Many managers in traditional product-oriented businesses are struggling to turn their companies into solutions-oriented ones, a strategy that is widely considered the route to success in the 21st century.1 An effective first step in this direction can be to establish corporate consultancies — consulting units whose main purpose is to provide solutions based on the traditional business’s products or expertise.2 That is why computer companies such as IBM are moving toward integrated information-technology solutions, telecom-equipment manufacturers such as Nokia are providing turnkey network solutions, and the train and signaling manufacturer Alstom is offering “train availability.”
To make the transition to a solutions business, companies must develop new capabilities in consulting, systems integration, operational services and financing.3 They need to change organizational structures, strategies for recruitment and skills development, and performance measures. For some (Xerox attempting to become a supplier of “document solutions”; Hewlett-Packard struggling to integrate its broad range of products into customer solutions), making the transition all at once is problematic.4
Corporate consultancies can be a better alternative. Under names such as Ericsson Consulting, Shell Global Solutions and AT&T Professional Services, traditional product businesses now offer value-adding professional services. Some have been so successful they have outgrown their product businesses, indicating that creating corporate consultancies may be a first step toward complete reorientation... To read the complete article, login or sign-up using the form below.
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