What exactly is RVA, and why is it rapidly gaining traction? In this article by Michael Blumberg, President of Blumberg Advisory Group, we'll get to know more about this game-changing technology.
AUTHOR ARCHIVES: Michael Blumberg
About the Author:
Michael Blumberg is President of Blumberg Advisory Group, Inc., a research, and consulting firm to the Field Service. Michael’s firm provides clients with strategic guidance and tactical assistance for improving the overall profitability and quality of field service operations. Mr. Blumberg is a prolific author and frequent speaker at industry events and conferences. Michael may be reached at +1-267-334-0135. Via email at michaelblumberg@blumbergadvisor.com. Michael’s blog is accessible at www.michaelrblumberg.com. Follow him on twitter via @blumberg1.
Mar 29, 2021 • Features • Michael Blumberg • Digital Transformation • softrware and apps • Technology
What exactly is RVA, and why is it rapidly gaining traction? In this article by Michael Blumberg, President of Blumberg Advisory Group, we'll get to know more about this game-changing technology.
Remote Visual Assistance (RVA) is not exactly new technology. It has been around for a couple of years now pre-COVID. However, it was only until COVID that it gained the attention of many businesses.
RVA is one of the emerging solutions amid the challenges posed by the pandemic. But what exactly is RVA, and why is it gaining the attention it has today? In Blumberg Advisory Groups’ Buyer’s Guide to RVA Software, we’ll get to know this game-changing tech, why it is a worthwhile investment, and what to look for in an RVA software fit for your business.
WHAT IS REMOTE VISUAL ASSISTANCE (RVA)?
Remote Visual Assistance (RVA) incorporates augmented reality, including merged reality and 3D annotation, along with video collaboration tools to create a virtual environment where the receiver and provider of support can communicate instantly, on-demand, and in real-time.
It can deliver guided troubleshooting and remote assistance to customers and field engineers through remote virtual assistance software. These features meet the challenges of the COVID-19 pandemic, which has limited companies from sending onsite customer support due to health and safety concerns. This is one of the primary reasons RVA has become the new expectation for service delivery within the Aftermarket Service Industry (i.e., field service, call center, technical support).
USE CASES FOR RVA SOFTWARE
Field Service Leaders consider remote assistance software due to its many uses in the Aftermarket Service Industry. As it continues to prove its value to businesses, it has slowly become the preferred model for onsite service. Below are the most common use cases by business function:
- Call Center - Technical Support: Remote Support, Troubleshooting, and Triage, Customer Self-Service
- Field Service: Second Tier Support, Cross Border Support, Workforce Productivity, Scheduled Service
- Others: Application Support, Training, and Onboarding
BENEFITS OF RVA SOFTWARE
To get a more clear picture of the benefits that RVA software provides to companies, below are recorded improvements of companies who utilize RVA software in their business operations:
- 30% reduction in time to resolution
- 20% improvement in phone fix rate
- 35% increase in first-time fix
- 30% increase in customer satisfaction
The numbers above serve as proof of how RVA has enabled companies to optimize their service delivery performance continually. It has helped lower costs by resolving calls remotely and efficiently and avoiding FSE dispatching. Companies are also able to meet and exceed customer expectations through RVA. Besides improving operations, RVA also has a role in reaching business growth objectives - by monetizing its RVA investment when offering remote support or using RVA as a paid service.
CORE FUNCTIONALITIES A RVA SOFTWARE MUST HAVE
When looking for the best RVA software, there are three general core functionalities to look for: (1) collaboration, (2) access and communication, and (3) enterprise administration.
Collaboration: RVA software must have the ability to allow people at different locations to give and receive help through a remote, collaborative experience. There is a broad array of features that can support collaboration. The most critical of these features are 3D annotation.
Access and Communication: A successful remote session is where the giver and receiver can quickly communicate in real-time. Various features make this possible, including but not limited to in-app messaging and mobile web browser support.
System Administration: As with any software, RVA must-have system administration features that provide user access, manages user accounts, monitor system security, and perform many other functions such as call reporting & analytics, and platform integration, and API support.
A complete description of core RVA feature functionality can be found in Blumberg Advisory Groups’ Buyer’s Guide to RVA Software.
RVA SOFTWARE VENDOR CAPABILITIES
Now that you know the key features an RVA solution must contain, the next step is to evaluate vendor capabilities. Here is an overview of the core capabilities and competencies you can use to assess a potential RVA vendor:
- Application Ease Of Use: End-users can quickly deploy the software
- Customer Success Management: Strong bench of implementation subject matter experts
- Strategic Coaching: The vendor offers ongoing guidance on using RVA in other parts of the customer’s organization.
- Maturity Model Framework: Roadmap for end-user organizations to evaluate areas for improvement and future growth.
- Partnership Approach: Vendor is responsive, flexible, and collaborative; has built a partner network.
- Enterprise-Grade Support: Vendor’s support team can support the needs and requirements of enterprise size customers and integrate their RVA software with enterprise systems.
QUESTIONS TO ASK YOUR RVA SOFTWARE VENDOR
Blumberg Advisory Group has also identified a few Should Ask Questions (SAQs) which are critical questions you can ask your vendors to make the best final selection. For instance:
- How sound is the vendor's company?
- How easy is the product to use and implement?
- What level of security and certification does the application have?
- How will the vendor support your future requirements?
- What is the vendor's track record?
- How scalable is the vendor's solution?
The Buyer’s Guide provides model answers to these questions to help you evaluate and select an RVA software solution.
Read more of Blumberg Advisory Group’s in-depth analysis of Visual Remote Assistance by getting a copy of the full version of the Buyer’s Guide today at go.helplightning.com/2021BuyersGuide.
Further Reading:
- Read more articles by Michael Blumberg @ www.fieldservicenews.com/michael-blumberg
- Read the 2021 Remote Assistance Buyer's Guide @ go.helplightning.com/2021BuyersGuide
- Read more about Digital Transformation @ www.fieldservicenews.com/digital-transformation
- Follow Michael Blumberg on Twitter @ twitter.com/blumberg1
- Connect with Michael Blumberg directly by email @ michaelblumberg@blumbergadvisor.com
Mar 05, 2021 • Features • Michael Blumberg • Parts Pricing and Logistics • Spare Parts Management
In this new article for Field Service News, Michael Blumberg, President of Blumberg Advisory Group, discusses the strategic value of Spare Parts Management in product service businesses.
