A Finnish engineering, structure, and venture consulting firm, AINS Group, not too long ago opened a web based retailer to buy fixed-price companies. The shop presents specialist work in a product-like format, with mounted service names, outlined scopes, and visual costs, comparable to a constructing historical past report, a zoning plan value evaluation, and a technical preliminary survey for a property transaction.
Is that this productization a wise transfer or an indication that knowledgeable companies are being commoditized?
The idea of “service productization”
Productization turns experience right into a extra tangible bundle with a transparent scope, timeline, final result, and worth level. The thought acquired traction within the late Nineteen Eighties, however it turned a named idea within the 2010s. Again in 2010, I printed a SlideShare deck titled “Productize your service.” It obtained over 30,000 views and led to a number of consulting and coaching commissions that proceed to at the present time.
The world-renowned service guru, Professor Christian Grönroos, has criticized the thought of companies as merchandise. “If flexibility and flexibility kind the important thing sources of aggressive benefit of companies, what’s the grand concept with eliminating and even lowering these capacities, as an alternative of managing them?” he writes.
What Professor Grönroos suggests is that we cease attempting to make companies appear to be items and as an alternative systematize them in a customer-centric method. He would reasonably discuss concerning the commercialization of companies. I completely agree, however I’ll use ‘productization’ as a result of it succinctly captures the idea.
What may be productized?
I as soon as gave a presentation about service productization to a gaggle of U.S. architects. The suggestions was overly adverse. Many noticed the thought as a menace reasonably than a possibility.
I used to be not suggesting they convert all their work into merchandise, however reasonably offered this as a brand new enterprise alternative to face out. I used “Inexperienced Loft Conversion” for example of a well-scoped, systematic course of focused at constructing house owners with unused attic or roof area.
When you’ve got or can think about a service with sure options, it has potential for productization. If the service is repeatable sufficient, you’ll be able to outline the scope clearly, and if it may be systematized, it has the makings of a product. You must be capable of handle the dangers and safe margins so that you could worth it confidently. If you happen to can train it to others, you’ll be able to scale it with out counting on particular people.
These days, AI is an integral know-how for productization. It permits individualized service parts to be cost-efficient.
Does productization make enterprise sense?
Shopping for knowledgeable companies is commonly a prolonged course of and tough in case you’re not knowledgeable purchaser. A productized service with a transparent final result removes a lot of the friction and work concerned within the conventional RFP course of. A buyer will doubtless select the better different in the event that they discover the price-value proposition passable and the supplier reliable.
For the service supplier, profitability and scalability must be key outcomes. Systematization requires an upfront funding, however the ROI may be excessive if the product aligns nicely with patrons’ wants and there’s a sufficiently big market.
The place to start out?
You don’t should intention for full-blown productization up entrance. You can begin by modularizing an present service and systematizing the modules that recur throughout tasks.
A essential a part of productization is knowing the place variation will happen and tips on how to handle it. An knowledgeable service won’t ever be 100% deterministic; in any other case, a machine may do it.
When you’ve gained expertise in systematizing, you’ll be able to productize an present course of or innovate new ones.
Systemic productization
I’ve productized many actual property, AEC, and data administration companies for our shoppers and ourselves, together with evaluation processes, homebuyer assist, and a enterprise case course of for a SaaS supplier.
I run these by a five-phase course of I name PACED, quick for Place, Assemble, Codify, Equip, and Develop. It deserves its personal article; the purpose right here is {that a} framework, no matter you name it, retains productization disciplined as an alternative of unintended.
So, is Ains Group commoditizing experience?
Ains Group has not turned engineering right into a commodity. It has made a slice of its work straightforward to purchase: assessments and inspections which might be repeatable, well-understood, and low in variation. An indoor air high quality inspection or a carbon footprint calculation for a renovation venture doesn’t demand the identical case-by-case negotiation as a structural redesign or a posh renovation venture, so placing a hard and fast worth on it prices the agency nothing in experience and saves the client actual friction.
Productization isn’t a verdict on the worth of your experience. It’s a determination about which components of your service portfolio behave like a product and which don’t, and Ains Group’s retailer works as a result of somebody there did that sorting first.
Each design course of has components that may be productized, even when the remainder of it can’t. Do this sorting in your personal observe, and productization stops trying like a menace and begins trying just like the strategic determination it’s.
