How to move focus from hardware to software solutions
This was the topic of the first physical Tank Meeting of 2021, hosted by Teledyne FLIR.
Teledyne FLIR used the classic product lifecycle S-curve to kick off the topic, stressing the importance of understanding what phase of the product lifecycle your core product is currently in. If your product is approaching the maturity phase, it is about time to find the next high-performing offering to secure future revenue growth and profit margins.
Teledyne FLIR also used the Business Model Canvas to visualize the state of the current business model versus the new service-focused business model. With the new business model still having many gaps to be filled compared to the old model, how do you successfully manage the transformation to the new business model?
SUMMARY OF KEY TAKE-AWAYS FROM THE DAY
The members shared their own experiences and learnings on how to transform the business model into a service offering. Here is a summary of the main reflections from the Tank Meeting:
- Problem-centric instead of product-centric solutions development
Make sure you focus on the solution, the pain point to be solved, when developing new service offerings. Many development projects fail, but the people who stay the closest to the real customer problem tend to be the most successful ones at developing solutions with a strong market fit.
- Understanding the ecosystem you’re operating within
We are operating in ecosystem environments. Understanding the role you want to play in your environment is key. Are you a platform? Are you offering an application to complement another ecosystem? Are you an advisor? Where are you building value?
- Injecting the service management DNA into the whole organisation
You need to make sure the whole organisation embrace the service management thinking. It is typically not the technology that is the challenge, it is the people. Sell the vision internally, align incentives and focus on the pioneers who want to change.
- Being profitable is an argument to invest!
It can be difficult to compete internally with an existing business model still yielding the largest portion of revenue. However investing in developing in a new service offering when profits are already declining is too late, so investing in new development is key while you are still profitable.
- Understanding when you can get lost, and when you need to be 100% accurate
Developing new services and products means navigating the unknown. In order to not get stuck in perfection, it is important to understand when you need to be 100% right, and when you can ship Minimum Viable Products to the market.
- Prioritize wisely to bridge the gaps to complete the transformation
How do you structure the organisation when you are adding a new service offering to the business? What ideas should you work on? Which innovations fit your strategy? Make sure you prioritize wisely to keep speed in the development process and to get the organisation aligned on the vision.
Thank you to the team at Teledyne FLIR for hosting an interesting and insightful day! As always, thank you to all the members who shared their own experiences and contributed to the collective learning session.
Documentation from the session can be found here on the website. If you have forgot the password just email susanne.fuglsang@innovationpioneers.net and I will send it to you.