{"id":35515,"date":"2025-01-13T13:00:38","date_gmt":"2025-01-13T12:00:38","guid":{"rendered":"https:\/\/www.logicline.de\/the-future-of-service-from-cost-factor-to-profit-center"},"modified":"2026-11-04T19:52:39","modified_gmt":"2026-11-04T18:52:39","slug":"service-in-mechanical-engineering-as-a-profit-center-logicline","status":"publish","type":"post","link":"https:\/\/www.logicline.de\/en\/service-in-mechanical-engineering-as-a-profit-center-logicline","title":{"rendered":"The future of service: from cost factor to profit center"},"content":{"rendered":"\t\t
\n\t\t\t\t
\n\t\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t
\n\t\t\t\t\t\t\t\t\t

For a long time, service was considered a cost center. Today, it is becoming a key driver of growth and resilience. <\/strong> Markus Fournell<\/a>, Senior Advisor and service expert, and Edgar Schueber<\/a>, CEO and founder of logicline, discuss why this is the case and how machinery and plant manufacturers can turn their service business into a profit center. The two share a common vision for the future of service\u2014and they\u2019ve known each other for quite some time. <\/p>

Edgar Schueber:<\/strong> Markus, you say that service is more than just a stabilizing factor. What do you mean by that? <\/p>

Markus Fournell:<\/strong> \u201cStabilizing\u201d doesn\u2019t quite capture it for me. In an environment marked by geopolitical tensions, fragile supply chains, and a shortage of skilled workers, service becomes a key factor in resilience. It ensures recurring revenue, direct access to customers, and data from the installed base\u2014all of which form the foundation for innovation. Resilience means more than just stability: it means absorbing shocks, adapting, and emerging from crises stronger than before. This is precisely where the opportunity for service lies\u2014if you think of it strategically rather than just operationally. <\/p>

Edgar Schueber:<\/strong> In many companies, however, customer service is still treated as a secondary priority from an organizational standpoint. What do you think is the problem? <\/p>

Markus Fournell:<\/strong> Time and again, I see the same pattern in projects: Service is viewed from an operational perspective, organized reactively, and too rarely understood as a standalone business model. There\u2019s a clear gap between awareness and implementation. Many people know that their service business is valuable, but they continue to operate in reactive mode. What\u2019s needed is a shift in perspective: away from managing, toward shaping. Service must become part of the company\u2019s DNA\u2014with strategic integration, appropriate structures, and targeted investments. <\/p>

The article \u201cService in Machinery and Equipment : The Underestimated Business<\/a> of Numbers\u201d illustrates just how wide this gap between importance and resource allocation actually is.<\/p>

Do you want to strategically grow your service business?<\/strong>In an introductory call without obligation, we\u2019ll identify where the greatest potential lies.\u2192 Schedule an introductory call<\/strong><\/a><\/p><\/div>

Edgar Schueber:<\/strong> You often refer to the installed base as an underestimated lever. We see it the same way in our projects\u2014most of the time, things fall apart right at the data stage. <\/p>

Markus Fournell:<\/strong> Exactly. The treasure is right in front of us, yet it\u2019s rarely tapped. Information about assets, contracts, and service histories is scattered\u2014across various systems, in Excel spreadsheets, or in the minds of individual employees. This knowledge was built up at one point but has never been consistently developed further. The result is enormous untapped potential: for better services, for data-driven business models, and for true customer success. <\/p>

Edgar Schueber:<\/strong> That’s why we start at the very beginning: Without a structured Digital Machine File<\/strong><\/a>that accurately maps the installed base, every subsequent step remains piecemeal. But assuming the data is there\u2014what happens if companies fail to tap into this potential? <\/p>

Markus Fournell:<\/strong> Then others will do it. Platforms and new competitors are ready to position themselves between companies and customers\u2014and to develop their own business models based on precisely this data. Waiting, therefore, is not a strategy. Companies that fail to take control of the customer interface and maintain sovereignty over their own installed base risk losing them. <\/p>

Edgar Schueber:<\/strong> For me, that\u2019s the crux of the matter. We deliberately design our intelligence layer so that the data remains on the customer\u2019s premises and every AI recommendation is traceable with a source citation\u2014data sovereignty as an architectural decision, not as a requirement imposed after the fact. We\u2019ve outlined exactly how this works in our article on data sovereignty in AI for service<\/strong><\/a> . But back to the path to getting there: How does a company transition from reactive service to a business model? <\/p>

Markus Fournell:<\/strong> We need to take a holistic view of the entire service operating model\u2014from strategy and portfolio to processes, organization, and technology. Traditional services such as spare parts, maintenance, and retrofits remain important; they are the anchor of resilience. The next step involves digital and data-driven services: predictive maintenance, usage-based, and outcome-based models. It\u2019s crucial to consistently think from the customer\u2019s perspective: What outcome do they want to achieve? Where are they currently wasting time, money, or getting frustrated? It\u2019s also important to make service more robust globally while at the same time making it more localized\u2014with regional structures and fewer dependencies. <\/p>

Edgar Schueber:<\/strong> What role do recurring and performance-based models play in this context?<\/p>

Markus Fournell:<\/strong> A major one. Customers don\u2019t want one-time solutions; they want reliable results. Recurring models\u2014from maintenance contracts to Equipment-as-a-Service\u2014generate predictable revenue and foster stronger customer loyalty. However, the focus must be on customer value, not on the billing model. And a performance guarantee requires a robust data foundation: Without knowledge of the equipment\u2019s condition and usage, availability cannot be reliably guaranteed. <\/p>

Edgar Schueber:<\/strong> For me, this brings things full circle\u2014this is exactly the sequence we follow in our phased model: first digitize and connect, then use Service Decision Intelligence<\/strong><\/a> Decide, and, building on that, scale service operations in an outcome-based way. Finally, Markus: What advice would you give to service managers who want to get started now? <\/p>

Markus Fournell:<\/strong> Start with a clear strategy that combines customer focus and digitalization. Turn your installed base into a robust data foundation. And actively involve your team\u2014change can only succeed if service is understood as a mindset, not just a department. Celebrate successes, and use setbacks as opportunities to learn. And above all: Start now. The competition won\u2019t wait. <\/p>

—<\/p>

The article \u201cMonetizing Digital Services<\/a> \u2014From Tiered Contracts to Outcome-Based Pricing\u201d illustrates how individual services can be transformed into products that can be priced.<\/p>

The figures behind this discussion\u201425 percent of revenue, 7 percent of investments, and an EBIT contribution of 48 percent versus 15 percent, depending on the service model\u2014are documented in the white paper on the underestimated service business<\/a>.<\/p>

It’s easy to determine where your service business stands today:<\/p>