How might we design innovative and sustainable service-based business models for spare and wear parts?
ANDRITZ Metals is one of the leading global suppliers of complete production and processing lines of cold-rolled strip made of carbon steel, stainless steel, aluminum, and other non-ferrous metals. We also supply spare and wear parts (from small sealings to big rolls) for our entire product portfolio.
As a product-centric company we tend to operate in a sequential fashion moving the customer between phases in the value chain with handoffs between independently operating teams. For instance, consider the workflow for spare and wear parts. First, our customers inquire by email. Our team then identifies the required spare part and prepares a quote. The quote is sent to the customer. The customer submits a purchase order. The search for the right parts is complicated. Single parts are sold. Delivery takes time and storage is an issue. The process is further complicated by those involved using various software tools such as Enterprise Resource Planning (ERP), engineering tools or Outlook.
What if we could leverage digital technology to create better solutions? Could we offer a subscription model with recurring revenue rather than single transactions? How do we organize dynamic pricing in line with delivery time and storage costs? Can we offer customers product delivery and payment options that allow them to purchase access to products as a service? How can we transition from supplying parts to leveraging our products via our platforms to deliver services that solve our customers problems? Our Metris spare part catalog and our Metris customer care portal are such platforms (see video).
We challenge you to go a step further: How might we leverage our Metris Customer Care Platform, the Metris Spare Parts Catalog and new applications to generate innovative business models for spare and wear parts? We aim to embrace smart services to build long-lasting customer relationships, increase our margins (reduced cost on both ends) on existing business, expand existing business and develop new business. We encourage you to learn from other industries and our major metals competitors (SMS Group, Primetals, Danieli).
Service innovation for spare and wear parts will help us to leverage the opportunities the Circular Economy presents. With digital services we can design processes, services, and systems that fit the tenets of the circular economy: built-to-last, built-to-repair, built-to-remanufacture and/or built-to-recycle. These kinds of services can provide us with the type of closed-loop, zero-waste process, that manufacturers are pursuing as they move away from the traditional linear “take-make-dispose” model of creation and consumption, to a circular model in which materials are continuously looped back into the value chain for re-use, resulting in less energy and resource consumption. The combination of digital tools with a Circular Economy approach can be a catalyst for optimizing manufacturing and business processes to minimize waste and energy consumption.
Let’s leverage digitalization and apply the mindset of the Circular Economy to support our customers in reaching their goals with regard to productivity, operating costs, energy efficiency and environmental protection.
We offer paid internships and research collaborations to take your idea to the next level.