How Wearable Technology can help Servitization

Don’t switch off your Google Glass headset yet, says Professor Andy Neely, Director of the Cambridge Service Alliance. Whether it is the latest headset or even a new Smartwatch the information being gathered by the wearables is offering some really interesting opportunities for innovation in products and services. He says the information gathered by Wearable’s will have positive outcomes for firms and society more generally.

If patients can monitor their own blood pressure automatically or heart rates automatically potentially then they could feed that data back to the hospital or the doctor and they could then be smarter at how they allocate their limited resources. The doctor could be sent the data the patients were getting from monitoring their own blood pressures, and this would allow them to call in the patients with problems for further investigation.  The technology allows organisations to allocate their resource more efficiently which in the long run is going to be better for the tax payer and Society generally.

Andy uses the example of a technician, who may go out to repair something and they may look at the appliance and not know how to repair it. But if they had Google Glass they could potentially stream a video back to their base and ask other experts around the World for their suggestions too.  Support teams won’t need to travel to the site, they could offer suggestions to your technician about how to repair it and they could then carry out their suggestions. The technician could then upload their video to the internal intranet and others could then access it too if they came across the same problem sometime. 

Wearable technology can improve the quality and efficiency of the way in which services are delivered. The value is in the data, not the metal, that’s for sure. Making that shift to services requires a significant organisational change, but the key to making this change is understanding your customer and your customer’s customer, says Andy. The wearables will enable you to start that journey. 

Listen to a PODCAST by Andy Neely on this topic. In this Podcast Interview Professor Andy Neely, Director of the Cambridge Service Alliance, examines how the new Wearable technologies can help firms make the shift to services 

Is servitization for everyone?

One of the questions I have been asking my students recently is whether "servitization is a strategy for everyone". Effectively I ask them to take any product they wish and develop an idea for a service that is directly related to the product. The students have come up with some great ideas. One group developed a business model for renting umbrellas. Imagine having umbrella rental kiosks at busy main line stations in London. You arrive at Kings Cross, without an umbrella, only to find it is raining. Rather than buying an overpriced umbrella in a local store, you can rent one for a day and if you don't return it, you forfeit your deposit, but are then allowed to keep the umbrella. Another group developed a business model for exchanging baby products - a store where you could buy second hand cots, toys and prams (all of which had been fully refurbished and reconditioned). As your baby grows older and bigger the store would take back products you no longer needed and sell you a new set - a child's bed rather than a cot or toys for a three year old, rather than a new born baby. Any products you returned to the shop would be refurbished, reconditioned and sold on to a new set of parents. Yet other groups have suggested technologically enabled services. One team came up with the idea of machine tool manufacturers offering environmental monitoring services. This group proposed that firms should couple an energy monitoring service with the machine tools they sell. In essence the manufacturer of the machine tool would provide guidance and advice on how to reduce energy consumption of capital equipment.

While the ideas themselves are interesting, one of the things that I have found most fascinating is that nobody has yet come up with a product that could not be accompanied by a service. Luxury goods - where ownership might confer status - are appealing as rental items. Why own that fantastic diamond necklace (and carry the risks and costs associated with ownership of a very valuable piece of jewellery) when you can rent whatever jewellery you want for particular events. A counter argument might be that jewellery as a gift is important. If I told my wife that I had rented our wedding ring rather than bought it for her I might get short shrift. But the jeweller who sold me the ring offers a reconditioning service, a personalisation service and could offer a consultancy service, providing advice on which product to select.

Move to the other end of the scale and think about commodity products. Take something as simple as a paperclip. What service could be associated with paperclips? At first blush this appears to be a more challenging question. Paperclips are so plentiful and cheap that it is more difficult to conceive a service. But think about how many paperclips are wasted, taken off sheets of paper and dropped in the bin or put in that jar that sits on your desk and gradually fills to overflowing. What about a service centred around paperclip recycling, where unwanted paperclips (like spent batteries) are collected and returned to source. What about paperclips with RFID tags on them - paperclips that could provide location information so you would never again lose that important document in a pile of paperwork!

The more I think about it, the more I feel that the world of services and solutions is endless. Some of my academic colleagues argue that products are only ever a means to deliver services. I wouldn't go quite that far, but I think it is right to say that all products can be supported or supplemented by services. I'd be interested to hear of examples of products that you think it would be difficult to support or supplement with services.

The Big Data Revolution: What Happened to Data Quality?

There's a wonderful irony in the world of Big Data Analytics. At a time when interest in Big Data appears to be growing exponentially, it appears that some are forgetting the fundamental challenges of Data Quality. A quick Google Trends analysis highlights the point. The chart below shows two trend lines extracted from Google Trends. The line in blue reflects the popularity of searches for Big Data, while the line in red shows the popularity of searches for Data Quality. It is important to note that the lines show relative popularity, not absolute volumes of search terms. In fact, Google Keywords suggests that in absolute terms searches for Big Data are about 20 times as popular as searches for Data Quality.

This raises an interesting question - what's happened to Data Quality? At a time when organisations are becoming ever more interested in using their data to create performance insights and predictions, interest the Data Quality appears to be declining. Is this because Data Quality is no longer an issue?

I don't think so. On three separate occasions in the last week alone I have been involved in discussions with senior managers from some of the world's leading manufacturing and service businesses. Each time, the issue of Data Quality has come up loud and clear. These firms recognise the potential of Big Data and Analytics, but are realistic enough to know that unless they sort out their data fundamentals - unless the track the right things and make sure the raw data if accessible and of high quality, all of the Big Data Analytics in the world is not going to help them. That's why - in the Cambridge Service Alliance - one of our projects this year is focusing on creating a data diagnostic - a methodology that can be used to check whether the data you have access to is appropriate and can be better used to optimise the delivery of your services and solutions. We're in the process of testing this data diagnostic at the moment and would love to hear from you if you'd be interested in being one of the pilot test sites.