translated from the original interview in italian written by Mauro Bellini, Journalist | Digital360.

Companies that "invest in data and knowledge" to enhance their products are embracing a service-oriented and sustainable business model. The ability to understand and manage all usage scenarios and the variables that shape a product's lifecycle is essential for achieving optimal outcomes, including ESG goals.

A powerful example is the "BAXI by Your Side" project, a remote monitoring and management service that redefines Baxi’s relationship with customers and partners, centering it on data and insights.

‍Marco Grisot, Strategic & Product Marketing Team Manager at Baxi, explains the project's core values, objectives and growth opportunities.

Let’s explain, in summary, the service “BAXI by Your Side”

To fully understand the context in which this project was conceived, it's important to consider how services are increasingly driving end-user choices.

Today, users choose products and solutions based on the quality of services they expect, the capabilities those services provide, and the ability of the vendor to understand their needs and solve problems. In this evolving landscape, we see a growing trend where customers value the benefits associated with a product more than the product itself.

In other words, they are prioritizing services over ownership. This shift, combined with the critical challenges of the energy and environmental transition, is the backdrop for BAXI's strategic approach. As a leading manufacturer of heating and cooling systems, BAXI recognizes its heightened responsibility to contribute to sustainability goals. The shift from a product-based model to a service-based model is perfectly in line with these ambitions.

‍Let’s examine this aspect and understand how servitization and sustainability are connected

The first part of the answer comes directly from our customers. Whereas a few years ago, their main priority was comfort, today energy savings and sustainability are at the forefront. What's more, thanks to digitalization and the growing importance of services, these values are now seamlessly integrated with comfort.

The essence of "BAXI by your side" goes beyond simply providing advanced technology - whether it's a heat pump, a hybrid system or a future hydrogen boiler. It's about providing the high quality service that customers need, while keeping pace with the latest technological innovations. In other words, we focus on providing the right services for each customer to ensure that, whatever the technology, "BAXI is always by your side".

When did the "BAXI by your side" was born and what goals did you set?

The project was launched in 2020 after an extensive period of research, development and testing. As BAXI operates in a high-volume market, the testing and verification phases were designed to ensure that the system could efficiently handle significant volumes.

The benefits of this project can be seen in two main areas. First, for the user, it provides remote control of their system, allowing them to directly optimize convenience and resource usage. Second, from a strategic perspective, the service center can remotely monitor and manage each customer's system to ensure optimal performance and service levels.

Let's focus on the user benefits

The direct benefit to the user depends on how they interact with their home and its systems. With "BAXI by Your Side", we aim to enhance this interaction through significant improvements in user experience, interface design and smartphone connectivity. By allowing users to control our systems through a familiar device like their mobile phone, we are making it easier and more intuitive to manage the comfort and energy efficiency of their home.

This increased ease of use not only simplifies interaction, but also promotes greater awareness of the system's features and capabilities. As a result, users are more engaged with our solutions, ultimately adding value to the overall product experience.

These are a number of important benefits that allow partners to focus attention and resources on higher value-added activities, correct?

Absolutely. When we look at the benefits to our partners, especially service centers, we see significant improvements. They can respond much more quickly, often anticipating the user's call with a thorough understanding of the system's status. In many cases, the quality of service is so high that users don't even know a problem has been addressed - errors are detected and resolved before they become apparent.

This represents a major advance in both response time and service delivery. In addition, this approach reduces costs and has significant environmental benefits. For example, the need for on-site visits is dramatically reduced, reducing travel and associated emissions.

In summary, can we consider it as a digital-based transformation that brings benefits to all stakeholders?

One of the key strengths of this project is its ability to create value for all stakeholders. From BAXI to end customers and service centers, all parties can forge a new relationship and governance model for services, maximizing benefits across the board. This includes ensuring the highest quality standards, reducing energy costs and contributing to sustainability goals.

Of particular note are business users, especially those managing real estate portfolios. These stakeholders oversee residential or commercial rental properties, and for them the ability to monitor and manage services, consumption, and environmental impact becomes a powerful and highly relevant business tool.

How did you build this solution and how did you set up the collaboration with Servitly?

The collaboration with Servitly grew naturally out of our existing relationship with Giordano Controls, a company we work with to develop the electronics for our systems. As our products evolved and became more digitally integrated, this opened the door to developing a joint plan that would ultimately lead to the implementation of a servitization solution.

Once our products were connected, we realized the vast amount of data they were generating and began to explore how we could use that data to create value for both BAXI and our customers. This led to the creation of our Servitly DPS (Digital Product-Service) system, which manages multiple services tailored to the unique needs of each stakeholder. The DPS continuously centralizes, processes and analyzes large amounts of data to monitor product performance and usage and identify situations that require attention.

In addition, the DPS serves as a central hub that distributes relevant information to stakeholders based on their roles, needs, and goals. It also enables bi-directional communication with connected boilers, facilitating remote command execution.

Through an app connected to the DPS via an API, customers receive real-time information about their heat pumps, hybrid systems or boilers and can remotely adjust parameters to optimize comfort and energy efficiency.

The Control Room, a web interface available to service centers, allows them to monitor the health of boilers, quickly detect faults and anomalies, receive alerts, and resolve issues remotely.

The Servitly DPS proved to be the ideal mix of predefined, integrated and configurable features that allowed us to strengthen and differentiate our value proposition - not only for customers, but especially for Service Centers. As the first point of contact with customers, these centers can fully leverage connected services to gain a competitive advantage.

How do you measure the results? What are the metrics and methods of monitoring to evaluate the benefits of this activity?

In an innovation process like this, it's important to recognize that some benefits can be measured with reasonable accuracy, while others, while concrete and objective, are harder to quantify.

At BAXI, we operate through a distribution channel consisting of distributors who serve installers and ultimately deliver products to end users. While we have excellent relationships with distributors under normal circumstances, we do not typically deal directly with end users. This provides us with a strategic advantage: insight into user needs, which are increasingly service-oriented and constantly evolving.

With full respect for privacy, we have access to detailed information about how our products are used and the specific needs of our customers. This knowledge enables us to provide a comprehensive experience of convenience and quality of service, while at the same time gaining important insights to guide our technological advancements.

In addition to these benefits, we are seeing continuous improvements in efficiency, particularly in energy consumption and reduced maintenance visits. This translates into fewer service vehicle trips, optimized labor time, improved overall work organization, and enhanced customer insights gathered by our service centers. Ultimately, these benefits extend to many businesses in the region.

This strategy gives you an extraordinary amount of data and the possibility of amplifying, as we have seen, your knowledge on the real needs of customers and how they can evolve.

What are the opportunities for the future of this approach?

In the past, manufacturers would develop a product and conduct extensive testing, but often struggled to replicate real-world operating conditions. However, user behavior is a critical factor to consider.

Understanding how a product performs and how it should respond to evolving user needs provides valuable insights for R&D. This knowledge allows us to develop algorithms that improve the interaction between product performance, user needs, and operational efficiency.

Looking ahead, this approach can provide new benefits, such as improving the efficiency of heat production in line with comfort needs and sustainability goals. Ultimately, this leads to continuous improvement that benefits not only the end user, but also our ecosystem and the planet.

What are the general next developments of a servitization process like this?

The key is to add value, which opens up a world of possibilities. For example, we envision services where customers "pay for convenience" rather than simply buying a product. Instead of just managing a service, they would pay for the level of convenience it provides.

This shift allows us to create new forms of value and innovative business models around service delivery.

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‍What about you? How are you using the data generated by your connected products to grow your business with a unique and distinctive new offering?