• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
    • Webinar Library
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » Spare Parts Supply Chains in the Era of Servitization

Spare Parts Supply Chains in the Era of Servitization

Spare Parts Supply Chains in the Era of Servitization
February 6, 2019
Andy Prinz & Alex Cheesman, SCB Contributors

Spare parts are an often-overlooked component of supply chains.

However, with the rise of service-based business models and the concept of servitization, the spare/service parts supply chain is a more critical path to success for companies. Pairing current and emerging technologies with servitization focus can enable an organization to meet customers’ demands — not just for service parts but for all supply chain elements needing to operate in a similar, nimble manner.

Investment in Capability 

There is significant supply chain technology already populating the marketplace. These software systems can provide companies the functionality and flexibility to continuously adapt their processes and supply chain to meet ever-changing demand for service parts support and servitization complexity. A modern suite of planning systems, WMS, OMS, TMS, etc., will ensure that key supply chain capabilities are in place as the stress of service parts and one-off customer requirements continue to increase in scale and importance.

Not only will such integrated systems enable new levels of visibility across an enterprise, they will lessen response times to customer requests. By leveraging the cross-functional data from these systems, companies can better understand trends around customers and their needs. Synchronizing these supply chain systems, associated data and processes into fully functional, integrated operations is becoming a “must have” in supply chains.

The Power of Prediction

Even companies that have integrated technology, data and processes are only scratching the surface of what is possible. In today’s digital age, many organizations have incredibly valuable data that they are still unable to capitalize on. Enter big data — vast amounts of unstructured, cross-functional data that represent a majority of an organization’s internal and external transactions. This transactional data can be utilized for proactive work, instead of reactive chaos. The service parts supply chain is centered on erratic customer need, but there are patterns that can be utilized so that some needs can be predicted before they arise. The incorporation of internet of things (IoT) sensors magnifies the value of this data — especially within prediction of failure rates and product service needs. These trends, alongside product and customer segmentation, present great opportunity for service and spare parts supply chains.

Of course, there are structural limitations that a company must understand and address before being ready to realize benefits from such new technologies. However, value can be delivered in the short term. SKU or specific failure rates and purchasing data/trends that show insight into SKU/part, location, failure rate and customer profile correlations can enable companies to get ahead of the demand and adjust service/stocking/purchasing strategies. This will result in higher customer satisfaction, higher customer retention, decreased inventory costs, and reduced technician hours per service visit, among other benefits. 

This will also enable companies to support new operating models, based on servitization, that will offer increased revenue, customer satisfaction and competitive positioning.

The Outlook

The future of supply chains requires integrated operations, data and technology — as complex, nimble supply chains will be necessary to meet the servitization demands of the modern consumer. This is particularly true for service parts and aftermarket operations where new servitization business models will continue to increase in importance. Adoption of integrated technology and advanced analytics will be required by any future supply chain hoping to succeed in this challenging environment.

Andy Prinz is an associate partner, and Alex Cheesman is a consultant for supply chain management at InfoSys Consulting.

RELATED CONTENT

RELATED VIDEOS

Service Parts Management Data Management (Big Data/IoT/Blockchain) Forecasting & Demand Planning Technology All Warehouse Services Warehouse Management Systems
KEYWORDS All Warehouse Services Big Data/IOT Forecasting & Demand Planning Service Parts Management service parts supply chain Technology Warehouse Management Systems
  • Related Directories

    SnapFulfil

Andy Prinz & Alex Cheesman, SCB Contributors

More from this author

Subscribe to our Daily Newsletter!

Timely, incisive articles delivered directly to your inbox.

Popular Stories

  • karen-jones.jpg

    Watch: Four Industry Disrupters Impacting Logistics

    Data Management (Big Data/IoT/Blockchain)
  • THE SPACE AROUND A COMPUTER KEYBOARD IS CLUSTERED WITH IMAGES GENERIC SHIPPING BOXES

    How Suppliers Can Overcome E-Commerce Supply Chain Challenges

    Data Management (Big Data/IoT/Blockchain)
  • A CSX TRAIN IS SEEN FROM THE FRONT

    CSX’s New CEO Has a Big Idea for Railroads: Carry More Freight

    Rail & Intermodal
  • A SEATED PERSON HOLDS A SMARTPHONE, SHOPPING

    Retail Consumer Data: The Key to Personalization, or Privacy Violation?

    Regulation & Compliance
  • A ROBOT ARM AND A HUMAN ARM ALMOST TOUCH FINGERS

    AI + SCM: A Formula for Automation and Optimization

    Supply Chain Planning & Optimization

Digital Edition

Scb q1 2023 cover

2023 Supply Chain Management Resource Guide: Packing for a Difficult Year

VIEW THE LATEST ISSUE

Case Studies

  • New Revenue for Cloud-Based TMS that Embeds Orderful’s Modern EDI Platform

  • Convenience Store Client Maximizes Profit and Improves Customer Service

  • A Digitally Native Footwear Brand Finds Rapid Fulfillment

  • Expanding Apparel Brand Scales Seamlessly with E-Commerce Technology

  • How a Global LSP Scaled its Security Program and Won More Business

Visit Our Sponsors

Orderful Yang Ming Alithya
Barcoding Blue Yonder BNSF Logistics
CoEnterprise Data Capture Deposco
E2open GAINSystems Generix
Geodis GEP GreyOrange
Here Holman Logistics Honeywell Intelligrated
IFM Infor Inmar
Keelvar Kinaxis Korber
Lean Solutions Group 2H Liberty SBF Locus Robotics
Logility LogistiVIEW Lucas Systems
MCA Connect MPO Nvidia
Old Dominion OpenText ORTEC
Overhaul Parsyl PMMI
QIMA Redwood Logistics Ryder E-commerce by Whiplash
Saddle Creek Logistics Schneider Dedicated Setlog Holding AG
Ship4WD Shipwell Shyft
Sourcemap Tecsys TGW Systems
Thomson Reuters Tive Trailer Bridge
Vecna Robotics Verity
Verusen
  • More From SCB
    • Featured Content
    • Video Library
    • Think Tank Blog
    • SupplyChainBrain Podcast
    • Whitepapers
    • On-Demand Webinars
    • Upcoming Webinars
  • Digital Offerings
    • Digital Issue
    • Subscribe
    • Manage Your Subscription
    • Newsletters
  • Resources
    • Events Calendar
    • SCB's Great Supply Chain Partners
    • Supplier Directory
    • Case Study Showcase
    • Supply Chain Innovation Awards
    • 100 Great Partners Form
  • SCB Corporate
    • Advertise on SCB.COM
    • About Us
    • Privacy Policy
    • Contact Us
    • Data Sharing Opt-Out

All content copyright ©2023 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

Design, CMS, Hosting & Web Development :: ePublishing