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Kris Oldland speaks exclusively to Marne Martin, CEO ServicePower on the recent sale of the business to Diversis and ask her what does this mean for the future direction of her company...

KO: It’s been a real period of innovation and growth for you over the last couple of years, with the launch of NexusTM plus the investment on patents such as the work you’ve done in quantum annealing. So what was it that attracted Diversis to invest in you - was it a case of they just wanted access to the growing field service sector or was it more about being in line with the direction in which you were already headed?

MM: Firstly, it was an interesting financial opportunity for them because there is a disconnect between the valuations in the US for companies that are innovating and growing, those that have a national presence, versus what we were seeing on the A market - so there was a financial rationale.

But the real thing that they ultimately believe in, is in companies that have great products, companies that have core differentiators in their market.

They’d been interested in field service for some time - as you know it’s a hot sector and when they saw the use case of what we’d been able to do with Nexus and the wider service management tools...  plus also quantum annealing and taking that towards predictive maintenance, and then spare parts forecasting in the future and thinking about the journey we’ve been on in starting our intelligent customer portal as well... it was really just too good for them to pass up. 

They’ve been really passionate about investing in us, and in pushing us to continue to develop truly great products and as such they’ve brought in operational technical advisors as well as some other consultants, who are helping us to look further and have more functions in the next generation UX/user experiences and then tying the platform functions together more seamlessly, so the user experience is better and more automated.

KO: Of course, the one question that has to be asked with any acquisition is will it be a case of business as usual under a different name, or will there be a changing of the guard in terms of personnel and direction?

MM: I told them when we were doing our due diligence, I felt that we were 75% and we were really looking for someone to get us to 100% of where we saw the opportunity in the sector not just for the current but in the future.

[quote float="left"]I felt that we were 75% and we were really looking for someone to get us to 100% of where we saw the opportunity in the sector not just for the current but in the future.

There will be perhaps some refinement, we are no longer going to be focussing generally on the smaller end of the market from now on, at least not in the US - we are refining the focus towards the mid-market and enterprise space, but that is already pretty much where we were anyway.

 

With Nexus, we’re going to be rolling that functionality out to the core product and we will be transitioning the branding so rather than have all these product names we are going to have modular functionality that are all basically connected to the Nexus mobility and Service Management platform.

So all of the new UIs will be coded in that look and feel, we’ll tie in the mobile with the angular JS front end and we will still have the robust back-end. We are making it more seamless but also more configurable. The message from Diversis is yes it’s still business as usual but they are helping us to accelerate our own trajectories.

KO: Is the recent amount of investment we have seen in the industry - with yourselves, ServiceMax, ClickSoftware and IFS all having been acquired within a period of 18 months an indication of how important service is becoming in the wider world of global commerce?

MM: Absolutely. I think there are two things, firstly there is a lot of money floating around - the only way people make money is by investing, so you do have a lot of money in private equity that they are trying to put to work and that definitely is a factor here.

[quote float="right"]Field service really is the engine for growth in a business.... If you look at CRM and ERP players they are not really doing that much true innovation

It used to be that a lot of the larger endowments or high-net worth family funds might invest in public equity but because valuations have been somewhat volatile, many of those type of investors have actually become backers of private equity funds. That gives more money to PE investors plus the expectation that they are actually going to invest. So that’s one half of the story... 

 

But the second half is that field service really is the engine for growth in a business.

If you look at CRM and ERP players they are not really doing that much true innovation and that’s where if you had the ability to drive return on investment in terms of productivity plus additional revenue in the service arm and you start looking at what we call the e-commerce opportunity - how you can actually build customer prioritisation into your service model?

 

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Kris Oldland deliver's his editorial leader in issue 16 of Field Service News - the first issue of 2017...

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Field Service News subscribers are entitled to our bi-monthly magazine in both print and digital versions. Subscription is free for field service professionals click here to subscribe now and get a digital copy of issue 16 sent straight to your inbox

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Is anyone else starting to feel like 2016 was already a long, long time ago?

Perhaps it was the late flurry of field service conferences towards the end of last year but the tail end of 2016 felt like we were hurtling along at breakneck speed and it felt like it was never going to end.

Yet as is always the way, once it is over and done with and we move onto the next project what felt like an endless session of conferences and interviews seems like a long time ago.

However, that is where I am lucky in my job. For as we have been putting together both this issue and our annual publication “The Handy Little Book For Field Service Managers” i’ve been able to take my time to review all of the interviews and sessions that I sat in on across the last few months and there were some really thought provoking moments amongst them.

As a result this issue is absolutely jam packed with features - in fact we have more features this time around than in any issue to date.

So if I may, I’ll use my column in this issue to just pick up on a few of the highlights that really caught my attention.

Firstly our cover feature “No Fault Found” which is based on my interview with Dr John Erkoyuncu of Cranfield University. I’d seen John giving a fantastic presentation on the topic at ServiceMax’s Maximize Europe event and he was kind enough to talk me through his presentation a little later on over a coffee.

