Divestitures: Key Questions for Separating the “Service” Function(s)
Operational Separation of “Services” during Divestitures
Given the recent evolution of the consumption economy everything from technology to car rides are being offered as a “Service”, traditional product companies are in transition to service based business models. In additions, several product and service business units are not separating out as different companies by engaging in carve-outs, asset sales or even pure spin-offs. Service is a very customer facing function, often having varying definitions across industries and sectors e.g., Support, Training /Education Services, Professional Services and Product as a Service etc.
Typically, functional separation based on headcount and contracts are easier to separate but when assets (e.g., call centers etc.) get involved, the operational disentanglement can become quite complex. In this article, I will explore several sub-functions within Service and examine some key questions needing to be addressed during separation. All operational elements of separation need to be examined by closely looking at Separation Management, Day One Planning/Execution, Dis-Synergies, Stranded Costs, Standalone Costs (where applicable) and TSAs (Transition Services Agreements)
