Maintenance outsourcing: A step towards Product Service Systems

Intense competition in the current global business environment and the need to increase profit have caused companies to seek competitive advantage through the provision of services. In this new service-oriented world companies are providing integrated 'Product-Service Systems' instead of selling only tangible products. In addition, companies are continually trying to reduce their costs, and one primary focus is to minimise the cost of processes like maintenance – which has always been considered a cost centre.

This paper considers Product Service Systems as an emerging approach to creating a win-win situation for OEMs and their customers, and discusses maintenance outsourcing as a step towards applying this new concept. Two key elements in successful maintenance outsourcing are to understand the risks to the service providers in taking responsibility for their customers' maintenance activities, and understanding the value that is delivered to the customers by the maintenance service provider. The concept of 'value-in-use' will be introduced as an improved decision criterion for maintenance outsourcing, and the need for a tool to assess value-in-use will be explained.