Vivek Joshi is the founder and CEO of Entytle, Inc. He is a veteran of the Industrial economy and has decades of experience in industry.
I’ve spent a few days recently in London, visiting customers, prospects, partners and investors. Much of my travel between meetings was on “the Tube,” and of course, the ubiquitous “mind the gap” soundtrack was a constant presence throughout the commutes.
We know that this is a safety announcement for passengers, but I think the words are also an apt metaphor for industrial OEMs in the midst of their aftermarket transformation journey. My company’s experience with customers large and small in the past few years has informed our Aftermarket Readiness Assessment framework, which captures our thinking of what it takes to make these transformations successful.
A key lesson embodied in the framework is that there are distinct gaps between levels. It’s not as simple as checking boxes and moving up the curve. It requires development of core capabilities on all aspects of the people-process-technology pillars. I’ve seen companies focus on one pillar or the other, and often the unbalanced approach dooms their transformations to failure.
There are some gaps that need to be addressed in a priority manner over others.
In my experience, the “skill-will” gap in an organization’s employees is the biggest cause of failure in most transformation journeys. Quite often, a leader will initiate the transformation of their aftermarket business with a clear change of strategy, posture and approach. But invariably, there are employees who have been with the company or aftermarket business for a long time, wedded to old ways of doing things.
The issues in this failure mode are two-fold: 1) simple lack of skills, which can be remediated through training, reskilling, etc., or 2) the larger issue of lack of will to go along with the new way of doing their jobs. This is a problematic gap and invariably results in derailment of key initiatives.
This gap is amplified by the need for change driven by external headwinds and dynamic markets.
This is not just about “artificial intelligence” and “digital transformations” but the way that customers have to be approached and relationships nurtured. Companies can no longer rely on outdated strategies like the “spray and pray” approach. A stronghold on channels and delivery networks that used to be a point of strength for traditional manufacturing companies is no longer a big differentiator.
Customers now demand personalized experiences and have a plethora of choices at their fingertips. Premium pricing is becoming hard. The world is more transparent than ever, and let’s face it, everyone is naked (figuratively speaking, of course).
It’s time for a new approach.
This means that companies, and their employees, must prioritize a deep, data-driven knowledge of a customer and their habits and preferences versus relying on Bob, George, Jane or Jill’s experience and intuition to carry the day. Unfortunately, time and time again, I’ve observed that this change is incredibly hard for companies to execute, and it invariably comes down to the “will” aspect of change.
In my experience, most companies don’t make the people changes necessary to succeed. Hanging on to hope that employees will change and adapt to the new norms is not a strategy for success. Instead, I recommend focusing first on reskilling, along with career development; this allows each and every employee to find a fit that is right for them. Simplistic, but it seems to work!
Transformational aftermarket leaders understand the importance of addressing both the internal skill-will gap and the external forces shaking things up. And I suggest they act fast before it’s too late and the opportunity is “gone with the wind.”
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