If I’m completely honest it was the first time I’d ever given No Fault Found any serious consideration, but after listening our conversation I realised not just how big a potential issue this could be for field service organisations today, but also how this issue could be easily magnified in the near future if the servitization trend continues to take root.

Another great interview that I was privileged to conduct towards the end of the year was with Microsoft’s Carsten Groth.

Carsten is one of those fantastic people in industry that don’t quite sit within the confines of your normal grey suited, conservative industry professional.

He’s the kind of guy that has no qualms running over to you and giving you a bear hug in the middle of a busy conference auditorium.

He’s a free thinker and an intelligent thinker and a good guy to boot and it’s always a pleasure interviewing him at the time because the conversation is fluid and easy. That said it’s usually a pain writing up his interviews because it’s tricky trying to cut that conversation down enough to fit on the page.

[quote]“Once again we’ve brought together our panel of advisors and locked them in a dark room until they agreed on 20 people that they think will have an influence on our industry across the next twelve months...”

 

The final feature I’ll pick in my highlights has to be of course the announcement of this year’s FSN20.

Once again we’ve brought together our panel of advisors and locked them in a dark room until they agreed on 20 people that they think will have an influence on our industry across the next twelve months.

There are some familiar faces in the list but some new names too.

What I think is great about the #FSN20 is the discussion it creates.

To be honest if you asked each of member of the panel who put this list together if they thought the list was perfect, they’d probably argue admit that ‘person x’ should replace ‘person y’.

In fact putting the list together was great fun as it always is, because it’s a fantastic exercise in celebrating those in our industry who are driving innovation - and there are certainly more than twenty people doing that for sure!

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Field Service News subscribers are entitled to our bi-monthly magazine in both print and digital versions. Subscription is free for field service professionals click here to subscribe now and get a digital copy of issue 16 sent straight to your inbox

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Gary Brooks, CMO, Syncron outlines some of the key technologies set to have a significant impact on field service in the not so distant future... 

Regardless of industry, emerging technologies like autonomous vehicles, wearable devices, the Internet of Things (IoT), 3D printing and drones, will have a significant impact on how after-sales service, the service delivered after the initial sale of a product, is performed. For manufacturers of long lasting durable goods specifically, these new and evolving technologies will enable them to respond to the increasing demands of today’s consumers.

After-sales service is now one of the biggest opportunities for manufacturers to generate revenue, increase margins and improve customer loyalty. For field service repairs, emerging technology used correctly could become a huge source of competitive differentiation and improved service levels.

 Below, I outline five emerging technologies and how manufacturers can use them to positively impact their field service organisations.

Driverless cars:

According to Juniper Research, by 2025 there will be 20 million driverless cars on roads around the world, with them becoming most popular in North America and Western Europe by 2021. For manufacturers, this emerging technology could be especially beneficial to field service. Driverless vehicles mean technicians can multitask – something that they can’t (or at least shouldn’t) do behind the wheel today.

Multitasking allows technicians to use their field service app to ensure the upcoming appointment is as efficient as possible while en-route to the call – reading up on customer history, service part inventory and equipment data – so that the technician walks into the appointment ready to make the repair quickly and successfully. The possibilities are endless – if a vehicle is not stocked with a needed service part, it could self-drive to a warehouse to retrieve it while the technician is working on other aspects of the repair. This emerging technology could provide new and easy ways for technicians to do their jobs more efficiently and effectively, and for manufacturers to create that competitive edge with their service organisation.

 

Wearables:

Gartner anticipates smartglasses, like Google Glass, could impact the field service industry by $1 billion in 2017. The biggest impact wearables could make is in efficiency – if technicians can diagnose and fix problems more quickly without bringing in additional experts, both the cost savings and improved customer experiences could be monumental.

The augmented reality associated with smartglasses provides on-the-job training to technicians, and enables them to more easily repair goods, especially those they have less experience repairing. Additionally, the hands-free nature of smartglasses allows technicians to complete tasks without having to start and stop to read or view instructions. Video collaboration with remote experts could also add to efficiency.

While adoption of wearable technology has been slow due to the dependence on apps and services targeted to field service, companies like KPIT have already deployed smart glass technologies for field service specifically. As barriers to entry become lower, brands will be forced to adopt ‘smart’ devices to meet demanding customer expectations.

Internet of Things (IoT) 

Forrester foresees IoT as a means to create more valuable customer interactions and improve the customer experience. And, this holds true for field service, which oftentimes serves as the ‘face’ of manufacturing brands.

The intertwined network of physical goods with sensors and software allows manufacturers to freely exchange data between the products they sell and their internal systems in place. This helps both the manufacturer and end-customer – products built with ‘smart parts’ can send a signal to both the manufacturer and customer to alert them a repair is needed and to schedule a service appointment soon. With the appropriate service parts management technology in place, the manufacturer proactively ensures the needed part is available and sends a technician to repair the product quickly, alleviating any downtime, and delivering the amazing experience customers expect.

