Strategy Image

Uniformity in the Danish Service Sector

Monday 02 Jun 14

The Danish Service Sector is Too Uniform and Demands a Strong Strategy in Order to Survive

The Danish service-sector has reached a position of conformity, where service companies do not differentiate from one another. According to Peter Arbs, SMSI Program Director at DTU Business, the situation poses a serious threat to the earning capacity of the sector, and the future existence of Danish service companies. 

"Businesses need to rethink their strategy at an operational level. "
Peter Arbs, Program Director DTU Business

Peter Arbs elaborates:
“Businesses need to rethink their strategy at an operational level. Danish service companies cannot compete on price parameters, as foreign companies will always be able to deliver cheaper products, therefore Danish companies need to define and focus on their core competences and supply their customers with specific, valuable solutions, not a generic product.”

An International Marketplace

Firstly, one of the key-issues lies in the fundamental understanding of the marketplace. According to Peter Arbs Danish companies need to adapt an international mindset:

“Businesses operate in a international marketplace. Foreign companies are competing heavily on price, and flooding the domestic market with cheaper products. Danish companies need to compete within an international frameset, and on different service parameters in order to win back the customers.” 

The biggest gains can be reached by understanding that customers buy solutions, and not products.

Customers Buy Solutions – Not Products

Service companies need to design their business around the customer. Peter Arbs elaborates that customers want a guarantee that products can cover their needs:

“When a customer goes out in the market to buy a product, they have little interest in detailed product specifications e.g. what type of motor your refrigerator has. The majority of customers want solutions to their challenges. So if we take a very simple example: instead of selling the customer a refrigerator, you have to supply him with the solution of keeping food cold. Thereby, you are offering the customer a service, and not simply a product.”

Rethinking Strategy

In order to survive in the future, and sustain a healthy income, the service-sector needs to look at the mechanics of their businesses, and rethink the strategy:

“Companies need to determine what makes them unique, and what values they can offer customers. They have to realize the potential of placing their services further along in the value-chain. They need to acknowledge and implement their service-offerings on a strategic level, and make it a central part of their business model.”, states Peter Arbs.


For more information please contact Program Director Peter Arbs at parbs@business.dtu.dk or +45 2029 2510


Related videos  

video thumbnail image

video thumbnail image

video thumbnail image

video thumbnail image

Show more

News and filters

Get updated on news that match your filter.