Group Service, July 2014
Service at ABB
Key engine for the next level of
profitable growth
For internal use only
Service
Key engine for the next level of profitable growth
“Service is one of our greatest
opportunities for profitable growth.
Our customers base their buying
decisions more and more not only on
our reputation or the quality of our
products, solutions and systems, but
also on life-cycle partnerships and the
services we can offer.
With world-class services, we really make a difference
for our customers – and all of ABB.”
Ulrich Spiesshofer, CEO
Source: CEO letter to employees, February 2014
For internal use only
Service at ABB
Table of contents
Safety first
Service strategy

Don’t look the
other way

Present at key
markets

Building
sustainable safety
culture

Full potential
service strategy
implementation
Profitable growth
Customer focus
Service excellence

Systematic
growth
development

Service value
propositions and
offerings matrix

Service strategy
implementation focus areas 2014

Order/revenue
development


Customer
success stories

Net Promoter
Score in Service
Industrializing
ABB Service
offering portfolio

Service online

Service external
messaging
For internal use only
Service Safety
Don’t look the other way
Self
Zero as a vision
Zero as a target
 Safety by
natural instinct
 Management
commitment and driven
 Cooperation within and
across team
 Compliance is
the goal
 Governed by rules
and regulations
 Process and complexity
of the operation are well
understood
 Delegate safety
to manager
 More reactive than
proactive
 Personal commitment to
safety
 Organizational pride
 Lack of
management
involvement
 Selective communication
of objectives
Zero is unrealistic
Injury Rate
Teams
Supervision
Natural instincts
 Use of control/discipline
prevalent
Today
Reactive
Dependent
 Individuals can selfmanage
 Most improvements are
procedure-based
 Individuals share logic
and ideas
Tomorrow
Independent
Relative Culture Strength
For internal use only
Zero as an expectation
 Peer’s keeper
 Management is comfortable
leading or allowing others to
lead
 Team is fully engaged in
goal setting and
improvements
Goal
Interdependent
Service Safety
Building sustainable safety culture
For internal use only

Injury trends, total incident rate
(TIR) and lost time incidents
(LTI) improving from 2013

44 standard Code of Practices
developed and to be rolled out

10 point action plan under
implementation - zero tolerance
Present at key markets
Power, automation, infrastructure & transportation
$ 11 billion
$ 8.4 billion
$ 9.9 billion
$ 7.7 billion
$ 8.5 billion
35,600 employees
20,300 employees
30,200 employees
31,700 employees
25,900 employees
Service
$ 7 billion
26,000 employees
For internal use only
What we said…
Achieving the full potential of service
Service as % of total revenue1
Impact of Service Strategy
15%
15%
16%
17%
17%
2007
2008
2009
2010
2011
1 excl.
20-25%
2015
Baldor, Thomas & Betts, PowerOne

Harvest ABB’s installed base

Invest in service R&D

Productized offerings

Focus on operational excellence

Close white spots – technology
and geography

Onboard new service
professionals

Use the full ABB portfolio
For internal use only
What we said…
Increased penetration of Installed Base
Penetration of service market for ABB
installed base by division, 2010-2015
100%

ABB Installed Base value 300 BUSD

ABB IB available service market 20BUSD

Penetration to ABB IB 25% in 2010

Target penetration 40% by 2015
75%
40% T2015
50%
A2013
A2010
25%
25%
0%
PP
PS
DM
LP
PA
For internal use only
2015 IB penetration ambition by Division
2010 IB penetration baseline by Division
Dedicated service sales
Installed base penetration
Where to Play and How to Win framework
Strategy implementation
Market
Transparency
M&A Opportunity
Service Specific
Marketing
Part Supply
Chain
Safety
KPI
2015
Safety
LTI < 0.5
NPS
> 50%
IB Penetration
40%
Orders
20-25% of total
Op. EBITDA
22%
Service
Service Process
& applications
Performance
On- and Off site
Service
eBusiness
Go To Market
Distribution
Channels
Service Offering
Portfolio
Service
People
Service R&D
Closed Feedback
Loop
Pricing Best
Practices
Customer
Contact
Management
Dedicated service product management
Service offering portfolio
For internal use only
Systematic growth process
Matching customer needs, IB and service portfolio
Service portfolio
Match and
identify service
opportunities
Leadership
Prioritize and
categorize
service
opportunities
Establish growth
plan
Installed base
Execute and
follow-up
Execution

Industrialized service products and professional product management in place

Installed base known by customer sites, market potential regularly updated

Opportunities prioritized based on potential and customer needs

SMT used globally for initiative tracking and follow up

Service Management and sales trainings established to support growth
For internal use only
What results we achieved by 2013
Organic growth, excluding acquisitions
Organic Orders Growth *
Service Orders share of total *
140%
20%
130%
19%
120%
110%
18%
100%
90%
17%
80%
70%
16%
60%
2010
ABB Group
2011
2012
LCS
2013
Full Service
15%
2010
2011
2012
2013
* Excludes acquisitions of Baldor, T&B and PowerOne



