It's been said in many corners of the field service industry and beyond, that COVID-19 has been the greatest disrupter of all time - what does this mean for the field service sector?
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Sep 07, 2020 • Features • Covid-19 • Think Tank
It's been said in many corners of the field service industry and beyond, that COVID-19 has been the greatest disrupter of all time - what does this mean for the field service sector?
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The Short-Term & Long-Term Planning Field Service Companies Should Be Undertaking
Within the recent Field Service News Think Tank Session that was focused on the impact on the pandemic on the field service industry, it was also pointed out that it's also been the greatest accelerator for digital transformation amongst field service companies.
As Kevin Starr, ABB said one of our Digital Symposium live streams during the lockdowns commented, "our five year plan digital transformation plan got condensed to five weeks!"
Whilst Starr may have been being slightly hyperbolic; it remains a neat summary of how digital transformation projects in our industry have not just been accelerated but have been given a turbo boost.
However, while we have seen digital transformation become the single most pressing focus for the majority of field service companies in 2020, one thing that became apparent during the pandemic is that it is those companies that were already well down the path towards digitalization, and who had already begun to rethink their approach to service delivery as part of that process who were best positioned to adapt.
"While Cranny may have expressed the concept in his trademark pragmatic way ahead of the curve, he was not alone in sharing this vision of the future of field service..."
As Ged Cranny, Konica Minolta had explained during a Field Service Think Tank session, "one of the things that we realized four or five years ago was that machines are getting more reliable. Plus, we had an ageing workforce. I walked in the room and told everybody, I wanted to run the service department with no engineers. My management team looked at me as if I had gone mad."
It was a bold statement five years ago. Today, it is an uncannily prescient move that positions Konica Minolta well as they and all around them are forced to consider a world of zero-touch service delivery where possible. I said to them, if we achieve this everybody in the world, we'll look at what we're doing. Indeed, while Cranny may have expressed the concept in his trademark pragmatic way ahead of the curve, he was not alone in sharing this vision of the future of field service. Many other forward-thinking organizations were also considering the move to remote services. Yet, while the path was being laid it out, a remote-first approach remained for most a dot on the horizon.
"I think, if you look into the majority of service contracts were in existence, that they were already offering such services, Rajat Kakar, IBM had commented during the same Field Service News Think Tank Session. However, COVID-19 has pushed us much closer to that horizon in 2020 than anyone might have anticipated.
"I think the markets need to move a little bit faster in adapting to some of the tools we have," added Kakar. "If you launch an engineer is quite expensive. If you can reduce that cost by utilizing remote support. Then from the OEM standpoint, we should start thinking about self healing a lot more," Kakar had expanded.
"In the near term, you're looking at things around workforce, models for capacity needed when lockdowns are raised, identifying which workers can be brought back in and evaluating your cash situation..."
- Daniel Brabec, ServiceMax
It is such forward-thinking that sets apart the Think Tank discussions as some of the leading conversations happening today within our industry. A format that brings true industry leaders together with the freedom to bounce ideas off each other without constraint can lead to genuinely inspiring conversations.
As we worked through some of the salient points from the last quarter's Think Tank sessions, Daniel Brabec, VP Global Customer Transformation, ServiceMax neatly summarized the current thinking that we are seeing emerge.
"You've got the short term where you're keeping the business going, looking at your current field procedures to determine which steps can be reworked or bypassed, locating your critical parts, Brabec explained.
"In the near term, you're looking at things around workforce, models for capacity needed when lockdowns are raised, identifying which workers can be brought back in and evaluating your cash situation looking at the impact of pent up demand or deferred demand for installations and preventative maintenance visits.
"Then in the long term, you really want to start assessing and reevaluating how you're going to approach your whole structure of service moving forward, structuring the way forward and getting more remote support, even looking forwards to new concepts such as self healing. Having more connected devices and products and enabling your customers more is going to be the way of the future and I think COVID is really helping to accelerate all of them."
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Sep 03, 2020 • Features • Covid-19 • Think Tank
Daniel Brabec and Coen Jeukens of Servicemax reflect on the financial impact of the global lockdowns on th efield service sector.
Daniel Brabec and Coen Jeukens of Servicemax reflect on the financial impact of the global lockdowns on th efield service sector.
