Turning a product-sales business into a services business — using the data it was already producing.

Baxter Renal Care's US home dialysis business sold devices and consumables to dialysis clinics. The financial model was straightforward: ship more product, recognize more revenue. The clinical model was harder. Home dialysis patients drop off therapy at high rates — when they do, clinical outcomes get worse and revenue evaporates. Clinics knew this was happening but had no way to see it coming.

The devices themselves had been quietly cloud-connected for years. Every machine in every home was generating treatment data and sending it back to Baxter. The data was sitting in a warehouse, used for engineering and quality work but not as a product. The question was whether that data could be sold back to the clinics as something they’d pay for.

I led a cross-functional team — marketing, sales, supply chain, customer service, IT, and finance — with one mandate: design, build, and launch the first paid services offer in a business that had only ever sold things. The model had to drive enough customer value that clinics would pay for it. The economics had to work for Baxter. And the operational lift — a new service organization sitting on top of an existing product business — couldn’t break what was already working.

The technology was the entry point. We built predictive analytics on top of the existing device telemetry that flagged patients at risk of dropping off therapy before they actually did. The model wasn’t the product, though — the product was what happened next. We stood up a remote nursing team inside Baxter that received the flags, called the patients, and intervened. Clinics paid Baxter a recurring fee for the combined service.

That last part — the nursing team — was the structurally hardest piece. Putting a clinical service organization inside a medical device manufacturer raises HIPAA, FDA, and entity-level complications. We worked through a corporate structure realignment that moved the customer service and clinical consulting organizations into an affiliated non-FDA-regulated entity. That change unlocked the ability to handle protected health data in ways the device-manufacturing entity couldn’t, and gave the new service line room to operate without contaminating the regulatory profile of the underlying devices.

Pricing was its own problem. The clinic was paying for an outcome — patients staying on therapy — using data that originated from devices the clinic had already bought. We had to make the value visible enough that clinics could see what they were getting, without overpromising what predictive analytics could actually do. The first contracts were structured to make the operational and clinical benefits legible in monthly reporting clinics could share with their own boards.

We shipped the industry’s first paid customer-facing technology service in home dialysis. The US Renal team received Baxter’s 2018 Chairman’s Award, and I received a 2018 CEO Award. More importantly, the business stopped being a pure product company. Once one services line existed and the operational infrastructure was in place to support it, the next ones got easier — by the time I left, services had become an actual strategic dimension of the business rather than an experiment.

Most product businesses are sitting on a service business they could be selling, and the answer is rarely “hire a service organization and add headcount.” The data the products are already generating usually contains the value. The work is in three parts: figuring out what outcome the customer would actually pay for, building the technology layer that surfaces it, and standing up enough operational capability to deliver the outcome reliably.

The financial reframing is the part most operators miss. Adding a service line to a product business isn’t a revenue project — it’s a valuation project. Recurring service revenue trades at multiples of one-time product revenue, and a business that’s 80% product and 20% recurring services is worth meaningfully more than a business that’s 100% product, even when total revenue is identical. That’s the strategic prize, not the line-item revenue.

If you sell products and your customers are getting value you can’t see, there’s a services business in there. Worth two or three months of work to find out whether it’s real.