ARCHIVE FOR THE ‘continuous-improvement’ CATEGORY

Steve Wellen, CEO of FieldAware outlines the evolution of analytics and how field service organisations are reaping the benefits...

Research into field service management consistently shows that when respondents are asked what they are planning to invest in or are looking to implement, analytic tools, more and more, are being highlighted above other functionality.

No great surprise given that today’s field service operations can rely on many different systems and solutions, all of which generate huge amounts of data. However, being able to organise and analyse data in an effective, simple and reliable way is a major challenge and without the means of turning it into something actionable, many businesses just don’t benefit. So, where are we in the evolution of field service analytics and how are field service organisations making their data work smarter, not harder?

Data, data everywhere

Over the past decade, field service organisations have become overwhelmed by the increasing information coming in from multiple sources and in various formats. As field service has become more and more integrated with other business solutions, (including accounting, ERP and CRM), organising this data becomes such a complex task that it may simply end up being unused. Managers and team members may then revert to relying on what they used to do, or make decisions based on hunches to run the business, rather than use the business intelligence they need.

Business leaders understand the data they have cannot be ignored. The major challenge they face, however, is how to sift through the data and link it together in a meaningful way. Data is often from disparate systems, but needs to be collated and reported in an easily understood way, to reveal the valuable insights that are needed for day-to-day performance and longer-term business strategy.

A brief history of field service analytics

The early adopters of field service analytics have seen a transformation of the solutions available, and we have witnessed this evolution first-hand.

We have seen our customers move from their initial requirements of basic business reporting, through to needing a comprehensive business intelligence solution.

Early on, it was often a snapshot of what had happened that was required, for example, how many jobs had been completed. It soon became apparent that organisations had different performance indicators to manage, and individuals needed metrics specific to roles. A layer of sophistication was needed, with custom reports where customers could then dive deeper to retrieve further information.

They could explore the types of jobs that were being completed, monitor individual performance or compare geographies.

Using data to make business decisions then drove the need for further information and queries could be set up to examine any problems or if any differences were apparent, for example, time taken on jobs, cost variations or first-time fix rates.

In addition, alerts could be set to enable better management of SLAs by flagging potential issues such as at-risk jobs.

A continual journey

All useful perspective, but for those using analytics for the first time, there is now no reason to stop at what could simply be seen to be mimicking what paper-based processes capture on the ‘what’ and the ‘where’.

Leap forward and it is the ‘why’ within analytics capabilities that truly enhances the value. After generating basic reports, managers did not always have time, the knowledge or experience to translate the results into meaningful action.

Advances in analytics provide businesses with the ability to view data after it has been configured and cross-referenced using statistical modelling.

Better decisions can be made more easily as they are based on accurate, analysed information, and better decision-making means a more effective, efficient operation.

The future’s bright, the future is optimised 

Today, field service leaders realise they need analytics that enables them to make more informed decisions to continue to grow their business. Just having data is not enough – they need the ability to use the data to align service teams to work together towards meeting company goals and managing customer expectations. Organisations now demand analytics solutions that migrate from reactive to predictive operations.

They need to move from insight to action faster than ever before with business insights from finance, CRM, ERP, FSM solutions that they depend upon for everyday operations.

They need better teamwork and collaboration so that they can quickly arrive at consensus, act and capitalise on opportunities.

These include discovering hidden opportunities and finding the next big opportunity in the business intelligence.

The business is optimised not only through these day-to-day enhancements, but the operational insights are consistently fed back to business and management, enabling a real-time feedback loop ensuring that key metrics improve continuously - creating a cycle of continual improvement for the field service organisation and improved operations.

For more information on using analytics for your field service optimisation and how you can reap the benefits, visit www.fieldaware.com 

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Jan van Veen, Managing Director, moreMomentum interviews Seva Gavrilov, Market Unit Director, Russian of Volvo Penta

Volvo Penta is a global, world-leading supplier of engines and complete power solutions for marine and industrial applications. Their comprehensive, reliable solutions have helped customers all over the world increase productivity and performance – in every detail. By continuously improving their offer, through innovative, sustainable power solutions and the strengths and expertise of the entire Volvo Group, they have redefined premium for the modern market, operating entirely through their independent dealership network.