In this new article for Field Service News, Michael Blumberg, President of Blumberg Advisory Group, discusses the strategic value of Spare Parts Management in product service businesses.
INTRODUCTION
Spare parts represent the single largest investment and second-largest expense when running a product service business. This is true regardless of whether Aftermarket Service operates as a cost center, revenue center, or profit center. Additionally, several industry trends, including Servitization, Circular Economy, and a tsunami of technological innovations, have placed even greater pressure on Service Leaders and Supply Chain Managers to be as effective as possible when itforecasting, managing, and ordering spare parts. Spare Parts Management (SPM) is the process that companies use to ensure that the right spare parts are available at the right place and at the right time.. However, operating a successful SPM function creates a few challenges. As mentioned above, the goal is to have the parts available at the right place at the right time. But carrying too much inventory will hurt the income statement and alance sheet, as well as KPIs such asreturn on assets and return on invested inventory. Another challenge is that service parts are not the same as any other inventory like finished goods. This is because they can be repaired and reused, thereby being a great revenue source and solution for any service issues. To sum up, SPM has unique characteristics that make it complicated. Therefore, there is a need for industry-specific software to meet such complexities.SPM State of the Art
Blumberg Advisory Group published a report that aims to educate Service Supply Chain Executives on the strategic value of SPM to their company’s financial and operational performance. It also contains independent benchmark evaluation and profiling of selected SPM vendors and their key capabilities.
The objectives of the Blumberg Advisory Group report:
- To educate Service Supply Chain Executives on the strategic value of SPM to their company’s financial and operational performance.
- To provide an independent benchmark evaluation and profiling of vendors based on the following criteria – feature functionality, vertical market focus, core competencies, use cases, current and planned innovations.
The report relied on Blumberg’s knowledge of the SPM market and a wide array of data sources when profiling vendors. This includes whitepapers, publicly available information and literature, structured discussions, data collection processes with said vendors, interviews with industry leaders, consultants and end-users.
IMPACT OF KEY TRENDS ON SPM
There are three major trends that have a significant impact on SPM. These are:
- The Servitization of Products. This trend places greater attention on generating additional revenue through the sale of spare parts. It is the main drive for companies to become proficient in planning, forecasting, and managing spare parts.
- The emergence of the Circular economy. Here, companies create value by repurposing, reusing, and recycling products. This allows supply chain managers to replenish their spare parts inventory by simply repairing and refurbishing defective parts.
- The tsunami of new technologies in recent years. The rise of modern technology in helping companies improve customer satisfaction and experience has shaped SPM into a more accurate and effective technological solution.
CORE FEATURES OF SPARE PARTS MANAGEMENT SOLUTIONS
Below are the core features to look out for when investing in Spare Parts Management (SPM) Solutions:
- User Interface
- Parts Management and Grouping
- Forecasting
- Inventory Planning and Optimization
- Supply Planning (Order Plan)
- Reporting and Analytics
CORE FEATURES OF SPARE PARTS MANAGEMENT SOLUTIONS
Here are other aspects to consider in your choice of SPM solution:
- First, make sure that the solution is specifically designed for managing the Aftermarket Service Supply Chain.
- Second, research the vendor’s experience and expertise within your vertical market.
- Third, check if there are any independent organizations that validated the math behind the inventory planning and which organizations. This adds credibility to the vendor’s ability to meet organizational requirements regarding SPM.
- Fourth, find out what planning objectives are met or optimized through their SPM system and what their application is trying to accomplish. Finally, investigate the SPM solution’s ability to keep with the new technological development and how they incorporate them in various optimization and planning scenarios.
VENDOR PROFILES
VENDOR |
COMPANY INFORMATION |
KEY CONSIDERATIONS |
Baxter Planning Systems |
Baxter Planning (Baxter) is a privately held vendor of advanced planning software for Service Parts Management founded in 1993 by Greg Baxter in Austin, TX. While most of its customers are of enterprise size with $1B+ revenue, Baxter also caters to mid-size companies within Information Technology and Telecommunications verticals. |
When choosing Baxter, one of its highlights that many users value is the TCO approach because it is aligned with business objectives that all stakeholders in the organization can understand. |
Oracle |
Oracle is a $39 Billion company. Its Supply Chain practice accounts for approximately 3.8% of total corporate revenue. Its Oracle Spares Management (SM) is a complete solution covering key processes and functionality required to manage serviced parts within a service supply chain. |
Although it presents many features, it is recommended that manufacturers only consider Oracle Service Parts Planning (SPP) - an Oracle SM component, when they are already a part of the Oracle Platform. |
PTC Servigistics |
PTC’s Servigistics software is a purpose-built Service Parts Management (SPM) solution that incorporates the broadest and deepest features in the marketplace. Servigistics represents approximately 10% of PTC’s business, making it by far the largest Spare Parts Management (SPM) solution provider.
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Servigistics is the best fit for companies that manage large, complex supply chains or where service levels agreements or connected assets are significant considerations. It is still a viable option for mid and small-market service organizations since it offers various packaging and pricing options. Servigistics has innovated with AI, ML, Big Data, and IoT helping organizations stay ahead of the Digital Transformation trend.
|
SAP |
SAP, a leading ERP software vendor, delivers Service Parts Management capabilities through its Extended Service Parts Planning (eSPP) and Integrated Business Planning (IBP). These applications work together to deliver the full breadth of capabilities found within a typical SPM solution.