3D Printing

3D printing has long been used in manufacturing to create part prototypes. Now, with the advances made to the technology, they can print parts in metal, which means 3D printing can be used to create actual replacement parts.

As the technology continues to advance, the impact 3D printing could have on parts inventory levels, warehouse needs and the logistics of moving parts from one location to another could be monumental. These factors will lead to reduced cost and faster repair times – meaning more revenue for the manufacturer and better experiences for the end-user. And, it might not be in the too-distant future that driverless vehicles could be equipped with printers that can print parts on the spot!

 

Drones

Drones are becoming increasingly common for personal use. You’ll oftentimes see them at high school sporting events, outdoor concerts or being used for personal photography. For field service specifically, there are both immediate and long-term benefits of drone technology.

More immediately, drones can be used as a means of diagnosing issues on large-scale equipment like oil rigs. This means less risk for the field service technician, as drones can help them survey large or hard-to-reach areas without putting themselves in dangerous situations. Or, they can be used in warehouses to retrieve parts, making the process much more efficient.

In the future, drones could even be used to deliver a part in the field. If a technician is on-site making a repair but doesn’t have the necessary part, a drone could bring it to him or her, eliminating the need to make an additional service call.

 These emerging technologies are beginning to impact businesses today, and manufacturers must consider adopting them to meet the needs of today’s customers, while simultaneously driving revenue. Soon, everyone will be able to say they’ve received exceptional customer service, as long as manufacturers embrace these new tools.

 

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Mark Brewer, Global Industry Director - Service Management, IFS explains how the field service sector is being undeniably changed by the growing shift of companies towards servitization...

When I first started working in the field service management (FSM) space more than a decade ago, the industry landscape looked much different than it does today.

Ten years ago, organisations were looking to automate their field service processes in an attempt to decrease unpredictable costs and inefficiencies while gaining a little more control and visibility over an otherwise unpredictable industry. The core focus was scheduling and dispatch. Today, the focus has shifted, moving from core functionality towards a new, more holistic emphasis on the end customer.

The potential is limitless and the changing market cannot be overlooked. In a 2016 research report by Markets and Markets, it is estimated that the field service management market will grow from $1.97 billion in 2015 to $5.11 billion by 2020.

 

Low profit margins, increased competition and growing consumer demand fuelled by technological revolution have contributed to a major shift in the field service management market, both in demand and vendor response.

As field service organisations look to find new innovative ways to maximise operational efficiency and reduce operational costs, enterprise software vendors have established a sweet spot, spurring a flurry of field service management vendor acquisitions.

This change has created a fundamental shift in field service management, from expectations through to functionality and approach. As product-based organisations transition towards servitization and as traditional field service organisations look to adapt and grow, the following trends have emerged in order to enable the transformation.

1. END-TO-END. A NEW APPROACH MOVING AWAY FROM BEST OF BREED

Ten years ago, service organisations were simply looking to automate their existing processes.

In the majority of cases, schedules were generated on whiteboards or spreadsheets, paper work orders were manually distributed and communication between the field and back office was limited or non-existent. Best of breed solutions provided badly needed automation enabling organisations to increase efficiencies and reduce costs. Automation is now a given.

Today it is all about the data. As technology has advanced, organisations are now able to capture the data required to drive key business decisions at the highest level.

Where an automated solution provided process efficiency, an end-to-end intelligent service solution provides the seamless data flow required to optimally drive and scale the business while delighting customers. With end-to-end field service management, an organisation has access to real-time data, empowering fact based decisions and future plans.

2. CONSUMER-DRIVEN PRODUCT AND SERVICE DIRECTION

Now more than ever, today’s consumer is empowered and knows what they want. The world has become smaller thanks to globalisation, social media and connectivity in general.

Experiences are more important than ever as today’s customer has a multitude of platforms available to make their voice heard. Customer engagement is now imperative.

In the traditional make and sell model, you design a product, engineer it, procure materials, manufacture the end product, market and sell it to customers and then optionally provide aftersales support.

 

The shift now is moving away from selling products towards delivering ‘product-as-a-service’. Where price has traditionally been based on product output and performance, now ‘contract value’ is based on a defined outcome, thus moving away from a transaction based model to a value based partner relationship. A field service organisation needs the right platform to facilitate this change in order to drive value from the product throughout its entire lifecycle.

3. REINVENTING OPTIMISATION

Whilst Servitization can be a strategy to drive enhanced revenue, this should not be to the detriment of service execution. Service will always be measured by how well you perform, and that means optimising the entire service chain from human capital to parts and logistics.

It also encompasses real-time measuring and monitoring of service execution enabling the transition to a proactive ‘manage by exception’ model, rather than providing a reactive response.

Optimisation is no longer viewed in isolation, optimising intraday schedules and inventory. Rather it should be considered holistically in an effort to deliver flawless end-to-end service.

How do field service organisations prepare for what’s next in the industry while ensuring continued success?

