Steve Downton, Downton Service Management Consultants Ltd, Noventum Group
Service has tended to be regarded as the poor relation when it comes to investment, however there seems to be a genuine uplift currently in the amount of investment, and one of the main reasons would appear to be a change of attitude in the boardroom towards the value of service. Investigating what has caused such a change indicates a shift in the approach to, and method of measuring the value of investment, and a review of the way ROIs are calculated and presented.
One main reason for such keen analysis has been that many businesses have run out of ways of maintaining revenue and margins on their products and in desperation have looked around the rest of the business in search of areas where better margins can be made.
In many cases in maturing industries, product revenues and margins have begun to suffer, but what has become apparent is that their service operations could provide the source of high return on investment. This is strongly supported by research done in 2004 by AMR and which I followed up with further research at the end of 2006.
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