Solutions Marketing: How Invensys built a Business Value Solutions Model that Moved it out of a Commodity Business
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Many technology companies that have served the manufacturing and process automation markets have struggled to get technology innovation accepted, resulting in a concentration of products that are seen to be commoditized and generic “for the plant floor”. This is a story of a company that was able to break out of this syndrome and find a way to develop and deliver high value, differentiated solutions to its customers.
Invensys Operations Management (IOM), a division of the $3.75 billion Dallas-based company Invensys Corporation, is a leading provider of automation and information technologies, systems, software solutions, and services to global manufacturing and infrastructure industries.
The problems that IOM faced are typical of many companies that make the decision to undertake a solutions transformation initiative. Many of their products were perceived as entering into a commoditized, “me too” cycle, with very little or no differentiation. In fact, however, the IOM measurement systems provided significantly superior functionality by allowing companies to measure performance across a wide array of processes for individual as well as networked factories and other operations facilities, leading to significant cost reduction opportunities. Moreover, IOM gained even greater product advantage by creating what they called the Enterprise Control System (ECS), a unique technology that showed a measurable value improvement in their customers’ real time cost accounting systems.
Unfortunately, the total value that they could deliver was lost on their buyers who had very different motivations and did not face a compelling reason to upgrade or replace their outdated, aging automation assets. IOM realized the business value of its process measurement systems would be understood and appreciated by the middle and senior level managers who were responsible and accountable for overall manufacturing and facilities operations and costs.The challenges for IOM were: Some of their other challenges were:
The core principles have to be behind every solution; otherwise, it's unclear what your motivations are in providing that solution in the first place. That's why Steve Jobs was so successful. Everyone knew that he had clear morals and visions, and wasn't just out for a quick buck.
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BLOG POST 1: http://www.solutionsinsights.com/process/CreateJournalEntryComment?moduleId=3028212&entryId=13395834&finalize=true This is a great example of how Invensys used the approach to solutions as outlined in another blog, "Socializing Solutions: Four Priorities for Solutions Marketing and Sales". The main approach here was to focus on the their core priorities to provide guidance on how to become a solutions model business. These are 1. Identifying new opportunities for growth: Invensys recognised that in order to grow they needed to become a solutions company; this would allow them to break the commodities cycle. 2. Creating compelling offerings: Invensys differentiated itself by offering solutions rather than simply the commodity. This was obviously their superior IOM measurement systems. 3. Strengthening customer connections: This was important for Invensys because one of the challenges they identified was that it was difficult for their salesepeople to engage with senior management. This was addressed by becoming a 'trusted advisor' to clients which highly strengthened these connections. 4. Accelerating the sales cycle: Using internal communities was done in the form of the BVS teams which were dedicated solely to understanding how to sell solutions.
This is a problem that any and all product based companies face. This is a great success story but was there any backlash? We hear time and time again of sales forces being cut by nearly 80% should employees be unable to adapt to the new solutions environment, was there a similar situation here? Further, for an operation this thorough, how long did it take to fully implement the Solutions model. I imagine that a "holistic" approach would take more time than a standard version. Finally, have their been copiers of this system since IOM adopted it? This was a great read, and I thank you for it. If you could answer my questions it would be most appreciated.