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Just like with Oracle, it is recommended for SPM users that are already on the SAP Platform and there are no third-party solutions available to them through their IT department. Also, SAP is only suggested for SPM where parts returns, or repairs do not play a big role. |
Syncron |
Syncron is a privately held company founded in 1999 and headquartered in Stockholm, Sweden. Syncron has developed numerous SPM solutions over the years including Syncron Inventory, Syncron Retail, Syncron Price, and Syncron Uptime. Syncron supports a broad array of vertical markets, including but not limited to agriculture equipment, automotive, energy, and more. |
If looking to generate a larger percentage of total corporate revenue from the sale of aftermarket spare parts, then manufacturers should consider Syncron. It is also a great option when products are IoT enabled and critical to PaaS agreements. |
SUMMARY
To meet the need of SPM solutions in the market, various vendors have emerged offering their own set of features and capabilities. In fact, the Blumberg Report has successfully profiled each vendor according to certain functionalities including Reporting and Analytics, Parts Management, Supply Planning, Forecasting, and Inventory Optimization. However, it is important to note that choosing an SPM solution depends on your company’s objectives and goals. It is through these sets of goals that you can determine what features you need, and which vendor offers the best solution according to those requirements.
Download Blumberg’s report to gain new perspectives and insights on the SPM State of the Art.
Further Reading:
- Read more FSN exclusive articles by Michael Blumberg @ www.fieldservicenews.com/michael-blumberg
- Downdload Blumberg's report on the SPM State of the Art @ www.blumbergadvisor.com/spm-benchmark
- Read more about Parts, Pricing & Logistics @ www.fieldservicenews.com/digital-transformation
- Follow Michael Blumberg on Twitter @ twitter.com/blumberg1
- Connect with Michael Blumberg directly by email @ michaelblumberg@blumbergadvisor.com
Jan 28, 2021 • Features • Michael Blumberg • Digital Transformation • Covid-19 • Remote Services
In this article for Field Service News, Michael Blumberg, President of Blumberg Advisory Group, discusses the "new normal" expectation for field service organisations to offer a proactive, connected, and remote service...
In this article for Field Service News, Michael Blumberg, President of Blumberg Advisory Group, discusses the "new normal" expectation for field service organisations to offer a proactive, connected, and remote service...
Over the last 12 months, Field Service Organizations (FSOs) have had to rethink how they deliver service due to the restrictions of COVID-19. With the limited ability to provide onsite, face-to-face service 100% of the time, FSOs needed to implement new processes and procedures to ensure their employees' and customers' health and safety. One of the developments which emerged was the concept of a Hybrid-Service Delivery model. This model, fueled by remote monitoring and IoT technology, enables FSOs to resolve a significant amount of service issues remotely through enhanced triage and troubleshooting capabilities while improving technicians' ability to quickly resolve onsite service issues if an onsite dispatch is needed.
The ability to offer and deliver this proactive, connected, and remote service, which had once been the domain of best-practice companies, has become the "new normal" expectation for FSOs of all sizes. Covid-19 may have been the catalyst for rapid change, but the foundation for these offerings has been building for many years. At issue, several macro-environmental trends have been fueling investment in the building blocks necessary for delivering a proactive, connected service experience. These trends include the proliferation of IoT devices, Moore's Law, and Servitization.
The significance of COVID-19 was that it forced FSOs to adopt and apply the building blocks of Hybrid Service much sooner than expected as a matter of survival. Indeed, a recent study by Field Service News reveals that 67% of respondent companies surveyed have implemented these types of solutions because of COVID. However, many FSO industry participants found themselves quickly cobbling together these solutions to deal with the immediacy of the situation. This has led to gaps in capabilities within and between FSOs. The industry now faces the challenge of filling in these gaps by systemizing and scaling these capabilities and providing access to FSOs of all sizes.
FIELD SERVICE ORGANISATIONS ARE USING UtaaS SOLUTIONS TO PROVIDE CUSTOMERS WITH A PROACTIVE SERVICE
The ability to capture and monitor data from assets in the field is central to the Hybrid Service Delivery model. By collecting, monitoring, and analyzing this data, FSOs can anticipate future service events and reduce face-to-face onsite visits. It enables FSOs to take the appropriate preventive actions to resolve problems, often remotely before they occur, which extends the life of their customer's equipment. Lastly, they can generate new revenue sources through an Uptime as a Service (UtaaS) offering. Through a UtaaS offering, FSOs can meet their objectives of cost reduction, service excellence, and revenue growth. These objectives will remain central to FSO strategies in the new normal. To provide UtaaS, FSOs must have a few basic building blocks in place, including but not limited to
- the capability to read data from assets in the field
- the ability to read data in real-time
- the ability to utilize the data as part of a triage process for identifying faults and guiding the best route for issue resolution
- automation of the workflows and processes to activate service
- accessibility to organizations of all sizes
Achieving this outcome presents a challenge for a significant segment of the Field Service Industry. Per research from Field Service New, three quarters (76%) of respondents can read data from assets in the field, but only two-thirds can view it in real-time. The net effect is that only 51% of respondents have this combined capability. While 72% can utilize the data as part of the triage process, slightly more than one-third (36%) possess all three abilities. In other words, there is a large gap in capabilities between FSOs who have fully enabled UtaaS solutions in place and those who don't. Only a small segment of the market has all the building blocks and can deliver a complete Hybrid Service experience.
Fortunately, macro trends such as Moore's Law combined with cloud computing and advancements in telemetry have made it possible for SMB and Mid-Sized companies to implement many of the foundational components for UtaaS solutions in recent years. The technology has become more affordable, easier, and efficient to deploy. It also helps that software vendors have made a strategic decision to target these market participants.
Field Aware, a developer of Field Service Management software, and ThingTech, a supplier of IoT -based Asset Management solution, are two such vendors who have teamed up to deliver UtaaS solutions accessible to organizations of all sizes. Their combined solution provides a perspective of what to look for in a best-in-breed, UtaaS solution.
The UtaaS solution from FieldAware and ThingTech enables companies to gather data from any asset type in the field. The data is processed in real-time and produces alerts, reports, and notifications based on user-configured rules and workflows. Based on these rules and workflows, automation within the FieldAware service hub triggers the appropriate action. For example, submit a work order, dispatch a technician, or schedule a preventative maintenance visit. Once the service event is completed, the technician can document his actions and update the system through his mobile device.
M.E.S.O., a company that provides Fleet Maintenance on capital intensive, mobile equipment found in multiple industries (i.e., Oil & Gas, Construction, Utilities, etc.), needed a solution that could provide a line of sight to the assets in the field, facilitate high levels of technician efficiency and productivity, and streamline back-office operations. M.E.S.O. was able to achieve these results by implementing the UtaaS solution described above.