 

The first step is to ensure they have a strong foundation or platform to start from. Core processes and systems should be running optimally to allow an organisation the ability to effectively scale and adopt new technology.

Organisations must embrace change with an enterprise-wide change management strategy.

Lastly, the most successful field service organisations have a clear understanding of the end consumer’s expectations for today and tomorrow to ensure these can be met or exceeded today as well as anticipated for the future. Value added service is no longer optional, it is the very future of service.

 

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Resource Type: White Paper
Published by:  ClickSoftware
Title: The Uberization of Service: A consumer and supplier view

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Synopsis:

With the advent of real-time communications and new technologies such as social media, wearables, IoT, augmented reality, and artificial intelligence, there are countless opportunities for businesses to transform customer service. Key research from ClickSoftware presented in this white paper looks to the challenges of the near future of field service...

ClickSoftware, have commissioned a global industry and consumer research project to further understand consumer expectations when it comes to services being delivered to the home.

By comparing this with field service supplier plans to implement and enhance their offering and roll out new technologies, the survey set out to make comparisons between the two in a rapidly changing landscape, and uncover any discernable gaps or challenges in the provision of a great customer experience. The findings of this research are in this report.

Download this white paper published by ClickSoftware to find out:

• How the ‘Uberization of service’ is driving a more demanding, hard-to-satisfy, customer base
• Why 61% of all respondents globally have cited ‘customer satisfaction’ as a key priority
• Detailed analysis of Consumer vs. Supplier Findings and how the needs of customers and focus of suppliers marry

Overview:

The modern day consumer has a new perspective on customer service, and irrespective of sector or business, they expect and demand a level of real-time communication and visibility. Service levels provided from retailers, such as Amazon and Uber, are driving expectations across the board, forcing other industries to play catch up.

With this in mind, ClickSoftware, the leading provider of field service management software, commissioned global industry and consumer research to further understand consumer expectations when it comes to services being delivered to the home. By comparing this with field service supplier plans to implement and enhance their offering and roll out new technologies, the survey set out to make comparisons between the two in a rapidly changing landscape, and uncover any

With the advent of real-time communications and new technologies such as social media, wearables, IoT, augmented reality, and artificial intelligence, there are countless opportunities for businesses to transform customer service. The research highlights the differences in expectations versus reality, critical in an age where organisations can no longer expect customers to accept the old way of operating.

 

It also points out one key difference: suppliers are focused on the delivery of new technologies rather than recognising that optimised, real-time communications and a transparency for service delivery are high on the customer agenda. The survey results also highlight some key differences in expectations and communications methods by geographic region, underscoring the complexity of running an international field service business, where end users in each region expect different things from customer service.

The white paper then moves into three key sections:

Executive Summaries: Consumer Survey

Overall, the survey responses show customer expectations are increasing across the board, with the ‘Uberization of service’ driving this and generating a more demanding, hard-to-satisfy, customer base. Essentially, customers know that the advent of technology now allows for engineer location tracking and up-to-the-minute communication, and they have come to expect this

Executive Summaries: Supplier Survey

When field service suppliers were asked which measure of field service management their organisation values most, an average of 61% of all respondents cited ‘customer satisfaction’ as the top field service measure, with as many as two-thirds of those polled in Australia selecting this answer.

Comparative Survey Analysis:

The final section of the white paper is the most detailed and insightful, bringing the data from these two essential pieces of research to identify the most important trends appearing on both sides of the service spectrum. With the data laid out in clear graphical formats accompanied by well thought out and intelligent analysis, it is advised reading for any senior field service professional.

 

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In his role as Director of IFS Labs Bas de Vos, is at the heart of driving innovation forward in our industry. So who better to talk to find out what technologies we should be eagerly awaiting and what is the process to take these technologies from cool ideas through to practical applications...

FSN: What are the three most exciting technologies that have yet to come fully to light that you and your team are currently working on?

BdV: Firstly it is augmented reality or mixed reality as I see it, secondly I would say that drones are still in there as well and the third one is something that we have been working on for some time that we keep coming back to - autonomous assistance. New ways of interacting with business applications - can I talk to my device? Can I chat with my device - it’s a very interesting subject. We have a prototype and we are going to researching and further developing that.

Whether it will be an IFS product one day, that is something that with Labs I can never say up front - but I see the development now in the consumer space with speech control like Siri and Cortana and on the other hand chat-bots for Facebook and Snap Chat etc it’s all very interesting, so we shall see.

FSN: Your team demonstrated a great example of Drones, IoT and FSM software all coming together at the last IFS World Conference - is that product ready to go or was it just a proof of concept demo?

BdV: Well, yes it is ready to go but it won’t be an actual IFS product - we won’t have the IFS drone product out in the market - definitely not.

No, what we wanted to do was demonstrate how companies who want to do stuff like this can do so through using our IoT business connector. Basically everything that we demonstrated at the World Conference in that session, the integration of drone technology, image capture and recognition and automated data analysis was made all possible through the IoT business connector.

FSN: How much of what you and your team do is about actually giving your customers the ideas of what is possible to allow them to innovate themselves?

