The Step-by-Step Path to Servitization Success
In our first article, we introduced the servitization maturity model and its four stages. In this piece, we examine why companies typically progress through these stages step by step — and how technology, processes, and organizational readiness shape that journey.
Servitization requires a strong foundation of technology, processes, and organizational capabilities. This backbone allows manufacturers to advance toward more sophisticated service models without disrupting day-to-day operations or jeopardizing existing customer commitments and revenue targets.
Gartner identifies eight pillars that form this foundation:
- Strategy
- Technology
- Revenue Model
- Sales Approach
- Internal Ecosystem
- Digital Organization
- Maintenance Style
- Customer Metrics
Each pillar involves complex, interdependent changes that mature at different speeds. Adjusting the revenue model affects team structure; digital organization shapes sales approaches; the chosen tech stack determines which customer metrics can be measured. Because these elements influence one another, attempting to overhaul everything at once often leads to cascading operational issues.
Legacy technology adds further constraints. Traditional manufacturers rely on systems designed for one-time product transactions, not continuous service delivery, making it challenging to support proactive maintenance or connected-product models without gradual modernization.
For this reason, most companies start small. Industry studies indicate that approximately 55% of manufacturers have already initiated the servitization journey by incorporating value-added services into their core offerings. They typically pilot the approach with a single product line, refine the model, and scale once the operational and technological foundations are stable.
How Technology Helps Manufacturers Progress Through the Maturity Model
Servitization isn’t a simple component upgrade; it transforms multiple organizational layers simultaneously, with technology as a central enabler. Each maturity stage has distinct needs, so timing is critical: investing in advanced tools too early can waste resources, while investing too late can slow progress.
Below are the recommended technologies for each maturity stage. Capabilities developed at one level form the foundation for the next, creating the building blocks for more advanced servitization.
Stage 2, the value-added manufacturer phase, requires technologies such as CRM and SLA tracking platforms, Enterprise Asset Management systems, Master Data Management platforms, ERP, MES, and SCADA systems, as well as connected product enablement. The outcome of this stage is the establishment of a foundation for service operations, a structured service history and contracts, unified data from operational systems, and high-quality data for IoT.
Stage 3, the full-service provider phase, relies on Industrial IoT sensors and edge devices, cloud analytics and machine-learning platforms, API management and ETL integration tools, and Field Service Management systems. This leads to predictive maintenance capabilities, subscription and consumption-based pricing, integrated operational and business data, and remote monitoring and diagnostics.
Stage 4, the servitization leader phase, involves digital twin platforms, 3D modelling, AI and machine-learning decision engines and automation, real-time analytics and business-intelligence platforms, and outcome-based contract management systems. The result is guaranteed customer outcomes, automated problem prediction and prevention, outcome-based service delivery, end-to-end system orchestration, and full service reliability.
There’s no universal playbook for servitization, but a structured approach helps companies navigate the transition. Whether building connectivity, establishing data frameworks, or deploying digital twins, progress usually follows a disciplined sequence.
It starts with intent: define objectives and success criteria. Select a product line or site with favorable conditions, run a pilot, and measure results. Capture the critical elements — required data, interfaces, controls, roles, and security — to create a foundation for scaling. Gradually expand, turning a single success into capabilities that can be replicated across products and plants.
Summary
The move toward outcome-based models is evolutionary, gradually reshaping the industry. Companies that succeed in servitization align their investments with their current level of maturity, rather than rushing the transformation.
While early adopters faced high costs, today’s manufacturers benefit from lower technology expenses and proven success stories to guide their approach. The key is having a clear strategy and understanding which capabilities to build next.
Start by assessing your current maturity and identifying the capabilities required for the next stage. A structured, phased approach ensures a smoother transformation and maximizes the value of servitization initiatives.
If you’re ready to start your servitization journey, don’t hesitate to speak with experienced IT consultants like Sigma Software for expert support in advancing through the servitization maturity levels.
About the author
This article was written by Natalya Zheltukhina, Partner Network Manager at Sigma Software Group, DACH Region. Natalya is responsible for growing Sigma Software Group’s business on the DACH market, with a dedicated focus on the Automotive, Logistics, and Industrial Manufacturing Sectors.