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Research conducted by Bill Pollock, president and principal consulting analyst at Strategies For GrowthSM (SFGSM) reveals that selecting a Field Service Management (FSM) solution often requires months – if not years – of due diligence to reduce the “long list” of potential vendors and solutions down to a carefully selected “short list” of possibilities...

Making a decision based on your own research is often a daunting task, collating and interpreting RFP information and sorting live demonstration ‘vaporware’ from actual, live software capabilities.

The following provides an additional set of information that your peers in the industry consider fundamental to the decision – data your team can use to make a final, intelligent choice that grows with your business into the future.

The results from SFGSM’s 2017 Field Service Management Benchmark Survey clearly identify four specific factors cited by half (or nearly half) of the survey respondent base when making their respective FSM vendor and solution decisions, namely:

• 50% Prefer a solution that interfaces with Customer Relationship Management (CRM)
• 47% Prefer to work with a single provider of Field Service functionality
• 47% Prefer a solution that is intuitive and easy to train on
•  45% Prefer to invest in a solution that fosters Sales and Service collaboration

Another 35% also cite their preference for a solution that rolls out quickly.

While each (or all) of these factors may have contributed in some way to your decision-making process, your final decision is likely to rely more on how the FSM solution you choose will address your greatest challenges, provide the greatest opportunities and benefits for services delivery improvement, and allow you to compete head-to-head against your strongest competitors.

Compounding the importance of your selection, the chosen solution must also provide the ability to improve existing customer satisfaction levels, and increase the services organisation’s contribution to the company’s bottom line. Quite an undertaking, to be sure; but certainly doable – but, only with the most effective and robust FSM solution in place, and a full complement of vendor resources to support it over time.

Functionalities to Look For When Selecting & Evaluating an FSM Vendor/Solution

Gartner cites six categories of FSM enablement that should be included in any (i.e., every) FSM solution – at least every FSM solution that is strong enough to run the entire organisation’s services business. They are:

1. Demand Management – including customer portals, multichannel customer communications, IoT integration, triage support, field work order/appointment request, field quoting, field parts sourcing, ticketing system integration and long-cycle work requests.
2. Work Planning – including forecasting, scheduling optimisation, parts demand planning, purchasing, Geographic Information Systems (GIS) integration, customer communications and third-party service enablement.
3. Technician Enablement (Mobile) – including Global Positioning System (GPS) integration, routing, equipment history/site details, social collaboration, customer communications, knowledge base/work instructions, purchasing & quoting/sales and tool management.
4. Work Order Debrief – including work order financial information, customer forms, site evidence, equipment updates, recommendations, payment collection and customer surveys.
5. Operations – including invoicing and price books, installed equipment manager, maintenance agreement management, maintenance plans and quoting, warranty management & warranty claims management, revenue recognition enablement, reverse logistics management, depot repair, equipment supersession, engineering change requests and fleet management.
6. Analytics and Integration – including field service performance management; cross-functional predictive analytics; alerts, notifications and gamification; and Enterprise Resource Planning (ERP), Customer Relationship Management (CRM) and GPS integration.

While most vendors will say they offer all of these functionalities within their FSM solution offerings, it is more than likely that there will be significant gaps in key categories such as work planning, technician enablement, and analytics and integration (among others).

However, each of these areas will be critical to the overall enablement that your FSM solution is needed to provide and, therefore, must be included in the FSM solution that is ultimately selected and implemented.

Marne Martin, CEO, ServicePower, a leading provider of field service and hybrid mobile workforce management solutions, agrees that all six of these areas must be addressed in any FSM solution, noting “For organisations looking for a single vendor, end-to-end solution with an easy integration process to existing CRM or ERP packages, ServicePower is a great fit.”

“ServicePower supports a seamless integration mechanism to any CRM, including the launch of an App for the Salesforce AppExchange and new prebuilt connectors to most major software packages.”

 

“Our solution provides a full complement of mobile workforce management functionality, from consumer entitlement, to schedule optimisation and contractor dispatching, work order management, enterprise mobility, asset, inventory and contract management, and 360° BI (i.e., Business Intelligence).”

She further adds that, “While most FSM vendors also offer ‘scheduling’, ServicePower’s solution is the only one on the market designed to improve the customer experience though real time AI (i.e., Artificial Intelligence) and robust mobile functionality, while streamlining service operations with integrated hybrid workforce management functionality.

SFGSM’s survey results validate the effort ServicePower has expended in extending our solution to include the full spectrum of functionality required to manage a mobile operation, from entitlement through a plug and play intelligent consumer portal to warranty management and BI.”

Making the Final Decision – It’s Time to Decide!

The Cloud has normalised the playing field for most FSM vendors and their customers.

The options are many, the costs have come down (i.e., through the proliferation of the subscription basis model) and the FSM solution alternatives are “all over the place” with respect to the comparative breadth and depth of product functionality, strategic partnerships, FSM vendor acquisitions, “new” product roll-outs and the like.