BdV: If you look at the mission we have as IFS labs it is threefold. Firstly, we exist to guide, basically we do a lot of research. We don’t get to only do the cool stuff - so it’s not only playing with drones! We do a lot of proper research into database technologies etc. So we are there to guide the R&D teams on what we think they should be picking up and taking further.

Secondly, we are here to talk to influencers, to help explain to the wider world what we are doing at IFS and what the purposes of IFS Labs as a technology incubator is all about.

Then thirdly, and perhaps the most important part of the job for me is that we are here to inspire our clients to do more with their business applications. If you look at my work personally it’s an equal split across these core functions. 

FSN: In general do you ever feel an urgency to push a project out whilst it may be still in Beta or do you think it is better to wait until the product is fully refined and completely free of bugs?

BdV: That’s a very good question.

First of all do I feel pressure to deliver IFS products around any given technology? The answer is always no and the reason for that is fairly simple. We are not here to compete with say Microsoft HoloLens in terms of technology. We will not be providing the actual AR technology ourselves.

What we need to do -which is part of the mission of IFS labs is to make sure that our business application is ready for when these technologies do become viable products.

What I mean by that is we need to be able to have an app ready to go on HoloLens to take advantage of that technology, or any other similar new emerging technologies.

Are we the guys that will actually create the technology? No I don’t think that is our core business and to be honest I don’t think that we would have the skill set to do that as well as others who are focussed on that area.

Our task at labs is to keep on monitoring the market and being able to leverage these exciting technologies once they are industry ready.

 

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Kris Oldland, talks to Lucio Golinelli, Senior Director of Service & Delivery with Sky Italia about the digital transformation they are undertaking and how it is helping to drive new profits....

There were a number of interesting case studies presented at the recent Maximize Europe event held by ServiceMax from companies across many different industry verticals.

However, one that really caught the eye was that of Sky Italia who worked closely with the field service management provider as part of an ambitious company wide digital transformation program.

As Europe’s largest Pay-TV company with dominant presence in the Pay TV sector across five European countries (UK, Ireland, Germany, Italy and Austria) Sky is a household name that resonates across the continent. However, the Pay-TV vertical has become increasingly competitive over the last few years and customer experience and satisfaction are two key differentiators in the sector.

So it was perhaps no surprise that improving customer experience through digital transformation was at the heart of the organisation’s move to dramatically change their business operating systems.

Indeed, Lucio Golinelli, a Senior Director of Service & Delivery with Sky Italia who has responsibility for both field services and the supply chain explained that the key benefits his organisation sought through the digital transformation - whereby they moved away from their traditional processes of field service delivery to a more digital centric process, were equally centred around both customer experience and financial KPIs.

However, from Golinelli’s side of the business this meant working closely with ServiceMax to find a solution that worked across their whole supply chain rather than simply adopting an off the shelf solution.

The main reason for this is that when it comes to installations, Sky Italia operate within the framework of an outsourced model.

“We have a multi level approach in that we have 400 company partners, which tend to be smaller companies or ‘entrepreneurs’ rather than large organisations - who then manage for Sky approximately 2500 installers,” Golinelli explained to me as he talked me through the challenges he faced throughout the transformation process.

“For Sky Italia, installation is not a revenue stream but a cost stream,” he continued. “Because for us the installation is just an enabler to provide the services to our customers.” So whilst traditional benefits of increased installer productivity may be a side effect of the implementation this was never an end-goal for Sky Italia.

Perhaps the biggest challenge Golinelli and his team faced was how to fully integrate their own needs - as an effectively B2B organisation dealing with the partner ecosystem, and their end users - who are a B2C market. Success here however, would provide Sky Italia with granular levels of information that can allow them to discover new up-sell opportunities.

 

In order to best achieve this Sky Italia simultaneously replaced their old FSM, CRM and marketing tools bringing them all together on one new Cloud based solution and working alongside ServiceMax to find a customised solution for their FSM tools.

Currently in the process of undertaking this transformation program, digital visibility will be built across the whole chain from Sky through to their end customers. This is vital as it means they are not just changing the way they interact with their customers, but even changing the interface with which they undertake such interactions.

Of course, the main challenge for any company that outsources its service is that they essentially need at least two flavours of the same solution. From a Global operation with a nationwide presence, Golinelli’s team will need different dashboards, KPIs and control rooms to those that the majority of their partners will require.

It has taken Sky Italia working directly with ServiceMax over two years to develop a solution that works across Sky themselves, their partners and their customers but it seems that all that effort is now beginning to reap it’s rewards.

They have already launched the initial phase of the development with almost 1,000 installers already on track - and Golinelli appears immensely proud to see his team flourishing.

“There are two aims, “Golinelli explains.

“Firstly, the real benefit of improved efficiency for us is less errors,and in particular less mistakes in administration - that has now been largely overcome and is being dramatically reduced.”

Secondly, it is also important that if Sky Italia’s new processes are to succeed, that the various new tools used in isolation.

