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Out With The Old, In With The New

Innovation is a process that continually pushes us towards the future, and it comes in many different shapes and sizes. Whether it be an additional tablespoon of sugar at a neighborhood lemonade stand, or multinational companies revolutionizing their business design through new and exciting avenues, innovation is an essential part of business. 

“If you tell me 15 years ago when I started at Bayer that we would be refining digital solutions and services for the pest management industry, I probably would’ve told you you’re crazy.”

The secret to a perfectly refreshing lemonade recipe might be just a Google search away, but the path for large companies to evolve their business is much less straightforward. Service Design Group founder and CEO Patrick McGowan sat down with Scott Broaddus from Bayer Pest Control to discuss the German giant’s experience with innovation.

Bayer has recently made a push towards servitizing portions of their pest control business portfolio, which is exemplified by their sensor-driven rodent monitoring service for zero-tolerance locations such as hospitals and food processing plants.

Transitioning from selling products that deal with pests to selling IoT-enabled pest monitoring as-a-service is an interesting transition. “If you tell me 15 years ago when I started at Bayer that we would be refining digital solutions and services for the pest management industry, I probably would’ve told you you’re crazy,” Broaddus said. 

Bayer is one of many companies that face challenges as they move to augment and enhance their traditional offerings. It’s difficult to inform consumers about how to best take advantage of new services, and hard to keep employees on the same page. To do so, “[Bayer] finds synergy between our traditional core portfolio and the digital technologies we are bringing to market,” Broaddus explained. This helps to smooth out the process. 

At the end of the day, servitization is about providing customers with outcomes, not products. Broaddus knew that customers would be reluctant to adopt a new mindset that they didn’t yet understand. But Bayer is committed to finding the best possible way to serve its clients, and pushed forward despite the risks. 

“People underestimate the value of being first movers in service industries”

“I’m excited to change the face of what this really old school industry looks like. To change the face of pest control to this more modern-day, cutting-edge innovative service, to me is super exciting,” Broaddus said. “As you innovate and modernize what your business looks like, through the use of cutting edge technology, it allows you to recruit a different type of customer, a different type of employee.” These new types of customers and employees are what assure Broaddus that Bayer’s decision to innovate was the right one for the future.

Being slow to react to innovation can be detrimental, which is why Broaddus is happy that Bayer moved toward servitizing early. “People underestimate the value of being first movers in service industries,” he said. 

Any company should expect turbulence when revolutionizing the way they interact with consumers. But the cost of complacency can be much more severe. As industries across the world face pressure to servitize, it’s important to be aware of the challenges that arise from reluctance to deviate from traditional or legacy offerings. 

For more insight about this discussion, check out the Video Chats section of our website and watch the recording of the discussion between Patrick and Scott.

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