By implementing this solution, M.E.S.O. can provide its customers with a predictive and proactive solution that increases uptime, reduces maintenance and repair expenditures, and extends the equipment lifecycle. This solution also saves M.E.S.O. an enormous amount of time. Backoffice productivity has improved by a factor of five without hiring additional staff. The decision to provide Uptime as a Service and invest in the has had positive results for M.E.S.O. The management team views it as a huge competitive advantage, and it plays a central role in the company's sales & marketing message.
Read Michael’s latest white paper, Uptime as a Service: Driving Service Excellence, Cost Reduction, and Growth in the New Normal, to obtain more insights and perspectives on this topic. Click Here
Further Reading:
- Read more about Digital Transformation @ www.fieldservicenews.com/digital-transformation
- Read more FSN exclusive articles by Michael Blumberg @ www.fieldservicenews.com/michael-blumberg
- Read Michael's latest white paper @ info.fieldaware.com/Uptime-as-a-Service-IOT-White-Paper
- Read about the impact of COVID-19 on the field service sector @ www.fieldservicenews.com/covid-19
- Follow Michael Blumberg on Twitter @ twitter.com/blumberg1
- Connect with Michael Blumberg directly by email @ michaelblumberg@blumbergadvisor.com
Dec 11, 2020 • Features • Michael Blumberg • Digital Transformation • Covid-19 • Remote Services
In this exclusive article for Field Service News, Michael Blumberg, President of Blumberg Advisory Group, analyzes how remote support tools will continue to provide lots of benefits to organizations in the field service sector in the post-pandemic...
In this exclusive article for Field Service News, Michael Blumberg, President of Blumberg Advisory Group, analyzes how remote support tools will continue to provide lots of benefits to organizations in the field service sector in the post-pandemic world.
One of the ways that Field Service Organizations (FSOs) have been able to overcome the challenges of Covid-19 is through the provision of Remote Support, also known as Touchless Service. This represents a viable way for FSOs to renegotiate SLAs and to effectively resolve customers’ service issues where restrictions exist. Although remote support has been around for some time, it was not always the preferred solution. Covid-19 has made the provision of remote support a necessity.
Since the onset of the pandemic, there has been an increase in the use of remote support tools to deliver a Touchless Service experience. The increase can be measured in terms of the number of companies using these tools and applications, the frequency in which they are used, and the applications in which they are used. Originally perceived as an application for delivering 2nd tier expert support, remote support tools are now used in a broad array of service situations from installations, to depot repair, to site surveys and application support.
Many industry participants wonder how remote support tools will be utilized Post COVID. Will FSOs abandon Touchless Service for a more traditional onsite experience? The answer is no. Touchless Service is now becoming table stakes for FSOs. This is because remote support tools offer a lot of benefits to a service organization and the customer. One of the biggest benefits is it eliminates friction, and friction is caused when there are a lot of touches, steps, or time involved in completing a task or process. Remote support tools enable FSOs to reduce or eliminate technician travel time which allows them to complete more calls per day.
REMOTE SUPPORT WILL CONTINUE TO PROVIDE VALUE TO ORGANISATIONS AND CUSTOMERS POST COVID
No doubt, FSOs will need to incorporate Touchless Service into their overall business strategy. The specifics of how and when remote support will be deployed will depend in part on the industry or vertical market. Key considerations include the complexity, criticality, and safety issues involved in supporting the install base. Touchless Service is appropriate for supporting equipment in an environment that’s not complex and where the customer is willing and capable of participating in the service resolution process. However, a more complex service environment, one that is mission-critical and presents safety concerns or requires specialized skills or certification, will likely mandate an onsite service visit. Nevertheless, remote support tools can still play a critical role in providing expert assistance in either case.
FSOs also need to decide when to deploy or emphasize the softer skills involved in maintaining high levels of customer loyalty and satisfaction. After all, the human connection is important and it’s just not the same with remote support, even if it involves video. As such, FSOs should evaluate the critical touchpoints during the customer journey where an in-person site visit is both appropriate and valuable. These can be planned or ad-hoc or by exception. For example, in reoccurring service issues or during a service event that occurs less than 90 days before service contract renewal. In these instances, the technician servs as a brand ambassador and trusted advisor to the customer.
FSOs may also want to consider how they monetize their investment in remote support technologies. The ability to monetize will depend on the economics of service delivery, customer willingness to pay, or the competitive practices within a specific service market. In other words, there are use cases where it could be more economical for an FSO to provide remote support as part of a basic service offering and not charge extra while there are other use cases that justify offering it as part of a premium-priced, value-added service. Assuming monetization is an objective, then there are several steps that an FSO needs to accomplish First, they need to gain clarity about the value-in-use of remote support. They need to be able to clearly articulate this value to their customers. The second step is to construct service offerings with different price points. Third, conduct market research to validate there’s a value to the customer and the customer is willing to pay for theses services. Fourth, determine the addressable market for the service. Lastly, create a go-to-market plan and roll-out the new offering to a select group of pilot customers.
Remote support will continue to provide a trifecta of value in our post-pandemic world. Value driver #1 is that it dramatically improves the customer experience. Customers receive faster service and are more engaged in the service resolution process. Value driver #2 is that it optimizes service delivery, so an FSO can do more with fewer people. Remote support frees technicians from travel which means one technician can handle more service request per day. Value driver #3 is increased technician productivity. Less time on the road means more time resolving customers' issues remotely, which leads to more calls completed per day.
It is important that FSOs view the rollout of remote support solutions from a strategic perspective not simply as another application within their technicians or tech support personnels’ tool kit. Remote support has implications for various aspects of the service business and stakeholders. Due diligence is required when it comes to integrating remote support into the overall service business strategy since the return on investment can be significant.