“We moved from customised platform for CRM, custom FSM software, and a customised platform for marketing to a common cloud solution shared across all divisions,” Golinelli expands.

“Now we have all of the key operations based on the same cloud platform. This is very effective as the power of this system is the real-time exchange of information, from installer to an operator in a call centre or vice versa. We can also pick up a lot of anecdotal information from the installers and then feed that back to marketing, again in real-time.”

 

It is in this last concept that Sky Italia are truly seeing the largest benefit, the shared platform gives them a much better opportunity to upsell their products.

For example let’s say an installation is being undertaken and the installer can see there is a Manchester Utd flag. In real-time he can then check if the customer has the subscription for Sky Sports and can either try to make the upsell himself or feed that information straight back to his marketing department.

Although only mid-way through the process, the results so far have been impressive to say the least. The field service division is now responsible for generating more revenue than any other part of the business having seen a rise in the percentage of revenue generated by installers leap from 11% to 21%.

For Golinelli, the significant factor in their success so far is the easy movement of data from one business unit to the next. Meanwhile, for Sky Italia, the shift to a digital workflow is already beginning to reap it’s rewards as they move field service from a cost model to a cost + revenue model whilst customer satisfaction levels increase at the same time. Perfecto!

 

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The term closest competitors could have been coined for Xplore Technologies and Motion Computing. Whilst they both competed in the niche market place of rugged computing, physically they were even closer - both being based on the same stretch of road in Texas. So it was almost inevitable that the two would eventually merge, which they did in April 2015 - making them the world’s 2nd largest manufacturer of rugged tablets overnight.

But when something is inevitable it doesn’t always mean it’s easy. Kris Oldland spoke exclusively to Mark Holleran COO, Xplore Technologies to find out more about the recent past, the present and the near future of the Texan Rugged Specialists.

It is testament to Holleran’s hands on approach to managing Xplore Technologies and his resulting busy diary that it has taken the best part of three months of diary juggling on both sides of the Atlantic before we are finally able to schedule a call that actually worked for this interview.

With this in mind, ahead of the call I was expecting it to perhaps be a somewhat hurried affair, with Holleran spouting off some pre-scripted soundbites that most CEOs seem to usually have to hand - particularly when being questioned about M&A activity. Generic quotes about mutual respect, optimistic futures and grandiose visions of world domination that to put it politely aren’t never quite in tune with reality.

Fortunately, it turns out my instincts were wrong.

Whether it was a result of the legendary friendly nature of Texans so often commented on, Holleran’s genuine passion for his company and the industry at large (he has been with Xplore for over 13 years and in the tech space for over 30) or as is more likely a combination of both factors, Holleran proved to be both engaging and insightful during the hour and a bit that we spoke.

Indeed, he was not only prepared to take the time to answer the questions put to him with thoughtful and reasoned responses, but also with a level of straight honesty that is all too often missing in trade journal interviews today.

Often, the real insight within an interviewee’s responses can get buried under wave after wave of hyperbole and over exaggeration that often needs to be translated back from marketingspeak.

At the same time it seems that many trade journalists are frightened to ask anything too probing these days in case it upsets any commercial relationships.

Whilst as Editor-in-Chief, I have the ability to control at least one side of this set of challenges to help ensure we continue to publish content our readers value, I’ll readily admit that some interviewees make our lives as business journalists that much easier when they just speak from the heart and shoot from the hip.

 

Fortunately in Holleran, it seemed I had discovered a kindred spirit in someone that believes in the virtues of just saying it as it is and letting the story speak for itself.

That said, it does of course help when the story is as compelling as Xplore’s acquisition of Motion which suddenly catapulted them to being the world’s second largest manufacturer of rugged tablets, seemingly almost overnight.

As mentioned above the prospect of Xplore and Motion coming together at some point had a certain sense of inevitability about it.

However, most analysts would have predicted it would have been Motion who acquired Xplore rather than the other way around and the speed of Xplore’s acquisition of their rivals from up the road certainly took a few in the industry by surprise.

“I think Motion was foreclosed on Friday, on the Monday we bought the assets and the next Friday we had a BBQ where there was 53 people all together” Holleran explains when we discuss the speed at which everything was completed.

Indeed, the shared culture of the two companies that were literally based on the same road in Texas, was already firmly in place well before the acquisition happened.

Holleran recounts how at that inaugural group BBQ one very astute individual asked all those who had previously worked for both companies to stand up - about 40 people did so.

In fact, there had already been previous conversations about bringing the two companies together as Holleran explained.

“It was originally the Motion founders that approached Xplore, but my predecessor wasn’t receptive to that, we did talk and in the end we did try and help each other.”

“For me, did I think we would we eventually work out something – yes I’d like to think so. Then we took the opportunity when it came around and fortunately for us we were in the better financial health - so it was us who acquired them,” he adds.

What is particularly interesting however, is that despite both companies sitting in the rugged tablet space, being in the same location and as a result of that proximity even having an informal movement of personnel between one another, the product ranges were actually very complimentary and with very little overlap.