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The Falling Dominos of the Field Service Supply Chain:
There has been a lot of discussion about how the financial recovery may look since the pandemic hit. Initially, there was some optimism that as deep as the blow was to the global recovery we could see the economy bounce back in almost the same measure. Indeed, the economic analysts are largely predicting an upturn in US GDP of around 20% which would be the largest quarterly rise in history. Yet, this is positive momentum must of course be held up against a historic 33% contraction in the second quarter of 2020.
Perhaps the best description of how the economy may return to pre COVID levels is the ‘Nike Swoosh’ curve – a steep and steady drop followed by a more gradual and controlled return.
Ultimately, the impact of the global lockdowns has had a massive impact on economies across the world, and field service organisations have felt this challenge as much as any other industry, as the customer ecosystems that they operate within have been hugely effected. The domino effect of a crashing economy has hit service organisations hard.
Fundamentally, we all know that for the short to mid-term at least there is going to be a lot less there's going to be less cash in the market. However, the precedents of the past have shown that often in an economic downturn it is service delivery that will thrive as assets in the field are sweated that little bit longer – meaning the service and maintenance contracts required to keep those assets operating at full capacity become in greater demand.
"There's a whole knock on effect across all industries where companies are affected in being able to collect that revenue in line with the standard service the cash cycle..."
- Daniel Brabec, ServiceMax
“I think we have to look at a couple of pieces,” commented Daniel Brabec, Vice President, Globat Customer Transformation Services, ServiceMax during the last Field Service News Think Tank Quarterly Debrief.
“From the financial perspective, some companies such as those in med-tech sector are companies you would think are doing fantastic simply there's such a high need for their services at this time. However, you also have to consider whether or not their customers can pay them.
“There's a whole knock on effect across all industries where companies are affected in being able to collect that revenue in line with the standard service the cash cycle. So the question is what are these companies looking at in terms of bringing revenue back into the business to invest? I think Alec [Pinto, Leica Bio-Systems] really hit the nail on the head there in his in his comment about revenues being tied to fixed services.”
This is an important point and one that was discussed heavily during a Think Tank session that was centred around the initial impact of the pandemic. Will there be a requirement for rethinking the way we approach developing our service contracts and indeed our very service offerings as we try to adapt to the new normal?
“We need to see a shift and we will see a shift,” Brabec continues.
“I think for a lot of organizations if they want to thrive in the future the shift will be towards outcome based services. This is because you are working with a customer and end user and have a contract with them where you're guaranteeing certain levels, you still have that contract. It's not going to be impacted as much as a contract on a time and materials basis.
“Moving forward, I believe you're going to have a lot of organizations shift more toward that model out of pure necessity - they won't be able to survive if there were continued pandemics or any other issues that might arise in the future that could potentially limit their cash flow. So, companies will have to think of other ways to have that that recurring revenue that adds long term annuity streams that will help your business not only weather the storms but continue to thrive and grow into the future,” Brabec adds.
“I think this entire pandemic has showed us that we have a large vulnerability with the way we have set up our supply chains with a lot of manufacturing happening offshore..."
Coen Jeukens, ServiceMax
Of course, with the question of both customer supply chains and restricted funds within the market another big question we must address now is whether the service supply chain and spare parts logistics is robust enough to survive a second wave of lockdown should the pandemic rear its ugly head once again.
“I think this entire pandemic has showed us that we have a large vulnerability with the way we have set up our supply chains with a lot of manufacturing happening offshore,” reflected Coen Jeukens, Vice President, Global Customer Transformation, ServiceMax during the debrief session.
“If we go back to our customer base, we see that customers have organized their supply chain in a certain way because that was the most efficient way under the legacy model, because we couldn't conceive something like this would happen. Now we know and Daniel already mentioned the business continuity plans, those continuity plans, couldn't even foresee this happening. I think that right now with these new insights, we will rethink our continuity plans, and we will start preparing for it,” Jeukens adds.
So, could this be the impetus for a more widespread adoption of 3D printing? Particularly within the spare parts arena?
“I do think that in certain cases, it is possible to use 3d printing to print spare parts - it is possible but for other parts I think we do have to rethink, maybe we have to go back to the CFO and say, ‘well, you had an inventory reduction program, but if we look at our recovery process, we might have to invest in additional stock.” Jeukens comments.
