Capturing the aftermarket in engineering organizations: opportunities and challenges

The provision of additional services to accompanythe sale of products is increasingly central to the businessstrategies of companies in manufacturing and engineering, oftenreferred to as aftermarket services (AMS). The purpose of thispaper is to explore the experience of expanding AMS in thecontext of a leading organization in the engineering sector. Thepaper explores the meaning of – and rationale for - AMSprovision and the manifestations of aftermarket service offerings.AMS enthusiasts envisage an array of benefits including: highermargins, better exploitation of an installed asset base andsmoother revenue streams. However, the paper reveals thatwhilst organizations may find lifecycle AMS attractive, thetransition to becoming an integrated provider of product andAMS is likely to be more complex than much of the extantliterature suggests.