Further Reading:
- Read more about Digital Transformation @ www.fieldservicenews.com/digital-transformation
- Read more exclusive articles by Michael Blumberg @ www.fieldservicenews.com/michael-blumberg
- Read about the impact of COVID-19 on the field service sector @ www.fieldservicenews.com/covid-19
- Follow Michael Blumberg on Twitter @ twitter.com/blumberg1
- Connect with Michael Blumberg directly by email @ michaelblumberg@blumbergadvisor.com
Jul 10, 2020 • Features • research • Mize • Service Innovation and Design
Michael Blumberg offers us an exclusive analysis of the research he has recently conducted to identify trends amongst service organisations when it comes to service contract revenue that shows the secret is 'all about the asks'...
Michael Blumberg offers us an exclusive analysis of the research he has recently conducted to identify trends amongst service organisations when it comes to service contract revenue that shows the secret is 'all about the asks'...
Mize recently conducted a study among service executives and warranty professionals who are involved in marketing and selling service contracts and extended warranty (SC/EW) programs. The findings validate which strategies and tactics offer the best results which in turn will help managers and executives become more effective in marketing and selling extended warranty/service programs.
A total of 96 service contract and warranty professionals have participated in our survey. Just over two-thirds (68%) of the survey respondents were representative of the B2B segment. The remaining 32% were from the B2C segment.
Essential Key Performance Indicators Amongst Field Service Organisations
Attach and Renewal rates are the primary Key Performance Indicators that companies rely on to evaluate the success of their Service Contract and Extended Warranty Programs. A small percentage of respondents (15%) reported attach rates in the range of 51% to 70%. Most respondents (45%) reported attached rates of 26% to 70%).
Concerning renewal rates, while a majority (71.5%) of the respondent’s report renewal rates of less than 50%, over one-quarter have renewal rates of 76% or higher. Half of these respondents have renewal rates over 90% demonstrating that this level of performance is possible.
Higher attach and renewal rates were observed among respondents from the B2B segment. This is attributable to the fact that companies in the B2B segment are often more engaged with customers during and post-sale than those in the B2C segment. B2B companies may have multiple interactions with a customer before, during, and after the sale then B2C companies. For example, in the purchase of a refrigerator, the retailer may have only one chance, usually at the point of sale, to sell an extended warranty during the point of sale. In contrast, the seller of Construction Equipment may have multiple interactions with the customer throughout the lifecycle of the equipment. This increases their opportunities the seller must upsell, and cross-sell extended service programs.
Configuration
One of the key drives of successful Extended Warranty programs is Contract Configuration. This term, configuration refers to:
- the length of contract coverage,
- level of customization,
- processes/services engaged
- resources deployed in delivering the services
- entitlement levels offered.
With respect to length of coverage, most respondents (82%) surveyed to date indicate the typical length of SC/EW programs is equal to or less than three (3) years. Among these respondents, slightly more than half (48.0%) offer programs that range in length between 1-2 years, while 52% have programs of 3-4 years in length. The survey results suggest SC/EW programs have a shorter coverage period within B2B than B2C. Slightly more than half of the B2B respondents offer programs that are 1-2 years compared to only 18% of B2C respondents.
Customization
In terms the level of customization provided, over three quarters of the respondents offer SC/EW with some level of configuration. While approximately one-half (54%) offer mostly Standard Configuration, they also indicate that some of the programs have some level of customization. However, only 18% offer mostly Customized programs or entirely customized programs. The remaining respondents offer only a standard configuration. Customized programs are more prevalent within the B2B sector than B2C. Nearly 82% of B2B respondents offer programs with some level of configuration while only 44% in B2C.
Flexibility of Terms
Slightly less than half (48%) of the respondents surveyed indicate that they provide their customers with the ability to terminate their contracts after they are purchased. Among those who allow early termination, the majority (58%) allow for termination with penalties. Higher attach rates and renewal rates are associated with companies that provide ability to terminate early.
Approximately one-half (52%) of the respondents surveyed provide their customers with the ability to negotiate the price paid for service contracts. Higher attach and renewal rates were observed among companies who provide customers with the ability to negotiate. This practice is more common within the B2B Segment.
Processes
When it comes to processes covered, most (86%) respondents will correct failures that customers experience during the coverage period. Other types of processes engaged as reported by 20% to 30% of respondents include preventive maintenance, calibration, planned inspections, consumable replacement, recalls, and remote product monitoring.
In delivering these services, most respondents provide the following resources as part of the SC/EW program:
- Spare Parts (64%)
- Advanced exchange/parts swap (54%)
- Onsite Field Service (82%)
- Depot Repair (50%)
- Remote Support (57%)
A smaller percentage of respondents also offer Diagnostic tools (14%) and loaners (7%) as part of the SC/EW configuration.
Entitlements
Entitlements are another aspect of SC/EW configuration that customers will consider in their purchase. Entitlements can be viewed as the level of service they can expect to receive once a problem or claim is reported. Almost one-half of the respondents (43%) provide a field service response time guarantee. Another 39% include guaranteed parts delivery time. Other types of entitlements that maybe found with an SC/EW configuration include resolution time guarantee (21%) and telephone response time (36%) and loaner if problem can’t be resolved within 24 hours (18%).
Frequency of Communications
Survey respondents typically notify customers that their SC/EW programs are up for renewal. One half (50%) of the respondents indicate they provide more than 75-days advanced notification; 16% provide 90 days or more notification. Higher renewal rates observed among companies that provide 90 t0 76 days advanced notification. Two-thirds (68%) of respondents provide only 1-2 advanced notifications. The remaining 32% provide 3 or more notifications. Higher Renewal Rates are observed among respondent who provide 3 or more notifications
Front Line Personnel & Automation
A majority (54.2%) of respondents involve front line service personnel in the sale of SC/EW contracts. Approximately, two-thirds (68%) provide formal sales training while less than half (46.2%) use automation to facilitate the ability front line service personnel to sell SC/EW programs. Higher attach rates and renewals are cited among respondents that use automation to facilitate sale by front line service personnel
Summary & Implications
In summary, the more distinctions a company can make about its SC/EW program, the more likely customers will be to purchase it. In other words, customers consider the value of a service contract before they purchase it. This maybe an “eye-opener” for manufacturers and their channel partners who take the view that a warranty is a warranty. Just because customers purchase their product doesn’t mean that they’ll purchase the SC/EW.