“Alternatively, it may be the other way around. Maybe you have sufficient stock but you have certain technicians are hoarding spare parts in case of another supply chain failure. For me it is essential that companies invest in the visibility in their own infrastructure to see what technician is ordering and who's consuming it.
“Then, even if you have a shortage of material, then you should rethink from a prioritization perspective. What particular break-fix type of situation really warrants you to use one of those very precious spare parts instead of just fixing a piece of equipment for a machine that doesn't really have a criticality in a customer context? I think that revisiting those business continuity plans, rethinking the supply chain, see in what areas 3D printing can alleviate the pain, is an important undertaking for service organisations at this moment,”
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Aug 31, 2020 • Features • Covid-19 • Think Tank
In this excerpt from the inaugural Field Service News Think Tanks Debrief Session Kieran Notter and Daniel Brabec reflects on the groups comments around the initial operational challenges of Covid-19
In this excerpt from the inaugural Field Service News Think Tanks Debrief Session Kieran Notter and Daniel Brabec reflects on the groups comments around the initial operational challenges of Covid-19
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The many conversations required for servitization to work:
As we moved onto the final Think Tank of the three that we were reflecting on during this inaugural debrief session we touched on the longest and perhaps most important Think Tank that Field Service News has ever run. The focus of this session was to assess the impact of Covid-19 and to establish some first steps in building towards the recovery.
Having put an initial question to the group for them to outline their initial responses to the lockdowns of the pandemic, it made sense for Kieran Notter, VP Global Customer Transformation to be the one that opened up the discussion during the debrief.
During the actual Think Tank there were some excellent and well considered comments including Alec Pinto, Regional Service Manager DACH & High Growth Markets, Leica Biosystems comment:
“From an operative perspective, we couldn’t go out anymore. So we had to start getting used to the new regulations quickly. What was allowed in hospitals? How could we get our people into hospitals? Suddenly, we were putting our people in areas of risk, so managing that part of the operation and ensuring safety while letting our employees feel secure, that was a big challenge to overcome.”
As well as Rajat Kakar, Executive, IBM, Services EMEA comment:
“We saw a massive shift in ways of businesses. As an example, companies who provided services for people to migrate from office buildings to homes were busy; they didn’t have enough people to bring the office equipment, set it up at people’s homes and set up home offices. Whereas, companies which were primarily working on standard services, IT services within the corporate environments, they saw a decline in business.”
Reflecting back on both these quotes and the discussion at large Notter said, "for me, it was, it was quite interesting listening to everybody view. We gave them a rough two minutes to try and give a view of what the current situation was about. But it was it was that important or passionate to them that two minutes was nigh on impossible.
"On Alec's points, there was much that he sad that couldn't all fit into one slide but some of the other bits that Alec said that really sort of made a difference. We know med-tech device companies, at least some of them, are really, really it's going to thrive through this pandemic, because it's their business, it's what they do.
Then we have the other businesses that have done really bad because no one's using their products. There is no service has to be done and it's a very different environment. For someone like Alec, who was sort of in the middle, they were doing that that hospital work, where they had to stay open. It was even the confusion that if a technician went into a hospital to do some work in a schedule, you were asking do they need their quarantine for 14 days because they've been into a hospital? What are the rules behind it? What's the game plan?
Then there is the HR element that came into the conversation. How do we look after the technicians? What happens if they've got dependents at home who are vulnerable? So that's the level of detail really and understanding of what the challenges are.
"When Rajat, spoke, he spoke about some great points, but one of the most interesting things I thought he raised was one of the simplest. He said, People come to work, the telephones are on their desk. You leave them at home that telephonic system isn't with them anymore. How can they run a call center if they have no telephone? It's just really really simple things like that, that no-one had planned for."
"I think one of the key pieces that we've seen that's come came out of this is around business continuity plans and the way that that companies are starting to reassess the way they approach their customers," adds Daniel Brabec VP Global Customer Transformation, ServiceMax.
"We need to use this time to find ways to make and build relationships and any CSO that's looking at things from that perspective, I think, is is poised to thrive moving forward. They're acknowledging that we have a huge issue, but what are the ways that we can address it and not only adjust to the new normal but also come out of the stronger. A lot of that is focused on customer relationships and how they're going to actually approach service in the future."
