Industrial Services
The industrial services industry is facing numerous challenges, some of them contradictory:
- Varying degrees of maturity among the customer industries in terms of their use of external industrial services, combined with widely disparate regional demand, increase the need to set products and services apart and, at the same time, drives the complexity of service portfolios.
- Because customers have a global focus with worldwide sourcing, suppliers of industrial services must also have a global orientation.
- A broad, heterogeneous and—to a certain extent—highly fragmented supplier landscape, along with growing global competition and cost pressure, requires suppliers to increase the professional/industrial orientation of their products and services.
- This wide range of customer requirements, combined with cost challenges in an increasingly competitive global environment, means that the industry is also under greater pressure to specialize and consolidate, which will result in fundamental restructuring of the supplier landscape.
The key challenge in this market environment is to define a coherent business design which will enable the company to clearly position itself with transparent customer benefits, maximum profitability and value creation.
Establishing this position requires finding answers to the following key questions:
- Strategic focus: What segments of the services market are attractive and attainable? Which customer requirements should be addressed? How can a company set itself apart from the competition?
- Profit realization: What are the factors driving costs, profitability and company value? Which customer/service combinations have the greatest potential?
- Value creation and enhancement structure: Which steps along the service value chain need to be covered from a strategic and financial point of view? Which parts would benefit from partnerships with specialized service providers?
- Business system: What kind of organizational structures are needed in order to firmly establish a service orientation throughout the company? How should a performance management system be organized in order to ensure consistent transparency through profit, cost and value drivers within the company as well as for network activities?
Oliver Wyman has a global network of industrial service experts in North America, Europe and Asia. Our team also draws on the expertise of additional practice groups within the purchasing segments of the industrial services industry, including aviation, surface transportation, energy, oil & gas, production systems and engineering or automotive.