Both Group and LCS impacted by softening of larger project business
LCS small to medium size business showing growth as strategy implementation picks up the momentum
Service NPS developed from 12% to 32%
For internal use only
What results we achieved…
Service NPS/response development 2010 - 2013
Service NPS 2013
Service NPS
50%

Increase in respondents from
2,500 in 2012 to 11,500 in 2013

Issue resolution, logistics, billing
& documentation and spare parts
weakest areas
40%
32%
30%
26%
20%
17%
12%
Service NPS 2014
10%
0%
2010
Total
2011
ABB In General
2012
DM
LP

2013
PP
PS
PA
Responsiveness to customer web inquiries
100%
Web-inquiry responsiveness 2013

> 50 % increase in inquiries from
105,000 in 2012 to 160,000 in
2013

Inquiries primarily for new
sales/products
80%
60%
50%
40%
36%
20%
26%
35%
39%
Target set to 40%; focus on
systemic issues elimination
37%
25%
Web-inquiry responsiveness 2014
28%
0%
2010
2011
Within 24 hours
2012
2013
Within 72 hours
For internal use only

2014 target – 75% response rate
in 24hrs
Service value proposition and offering matrix
Covering the complete lifecycle
Rapid Response





Repairs
Spares and consumables
Replacement
Training
Service agreements
Lifecycle Management








Installation and
commissioning
Maintenance
Extensions, upgrades and
retrofits
Replacement
Training
Spares and consumables
End of life services
Service agreements
For internal use only
Operational Efficiency






Engineering and
consulting
Maintenance
Advanced services
Extensions, upgrades and
retrofits
Training
Service agreements
Performance Improvement





Advanced services
Engineering and
consulting
Extensions, upgrades and
retrofits
End of life services
Service agreements
Industrializing ABB Service Offering Portfolio
Service product categories driving common approach
For internal use only
Service external messaging
Based on service customer needs
Rapid Response
Lifecycle Management
We guarantee fast and flexible
service response to maximize
your equipment availability.
We provide you powerful tools
and our knowledge base to
optimize and extend the
lifecycle of your equipment.
Operational Efficiency
Performance Improvement
We optimize the usability
and efficiency of your
equipment and systems to
increase productivity.
Your strategic partner in improving
productivity, usability, reliability,
safety, cost-efficiency, energyefficiency and emissions control.
Month DD, YYYY
For internal use only
Service strategy implementation
Focus areas 2014
Business led collaboration
Safety
One ABB enabled through
cross-divisional collaboration
Don't look the other way!
Business led
collaboration
Safety first
Service Excellence
Relentless
execution
Service
excellence
Relentless execution
1-1-1-1 Service concept
Profitable
growth
Profitable growth
Driven by PIE concept
For internal use only
Driven by best practices
defined in How-to-Win
initiatives
What we need to do from here...
Way forward...


Profitable Growth

Drive penetration with IB intelligence and with improving portfolio

Further drive organic growth with adding service sales, local execution resources, and
service attachment rate

Strengthen service expansion focus with right incentives and ownership. Focus on the
onboarding of new technologies and scalable software, as well as SaaS capabilities.

Have best people ‘on the bus’, safely
Business led collaboration


Drive BU (and integrated cross BU) value propositions to maximize the potential. Ensure
service is integral part of account management across ABB.
Relentless execution

Drive disciplined How to Win initiative implementation across 100+ countries.
Have learning from best practices driving the speed.

Implement Service Operational Maturity Assessment model. Systematic self assessment
program to ensure quality and effectiveness across the field service processes.
For internal use only
Services across the entire value chain
Your partner in performance improvements
Boliden copper mine, Sweden
• Lifecycle services to ensure reliable
grinding operations (LTSA)
• Lifecycle management, Performance
improvement
Clarabelle mill, Canada
 Upgrade to Vale’s dual pinion
semi-autogenous (SAG) mill
 Lifecycle management,
Performance improvement
Power utility, Germany
• Spare part maintenance
agreement with IWB
• Lifecycle management, Rapid
response
Buzzard oil platform, UK
• Service contract with
Nexen at North Sea
 Lifecycle management
Royal Carribean Cruises
Ltd.
 Service agreement
 Rapid response, Lifecycle
Management
Shipbuilding site, Bahrain
 Service agreement with
ASRY for turbochargers
 Rapid response
Minera Yanacocha gold
mine, Peru
 Remote diagnostic
service contract
 Rapid response
Desalination plant, UAE
 Upgrade of a distributed
control system at DUBAL
 Lifecycle management,
Performance improvement
Chemical complex, SaudiArabia
 Operations management
software for Sadara
 Operational efficiency
For internal use only
Bauang diesel power plant ,
Philippines
 Upgrade of the control system
, Energy Corporation
 Rapid response
Coal-seam gas plant, Australia
 Long-term service agreement
with Queensland Gas
Company
 Lifecycle management
Service online
Connect with ABB
www.abb.com/service
www.abb.com/MyABB
www.youtube.com
www.yammer.com
www.pinterest.com
www.twitter.com
www.instagram.com
For internal use only
www.linkedin.com
www.facebook.com
For internal use only