However, in deciding which is the best fit for your field service operation, today and for the long term, one thing remains clear – the field service operations at your organisation will remain the central focus of your role and responsibility.

Why would you want to go with a vendor that doesn’t provide it all?

 

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ClickSoftware’s Paul Whitelam wonders if crowdsourcing could be the solution to fluctuating demands on a workforce that field service companies have been waiting for...

Service organisations have long relied on third parties to augment their core workforce to manage fluctuating demand, emergency work, and expansion to new regions.

The Service Council reported that 76% of service organisations have used a third party for service delivery and to augment their regular workforce.

By 2020, Gartner predicts 40% of service work will be delivered by contractors.

This increasing reliance on an external workforce appears to run parallel with some anxiety about talent shortages. The Service Council reported 70% of service organisations expect a talent shortage in the next 5-10 years. Many already struggle with hiring.

While contractors have supplied support to service organisations for a long time, there is growing interest in tapping into the gig economy and free agents to build an ad hoc workforce.

Rapidly scaling your field service workforce is a challenge under any circumstance, but a blended workforce can deliver many benefits. Let’s explore the pros and cons of outsourcing service work, and compare how crowdsourcing and contractors can play a role.

The Case for Outsourced Service

Variable demand persistently vexes anyone charged with scheduling a service workforce and forecasting the level of resources needed to do the expected and unexpected work.

Seasonal differences and large stand-alone projects are common reasons for temporarily increased demand, along with emergency and disaster relief work.

 

When expanding to new geographic areas, a contracted workforce enables a service organisation to quickly increase available coverage without the delay of needing to recruit, hire, and train a completely new core team. This separation from the core workforce can also provide a convenient way to pilot new technology or procedures before adopting them across the entire business.

Adding specialised skills to your roster is another massive benefit of outsourced service. A contracted workforce allows for new types of work to be done without the entire team requiring retraining.

Blended Workforce Challenges

Adding contractors to your workforce introduces challenges. Most stem from a lack of visibility into what happens once a job is assigned and accepted.

The service engineer is often the only face-to-face interaction a customer will have with a company, and serves as an ambassador capable of upholding or undermining the brand.

To blend your internal and external workforce successfully, the right processes and technology are essential. Your service organisation needs the ability to locate third-party resources, appropriately gauge their availability and skill level, track job status, and provide the support and information needed to deliver service in a manner consistent with business policies and SLAs, and customer expectations.

Some contractors will resist the adoption of new tools and processes when it forces change, but most will ultimately adopt your preferred solutions once they understand the value.

 

In a recent study from Michael Blumberg, KPIs for The Blended Workforce In the Gig Economy, his consultancy found that nearly 70% of field service organisations used a freelancer management system of some kind for staffing purposes.

Managing Contractors and Crowdsourcing in the Gig Economy

According to Intuit, the gig economy now makes up 34% of the US labor workforce. With new tools, devices, and skills, imagine how many thousands more will choose to work remotely as a part of this budding freelance economy in the coming years.

Millennials, as a subset of the working population, have already upended what had long been accepted as a standard employee-employer relationship. They are tech-savvy, adaptable, and value career advancement and mobility over longterm employment. Many are more comfortable with freelance and temporary employment and provide much of the supply to meet the demand for a more flexible workforce.

Making the most of your blended workforce will require not just better technology, but also a shift in mindset. While visibility into what’s happening is paramount to managing an internal or external workforce, service organisations will also need to consider how to best measure the performance of contracted workers and keep them engaged and enthusiastic about their work.

 

The most sophisticated service organisations have gained and maintained a competitive advantage through maximising productivity and optimising customer experience. A blended workforce should be able to extend the same level of efficiency and customer focus to its outermost layers.

Customer satisfaction and loyalty should be the ultimate goal for any business. With the right plan and solutions in place, any permanent or ad hoc worker should be able to provide the seamless experience your customers want and deserve.

 

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Emily Hackman, Global Director of Marketing, Astea, looks at how the modern phenomenon of the connected customer is driving heightened service expectations that field service companies must meet...

In the last few years we have gone through a true revolution when it comes to digital connectivity.

The widespread adoption of tools that offer ever-greater connectivity amongst the general populace is increasing at ever-faster speeds. The end result of this increase in connectivity for businesses is a rising need for meeting rapidly heightening customer expectations when it comes to service quality.

Indeed, this is truly the era of the connected customer—consumers have become accustomed to having an unprecedented access to the knowledge and insight offered by the Internet right at their fingertips. And in a world were smart phones are virtually omnipresent, that access is 24/7/365, no matter where they happen to be.

 

Today’s consumers can instantly interact with friends and associates via text or social media, they can quickly summon a ride, make restaurant reservations, or order a gift with just a few clicks and swipes on their phone. Looking back even just a decade we would never have imagined the sheer pervasiveness of connectivity that we enjoy today and the huge impact it would have on our lives.

Yet for field service business, such increased levels of connectivity can be a double-edged sword offering both challenges and opportunities in equal measure.

