Radically rethink your strategy: How digital B2B ecosystems can help traditional manufacturers create and protect value

Today, hardware is still the typical manufacturing company’s “bread and butter,” accounting for more than 60 percent of the value with software and services making up the rest. As digital proliferates, the balance is shifting. The price of hardware is increasingly coming under pressure as machine prices continue to drop, and software and services are expected to make up the majority of value in the near future. Looking ahead, the value-add is increasing in digitally enabled services, software, and machine integration, and tech companies are already well-positioned to dominate in this arena.

Individually, no machinery company can rival the software and IT capabilities of a technology powerhouse like Amazon or Alibaba. However, as part of an ecosystem that includes other machinery players—ones who serve a similar customer base and whose offers are complementary—that same company can fend off the new wave of tech competition by developing the capacity to deliver innovative aftersales and services offers. This type of alliance of traditional players constitutes the core of a digital B2B ecosystem play, and it is a radical strategy with the power to help manufacturing companies create and secure value in aftersales and service.

It is the collective know-how and access of the ecosystem that is the best defense against digital natives looking to enter the industry and dominate. Successful digital B2B ecosystems are lines of defense that help manufacturers and suppliers create real value in aftersales and services and hold onto valuable customer relationships, which tech giants seek to control.

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