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Manufacturers invest in smart tech

According to IDC, 70 per cent of manufacturers are evaluating, planning or implementing smart technologies for after-sales service.

Over the next 12 months, manufacturers will use smart technologies to generate a larger percentage of after-sales service revenue through content-aware applications and services.

This includes monitoring equipment for consumables replenishment and location-based services, as well as instrumented platforms for remote diagnostics and condition-based maintenance of customers' equipment.

Of the companies that have already invested in smart technologies, one quarter are investing from 25 per cent to 49 per cent of their IT budgets, while two-thirds still spend under 25 per cent.

These insights come from IDC Manufacturing Insights’ Business Strategy: Modernizing the Service Chain with Smart Technology report.

The research shows that, over the next three years, manufacturers increasingly plan to use service as a competitive differentiator and aim to grow business through product service innovation and value-added services for existing products.

Modernising the service supply chain with smart technology s well as strong executive support will be necessary to realise service revenue and profitability goals

Sheila Brennan, IDC
The report says that the application of smart technologies, such as sensors and data acquisition systems, along with ubiquitous connectivity and data analytics, can provide efficiencies and cost reduction, as well as a means for long-term, profitable revenue and customer ‘stickiness’.

It shows that manufacturers are taking steps to capitalise on these technologies for superior service of customer-owned assets.

“Tremendous demands are being placed on manufacturers' service organisations to deliver higher profits and innovative service revenue models" said Sheila Brennan, Smart Services and Aftermarket Strategies' programme manager at IDC Manufacturing Insights. "However, most companies are not equipped to deliver these, and have not adequately prepared for the organisational transformation and investment required to go from a product-centric to a service-centric organisation.

“Modernising the service supply chain with smart technology, leveraging corporate IT expertise and initiatives – big data/analytics, cloud, mobile and social – as well as strong executive support will be necessary to realise service revenue and profitability goals."

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