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Aug 27, 2020 • Features • 3D printing • Artificial intelligence • Video • Aquant • Parts Pricing and Logistics • north america • Field Service News Digital Symposium • 3D Systems Corporation
Having given an excellent presentation in the Field Service News Digital Symposium on the application of Artificial Intelligence in service triage, Mark Hessinger, Vice President, Global Customer Service, 3D Systems Corporation spoke with Kris...
Having given an excellent presentation in the Field Service News Digital Symposium on the application of Artificial Intelligence in service triage, Mark Hessinger, Vice President, Global Customer Service, 3D Systems Corporation spoke with Kris Oldland, Editor-in-Chief, Field Service News at length about the Aquant solution that they had implemented.
The session was designed to shine a light on the many benefits that 3D Systems Corporation realised from implementing the Aquant AI tool. However, it was also a golden opportunity to explore the potential of 3D printing in the service supply chain - which the two discussed briefly towards the latter part of the conversation.
During his presentation, Hessinger outlined that companies are beginning to move away from seeing 3D printing as a tool for prototyping and moving towards using the technology more in production as well.
Given the recent pandemic where supply chains were put under massive pressure as borders came crashing down, could it be that we'll see a further shift towards 3D printing and use of spare parts within the manufacturing sector and beyond?
"The thing about 3D printing is that it is not just making the same things differently. It enables you to do things a lot differently..."
"Yes, with what has happened throughout 2020, and supply chains being interrupted, we do see businesses especially manufacturing sites rethinking their supply chain, how they can do things and using 3D printing is going to really be something that these companies are looking at.
"We are starting to see that feedback already. There was one of the large UK companies just came out with 30% of their new products have to be produced through additive manufacturing.
"Also, the thing about 3D printing is that it is not just making the same things differently. It enables you to do things a lot differently. That bracket I showed [during the presentation] combined 13 parts. Fuel nozzles can be created much more efficiently because you can create geometries that you could never do in traditional manufacturing. I think we're going to have the impact from both sides. Supply chains need to rethink how they build things, and engineering needs to continue to get creative on how they make things to have better quality."
Further Reading:
- Read more about Digital Transformation @ www.fieldservicenews.com/blog/tag/digital-transformation
- Read more about Artificial Intelligence @ www.fieldservicenews.com/hs-search-results?term=Artificial+intelligence
- Read more exclusive FSN news and features from the Aquant team @ www.fieldservicenews.com/hs-search-results?term=Aquant
- Connect with Mark Hessinger on LinkedIN @ https://www.linkedin.com/in/markhessinger/
- Find out more about Aquant's AI-powered service triage @ www.aquant.io/
- Follow Aquant on Twitter @ twitter.com/Aquant_io
Aug 26, 2020 • Features • Think Tank • Servitization and Advanced Services
In this excerpt from the inaugural Field Service News Think Tanks Debrief Session, Daniel Brabec, Coen Jeukens and Kieran Notter of ServiceMax outline what they think is driving forwards the move to servitization amongst field service organisations.
In this excerpt from the inaugural Field Service News Think Tanks Debrief Session, Daniel Brabec, Coen Jeukens and Kieran Notter of ServiceMax outline what they think is driving forwards the move to servitization amongst field service organisations.
Missed the full debrief session? Field Service News Subscribers can access the full debrief session on the link below.
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The many conversations required for servitization to work:
While there is much discussion about the how of servitization it is also important to understand the why. This was something that came up in on of the Think Tanks covered within this debrief session.
As Maarten Wijnheijmer, Global Aftermarket Sales Director, Howden commented during the Think Tank in question:
“I think perhaps one of the most important points around servitization is that you cannot sell the concept to everyone immediately. Although an even more important point around servitization is that, if you want to keep it simple and practical, you don’t need to sell it to everyone immediately either. The trick is to start with customers that recognize the value, test the proposition with them and then scale-up.”
While in the same Think Tank Jan van Veen commented:
“I think there are two things that need to be considered. One is the belief in the direction, the other is that you need to be able to innovate and try and explore and that you have resources available to do so.
“Often within companies everything can be so short term oriented, if that is the attitude of top and middle management then innovations will never flourish because such projects are just a disturbance of what is really important which is hitting your monthly and quarterly numbers.”