Rising Expectations of the Connected Customer

Thanks in no small way to the companies like Uber and Amazon - who have embraced technology to not only disrupt the markets they exist within but also in many respects establish entirely new markets, the Connected Customer is intimately aware of the capabilities mobile computing bring to service operations.

Thanks to advances in mobility, their local florist or Pizza Delivery company can provide them with updates on their orders in real time. So why shouldn’t they expect field service technicians to be able to access those same or even more advanced mobile capabilities?

When it comes to service, connected customers now expect as standard:

• Real-time alerts when technicians are on their way to the job site/residence
• Technicians that will arrive armed with their individual customer histories and preferences
• A service organisation that can respond quickly to emergency calls
• The ability to receive real-time updates on the status of their service, both online and via their mobile phones
• Technicians that have full access to the repair information and parts that they need to complete the job

In fact, whilst just a few years ago mobile technology in and of itself offered a competitive advantage, mobility is now basic table stakes when it comes to field service.

And today, by harnessing the technology, service organisations are able to satisfy the needs of their customers. This can hugely effect how they refine and improve the customer experience, enhance their reputation, and reduce both employee and customer churn

Leveraging Customer Connectivity

In the world of enterprise, companies are rapidly embracing mobility.

According to data from Frost & Sullivan, 47% of North American businesses have at least 11 different mobile worker apps deployed, and 88% plan on introducing at least one new employee-facing app within the year.

According to the same data, companies have found that key mobility benefits include:

 

• More efficient business processes (49% of respondents),
• More productive employees (46%),
• Improved collaboration (46%),
• Cost savings (45%)
• More satisfied employees (44%),
• Enhanced customer engagement (43%),
• Competitive advantage (42%)

Of course, having a mobile solution in place does not automatically enable a service organisation to effectively serve the connected customer.

Focusing on reducing costs, whilst simultaneously improving productivity and efficiency is no longer the end game when it comes to mobility.

This is largely because whilst reducing costs and completing more jobs per day is good for the bottom line, they don’t necessarily assist in improving customer satisfaction and are not always in line with value creation in the long-term  and how quickly you can get them back up and running.

 

The brutally honest fact is that your customers don’t particularly care when you save money on fuel or can bill more jobs per month, they solely care about whether you’ve met your SLAUltimately, service customers simply want reliability and visibility. Did the service organisation get their technician to the job site quickly, armed with the right parts and repair knowledge? Were they able to complete the repair in one visit?

Every decision the service organisation makes should be weighed against a backdrop of the overall impact to the customer. The fact that customers are now highly connected makes it easier for service organisations to meet their needs, provided that they have their own robust mobility solution in place. But that is just the tip of the iceberg.

By leveraging analytics, the input your connected customers provide can help you understand consumption patterns and deliver a personalized solution—and potentially do so at a premium, creating new pricing models and differentiated service models, and establishing new revenue streams in the process.

 

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Want to know more - there is a white paper on this subject available for Field Service News subscribers - and FSN subscription is complimentary for industry practitioners.

Click here to apply for a complimentary industry subscription to Field Service News and get the white paper "Preparing for the Connected Customer" sent directly to your inbox now

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Coen Jeukens, CSO, D-Essence, explores the developing world of Products as a Service and the increasing drive both from customer pull and vendor push towards outcome based business and service models...

When we need light, we buy a bulb. When we need a hole, we buy a drill. It is so engrained in our thinking to own products whilst we actually need the outcome. More and more we see upstart businesses cater to this “new” demand. They sell a product as a service (PAAS). How are you preparing your organisation to sell your product as a service?

We move water 

At the After:Market 2016 event in Wiesbaden a German manufacturer of pumps introduced his company with the words “we move water”.

With those simple words he set the stage for his PAAS business model. Selling the pump is not his goal; it is a means to start an outcome-based discussion with his client.

In doing so he enters in a conversation where he truly understands what drives his customer. Because the conversation goes beyond the pump, he has created a new business model where he earns money with moving water.

The additional benefit is for the environment. Instead of designing your product for repeat sales you will wind down a track where you deliver outcome at a minimal material/ energy footprint.

Transforming legacy businesses is possible 

Understanding the effort it takes to transform a legacy business, University of Cambridge professor Andy Neely asked the panel of the Field Service Summit 2017 in Warwick what successful transformation examples should encourage others to follow suit. Both Boeing and Philips demonstrate you can have best of both worlds.

They serve customers in a hybrid model.

 

Via one business unit customers can buy the product in a legacy CAPEX/ OPEX mode. Via another business unit customers can buy the output/ outcome of the product. Depending on his propensity, a customer can choose between a  jet engine and a “power by the hour” propulsion solution or a bulb and a “pay per Lux” illumination solution.

Why should you explore PAAS

It may scare corporate executives and sound very blunt but exploring PAAS is a “do or die” message.

If you don’t do it, somebody else will. At best it is your current competition and you can see it coming. For the worst, you will face competition from newcomers starting with a clean slate.

