What’s more valuable, electricity or the equipment it powers?

What’s more valuable, electricity or the equipment it powers?

Mineral Point Cell Tower panoramic view

Earlier this week I enjoyed a webinar from the TSIA, From Traditional to XaaS Hardware: Navigating your Digital Transformation, and got many good notes from it. (“X” is for “anything.”) I thought I would share this point because it also illustrates the “mindshift” necessary on the part of vendors and customers to imagine the value of XaaS hardware.

On this slide Kevin Bowers, one of the presenters, made an extraordinary assertion:

The data you collect and insights you derive from it will be more valuable to your customers than the hardware you provide.

This may sound a bit crazy because, “If I don’t have the hardware, I can’t run my business at all. So how can data and insights be more valuable? Aren’t you just hyping things that are going to cost me more?”

Unfortunately, some early approaches to XaaS may have been accurately described by that concern. (And some clumsy approaches by vendors trying to make their first steps to the new model may fit that characterization still.)

I think, however, if you ponder it a bit longer you can see how the data and insights from a XaaS model can increase your experience of value immensely. Here are some prompts to help your pondering:

  • What’s more valuable, electricity or the equipment it powers?
  • When faced with a decision about how to run you business better, how grateful would you be to have empirical evidence of how it’s been operating?
  • How much do you prefer to find and fix problems before they happen vs after they become a crisis?
  • What if your equipment gave you ideas for reducing costs or increasing the value of what you provide to your own customers?

So choosing vendors who can become more of a partner in your business success is critical. And a good initial qualifying test is observing whether they talk more about their technology (red light) or more about your outcomes (green light).

Customers don’t care about your product; they care about THEIR outcomes.

Kevin Bowers, Director Field Service Research, TSIA

What do you think? Maybe you want to checkout the webinar recording for yourself? Definitely, if this and similar topics interest you, you should checkout the amazing information and insight created by the Technology & Services Industry Association (TSIA).

Just as definitely, if you’re facing a XaaS transformation, either because you’re changing your offering or because your vendors have changed theirs, you need to:

  1. Assess where you are today
  2. Articulate your vision for tomorrow
  3. Activate strategies and plans to make it happen

And that’s why Simbiotrek offers transformation consulting services, so that you can get clarity, get alignment, and get going. Contact me through simbiotrek.com to learn more.

Sean Kennedy

The creator of "Whatever The Heck That Means" can usually be found with his wife and two sons in their adopted home of North Carolina. From there he is the Founder and President of Simbiotrek, LLC (https://simbiotrek.com), and makes occasional digital imprints on LinkedIn (https://linkedin.com/in/seanpk) and Twitter (https://twitter.com/AkaMacGyver).

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