30 April 2021

Tech Perspective #29: Take Product-as-a-Service Model to the Next Level


Simply developing a good product is not a key to success anymore. With shorter product lifespans, rapidly changing customer needs, increasing ease of copying products, and unprecedented competition on the market, even the strongest players struggle to stay afloat. The reality where a product quickly becomes just a commodity is what many companies must face.

With the commoditisation of products becoming the norm, companies must adopt new strategies to stay ahead of the competition. Many of them decided to follow the trend of servitisation which means moving from a one-off sale of a product to offering product-related services and chose the Product-as-a-Service business model.

The concept of servitisation is not new. However, it has recently blown up, and many companies are still confused on how to make the most of it.

Follow me to find out how to make the Product-as-a-Service model work for your company.

Operating in PaaS

As I mentioned before, the Product-as-a-Service model is getting more and more publicity. As the studies and reports show, transforming the product business from manufacturing and selling products to a mix of selling and delivering service can drastically increase revenue and drive higher customer loyalty. There’s no wonder why so many companies are drawn towards it.

However, it’s not as simple as that. Transforming a business to the PaaS model entrails risks. Especially now, when the market is quite crowded with companies, including the most recognizable ones, offering products as services, it may be difficult to stand out and gain a competitive advantage.

Moreover, operating in this business model requires deep knowledge of customers’ habits, needs and demands. In order to succeed, your company must not only get to know the clients but also form a bond based upon trust and loyalty. It’s crucial to keep track of any changes in their habits and behaviours, and constantly adapt your offer to satisfy their needs.

And this can be achieved by using IoT devices.

Internet of Services

As reported by Forbes, there are already billions of IoT devices deployed, and as predicted by IDC, the number will rise to 41.6 billion by 2025. However, what’s the point of collecting data when you don’t make use of it?

According to a Gartner finding, organizations only analyse about 3% of the data they collect because owners often lack the manpower of knowledge on how to turn data into insights, and consequently, gain competitive advantage.

In the PaaS model, access to data ensures much greater insights over when, why and how the product is being used and how it is performing. With data from IoT sensors, companies can better understand their clients and provide them with the best possible solutions by optimising and adapting their services. Consequently, customers will get improved product performance.

Moreover, organisations can use insights derived from IoT data to lower costs and boost revenue via predictive maintenance and workflow-powered productivity gains. It can offer them an invaluable competitive advantage and successfully attract new clients.

PaaS – the Key to Success

The system of IoT sensors used in the PaaS business model can afford your company a spectrum of unexploited opportunities to increase profits. By allowing you to better understand your clients, it not only positively influences the quality of your services but also increases clients’ satisfaction.

The combined power of the PaaS model and IoT devices can help you gain competitive advantage and break into the market.

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Marcin Bartoszuk
Chief Operating Officer

With Microsoft technologies related since 2005. He graduated from the Computer Science Faculty of the Bialystok University of Technology where he was the leader of the .NET Group and the Microsoft Student Partner. Four times finalist of the national stage of the Imagine Cup competition, and later the mentor and the jury member of the contest. Co-founder of the Bialystok .NET Group. He lectured .NET development at the Bialystok University of Technology. Microsoft MVP in the Client Application Development category in 2008-2010, when he actively participated in the IT community. Constant new technology enthusiast and IT consultant.