Seva Gavrilov joined Volvo Penta 22 years ago and took over leadership of the Russian business in 2007. He has always had a passion for nautical engineering, having graduated from the Marine Technology University in St Petersberg as a Naval engineer but also as a visionary with a head for business. Now, he is leading Volvo Penta through a programme of initiatives that are giving their dealerships a competitive edge, more momentum and increasing the company’s market share.

moreMomentum believes, as a result of our research, that successful long-term managers and companies have established ‘Momentum’, starting with 4 Winning Habits – Direction, Dialogue, Decision-making and Discovery. In this series of Momentum Case Studies, Jan van Veen, co-founder of moreMomentum, interviews proven managers across the globe who are successfully implementing the 4 Winning Habits to lead innovative, energised and engaged teams.

Challenges facing Volvo Penta Services in Russia

In the early 2010’s Volvo Penta decided its route to increased growth was through the large corporate fleet owners such as the shipping and oil companies who controlled significant purchasing budgets. A major obstacle to this goal however was the dealer network that had created Volvo Penta’s success to date. At that time, the dealers saw each other as competitors and lacked trust. When it comes to corporate customers, many dealers are smaller local companies which do not have the resources, skills or confidence to respond to large-scale bids and service contracts. They lacked expertise in areas such as advanced corporate financing, project management, HR, etc. On the other hand, the larger dealers needed access to local markets for customer relationships, delivery and customer service. Seva needed a new approach to dealerships.

The Strategy

An obvious solution would have been to consolidate the dealers into a smaller number of large companies that could cope with the large deals, but in a large country like Russia that was impractical – they needed to keep access to small local areas. Instead, Seva created a strategy that would do two things: reverse the company’s focus so it put customers/fleet owners first and also encourage collaboration between the dealers instead of competition. All this could only be achieved by influence, to change how the dealers worked with each other, so a new environment of trust and co-operation could be built. The strategy was planned out over several years and introduced step-by-step so as not to scare people, but take them along on the journey.

Here we will show how Volvo Penta in Russia demonstrated each of the 4 Winning Habits in the implementation of its plan, creating momentum for long-term sustainable success. The strategy shows that momentum can start in highly competitive environments or even in other companies, elsewhere in the value chain, when the 4 Winning Habits are employed.

Direction – the common cause that everyone can get behind

Seva needed the dealers in the network to see the value in each other instead of just competition. Each had different strengths and skills that could be of use to the rest and enable them to reach and respond to more varied customers. This goal of collaboration was the direction driving the programme, although the dealers didn’t necessarily know it in the beginning. They soon realised however that along with collaboration come happier customers and a reduction in stress levels.

Dialogue – open discussion at and between all levels to encourage new ideas

The Volvo Penta annual dealer conference had always focussed mainly on reporting and products, so it was attended by dealers’ more junior managers. Starting in 2012 however, the agenda was changed to focus more on communication. It started with simple steps such as roundtable discussions that let the dealers identify common opportunities and solve common problems by themselves instead of with Volvo Penta’s intervention. Whereas before they would often blame each other, open discussion now started even on contentious subjects such as price wars. In the second year, Seva provoked discussions to create a realisation that collaboration was possible and even desirable. He made them think for themselves how it could work and what the benefits would be, and they produced 30 benefits of sharing resources (e.g. specialised mechanics, financial experts, parts, knowledge, etc).

The focus of the conference shifted to strategy, and with added training on subjects such as finance, communications, leadership and finding solutions from conflicts, it attracted more senior delegates as it was seen as a decision-making forum. From the third year, the dealers created their own agenda which has gone on to strengthen trust and collaboration.