"I think that buy-in across all the organisation is key," Commented Daniel Brabec, VP Global Transformation, ServiceMax during the debrief session.
"You have to have all of the different players and a groups and have everyone bought in," Brabec continues.
"If we think about basic change management skills, you have your project champions. You want to make sure you have champions essentially for servitization across the whole business. That's at the the field service engineer level, that's at the senior leadership executive level and that's obviously at the at the service leader level. I think the one thing that's hugely important is making sure that service has a seat at the executive table
"It's not being directed from any one individual, it's making sure it's a conversation across all areas of the organization and that everyone's bought in. I think one of the things that must think about with servitization is understanding the conversation must make sense for all these individuals. Making sure they understand what it is is actually going to change about the business. It is also focusing on those areas of customer intimacy, operational excellence and product leadership.
"It's understanding all of those pieces, and then the value that will be generated for each of their areas of the business," Brabec adds.
"In answering what is driving the move to servitization, I would say a launching customer..."
- Coen Jeukens, ServiceMax
"I agree with, with Daniel's statement," comments Kieran Notter, VP Global Customer Transformation, ServiceMax,
"However, I would also add that there is there is a change now for for many businesses. It probably was a little bit earlier in the IT world, but now it's hitting the rest of the world as well is this change from having two CSOs. One being a Chief Service Officer and the other being a Chief Sales Officer, and obviously, the Chief Sales Officer was generally on that table before his service equivalent ever got there.
"But now there's a change where those two CSOs are disappearing, and you're ending up with a Chief Revenue Officer. By having a Chief Revenue Officer, now, all of a sudden, a company is focusing on where revenue comes from, and where it exists. If you are moving to a truly outcome based services, when you get to the element that you're no longer selling your product, you're actually selling as a service then that changes the whole profile. You know, if you're not selling the product, you don't need the Chief Sales Officer you're selling as a service. So you need someone to look after that revenue and understand that need and how that works between the product and the actual service that you provide," adds Notter
"I really think that Kieran and Daniel are correct from an internal Field Service Organization perspective," concurs Coen Jeukens, VP GLobal Customer Transformation, ServiceMax.
"All these dynamics are important. in answering what is driving the move to servitization, I would say a launching customer. For instance, I think the most quoted servitization offering is power by the hour by Rolls Royce. However, Rolls Royce developed that service offering not because they thought it was such a good idea, but because the Royal Air Force said we want to have more predictable models. We want to buy it from you, so you develop it for us. So I think tapping into the mindset of the customer and see if you can find a launching customer. I think that is a very good addition to all the internal alignments just by the CEO, CFO or CSO"
Want to know more about this Think Tank Conversation? The full Executive Briefing Report from this Think Tank Session is now available for Field Service News Subscribers. If you are already a subscriber click the button below to read the report now!
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Data usage note: By accessing either of the premium content resources listed above you consent to the contact details submitted when you registered as a subscriber to fieldservicenews.com to be shared with the listed sponsor of this premium content, ServiceMax who may contact you for legitimate business reasons to discuss the content of these resources.
Aug 24, 2020 • Features • Artificial intelligence • Digital Transformation
At the beginning of 2020, the one technology predicted to finally be on the cusp of an industry-wide breakthrough this year was Augmented Reality (AR). Fast forward to the second half of the year, and that prediction has come true although for...
At the beginning of 2020, the one technology predicted to finally be on the cusp of an industry-wide breakthrough this year was Augmented Reality (AR). Fast forward to the second half of the year, and that prediction has come true although for different reasons than those predicted.
With Covid-19 driving an urgent need for remote service delivery, suddenly AR almost overnight became a necessity rather than a mere nice-to-have technology. However, while the drive towards remote service delivery has been given turbo-boosters by the pandemic, the critical developments within the technology that we at Field Service News thought would be the catalyst for wider spread adoption of AR in field service.
That development was the inclusion of Artificial Intelligence (AI) within the field service focused AR. Here we look at how AI may well be the missing key to unlock AR’s potential
“The challenges posed by the current global situation and the related change in proximity logics are rapidly transforming many companies’ business processes and their approach to daily activities,” writes Francesco Benvenuto, Product Marketing Manager, OverIT
Having just combined the two technologies (AI and AR) in their 3.0 release of SPACE1 (OverIT’s dedicated AR solution to field service) demonstrated on the Field Service News Digital Symposium. The AI-enhanced version of SPACE1 was undoubtedly impressive with multiple potential time savings aspects that could help get trainee technicians out into the field, bringing value to the organization much, much faster.
