Big Differences between Regions and their Approach to Services

ARC Advisory Group currently conducts an online survey, and you are all still welcome to participate here.

One of our key areas are the differences in regional service culture. Now, it is hard to measure a culture, but we asked participating end users (over 50 and a representative sample of today's industry), how they would describe the differences between regions. Overall, we see services as emerging from being something end-users typically tend to do by themselves, to in the end a service driven business approach. What is crucial is to see, that the service driven approach does not mean that everything is outsourced. It is more that the end users have an unbiased view on their business and their core competencies, asking the crucial make or buy decisions without any blinkers.

Describing these service cultures in our survey, we say:

• Traditional (Users do everything by themselves)
• Developing(first product oriented services outsourced)
• Emerging(product and project services are outsourced to a significant degree)
• Developed(product & project services outsourced, certain features are used as a service (leasing))
• Advanced(service driven approach, value add services are widely used)

The chart below shows the results.

While it is not surprising that North America ranks top, we are surprised by the high ranking of the Middle East. However, many end users here – and the associated investments - come from a capital driven approach and without much "history" in the related industry. When the Middle East was ramping up its chemical production in the mid 2000 there was no brownfield or traditional way of making things to stand in the way of modern business approach.

How important this green field approach can be is shown in Europe.  Here, we have a very service oriented approach, when it comes to relatively new topics, such as safety, cyber security, or energy management, but when it comes to training and maintenance, many users still prefer to do it on their own. 

Emerging Asia, which is dominated by China, has the weakest ranking. In fact, most of the end users hold huge engineering departments. Some of the electronics manufacturers even develop and produce their own robotics – an approach that would be seen as outdated in many parts of the Western World.  

We will further investigate this topic, and we would like all suppliers, EPCs, OEMs, and users to contribute to this survey here. All participants will receive some of the key findings for free.