Solution business platform
Successful solution business requires investments into the solution business platform. These investments are directed towards business model elements that are not visible to customers. Hence, it is sometimes difficult to build business cases for the new elements in order to get the necessary resource allocations. However, according to Vectia’s experience sustainable competitive advantage in solution business is highly dependent on a strong and coherent solution business platform.
Vectia’s framework for a solution platform highlights four different business platform elements:
Strategy planning. Moving into solution business puts demands on a firm’s strategy definition. Specifically it requires that top management has defined regions and goals that incorporate the solution business, and that the future financial impact on profitability or revenue growth of solution business has been estimated to be significant. Furthermore, the firm has to define focus markets and segments for the solution business, and develop segment specific strategies, including business goals. .
Management system. The logic of solution business is quite different from the logic of product business. It cannot, therefore, be managed in the same way; it cannot be planned the same way, it cannot be controlled the same way, and it cannot be measured in the same way. Thus, firms wanting to succeed in solution business have to invest in developing their management system accordingly.
Infrastructure support. The people and the processes related to solution business often require new types of infrastructure support. The different forms of infrastructure support needed can be divided into three main areas:
1) New business and customer intelligence capabilities that support sales with, for instance, market shares, trend analyses, and competitor information, which are stored in commonly available databases.
2) Infrastructure that supports tendering and contract management needs to be secured. Firms typically make contracts available in centralised libraries and provide legal support for contract negotiations both in the form of these contracts and in the form of centralised legal advice.
3) As solution sales is cross-functional, firms need to develop a customer relationship management (CRM) system that all functions have access to and use. Efficient delivery of solutions requires that the solutions components are digitalised and coded into the enterprise resource planning system (ERP). Furthermore, a product data management system (PDM) might be needed.
Human resources management. As all business, also solution business is executed by people with their experience background and skill profiles. There are specific skill profiles requirements, relevant for all functions, that need to be applied in solution business. Firms, hence, need to define skill profiles for all roles that relate to solution sales.
Vectia helps firms with creating a suitable solution platform by:
• Solution business capability assessment
• Solution business strategy and roadmap
• Definition of solution business model
• Solution business organisation and management system
• Defining new roles for solution business
• Benchmarking projects
• Training and coaching