However, the emergence of an AR solution underpinned by AI isn’t unique to SPACE1. It is the central premise of Augmentir’s solution. As Russ Fadel, CEO and Co-Founder, Augmentir outlined in an exclusive Field Service News feature where he explained why the next wave of AR implementations in our sector must harness Artificial Intelligence.
"What has been ignored is a real opportunity to create sustainable value throughout the organization – not only giving workers the ability to consume information and apply knowledge, but also augmenting the intelligence of the organization..."
- Russ Fadel, Augmentir
Writing in August 2019 Fadel had commented, “Despite some early momentum, Enterprise AR alone isn’t enough to deliver sustainable value in the field service sector.
“What has been ignored is a real opportunity to create sustainable value throughout the organization – not only giving workers the ability to consume information and apply knowledge, but also augmenting the intelligence of the organization relative to how it engages empowers, and continually improves its human workforce. At Augmentir, we are calling this Augmented Operations, and we believe that this will transform the service workforce of the future.”
Ultimately, at the heart of successful innovation in the industry is the harnessing of multiple technologies alongside each other.
As Bas De Vos, Vice President of IFS Labs, explains “Combining different technologies is the key to unlocking the full potential of any digital transformation/innovation projects.”
However, for DeVos, there is more that is needed for successful deployment of AR in field service than the introduction of AI.
“AI will certainly support the development of AR, but it’s not the only missing piece in its success,” De Vos suggests
“AI is a key ‘supportive’ technology, the use of AI in computer image processing and its unique learning abilities allows AR processes to develop to the next stage, to achieve the desired end goal and in doing so AI guides AR to new heights.
“However, to unlock the true value of AR’s potential, the world of head-mounted devices needs to accelerate. Today’s adoption speed is still lagging behind expectation which is mostly related to costs and the maturity of the hardware.
“The true value of AR shines best when combined with AI on a head mounted device, rather than a handheld device.”
The argument that De Vos makes undoubtedly holds some weight. Many would agree that the endpoint of AR in a field service environment would involve lightweight head-mounted computes. This allows the field service engineer to work hands-free, while still receiving vital information from either the asset itself via IoT connections, a remote expert or a knowledge management solution embedded into the AR/FSM solution.
However, it should equally be noted that the lack of affordable, field-ready solutions shouldn’t be seen as a barrier to adoption today.
Indeed, the majority of AR solutions today are available as cross-platform, solutions that can function well utilizing the existing technology in your field service technicians toolkit – namely either a smartphone or tablet.
In the Field Service News Digital Symposium presentation on SPACE1, there were multiple benefits of adopting such a tool, even if the implementation is based upon handheld devices.
For example, some of the benefits Benvenuto outlined during the presentation included:
- Maintenance: By providing support to field technicians during maintenance, inspection, and test activities, to enhance productivity, quality and safety, even in those situations with the low network coverage.
- Training: By introducing a new perspective in training activities, allowing users to collaborate everywhere and providing them with remote interaction and knowledge sharing tools.
- Presentation: By driving the way to cooperate to new heights, allowing to involve clients and suppliers from remote to propose products and share advanced contents in real-time, ensuring an unprecedented user experience.
However, what is catching the eye in many of the most impressive AR solutions is the further integration with Knowledge Management features, and this is increasingly reliant on harnessing the most advanced Artificial Intelligence technologies which allows for reshaping and sharing of collected data.
The future of AR in field service has finally begun, and AI will be a fundamental part of that future moving forward.
Further Reading:
- Read more about digital transformation in field service @ /www.fieldservicenews.com/blog/tag/digital-transformation
- Read more about the use of Artificial Intelligence in field service @ www.fieldservicenews.com/hs-search-results?term=artificial+intelligence
- Read more about the use of Augmented Reality in field service @ www.fieldservicenews.com/hs-search-results?term=augmented+reality+
- Find out more about the solutions OverIT offer field service companies @ www.overit.it/en/
- Find out more about the solutions IFS offer field service companies @ www.ifs.com/uk/
- Find out more about the solutions Augmentir offer field service companies @ www.augmentir.com/
Aug 24, 2020 • Features • Think Tank • Servitization and Advanced Services
In this excerpt from the inaugural Field Service News Think Tanks Debrief Session, Kieran Notter discusses his experience when it comes to structuring a field service organisation to adapt a servitized approach...
