Shorter Product Lifecycles Limit Manufacturing Growth
Must Transition to Service-Oriented Approach Through Customer Customization Strategy

"Manufacturing faces a situation where it must transform into a service industry"

As the middle class expands both domestically and globally, the capacity demanded of manufacturing is growing. However, as the workforce ages, it becomes difficult to pass down the expertise and knowledge they possess to the next generation. In this context, opinions are emerging that manufacturing must converge with services.

Professor Yong-Se Kim from Sungkyunkwan University stated, "As the technology gap between manufacturing companies narrows and product lifecycles become progressively shorter, there are limits to growth," and added, "The market is also shifting from technology-centric to human-centric focus, emphasizing consumer demands and needs. Manufacturing must also pursue customer customization strategies."

He introduced service models that can enable servitization in manufacturing, including Product Support Services (SSP) covering product functionality, distribution, parts replacement, and maintenance, as well as Customer Support Services (SSC) that enhance the experience value and capabilities of product customers.

Seo Han-Seok, CEO of Jikto, which began as a wrist-worn wearable device company, stated, "I pondered the question of what value there is in merely obtaining step counts and heart rates from wearable devices," and explained, "We found a way to collect users' personal healthcare data and utilize it by connecting with card companies, insurance providers, and hospitals."

There are already examples overseas. American insurance companies collect information such as height, body mass index, and blood pressure to provide disease management support to customers or offer customized insurance services. CEO Seo advised, "Rather than simply manufacturing hardware devices, we must move toward providing services that users need."

Discussion continued regarding how government agencies, public institutions, and companies should approach converging services with manufacturing.

Professor Kim noted, "The concept is still emerging. For many companies to accept this concept, there must be success cases," and stated, "For success cases to emerge, government support is necessary. Companies must change their mindset to voluntarily shift manufacturing into a service-oriented approach."

Kang Hak-Joo, CEO of UlalaLab, remarked, "Start small with demos and prototypes. In Korea, there are no manufacturing factories that go directly from factory to B2C. The structure goes to B2B," and added, "Methodologies and frameworks suited to this structure must emerge. Results will come when government leads and the private sector cooperates together."

CEO Seo stated, "In pursuing B2C, what's common whether it's service development or device development is that it's different for each person," and advised, "Changing people through devices or services is extremely difficult. When trying to change something for someone, it must be more than 10 times easier to bring about change. Even if it's twice as easy, change won't happen. We need to approach this from the consumer's perspective."

Jo Bartholomeo, Vice President of Rockwell Automation for the Asia-Pacific region, explained, "Korean manufacturing industry has both expertise and creativity. We hope to reference many success cases," and stated, "By referencing existing cases, we must identify opportunities in manufacturing."