Record labels were so focussed on holding to their CD product revenue stream and deliberated so long on legal download options, they were decimated by services like Spotify.

How do you assess your organisation? Products are meant to deliver a solution.

Using a more positive approach: the more you understand how the outcome of your products generates value to your customer the more you establish yourself as long term partner in both a profitable and sustainable way.

Where to start

In the example of Philips Lighting, a small team beyond the radar of product based business model executives designed the “pay per Lux” solution.

Upon demonstrated success with a launching customer the new PAAS solution was put in the spotlight.

Setting up a sandbox environment with servitization minded people is essential, as you will be in for a paradigm shift:

[unordered_list style="bullet"]

• When you sell Outcome there is no title passage of the Product. This means the product remains on your balance sheet.
• As supplier you will be responsible for and remain in control of all CAPEX and OPEX cost components.
• You need to understand your customer to define a “pay per use” earnings model.[/unordered_list]

Understanding cost

In the Philips Lighting dialogue the customer asks for a Design, Build, Finance, Maintain and Operate solution.

This DBFMO framework (in the image above) can be used to understand total cost of ownership. Design and Build lead to the commissioning of a Product.

Maintaining the Product safeguards the Output of the Product. Operating the Output provides an Outcome. The Outcome generates Value. Maintain and Operate are stated in terms of OPEX. When adding Finance services to your portfolio, you can transpose Design and Build CAPEX into OPEX too.

Design-for-Operation

With PAAS the total cost of ownership shifts from customer to supplier. As a result the supplier is incentivised to throw in all his expertise to continuously optimise product, output and outcome.

In order to make pay per use profitable all cost elements of DBFMO need to be designed in unison. Call it design-for-operate. Where design-for-service supplements design-for-manufacturing, design-for-operate augments the former two.

 

Remember: business models based on breaking products should not be accepted.

Pay per use

Where design-for-operate drives towards minimising waste and cost, engineering the right pay per use model determines your revenue. This is where entrepreneurship and partnership kicks in.

Pay per use is a bi-directional handshake between supplier and customer that takes it to the next level compared to a typical sales-purchasing relationship.

Instead of a cost/ revenue conversation about products and output your dialogue will evolve into an outcome based profit/ value handshake.

Your customer will help you define the pay per use drivers. If you really understand his business and you are confident in the capabilities of your own organisation to generate outcome that makes your customer succeed, your customer will be inclined to enter into a partnership to make you succeed as well. As a result de pay per use drivers will be fair, sustainable and durable to both parties.

Don’t own, enjoy

Ownership comes with responsibilities. Why should a customer have to carry the risk whilst the supplier is the expert in both understanding and influencing risk. A PAAS model is the ultimate form of “back to core business”. The supplier managed DBFMO, the customer uses the outcome to generate value.

In return the customer pays for use.

Does pay per use really work for both parties or do words like partnership, fair and sustainable sound altruistic? The IT industry does give us insight into what is to come. Because SAAS solutions are available for consumers as well, first hand experience is changing our perceptions, attitude and decision-making regarding cost and value.

 

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“Philips Lighting – a PAAS dialogue – “pay per Lux”*

Customer: “I need light in my office.”
Supplier: “How many bulbs do you need?”
Customer: “I don’t know. You are the expert. What do you advise?”
Supplier: “Our proposal contains 100 bulbs of model abc. This is an investment of xyz.”
Customer: “I want the energy bill of the bulbs to be included in your proposal.”
Supplier: “Our renewed proposal contains 90 bulbs of our newest energy efficient model.”
Customer: “I want you to design, build, finance, maintain and operate the solution.”
Supplier: “We have developed a special lighting solution for you. Low on energy, sustainable in materials usage and easy to (de)install. We name it ‘pay per Lux’.”

 

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Having introduced the concept of crowd-sourcing in previous articles for Field Service News, Manuel Grenacher, Coresystems, now takes a look at how and why the two new technologies dominating conversation in field service circles are perfect bed fellows for the gig economy...

As I discussed in my last article on why crowdsourcing could be transformational for the field service industry, the outlook for the growth of the field service market is hugely positive – MarketsandMarkets predicts that it will nearly triple in size to $5.11 billion between now and 2020. In this article, I’ll examine the technologies that will likely play a major role in driving that exponential growth of the field service market over the next few years.

The IoT Effect

The technology that has played a huge role so far in precipitating the growth of the field service industry is the Internet of Things (IoT).

This isn’t surprising, as the IoT is having a profound impact on not just every technology driven industry, but also the daily lives of people across the globe. And the IoT and the real-time connectivity it enables has led to a massive spike in consumer expectations for instantaneous customer service.

These new elevated customer demands created by the IoT are impacting the field service industry greatly, as organisations running any kind of a field service operation have been forced to rethink their strategies and tactics for customer service delivery, including their workforce resources and supporting field service technologies.

