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Sep 2016

The role of management accounting in servitisation

Exploring the potential role of management accounting in servitising manufacturing companies, where services are increasingly offered alongside physical products.

The evidence from our case studies demonstrates that management accounting should play a more proactive role in servitsation (i.e. offering services jointly with product) as a major strategic initiative. Although services are becoming increasingly important for manufacturing companies, accounting and control functions have offered much less support in this area compared to traditional products, as services are still a relatively new systematic issue. 

Pricing and profitability management, for example, are currently less systematically managed in services than in products. Servitisation therefore requires companies to rethink and improve the accounting objects and control devices they are using in order to develop more comprehensive and advanced service offerings. 

Our company, during its seventy years of operations, has installed more than 500 machines. This means we have an incredible potential consumer base for services. If we really improve our organisation we could reach up to 50% of revenues from services [...] and this is feasible in the future...

Financial Officer A. Celli Nonwovens

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The role of management accounting in servitisation