25 May Smart Industry Webinar – Digital services and business models: a missing or winning element of Europe’s Smart Industry?
Introduction by Wolfgang Ulaga, Senior Affiliate Professor of Marketing @ INSEAD
Wolfgang Ulaga works with executives, managers, scholars, and students around the globe on building and growing competencies and skills in marketing and sales of products, services, and customer solutions, with an emphasis on business-to-business (B2B) markets.
Jérôme Rampon, CEO of Algodone
Algodone a french startup based in Montpellier with currently uh nine persons and providing a turnkey platform to secure connected objects and permits their motivation with a new business model.
Service principles are now well installed in our economies with software as a service.
We have seen the emergence of this new business model driven by the cloud, the smartphone ecosystem, and the web economy. Our century will continue to see as a service expansion above 100 billion dollars revenue.
Their offering may be consumption-based, so you pay only for what you use. They can propose continuous improvements and evolutions through upgrades and new features.
Here we come to connected objects. We all know IoTs are everywhere. Security and safety are the highest challenges in particular for a professional complex but another challenge is the opportunity to diffuse a service business model in those markets.
Security and new monetization schemes are strictly combined to be able to activate on-demand, to monitor, and to meter deploy. To adapt as a service you need to design connected objects with a highly secure management system, otherwise, any potential unauthorized use could be responsible for revenue leaks.
In practice, it is requested to design your IoT before manufacturing, to include security features that will permit in the field to set up your system to activate and deactivate some features to meter usage of IoT. Finally to make a secure link between usage and billing.
To reach a good level of security hardware implementation, the best way is to go further with software security solutions. Complex connected objects may be used in hostile environments, where the objects can be accessed and in an open environment or they can be physically attacked. The software security solutions are not enough any attack on such connected objects may potentially lead to critical issues, where consequences of any corruption may be dramatic.
Peter Lukesch, COO of ondeso
Vendors often don’t see new digital services as chances for business models but as an additional workload that isn’t part of their core business.
On the other hand, there are customers struggling with work-intensive challenges like keeping their environment secure and up to date but aren’t (yet) willing to outsource those tasks to the vendors as a service.
It takes – especially in the production environments – a lot of trust and time (sales cycles of 3 years and more are not rare) to convince the operators to outsource working intensive tasks that aren’t part of their value chain. Sometimes even something has to happen, to make a decision or change a mind. Especially because a lot of those “digital maintenance” tasks will increase with ITSig 2.0, Kritis, and so on. There is a big chance of a Win-Win-Win Situation if Operators, Vendors, and Serv. The operator can outsource those “digital maintenance” tasks to a Service Provider independent of the different vendors he uses in his facility and can have an overview of the current fulfillment of security requirements of his vendors. That doesn’t require more manpower and building up knowledge for not-core tasks but raises the security level and keeps a lot of work and trouble away.ice Providers share a common platform for the supply and demand of those services.
The vendor can provide security updates (i.e. as part of the warranty), but also new software and feature updates (i.e. SaaS) that can be approved for special customers and machine types. Not only the vendor fulfills governmental requirements and has higher reliability for his customers, but also can sell new digital components for already sold machines.
The Service Provider can have new business models and don’t have to fight about the last piece in the office environment, because there is a high urge of Industrial IT support in the producing facilities across vendors and businesses.