 

The bottom line is the IoT is very much here and is impacting your industry whether you realise it or not; so to put it simply, either you respond to the new realities of an IoT-driven world or you risk obsolescence.

The Era of Augmented Reality

Augmented reality (AR) isn’t just a social media fad anymore, as enterprise use cases for augmented reality are on the rise and on a fast track to implementation. Indeed, ABI Research predicts that 21 million AR units will be shipped by 2020 with sales reaching $100 billion.

The field service industry, in particular, stands to benefit greatly from AR.

Imagine service technicians with specialised AR headsets, who will then have all the information they need for an installation and/or repair on a heads-up display. No more fumbling around for a laptop or tablet in the middle of a project.

 

AR would also connect on-site technicians with more experienced engineers back at an organisation’s headquarters who can visually supervise and troubleshoot more difficult technical issues.

With that, the use of AR boosts the key field service metrics of first-time fix rates and average repair time. It also benefits staff training and skills shortages, especially as devices trend toward IoT and more advanced technology.

Clearly, AR will benefit service engineers and technicians worldwide, many of whom are in the field service industry.

Enter the Gig Economy

Obviously, the gig economy isn’t a technology, but it’s a movement that could reshape field service management as we know it.

The digital technology underpinning the gig economy (such as the IoT) can help workers become entrepreneurs who have the freedom to dictate their work on their own terms, which has long been the allure of the independent contractor.

Skilled workers who have expertise in certain industry sectors – such as field service management – can either make extra money in their free time while pursuing their passions, or they can use the gig economy as their sole source of income.

Pioneering companies in the gig economy, such as Uber for the transportation sector and Airbnb for hospitality, have laid a blueprint for other industries to follow. In field service, we see a future in which for-hire field service technicians can connect – through technology tuned for the gig economy – to organisations who need extra manpower for their field service teams.

 

At Coresystems, we know first-hand the challenges that organisations face when the field service requests greatly outnumber that company’s field service technicians. By leveraging independent workers in the gig economy, organisations can help deliver the real-time service that customers now demand.

So there you go – the three factors that we envision having the biggest impact on the evolution of the field service industry over the next few years.

What are some other factors that you’re seeing through your own work in the field service industry?

We invite you to share your thoughts in the comments section.

 

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Marne Martin, CEO of ServicePower, discusses how the “intelligent” service organisation is able to meet increasing customer expectations whilst simultaneously driving increases in revenue and brand loyalty...

Productivity, for field service operations, is the means to an end of delighting both your customer and the C suite in your company.

Improved customer satisfaction and increased revenue are the holy grail of any field service department. If you are also able to do these two things using a hybrid workforce, your internal metrics and profitability of your service organisation can also improve.

Large enterprise organisations have long understood the value of artificial intelligence algorithms embedded within mobile workforce management technology, in its ability to improve productivity and efficiency of staffed mobile workers, as well as its ability to provide field teams with the process and information needed while on site to resolve issues in a single visit.

The power of big data, cloud computing, and machine learning are all proven to reap benefits of more productive, least costly schedules which improve overall metrics and customer-centric KPIs like schedule adherence and mean time to schedule. Service priorities can also be driven off of more than SLAs and start looking to customer profitability, propensity to purchase additional services, and a number of other emerging customer-centric areas that service organisations are starting to focus more on.

 

In the last decade, more and more of these same organisations have taken hold of the additional benefits of intelligently integrating contracted mobile workers into the labour mix, as well as the ability for customers to schedule into the time slots that a service organisation or manufacturer want to make available.

Using contractors expands capacity, in terms of availability, skills or geographical coverage, field service organisations can provide service when and where their customers require, in a manner that’s more consistent with an employee with a branded van.

In an “intelligent” service organisation, service is enabled to meet the customer’s expectations, drive increases in revenue, brand loyalty, as well as efficient capacity planning.

By using the available technology, plus a hybrid workforce model that looks to coverage and demand to assess what technicians you need where, the type, skills and training such that you can begin blending employed with contracted workforces, the next level of productivity beyond that of your peers can be achieved.

Field Service experts know service. But what can expertise in field service bring to complimentary sectors that are used only to point to point travel optimisation and not schedule or priority based optimisation.

The fact of the matter is that any business with mobile workers whether service, sales, delivery, inspection, home health care, etc. are dearly in need of the ability to drive improved schedule prioritisation, compliance and productivity.

Even financial services companies with work allocated to the back office can benefit from optimisation.

 

With that goal in mind, ServicePower recently released Boost, on the Salesforce AppExchange.

Boost provides any organisation with mobile workers beyond field service, to healthcare, financial services and sales teams, the ability to continue using their Salesforce application to manage customers and create work orders for when field based services, of any type, are needed. Then, using Boost, pass that list of work orders or tasks to ServicePower which uses our patented Artificial intelligence-based optimisation technology to produce a more productive, least costly schedule.

Boost makes schedule optimisation go far beyond only travel optimisation as it does both to achieve greater improvements in productivity, capacity and schedule compliance available to every organisation, easily, from the Salesforce AppExchange.