As the survey results indicate, the key drivers of a successful SC/EW program are level of customization, coverage and configuration, flexibility of terms, frequency of communication, use of front-line service personnel in sales process, and use of automation. When it comes to selling service contracts and extended warranty programs, it’s about the asks. These observations underscore the importance of implementing solutions that enable Durable Equipment Manufacturers and their Channel parts to set up, sell, administer, track, and analyze various service programs.
Further Reading:
- Read more exclusive FSN articles by Michael Blumberg @ www.fieldservicenews.com/blog/author/michael-blumberg
- Read more about MIze @ www.fieldservicenews.com/blog/all-about-mize
- Read more about research into field service management @ research.fieldservicenews.com
- Read more about Service Innovation & Design @ www.fieldservicenews.com/blog/tag/service-innovation-and-design
- Connect with Michael Blumberg on LInkedIN @ www.linkedin.com/in/blumberg1/
- Folllow Mize on twitter @ twitter.com/mizecom
- Find out more about the solutions offered by Mize @ m-ize.com
Jun 19, 2020 • Features • Michael Blumberg • Digital Transformation • worldwide
Following an appearance on the Field Service Podcast discussing digital transformation Michael Blumberg from Mize outlines some of the reasons why service leaders should be implementing their own digital journey, particularly in these unprecedented...
Following an appearance on the Field Service Podcast discussing digital transformation Michael Blumberg from Mize outlines some of the reasons why service leaders should be implementing their own digital journey, particularly in these unprecedented times.
Digital transformation (DX) is the process of using digital technologies to create new — or modify existing — business processes., culture and customer experiences to meet changing business and market requirements.
Digital Transformation in service
DX has gained increased attention among Field Service Leaders because it results in many benefits, including but not limited to:
Improved process efficiencies:
For example, DX initiatives have led to a reduction in paperwork by Field Service Engineers (FSEs) and an elimination of telephone calls to technical support personnel.
Increased productivity
DX automates manual activities and brings data and information to the hands of FSEs. As a result, FSEs are more productive. Less time searching for data and completing forms means more time in the field, and more call completed per day.
Real-time data-driven decisions
DX initiatives make it possible for Field Service Organization (FSOs) to forecast demand, predict and anticipate service events accurately.
Stakeholder enablement
Through DX, companies can extend the reach of corporate systems and infrastructure to business partners, dealer channels, and service provider networks so they can optimize service delivery and maximize Customer Lifetime Value (LTV). Employees can have tools they need to manage their day, improve performance, and generate additional revenue.
New business models
IoT enabled services, and Servitization models could not be possible without DX.
Ultimately, these benefits result in higher-margin revenue, and improved Customer Experience (CX) will, in turn, leads to a larger market share and improve customer retention for FSOs.
Stakeholders Driving DX
There are two groups of stakeholders that are driving DX. The first group is end-user customers. We now live in always-on, always-connected, "let's do business now" economy. Customers see the impact of DX in other industries and expect the same in Field Service. Also, customers have no tolerance for uncertainty or surprises. At issue, Field Service is full of uncertainties and surprises. DX helps mitigate these issues. For example, DX enables the Uberization of Field Service, making it possible for the customer to obtain real-time notification of when the FSE will arrive at the customer site and the route the FSEs are taking to the site.
The second group of stakeholders is business partners such as the resellers/dealers, service provider networks, and suppliers. These parties operate as independent entities. However, the Manufacturer relies on them to provide to deliver exceptional service, maintain customer loyalty, and generate high margin revenue. By implementing DX initiatives that support these stakeholders, the Manufacturer helps itself protect its brand. For example, providing resellers with online access to parts catalogs, inventory availability, and knowledge resources ensures their technician achieve a high first-time fix rate when they are providing service on the Manufacturer's brand.
Level of DX Adoption in Field Service
DX implementations within the Field Service Industry aligns with overall technology trends we are observing across all industries. According to a recent study by Dell Technologies, 78% of participants say DX should be more widespread within their organization. Despite the vast potential of DX, most companies are just scratching the surface in terms of what they can achieve through DX. Many businesspeople have concerns about whether their companies can effectively execute DX on time. They believe there is a limited window of opportunity before their companies may become irrelevant. Roughly half (51%) of the respondents in the Dell Technologies study indicate their companies will struggle to meet customer demands, and 49% worry their organization won't prove trustworthy in the next five years if they don't fully implement DX initiatives.
Underserved Segments
Quite often, when we hear about DX projects, the focus is often on use cases associated with concepts like Uberization of Service, Predictive, and Proactive Service enabled by IoT. These projects are significant and represent the future. However, they require a substantial investment in time and capital. Not every company is ready or able to pursue these types of strategies, and as evidenced by the market research, we shared in this article. On the other hand, there are a couple of low hanging opportunities that companies can pursue that can be implemented relatively quickly and provide a "good bang for the buck," For example:
Online portals for customers, channel partners, and suppliers to initiate or respond to requests (e.g., work orders, support tickets, RMAs), observe the status of activities and track financial and operational KPIs
- Electronic Forms to automate and streamline data capture
- Electronic Parts Catalogs to look-up, find, and order parts
- Unified Knowledge Platforms that make it easier for technicians and channel parts to find knowledge artifacts that may found in disparate applications and databases
Why is now the right time?
At the time of writing this article, COVID-19 has forced companies to implement contingency plans to keep their customers and employees safe and ensure their products and services get delivered on time. Companies who have implemented DX are likely to be nimbler in adapting to new realities created by the virus. Remote Support, Proactive Service, Same Day/Next Day delivery…all made possible through DX, have now become the standard model of service during these times of social distancing and self-quarantine.
There are, of course, many other reasons why FSOs might want to accelerate their DX initiatives. First and foremost is the technology is readily available and doesn't require a large capital outlay because it is available on a subscription basis. Second, the economics are favorable. DX initiatives have proven to have a high ROI and rapid payback. Third, DX initiatives have a positive impact on customer retention and loyalty. Fourth, competitive forces and consumer preferences will dictate it. Fifth, it is a good hedge against economic uncertainty.
DX is a journey that all service professionals should be contemplating if they haven't already.
