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Making solutions the answer
Many companies that have traditionally focused on stand-alone products are turning to "solutions"—integrated bundles of products and services—for better margins and faster growth. The reason? Solutions, unlike products, are hard to copy and resist commoditization. Solutions are proving lucrative for many companies, even as the profitability and growth of their stand-alone products have come under pressure. But few companies get solutions right.
The take-away: Companies that succeed with solutions often take strategic actions—such as bundling competitors' products with their own and walking away from established customers—that feel unnatural in the product world. They also make uncomfortable organizational changes.
Articles provided by The McKinsey Quarterly
© 1992-2003 McKinsey & Company, Inc
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