 

As Holleran explains “If you look at Xplore’s history we were in the Ultra Rugged tablets space, we made the most rugged PC in the world. Then about five years ago we decided to enter to the fully rugged space but we didn’t really compete with Motion, who would have been in what we viewed as the semi-rugged space. So we saw a unique opportunity to acquire an asset that was very complimentary, their products are 100% complimentary to ours. Their channel was also very complimentary with around 80-90%, distribution which was also something they did which we didn’t do, They were working on a dual tier model and we were working on a single tier  model,” he adds.

Basically, what Xplore did well, Motion was weaker at and vice versa and this also translated into vertical and geographical exposure.

“Some major companies and customers are now embracing our products more because Motion was number three in the market and we’ve got over 20 years experience,” Holleran asserts before making the bold, yet perfectly valid statement that with Motion and their product range brought into the Xplore fold they now “have the god given right now to expect to be on every major rugged tablet RFP.”

At this point we do need to address the elephant in the room. Namely the fact that the reason Xplore was able to acquire their bigger competitor was largely due to the fact that Motion had suffered from issues in the supply chain, that ultimately led to financial challenges.

Was this an issue that was now fully resolved?

“There are always issues in the supply chain but if you understand that and you work closely in the supply chain they can be overcome,” insists Holleran.

“Myself, I travel to Taipei once a quarter. And don’t forget we’ve been doing this longer than anyone else. We were there 14/15 years ago so we understand their culture and their history, we have long standing relationships over there and we have an excellent reputation there,” he adds.

Yet, supply chain challenges are not the only potential threats to the ongoing success of Xplore Technologies. Is the rugged tablet market itself in a healthy position?

It is all very well being the second largest maker of rugged tablets in the world- but should the market move away from tablets and embrace the newly emerged form factor of the convertible or detachable does that leave them exposed?

 

I was keen to get Holleran’s opinion on products such as the Panasonic CF-20 - a fully rugged detachable that offers the dual benefit of being both a laptop and tablet at the same time. Will we ever see a similar device from the Xplore team?

“We never say never but our speciality and history is in tablets and we consider ourselves the world experts on rugged tablets – we’ve been doing it for twenty years which is longer than Panasonic has,“ he replies when I put the question to him.

“We’re investigating that area – but I would say that basic physics says that you cannot build a notebook or a 2-in1 device as rugged as a tablet”

“It all depends on your needs – if you're really keyboard centric and data intensive then a 2-in-1 is for you, but as soon as you put a keyboard onto a device it is not a truly mobile device to use. You can carry it, but you can’t just pull it up within one hand and then use it, that’s only the function of a tablet. So if you need mobility, if you need to have one hand free to keep other things working – then you really do need a tablet,” he added.

Of course, another threat to rugged manufacturers is that of the consumer OEMs.

In the past the argument from rugged manufacturers was a fairly straight forward one. If you worked in an environment where your tablet could get a bit wet or accidentally knocked about then you really needed to go with something rugged.

However, with consumer manufacturers releasing products that are themselves becoming more rugged such as recent Samsung products being IP68 certified - are the lines between business-rugged, semi-rugged and rugged all blurring somewhat? If so why should we invest in devices from specialist rugged manufacturers such as Xplore?

“I would say that ruggedization has various hats,” Holleran begins.

 

“If you are looking at an IP rating, which means it is protected against dust and water that’s one thing, but you can’t use these devices in extreme temperatures, you can’t see them in the bright sun, you still can’t drop these devices,” he adds.

“There is a need for different types of devices but those devices are not enterprise class PCs. They’re basically for reading your emails, watching a video or game – if you want them for doing a dispatch, accessing your ERP or picking system for example then no – they’re not going to run.”

“Our market is not inside an office or going out occasionally. Our market is in nasty plants, outside, with rain, sleet, snow, hot, cold, vibrations from vehicles. So if anything we see it [competition from consumer brands] as good for us as it lends more credibility to the need for fully rugged devices.”

“It gives some people a better understanding of the fact that in different environments you’ll need different types of ruggedization and there are considerable degrees of ruggedization. There are different needs for different people of course.”

For Holleran it all comes down to a simple question of reliability, which given the often mission critical nature of both installation and maintenance work carried out in the field, is of course paramount for most field service organisations.

 

“Basically it’s simple – when the product is a tool for your job, in other words if your computer is not working then you cannot do your job – then you really need a rugged device. If you’ve got your dispatch system, your inventory systems, your schedule, your maps, your components then if that computer is not working you can’t do your job – so people in that scenario want a rugged device that’s going to last.”

“Our marketing strategy is quality; our products exceed our customer’s specs.”

“If you want a product that can stay in the field for three or four years, then you need a rugged device, you can’t put an enterprise device in – it just won’t last,” he concludes.

What about the sometimes mooted concept of just having a rack of pre-loaded cheap tablets, so when one device fails an engineer can just pick up a new one from HQ?