Further Reading:
- Listen to the Field Service Podcast with Michael Blumberg on digital transformation @ hwww.fieldservicenews.com/blog/digital-transformation
- Read more articles by Michael Blumnerg @ www.fieldservicenews.com/michaelblumberg
- Read more articles on digital transformation in service @ www.fieldservicenews.com/digital+transformation
- Read more articles on the Uberization of service @ www.fieldservicenews.com/uberization
- Read more about Mize @ https://m-ize.com/
May 25, 2020 • Features • Mize
Mize announce the availability of a new Health Check designed to monitor the health of technicians and protect the safety of end customers.
Mize announce the availability of a new Health Check designed to monitor the health of technicians and protect the safety of end customers.
Developed in response to COVID-19, this application enables organizations to assign service orders based on the health of their technicians.
At the beginning of each day, organizations can use the Health Check feature to collect vital health signs from each individual technician and automatically determine if the technician’s Health Check status is “Fit” or “Unfit”.
Health Check utilizes an intuitive user interface to capture information including the technician’s temperature and any COVID-19 symptoms the technician may be experiencing that day:
- Dry cough
- Lost or diminished smell
- Sore throat
- Weakness
- Change in appetite
- Difficulty breathing
Technicians receive a Health Check Status of “Fit” if their temperate is normal (96.0 to 98.6 degrees), and they have no symptoms. Otherwise, their status is “Unfit”.
Business Rules allocate and assign service orders based on the technician’s status.
Key features of the Health Check application include
- Automatically allocate and assign Service Orders to Technicians with a Fit status.
- Prevent allocation of Service Orders to Technicians with Unfit status
- Real time update and notification to dispatch schedule if a previously assigned technician’s status changes to Unfit
- Block Technicians with Unfit Status or who have not completed daily Health Check from starting work on a Service Order
- Enable Technicians with Fit Status to accept Service Orders from their mobile device
- Ability to access additional COVID-19 knowledge resources (e.g., checklists, videos, pdfs., presentations, etc.)
- Advanced Search capabilities enable an organization to search Health Check information by date, technician name, symptoms, and temperature
Health Check is now available as a free feature within Mize Service Smart Blox and Field Service Management Solution.
Click here to request a Free Demonstration of Mize Service Smart Blox and Health Check feature to learn more.
Further Reading:
- To find out more about Mize click here.
- Read more about health and safety in service @ www.fieldservicenews.com/safety
- Read more about Field Service Software @ www.fieldservicenews.com/Field_Service_Software
- Connect with Michael Blumberg, CMO Mize on Linked In @ https://www.linkedin.com/in/blumberg1/
- Follow Mize on twitter @ https://twitter.com/mizecom
May 05, 2020 • Features • Michael Blumberg • Covid-19
The world that we entered into at the start of 2020 is a very different one to the one we inhabit today. The Covid-19 novel coronavirus pandemic that brought national borders crashing down as we entered into a global lockdown has seen to that....
The world that we entered into at the start of 2020 is a very different one to the one we inhabit today. The Covid-19 novel coronavirus pandemic that brought national borders crashing down as we entered into a global lockdown has seen to that. Michael Blumberg assesses the situation outlines the challenges ahead and explains why he believes there is still a light at the end of the tunnel...
When I initially accepted the request to submit an article for The Handy Little Book for Field Service Managers, I did not anticipate that we'd be in this precarious situation. The topic that I intended to write about no longer seems relevant as we face growing uncertainty over public health and the future of the world's economies. Yet, the wheels of commerce continue to churn, and field service organizations continue to operate.
So, what can the service industry expect int the next 12 months? When faced with uncertainty, we can look to the past for insights and perspective of what we might be able to expect in the immediate future. If we consider this in terms of quarterly action plans, we will manage the next 12 months effectively
How Field Service Companies Can Manage the Pandemic
Over the next quarter, the service industry will need to do everything it can to move past this current crisis. While we might have the knee jerk reaction to throw our hands up in the air and proclaim, "we've never seen anything like this before," the truth is we have the means and ability to respond.
It is highly likely that segments of the economy, those businesses that are deemed essential, will continue to operate at full capacity and require high levels of service availability. In contrast, others will have decreased demand as they scale back operations to comply with shelter in place and lockdown orders. Field service organisations will need to be agile and flexible when it comes to resource and staff planning. If dealing with a large number of employees on sick leave, field service organisations can turn to subcontractors and contingent labor provides to augment staff.
To respond to social distancing and self-quarantine issues, field service organisations must ensure they have secure and reliable cloud-based systems in place to facilitate telecommuting. Field labor may be scarce due to illnesses, so field service organisations must ensure that have technicians who are working can easily find the parts and knowledge they need to resolve services right the first-time fix. There's no room for repeat visits.
"Field service organisations will need to have implemented the right technology and processes to facilitate this model..."
In dealing with social distancing , we may have to alter or modify service delivery. We may need to switch from a field service to Customer Self-Service or Remote Support. Field service organisations will need to have implemented the right technology and processes to facilitate this model. Guided troubleshooting, same day/next day parts delivery, Augmented Reality/Merged Reality, online customer portals, parts catalogs, and knowledge bases are all part of this model.
An essential thing that field service organisations can do is build goodwill and strengthen relationships with their stakeholders. This is required now more than ever. Managers will need to interact with employees who work from home through online communication platforms to ensure high levels of productivity and morale while employees work from home. Some customers may be faced with economic hardships and contemplate canceling their service contracts or placing their renewals on hold. Field service organisations can pre-empt this and build goodwill by offering freemium services and flexible payment terms. Field service organisations can also extend the length of service contracts, or explain to customers the contingency plans that they have put in place will not cause any disruption to their service.
A Rocky Road Ahead for Field Service Organisations
Medical experts predict that the spread of the Covid-19 Virus pandemic will begin to peter out and reach containment by the middle of Q3 2020. Even with government bailouts, economists predict that we will likely face a recession, and it could take another six to nine months to recover from it.Field Service Leaders should not be caught off guard. They can dust off their Recession Playbooks from 10 years ago and implement strategies to get through it.
