Electrolux AB is the world’s fifth-largest maker of consumer appliances. In November 2018, Electrolux launched the trial of a subscription-based business model in Sweden for the Pure i9 – a high-end robotic vacuum cleaner. Within nine months, Daniel Wentz, VP Software Products, who had spearheaded the initiative, started seeing traction in the market. Daniel was convinced that there was a much bigger opportunity for Electrolux to create value with the new hardware-as-a-service concept for small appliances. But key questions remained: How to shift the organization from a hardware-first product-push comfort zone to software-first service-pull model? How could Electrolux create more value with the hardware-as-a-service model? How to scale up the subscription-based business model? What options might be considered? What kind of investment and leadership commitment would it take to succeed?
Learning Objective
1) Shifting a traditional product business to subscription-based model: opportunities and challenges.
2)Assessing capabilities required to drive hardware-as-a-service business.
3) Transforming the organizational DNA of a B2B company to become a consumer obsessed D2C enterprise.
4) Understanding the evolving role of data.
5) Risk of killing a promising idea due to lack of focus, prioritization and organizational inertia.