It shows that once people start to talk they also start to trust and then solve issues which were critical but difficult to solve before - Seva Gavrilov, Volvo Penta

To support the new collaborative approach, Seva improved the bonus scheme to reward dealers who contributed to the success of the group. Now, only 30% of bonuses are sales driven, the rest being based on competencies, skills and as a reward for sharing resources. There is even an extra bonus that dealers can award to each other as thanks for assistance. Since bonus levels also define the next year’s discount they are extremely valuable and sought after.

Decision-making – local decision-making empowerment

As a result of the new open environment, the dealers have taken it upon themselves to support each other. The smaller dealers, that used to rely on discounting, are now being ‘lifted up’ and actively supported by the larger ones. They’re not only a source of leads but can keep local customer relationships going and provide local provisioning in regions that would otherwise be too costly. Dealers are now regularly sharing mechanics, knowledge, financial expertise, etc.

In order to reinforce the new culture, the top six dealers voluntarily withdrew themselves from the annual ‘Best Dealer’ competition for four years, making the rest more motivated to win. Now, the competition is much tougher and the winners are more representative of the whole dealer network.

In addition, the four largest dealers joined forces to mutually fund and develop new management reporting software, connected to the accounting systems, to measure daily performance against targets. It provides a report on sales, customer satisfaction, parts, etc. Soon it will be rolled out across the entire dealer network, meaning common standards and quality for the big fleet customers.

If Volvo Penta had developed the software it would have been more expensive and created resistance. Because they did it themselves they made it in the way they wanted and paid for it themselves. I expect the roll-out to be quicker than if Volvo Penta had done it - Seva Gavrilov, Volvo Penta

Discovery – Looking for new external trends, opportunities and threats

The conversation with customers has changed. Dealers are less and less seeing themselves as just parts suppliers and breakage fixers. They are looking for other values such as budgeting, parts supply forecast, telematics and other service solutions.

Having in mind shared resources, dealers now know they can provide better service to customers than before. This also opens up opportunities which dealers were not able to afford before such as better payment terms to customers, quicker service, etc. Some dealers have also started to open branches in remote areas as they see them as opportunities rather than cost.

Next Steps

The next step in the programme is to develop higher levels of customer service, to create such a good feeling about the brand that the people in customers and dealers feel proud to use Volvo Penta products. Their relationships will grow into trusted partnerships where the smallest to largest customers can be open to changing market conditions and challenges they see approaching.

The group HQ in Gothenburg, Sweden has been watching Seva’s programme carefully and has already implemented some similar ideas internationally. Since the company is in a transition period from being largely product and dealer focussed to Customer focused,  Russia’s key message is to enforce the shift to end-user benefits. Improvements in change processes, complaint handling and collaboration between groups such as sales and service can make huge improvements.

Beyond that, Seva wants the dealers to think about why they are in business in the first place. He wants them to make so much money that they spend more on their life, to make a better world for themselves and the people around them. - Seva Gavrilov, Volvo Penta

It’s important to make the connection between profits and common social values and that will be the subject of the next conference. Money and profits are only the intermediate result, there are more objectives behind it.

What will they do with their profit? What is the bigger game? What is their direction?

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Alastair Clifford-Jones, CEO of Leadent looks at how the focus of field service is shifting towards driving strategy rather than being a recipient of it...

The holy grail for field service managers has been to reduce costs whilst maintaining customer service levels; effectively meeting SLAs at the lowest possible cost. This is still important, but the focus is changing. Field service is moving into a space of key importance, driving strategy rather than being a recipient of it.

All markets are now impacted by this change. Looking at the consumer market there is so much information for consumers; independent websites that not only compare products but also services, and these naturally impact buying decisions.

Research has shown that many customers won’t switch until they have had a bad service experience.It’s now easy in the UK, with the deregulations of the Utilities market, for consumers to switch suppliers. Research has shown that many customers won’t switch until they have had a bad service experience. On the other hand, customers will switch if the price differential is greater than 20%.

The cost of bad service really impacts an organisation’s profits. In a recent Harvard Business Review report; a 5% increase in customer retention results in a 25%-95% increase in profits. This becomes more important to the service organisation as products become less differentiated on functionality.