“The problem with this idea problem is how do you get to all your data?” Holleran retorts.

“If your computer breaks, that data has then got to be put on a new computer and then you have to make sure that the new computer has all the security protocols etc, so your talking about days - maybe even a week if there is a backlog. A week where nothing happens and a guy can’t work? Do they just get an extra vacation whilst you lose money?” He asks.

From our conversation it seemed clear to me that Holleran not only has a strong depth of knowledge about his own market and the wider sectors he operates in, but also has similar depth of knowledge in understanding his customers needs and their workflows. I was keen to discuss this further so asked him how prevalent was such knowledge of their customer’s workflows across the company and was this ingrained into the success of Xplore to date.

“That is very important to us – Xplore is very much a customer centric company,” he begins.

“We will even put features into a product for the customer if required. For example, in our Rugged Android D10 we have HDMI-in port which allows it to work as a Telco testing device. So yes, that is one of our core competencies, it’s critical to the company and is a foundation which the business has been built upon.“

Indeed, it seems that the future for Xplore Technologies is well plotted and in Holleran they have a leader who has a clear understanding of where their strengths lie and how they can leverage those to best serve the markets they operate within.

“We still have new products under development the XSLATE will be the brand. We will continue to be a premium supplier with innovative technology; we have some new innovations under development,” he asserts.

“We intend to be the world’s expert authority on rugged tablets and peripherals attached to that. I tell people if you really want to buy a rugged notebook go buy Panasonic.”

“If you want to buy a rugged tablet come to Xplore – that’s what we do and we are the world's best at it.”

 

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In a year full of M&A activity that will impact our sector in ways as yet unknown the biggest story of all was certainly GE Digital’s acquisition of industry leader ServiceMax. Kris Oldland spoke exclusively to Dave Yarnold, CEO ServiceMax the morning before one of the biggest press conferences of his life...

KO: Exciting day for you folks is probably a bit of an understatement?

DY: Yes, it’s a very exciting day for us. Today signals the completion of a truly remarkable cycle and the beginning of a new chapter. Although, we’ve been saying it’s a new chapter, but it feels like it’s a new book because what we have been through over the last 9 years has been a book in itself. So yes, very exciting.

KO: Having just sold the business for close to a Billion dollars after 9 years of determined effort and hard work - no one would blame you if you wanted to spend the rest of your days sitting on a beach in the Caribbean  sipping Margaritas - but that doesn’t quite sound like the Dave Yarnold way?

What’s the next step for you - are you going to be fully driving this next stage of the company’s evolution alongside the original team?

DY: Absolutely. I’m all in! 

We’ve talked in the past about how I think that this segment is incredibly important and financially why service is really significant for all industrial sectors.

In some respects there has been a challenge for us to get awareness at the CEO and CFO level of the significance of what we do and I think to get the amplification of what we do with the GE brand and the additional component of what GE Digital are also doing, that is going to open a lot of doors. I just can’t wait.

I was in a meeting the other day with the chairman of a top five Telecom company globally, so the opportunity to be with a company that can open doors like that, and to be able to tell our story and have an impact at that level - it’s really, really exciting.

I think about all the things that we have been talking about in terms of creating an operating system for service and I now believe we can create that operating system for the industrial sector as a whole. I think service plays a key component, a very central component of that. But also with the ability to access data, and IoT and analytics and performance management and who knows what else... I think we can build out a complete platform for industrial companies and that is very exciting to me.

 

KO: One of the things that made ServiceMax such a special company, and one that grew so rapidly within the sector, was that whilst the product was software, the company intrinsically understood field service. Have GE Digital bought into that ethos or is that something you are going to have to push internally?

DY: They are one of our great examples of one of our customers who is benefiting from that approach and they have been so profitable from that.

However, to be fair their initial thrust around GE Digital has been technology orientated so the Predix platform and the ability to access, ingest and  analyse data - that’s primarily what they have been about to date and that’s a technology play.

I think now that they have acquired Meridium and ServiceMax - the message will probably change and it will probably be a bit more solution oriented. At this stage I’m still guessing as well, but the fact is that they have just spent a Billion and a Half dollars to acquire two pretty significant applications.

 

I think all of their previous messaging was reflective of their existing technology in digital and now as we move forward my guess is that it will begin to change and evolve in line with their product portfolio.

KO: ServiceMax is of course your baby, and we’ve spoken at length in the past about the fact that it was an fundamental passion for service that separated you from many of your competitors. What was it that convinced you that GE Digital would be a good home for the company to go on and flourish?

DY: First off I didn’t want ServiceMax to end up as another portfolio component within one of the major software players. That was just too obvious and not really interesting for us as an end state.

What I loved about GE was the fact that they really do understand service, they have an appreciation for the importance of service and they drive the majority of their profits through service. 

So there is a shared core appreciation of service that is integral to both our companies, which is a great starting platform. But they are also a company full of smart folks, who can push us even further onwards. I genuinely think that together we can achieve some really, really great things.

 

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