OEMs: Great technology, wrong model

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In the “old days,” equipment OEMs were able to compete largely by delivering more power and more hard iron. But times have changed and technology no longer resides quietly inside the machine.

Today, OEMs must increasingly compete on software-enabled services and platform ecosystems rather than machine characteristics, according to Kevin Juhl, an associate advisor at off-highway consultancy abcg. He goes on to explore what makes some more successful than others in doing so.

“While some OEMs are adapting their business models to accommodate the shift, others appear merely busy by going through the motions and struggling to translate their technology investments into what could be a unique customer experience and sustained advantage,” he asserted.

Juhl believes the difference between success and failure lies in how deeply OEMs are willing to evolve their business model, not just whether they have technology. It also depends on how their dealers evolve, and those dealers’ ability to drive technology adoption.

Read how the shift to what Juhl calls “servitization” could be the key to competing in today’s increasingly high-tech environment.