In light of new technology, and the change in consumer behaviour we at Leadent have developed a maturity model which I introduced in an earlier article for Field Service News. This model (see diagram below) not only measures where organisations are positioned currently, but what they should aim for by demonstrating the key characteristics an organisation needs.

Whilst it’s an organisational model, technology and processes still need to be implemented, and cultural change cannot be underestimated. So let's explore each of the three stages...

Chaotic Survival

This is the embryonic phase, often referred to as JFDI.

Everything is reactionary, heroes in the business are the people that get things done. Someone that fixes a water leak at three in the morning gets the company award. All the processes are desperate, and much of the knowledge about how to do things are in people’s heads.

The level of ‘Chaotic Survival’ can often be measured by the noise in the dispatch office and the number of calls made to the field and customers.

Initially, the workforce is seen as a cost, and any case for change is usually based on a cost reduction program by streamlining processes and the introduction of scheduling, albeit a manual tool.

Whilst many companies have moved beyond this stage, it is surprising how many organisations have not. Moving out of this phase is probably the most challenging in terms of people. Field teams need to be managed and dispatchers need to allow technology to make decisions. The world is littered with organisations that have failed to develop, those who may have implemented a technology solution but not the new processes, organisation and skills required to make this step.

Supply Led

This phase starts building the groundwork for excellence.

The technology both in scheduling and mobility starts to connect the organisation together. Silos, which were in the previous phase are dismantled and the organisation becomes more collaborative. From a business perspective, this is when customer service and field operations often become part of the same entity.

Rather than responding to customer needs in a reactive fashion, the company can start to become more proactive. Planned maintenance, if applicable, gets built into the schedule. Customer service levels can be monitored and informed decisions made in terms of minimising costs but maximising the customer service levels.

The field force, hitherto considered as a cost now has more flexibility and starts to drive a competitive advantage. Whilst we see these organisations becoming more collaborative internally they are still not working with customers and suppliers in a truly collaborative manner, and this is a huge missed opportunity.

Demand Led

The holy grail. This is the phase where technology and the right organisation can really disrupt the industry and organisations can leapfrog their competitors. Field service starts to drive the agenda, drive the strategy. The organisation no longer is a recipient of customer demand and fulfils these in an optimum manner. Processes are no longer just contained within the confines of the enterprise but are built to include customers and suppliers.

This is the new ‘battleground’ for field service and technology has made it possible. By putting the customer first, they have control. They can book appointments through multiple channels and based on their preferred choice. They have full visibility of the processes, and in many cases, can actually solve the problem themselves.

The suppliers are able to understand how their products perform in the field and feed this back to the manufacturing processes.

This is the new ‘battleground’ for field service and technology has made it possible.

IoT is a reality and no longer a pipe dream of visionary consultants, and it enables organisations to truly predict failures, determine preventative maintenance schedules and offer a level of service which exceeds customer expectations at a substantially lower cost.

This does, however, require a very different way of thinking and a true cultural shift. To be in this phase you need to have an organisation which thinks differently, embraces technology and one that really understands the customer.

Summary

In summary, the new world is exciting.

It’s even making field service seem ‘sexy’, but most of all digital service (an often misused term) is truly disrupting the industry. It is technology driven, but the companies that will be able to exploit this will think differently. They will think about the end to end processes from manufacturing and the whole customer journey; from making the purchase decision to disposal.

This needs an organisation to not only break down internal barriers but also external ones.

Given that each phase of maturity requires changes in culture, it would be very hard from an organisation to move from being ‘adhoc’ to ‘predict and engage’ in an instant as each phase is a building block for the next. However new entrants to the market can start on the right-hand side, and this is where organisations which don’t develop will lose out.

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In a new feature series Jan Van Veen explores what are the common factors in an organisations DNA that makes them stand head and shoulders above the rest of the competition...

We have discovered 4 winning habits of long-lasting achievers in service, which sets them apart from competition. These long-lasting achievers see that change and innovation in their organisations is energising and easy and that their people pursue opportunities that go beyond business-as-usual.

