with providing better customer experiences. To achieve this new business model, manufacturers need to rely on technology and Internet of Things (IoT).

How can building manufacturers use technology to stay relevant in the industry and move past competitors?

Modern customers are looking for a better experience. Providing that experience can improve business for manufacturers. Building products manufacturers can shift their business models to add services to their product offerings. They can provide services that install and maintain the products they sell.

Selling products straight to customers can also be new for businesses that sold them through a second company. Previously, customers might have bought kitchen cabinets at a home improvement store. Now, theycan buy them straight from the manufacturer. The same company will also install the cabinets. This setup could fit many types of building product manufacturers. Those that sell windows, carpets, doors, faucets, or other building materials could all install their products.

Adding services to keep up with changing demands doesn’t need to be difficult. Manufacturers can team up with third-party contractors. These service providers become integrated into the shop experience. This setup allows manufacturers to offer services to customers without dramatically changing their businesses. Companies that want to keep everything within the business can instead choose to provide their own service staff members.

Adding services has the potential to help manufacturers in numerous ways. Benefits include providing stability from seasonal changes, adding profitability and revenue, meeting demands of consumers, and distinguishing the brand.

Using IoT to include services

IoT is helping manufacturing companies use technology to drive new business processes and business models and offer new services. It allows new ways of running the business to meet the needs of companies and consumers. The products are connected to IoT with sensors and software that allow functions like remote monitoring. These kinds of benefits can help companies keep track of their products to check for defects and provide services.

In particular, service enablement can be used as an IoT scenario with building products. Companies can use service enablement to bring together different providers to create a service-oriented business model. Using IoT, companies could use a program to integrate their products and services, and to efficiently run the new type of business.

Heraeus Additive Manufacturing is a company that has used a technology platform to incorporate its additive manufacturing process into broader production and supply chains. A specific platform can help manufacturing companies better collaborate with service providers and other companies. Virtual project rooms help the different companies work together to meet supply and demand needs. Head of Heraeus Additive Manufacturing Tobias Caspari said that this type of virtual platform streamlines the process of collaboration between different experts.

Customers are demanding more from companies. Many manufacturing companies are finding ways to satisfy that demand by offering services on top of products. For example, they now install and maintain the products they sell. They are using technology to manage the different parts of the company. It helps different companies work together to meet customer demand. Manufacturing companies that don’t keep up with this type of change can expect to lose relevance with consumers. Using technology and new business methods helps discrete manufacturers compete and improve their businesses.

Learn how to bring new technologies and services together to power digital transformation by downloading The IoT Imperative for Energy and Natural Resource Companies. Explore how to bring Industry 4.0 insights into your business today by reading Industry 4.0: What’s Next?


Folkert Haag

About Folkert Haag

Folkert Haag is the global lead for building materials industries at SAP, and is part of the solution management team of the mill products and mining industry unit.