When the physical product cannot easily be differentiated, the key to competitive success may lie in
adding valued services and improving their quality. Rolls-Royce PLC has ensured its aircraft
engines are in high demand by continuously monitoring their health for 45 airlines through live
satellite feeds. Under its TotalCare program, airlines pay Rolls a fee for every hour an engine is in
flight, and Rolls assumes the risks and costs of downtime and repairs.13