Start moving beyond just the CRM to after-sales service to prioritise your visits by propensity to buy, profitability on orders, or any other customer metric you feel important.

It’s also worthy to note that true optimisation is not geo-productivity or Uber-like logic. Products that claim geo-productivity or Uber capabilities do provide a mechanism to schedule a resource when a customer raises a hand for a service. So, is response time better in this scenario?

Yes, in so much as you have a worker in the field already sitting idle, you can see their proximity on a map, and send them to the new customer. It doesn’t limit the schedule costs, because it’s not taking into account the entire daily schedule. It’s reactive scheduling, which is nice if you have slack  capacity, but slack capacity costs money.

On demand scheduling is great, from a PR perspective. It doesn’t offer the proactive services customers expect from providers today.

Mobile workforce management software with optimisation does.

Boost, in particular, provides more than a point on a map. It provides an easy route to a real optimised schedule, using your existing Salesforce implementation, regardless of whether you’re managing 25 mobile workers or 1,000.

Find Boost on the Salesforce AppExchange at: http://sforce.co/2p4mKV2

 

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Whilst some were heading out to the desert to watch the likes of Radiohead and Lady Gaga at Coachella 2017 early this year, others were in Palm Springs for perhaps the lesser known but equally fantastic Field Service USA.

Field Service News sent Michael Blumberg along to talk to the USAs largest collection of Field Service professionals in one place, find to out what were the biggest challenges being faced by the industry at large and how we can overcome them...

In April this year I attended WBR’s Field Service 2017 in Palm Springs, California. While I was at the conference, I spoke to several Field Service leaders about their biggest challenges and the strategies they will pursing to overcome them.

I was expecting to receive a myriad of different answers when I first thought about asking conference attendees about these issues. After all, business executives often think their problems and challenges are unique to their specific situation. However, I was surprised to learn of the common thread that ran through my conversations with field service leaders.

 

Basically, four different themes emerged from my conversations. Rather than keep you in further suspense, let me share what I learned from my discussions:

Key challenge #1 - Keeping up with advances in technology:

Field Service leaders understand that their customers expect the same experience they do with using consumer electronic products. In other words, they expect an always on, always connected, always available service experience.

Strategy to overcome challenge - Develop & Implement an IoT Strategy:

Field Service leaders recognise that that IoT improves the customer experience in very much the same way it does with consumer electronics.

While field service leaders I spoke to agree that conceptually IoT is the right technology to achieve this outcome, they also admit that the real challenges lie in competing for capital resources to implement service led, IoT solutions and prioritizing where these investments should be made.

Key Challenge #2 - Determining which technologies enable an improved service experience:

Field Service leaders are faced with a myriad of choices when it comes to selecting and implementing technology to improve the customer experience.

For example, there’s various categories (e.g., AR, IoT, mobility, etc.) of technology to choose from as well several different vendors in each category segment.

It can be an overwhelming and taunting task to learn about every technology on the market.

Strategy to overcome challenge - Due Diligence and Planning:

Field Service leaders understand that they must adopt an objective approach to identifying, evaluating, and prioritising investments in technologies as well as vetting and selecting vendors. This means they must find the intellectual bandwidth and manpower to complete this strategic work of their organisation.

Key Challenge #3 - Keeping up with the skills gaps

Let’s face it, millennials are not lining up in droves to accept field service positions. In addition, the baby boomer generation in retiring from the workforce as a rapid rate.

As a result, Field Service leaders are under pressure to implement creative strategies to overcome the current and growing shortage of skilled technicians.

Strategy to overcome challenge - Implement Augment Reality (AR)

Many Field Service leaders perceive that AR solutions provide an effective solution for dealing with the shortage of skilled labor. By utilising this technology, field service organisations can do more with less. Basically, they can leverage the expertise of a limited number of skilled Field Engineers and distribute this knowledge remotely to a broad number of people.

Key Challenge #4 - Becoming a customer centric organisation:

Field Service leaders understand that if service business is going to thrive and grow then their organisations must become more customer centric. Unfortunately, some companies still have a product focused orientation.

They are more concerned about feature on the feature functionality of their products then the quality of service and its impact on the customer experience.

 

As a result, they are not making the necessary investments or resource allocations for the field service organisation to remain profitable and competitive.

Strategy to overcome challenge - Influence senior management on the value of service

Basically, Field Service leaders realise they must exert greater effort in influencing senior management on the benefits of becoming a customer centric organisation.

This means they need to build a strong business case as to why their companies should invest in technologies that make their companies more customer centric such as IoT, AR, FSM software, mobility, etc.

The business case must consider the impact of technology investments and process improvements on customer satisfaction, product sales, and the overall financial performance of the company.

Interestingly, the comments that I received were very consistent with the overall themes of the conference. Obviously, WBR has a good pulse on the industry.

Nevertheless, it is always great to speak to people one on one at industry conferences. I find these conversations provide so much more insight and context then sitting through a “canned” presentation.