Everyone in their organisations has the opportunity to be highly influential In every manufacturing industry, there are exciting – but challenging- changes taking place; involving Servitization, Internet of Things, big data, and so on. Customer needs and expectations are shifting, as is the competitive landscape. The speed of change will only continue to increase.

And this will offer huge opportunities for existing manufacturers, and new entrants into the sector.

Many people in manufacturing companies have identified the changes, their impact, and the potential opportunities.

They also see their companies stagnating and dropping behind, despite many attempts to increase a sense of urgency and get buy-in. This often leaves them feeling disappointed and frustrated, yet they are still eager to make a difference.

The 3 Dominant Problems

Most leaders in manufacturing face 3 problems relating to their ability to adapt for more success today, and in the future. One of the concrete consequences, is slower growth of their service business.

Slow change: Whether it is regarding small changes or larger change, it seems to be that many forces repel against it. A lot of energy is wasted in resisting change and in turn, fighting resistance.

There is limited clarity in direction, limited collaboration between departments, a conflict of objectives, too much uncertainty and fear, and a lack of passion and engagement from employees.

As a result, performance issues continue without adequate and timely interventions. Projects and strategies slow down or at worst, fail during execution. Consequently, employees show signs of being worn-out of yet another change initiative.

 

Being stuck in “business as usual”: There are very few ideas and initiatives beyond small, incremental improvements, if any at all. Whether it is about product innovation, new services, sales approaches or delivery processes, most changes are focussed on incremental improvements of the status-quo. Of course, this is important, but not sufficient to be successful in our changing world.

Lack of influence: Most people within a company, from the operation specialists, to the CEOs, feel disappointed or even frustrated due to having limited influence to make a real difference.

What makes matters worse, is when they see good ideas and concerns failing to resonate with their organisation.

The 4 Winning Habits

The long-lasting achievers experience the same challenges and opportunities as those who stagnate. They have access to the same market for clients, same technology, same market for talents, and the same knowledge and expertise within the industry.

We can also point out that they have similar visions and strategies, change management, communication strategies and budgets for the change initiatives.

It appears that the ‘4 winning habits’ are in fact, the missing link to increase and sustain momentum, to continuously adapt, drive change and innovate their business- including driving a strong service business

The 4 habits are:

• Direction: Everyone shares a clear and succinct picture of changes in the industry, where the company is heading and what needs to change over the coming years. They all understand how they can contribute to the change, and ultimately, fit in.
• Dialogue: Across all teams and levels there is a constructive and forward-looking dialogue on performance, progress, priorities and aligned actions. Everyone feels secure and confident to adapt and try new approaches.
• Decision-making: Everyone has the power to make decisions within their role, to adjust, perform and improve. There are adequate guiding principles to ensure coherence and alignment of all decisions.
• Discovery: Everyone is aware of (potential) trends, opportunities and threats and the best practices available. They spend time in exploring, testing and learning. There is more focus on new things which go beyond the current core business, which is imperative for future success.

Over the following months, we will elaborate upon each of these habits and support our content with real-life examples.

The Result

The results long-lasting achievers obtain with these 4 winning habits is deep-rooted.

Fluid change: Everyone is passionate and keen to make a difference. They all recognise the need to change and adapt. They collectively think and act to achieve greatness. Change energises!

Pursuing opportunities beyond “business as usual”. Everyone is sensitive to threats, opportunities and obstacles, and behave in a coherent and forward-looking way.

Highly influential: The CEO, operational specialists, and anyone in between have influence to drive change and innovation, and make a positive difference.

They therefore discover:

• More real value innovation, like service innovation.
• Higher growth rates and margins
• Better customer loyalty
• Higher employee engagement
• Better retention and attraction of talents

The Essence

If you assume that the focus is about change management and buy-in, then you have missed the point: It is about making change management obsolete.

There is no need to cope with resistance against change, because the changes come from the ‘bottom-up’.

I believe this is the power of combining business innovation on one hand, and talent development and empowerment on the other.

 

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