During a recession, companies typically need to find ways to reduce or recover costs and create value. For field service organisations, a large percentage of operating expenses may be tied up in their parts inventory and labor. Field service organisations will need to implement strategies to reduce parts stock and recover the value from excess and obsolete inventory. At the same time, they'll need to implement processes and systems to ensure they have the right parts on hand at the right place when technicians need them to provide high first-time fix rates.
"Field service organisations mustn't abandon their plans when it comes to broader strategic initiatives like Digital Transformation and Servitization..."
Field service organisations will also need to remain flexible when it comes to resource planning and allocation. They may find themselves outsourcing their logistics operations to reduce costs or turning to service provider networks and subcontractors to deliver service. Of course, the field service organisation's service management systems must be able to connect and share data with all stakeholders and participants in their ecosystem.
Field service organisations mustn't abandon their plans when it comes to broader strategic initiatives like Digital Transformation and Servitization.
However, they may need to reprioritise them or reign them in at least temporarily. Instead of implementing multiple initiatives, they will need to focus only on the one that results in the highest return in the shortest amount of time. More then ever before, field service organisations will need to maintain strong rapport with customers and strive to obtain high service contract attachment and renewal rates. To maximize customer lifetime value and generate revenue from a satisfied installed base, field service organisations must rely on warranty and service contract management software solutions and continue to provide excellent service.
The Light at the End of the Tunnel for the Field Service Sector
Eventually, we will pull through this crisis and come out of it stronger and more resilient than ever before. By late Q1 or early Q2, we are likely to observe what economists call "green shoots" as the economy begins to recover. Field Service Leaders mustn't lose sight of the mission and business objectives they established before this current crisis.
field service organisations must continue to manage their business against KPIs and achieve performance targets during the next 12 months if they expect to obtain investment resources to grow the business once the recovery is here quickly.
Further Reading:
- Read more about how the impact of Covid-19 on field service @ www.fieldservicenews.com/covid-19
- Read more of Michael's exclusive features for Field Service News @ www.fieldservicenews.com/michael-bluemberg
- Join Michael's professional community @ www.fieldserviceinsights.com
- Follow Michael's work @ m-ize.com
Jan 28, 2020 • Features • Management • Michael Blumberg • Optimisation
Michael Blumberg suggests optimising a technician's time can revolutionise your service offering.
Michael Blumberg suggests optimising a technician's time can revolutionise your service offering.
In parallel to the Servitization trend that is occurring within Field Service is a growing desire among Field Service Organization to deliver proactive service. This can be achieved by either attempting to dispatch a technician to resolve a problem before the customer even knows about it or by attempting to resolve or prevent the problem occurring in the first place using remote support tools. Fortunately, Field Service Organizations have been able to turn to an ever-growing set of tools and technology to help them achieve this desired state. From Dynamic Scheduling to Spare Parts Optimization, to AI tool, these technologies have focused on helping FSOs organizations deliver proactive service and optimize their business.
Optimization in Field Service
Ultimately, optimization involves choosing between two or more alternatives that result in the most cost-effective or highest achievable performance given constraints, by maximizing desired factors and minimizing undesired ones. For example, achieving the highest level of customer satisfaction while maximizing the first-time fix and minimizing cost all through a fixed inventory of parts and a limited pool of technicians. Optimization technology has proven to be effective when dealing with strategic and tactical issues such as pricing, parts availability, and technician schedules. This is because automation can facilitate this process of choosing between multiple alternatives and constraints to arrive at the best solution.
Except for diagnostics and analytics, optimization techniques have not been applied to the full array of operational decisions a Field Service Engineer (FSE) must make while they are onsite. This is because unless we are dealing with service robots or cyborgs, it is almost impossible to automate/optimize human decision making. Humans don’t always solve problems in a linear way.
While we may not be able to optimize their decision, we can still help optimize their performance. In other words, we can provide the tools that make the highest and best use of their most precious resource...time.
Basically, FSOs can optimize job site performance by providing their FSEs with mobile solutions that provide access to critical feature functionality:
- Work Orders: FSOs can dispatch work orders to their FSE utilizing mobile solutions. In turn, FSEs can manage their time, routes, and schedules more effectively and make decisions that result in higher productivity.
- Install Base Data: Providing FSEs with information on their customers’ install base helps them understand the key characteristics of the customers' environment and service entitlements. This enables FSEs to demonstrate their knowledge, anticipate needs, provide suggestions, and position themselves as trusted advisors.
- Equipment Service History: This helps FSEs understand prior failures and corrective actions that may have been performed. As a result, FSEs can be more effective in diagnosing the problem and fixing the issue right the first time. Like Install Base Data, access to Equipment Service History information helps FSEs in their role as a trusted advisor.
- Electronic Parts Catalog/BOMs: FSOs can facilitate the first-time fix and improve FSE productivity by providing FSEs with mobile access to electronic parts catalogs and Bill of Materials. These applications help FSEs search for parts, determine availability, and place orders for new ones.
- Knowledge: Access to the right knowledge can be an impediment to first-time fix and timely service. While knowledge artifacts may exist within an FSO, they may be contained in disparate databases and difficult to find. Searching for the right knowledge can be time-consuming and costly. FSOs can overcome these challenges through a unified, mobile knowledge platform that puts access to a broad array of knowledge artifacts in the hands of FSEs.
- Forms: Mobile forms can help FSOs streamline the capture of critical service data. In addition, forms can be structured in such a way that they follow a standard workflow. By implementing forms in this way, FSOs improve FSE utilization and ensure they capture the right data to resolve the issue right the first time.
- Plans & Parts Sales: FSEs create value for their customers and for their company when they can offer service plans, extended warranties, attachments, and spare parts to their customers. FSEs also demonstrate their role as trusted advisors when they are able to create value for their customers. This is the ultimate measure of customer loyalty and satisfaction.
FSEs are the most valuable resources that an FSO has available when it comes to managing Customer Experience (CX) and service delivery. While advanced technology is making it possible for FSOs to resolve service issues remotely and even avoid dispatching entirely, there will still be situations where an FSE is required. By supplying FSEs with the right tools to optimize job site performance, they make the highest and best use of their time which in turn benefits the customer. FSEs become the true trusted advisors and rock stars when this happens!
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