The common thread between all these issues is that they involve the use of technology to optimise and improve field service delivery. This makes perfect sense as field service is a technology intensive business.

However, it is important that field service leaders do not fall into the trap of viewing technology as panacea for all aliments facing their organisation. The best technology is of little value without solid management, effective planning, and strong leadership behind it.

 

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The management of parts has been for a long time a little unloved in terms of field service technology. Kris Oldland talks to Gary Brooks, CMO, Syncron to find out how and why that is changing...

KO: There finally seems to have been a quite perceptible shift in the number of companies beginning to pay attention to the importance of good parts and inventory management. Are you feeling this?

For example every-time I come across your team at various different events I see you having a lots and lots of conversations at busy, busy booths.

Are you finding that whereas, perhaps a few years ago you were having to evangelise the importance of tools like yours, today people are actively looking for them?

GB: You’re absolutely right. There are so many things going on socially, politically, demographically, economically that are really putting pressure on the field service organisation to not only deliver maximum uptime - we are really moving away from the traditional break/fix aftermarket model, towards moving towards being much more proactive and preventative, and technologies are enabling us to do that.

Manufacturers around the world are waking up to the fact that the market has changes - from the volatility in the orders of durable goods, to millennials taking over the workforce, to the movement to ‘power by the hour’, so a lot of them are looking for low hanging fruit.

They’re asking “what can I do to my service organisation to increase revenue” because a lot of companies now view the product that they sell as something that can they can put in the field to leverage high margin service revenue for an extended period of time - in heavy equipment we’re talking 25 years.

 

So they are looking at this, they’re saying how can I improve revenue? How can I improve margin? How can I have a more predictable service business and then how can I deliver a wow level of service - or prevent that service call from having to actually take place over time because of the use IOT, machine learning and smart parts.

Our friends at The Service Council established that 50% of service attempts fail because of not having the right part, and even if the right part is available then companies are not maximising the revenue correctly because they are not pricing correctly. 

So, for a lot of organisations they are saying lets get the parts side of the business right - because the financial gain that can be harvested is significant. 

When you look at the inventory side, we see companies increase service parts revenue by up to fifteen percent, increase gross profit margins up by as much as forty percent and taking forty percent of inventory whilst taking their fill rate up above ninety percent.

So, mathematically, the financial value creation really works and then if those parts are priced appropriately- we are seeing companies take up their service parts revenue by as much as five percent and gross profit margins by as much as seven percent.

If you have several hundreds of millions of dollars, or even close to a billion dollars if you’re in a sector like Aerospace, five percent here and seven percent there suddenly becomes a very sizeable figure.

So in Answer to your initial question, yes we are now seeing a much bigger customer pull, and I think whilst it may be partly due to the Syncron being much more visible in the sector, but it is also a matter of demand from the market - increasingly companies are now coming to us.

KO: You mention outcome based services as a significant shift that is happening within field service across multiple regions and verticals.

What impact is that having on the spare parts/aftermarket and consumables markets - is there a direct adverse impact on this?

GB: Yes, I would think that it is very much having an adverse impact on this side of the market.

Manufacturers will increasingly sell service level agreements much like you would see in high tech.

In high tech there is not a lot of sales of parts. If your servicing a piece of high tech equipment whether it be in medical or whether it be in the IT space, you have a service level agreement and you have certain requirements whereby it needs to be back on line within an hour or two - so there is no buying of parts.

I think as more industries begin to adopt the service level agreement approach rather than buying a part it will have an impact on parts revenue as having that part available to perform that repair or maintenance in advance of the asset failing becomes even more critical.

 

In my car for example, I have an app that tells me when there is something going wrong with my car.

Today, it doesn’t tell me when a part is about to fail but in the future I imagine that it will and so when I do have to bring the car in for service it will say well this part, this part and this part are all close to failing so why don’t we replace these all now?

It becomes preventative maintenance, we prevent the failure from ever happening. This is changing the way businesses approach the value of parts and indeed service. It is certainly an exciting time to be in the field service business because of all these economic, social and political changes that are driving the attention on the service business but also the emergence of all these new technologies.

KO: Given this new wave of interest in Field Service as a something more than mission critical, but also fundamental to revenue streams - are you seeing more companies you work with getting involved with such conversations from board level?

GB: Yes, I absolutely think field service is really garnering executive level attention now.

I think a lot of that is driven by the demand and the shift that we are seeing amongst the customers. Customer-centricity has always been a bit of a buzz word in the industry but I think it is becoming hot again and I think that’s because by 2030 around 75% of the workforce will be comprised of Millennials.

Their service expectations have been informed by the likes of Amazon, Uber and TaskRabbit. Their mindset is “What do you mean I can’t have it fixed now?” And that is definitely driving the demand side.

[quote]Service expectations have been informed by the likes of Amazon, Uber and TaskRabbit. Their mindset is “What do you mean I can’t have it fixed now?” And that is definitely driving the demand side.

