Service is the magic word of digital transformation. In principle, it means that physical products are converted into services and products are ultimately replaced. There are plenty of examples: conventional hardware and software are transformed into cloud-based services such as Infrastructure as a Service or Software as a Service. The physical car is replaced by car sharing services. Even manufacturers of drills like Hilti now offer their product as a service.
However, Smart Services go beyond pure as-a-service economics. They enable customized services based on Smart Products tailored to the user. As a reminder: Smart Products are Internet-capable products equipped with sensors – such as networked cars, houses, or printers. The data generated and collected by these smart products forms the basis of Smart Services.
To turn a Smart Product into a Smart Service, the raw data collected by the product is first processed further. They are often linked, combined, and analyzed with other data via cloud platforms. In this way, „smart data” is created – processed, intelligent data – from which knowledge can be generated. This is then the basis for tailor-made services.
In Smart Services, the Big Data of the networked devices are ultimately refined into Smart Data and monetized in new, individually combinable Smart Services. The well-known pioneer for this “data refinement” is Google. Google algorithms analyze the behavior of large groups of users on different websites and their content to improve the positioning of search results. This is combined with specific data on individual Internet users for an even higher quality of search results.