But then also when you look at the margin side and at the revenue side, I think a lot of executives that are in the C-Suite came up from the manufacturing or sales side - so they sometimes have a biased view of their business. I call this the street light effect - they can only see what is in the light and that for them is looking at the product side of the business.

 

But for many of them, they’re starting to look beyond the street light and are saying wow - this service business is pretty darn exciting.

And in a lot of cases it’s often just held together with bubble gum and banding wire. So the thinking goes “if we make some upstream investments, we can deliver some pretty healthy downstream dividends.”

So I think that executives are just beginning to expand there point of view. For many years it’s been a case of “it’s [service] kicking up great margins, it’s not broke, let’s not fix it.”

But now companies are seeing with declining lures on the product base side of a business. They’re faced with dwindling margins and if they put even more effort on this side of the business they can only get a limited return.

I think companies are starting to see that similar investment in time and resources on the service side now is going to deliver a lot better returns.

 

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Michael Blumberg, President of the Blumberg Advisory Group discusses recent research his organisation worked on with Giuntini and Company on the processes being used to effectively sell extended warranty programs and argues that if you adopt the right approach, moving from customised service contracts to selling outcome based services isn’t such a huge leap of evolution...

No one can dispute the fact that manufacturers are placing increased attention on growing top line service revenue. Typically, this revenue is captured through the sale of EW/ES programs.

Given the level of focus place on this subject by manufacturers and service providers, Blumberg Advisory Group and Giuntini and Company partnered to conduct a study among professionals involved in selling extended warranty and/or extended service programs. To qualify as a survey participants, respondents had to influence, recommend or make decisions about these programs.

The objective in conducting the survey was twofold: To identify best practices involved in marketing and selling extended warranty and/or extended service (EW/ES) programs and to evaluate the impact of these practices on key performance indicators (KPIs).

 

As field service leaders may recognise, contract attachment and contract renewal are the most important Key Performance Indicators (KPIs) associated with marketing and selling of EW/ES programs. Interestingly, we found that only a small number (less than 22%) of survey participants have achieved best in class performance metrics of greater than 50% for contract attachment or 75% for contract renewal rates.

 

The factors that drive contract attachment rates are warranty configuration and the types of marketing tactics employed.

Configuration refers to the length of coverage, level of customisation, processes engaged and resources employed in delivering the warranty, and entitlement levels offered. The survey results suggest that the more distinctions a company can make about its EW/ES program, they more likely customers will be to purchase it.

In other words, customers consider the value of a service contract before they purchase it.

This is an “eye-opener” because many companies have the view that a warranty is a warranty. The management within these companies believe that just because customers purchase their product they’ll also purchase the extended warranty.

Most of the companies we surveyed rely on traditional marketing tactics like sales aids (e.g. brochures) and direct sales to sell EW/ES programs. Usually, these tactics are employed at the product point of purchase.

 

However, companies who continue to sell service contracts after the product sale are likely to experience a 20% improvement in attachment rates on average. Other sales and marketing tactics which have proven to be effective in driving attachment rates include customer testimonials, reputation management, telemarketing (i.e., outbound sales), public relations (e.g., press releases, article placement, etc.) and analyst reviews.

 

Manufacturers who experience high EW/ES contract attachment and renewal rates understand that the activities involved in marketing and selling these programs is separate and distinct from those involved in selling products.

In other words, service leaders in these best in class companies put as much time and effort into configuring, marketing, and selling service contracts as their counterparts in the product organisation place on designing, marketing and selling products.

Effective field service leaders recognise that service won’t sell itself. They understand that just because the customer owns the product doesn’t guarantee they’ll buy the service. In addition, field service leaders in these service organisations make sure they have the right systems and processes in place to market and sell service contracts.

 

For example, processes and systems that facilitate a company’s ability to configure, price, and quote customised service contracts. While 87.5% of companies surveyed have a formal process in place to configure and price service programs, only 13% employ a Configure, Price, and Quote (CPQ) software application.

 

The trend toward customers wanting to buy outcomes as opposed to services or products will place even more pressure on field service leaders to become proficient at configuring, pricing, quoting, and selling service contracts.

While recent technologies like IoT, AI, and Big Data will make it easier for companies to deliver outcomes, manufacturers still need to provide customers with a contract that specifies exactly what is include in the “outcome” they have purchased.

For example, it defines the terms and conditions, the hours of coverage, the level of availability, the resources provided, and the processes engaged in delivering the agreed upon outcome to the customer. It also describes the level of entitlements and roles and responsibilities of the party providing the outcome as well as the party receiving the outcome.

Furthermore, it is likely that outcomes may differ from customer to customer.

Manufacturers who have not mastered the fine art of selling traditional service programs may find selling outcome based services a real nightmare.

Yet in many ways, selling an outcome based contact is no different than selling a customised extended warranty or extended service contract.

That’s why companies need to start investing in systems and processes that facilitate configuration, pricing, and quotation of services contracts today.

 

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