In this excerpt from the inaugural Field Service News Think Tanks Debrief Session, Kieran Notter discusses his experience when it comes to structuring a field service organisation to adapt a servitized approach...
Missed the full debrief session? Field Service News Subscribers can access the full debrief session on the link below.
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The importance of aligning internal and external needs:
In the second of the Think Tanks discussed during this debrief session, the focus of the conversation was centred around the increasing drive towards servitization.
One thing that came through in the Think Tank from all of the members, was the importance of executive-level buy in for a servitization project to even begin.
However, we also saw across the discussion the importance of buy-in from the bottom up as well. It really does need to be a company wide movement and adoption.
As Christo Roux commented during the Think Tank:
“In our organisation up until two years ago we had two different business units, based on two different technologies but our board reorganised and we now have three units with service being the third. Service now has a seat at the executive table and that has been the real game-changer. Now service has a very high profile, it is no longer that secondary part of the discussion which just gets added to the end of the product sale. Service is now an intrinsic part of the overall sales process. What we have found is that when you have that executive board level representation, focus and support, that does make a difference to how you can servitize.
For a long time, service has proven that in the lows of capital expenditure, service maintains the revenue stream. People always need to maintain their equipment and keep service running, so we were always a constant revenue stream at constant margins.
This was largely driven by a change in the CEO seat and a lot of credit for this shift in mindset has to go to the new CEO who had the understanding and the vision to bring service into the executive conversations.”
In that same Think Tank, Kris Oldland, Editor-in-Chief, Field Service News commented:
“Another company I have worked with has organised their services within business units so each and every business unit is responsible for developing their own service offerings. However, what I believe they also need is a platform to establish new sertivized offerings, a central competence group that is guiding the teams to what is possible.
“Having covered the establishment of such groups in the past I’ve seen them have a real impact. Such groups, I think, should keep strategy simple and make it practical. Keeping it simple means taking baby steps, but at least you are taking them and moving forward. Making it practical is to enable these business divisions to actually deliver the projects. They are not going to invent the wheel themselves – so you have to bring it to them.
“Another organisational question in this area, is whether service is best structured as a separate business with its own P&L or as part of the product teams?
“The challenge is that if service is joined up, the focus will mainly be on the new builds or implementations, because that is where the big money is. Service is usually many smaller orders as opposed to the one big hit of the product sale. The service side of the organisation has to fight for priority and capacity and a shared understanding of the value of the long-term service relationship may ensure the organisation will accept the required investments in this case. On the other hand, if a company splits the operations, the problem becomes the handover from new build to service and customer relationship management. Ultimately, both models have challenges, the key is to realise what is the ‘inside of the battle’ and to establish the common ground to work together for the greater good.”
Oldland's comments reflect something of a common dichotomy in the field service sector. On the one hand there is a new innovative organization within an organization. As a company seeks to build out this servitized or advanced services solutions, they are competing with not only product sales, but also the standard, traditional service approaches within their organisation as well.
Having had experience of such challenges as a service leader himself and also in his role with ServiceMax assisting over service organisations navigate their way towards a servitized business approach, Kieran Notter, VP Global Customer Transformation, ServiceMax was well placed to help offer guidance for those on the call.
"One thing I have learned through the relationships I've had with my own experiences when working in the service industry, and then again, working for a software company like ServiceMax, but mostly through things like the Think Tank is that is never never clear yes on these answers," Notter began.
"There's so many variables that come into play such as the vertical that you are operating in. You look at things like new businesses, such as solar panels, they've come into the marketplace and instead of taking an old fashioned approach where they merely sell the solar panel, they have been able to ease into a servitized approach where they sell the outcome - the energy."
"There needs to be an alignment in the business. If you move into a siloed business you're not going to help anybody, the customers or yourself..."
- Kieran Notter, ServiceMax
"So there is a totally different aspect if you're a new company, you have a little bit more freedom. Whereas in some of the more traditional industries, companies that we expect to talk to day in day out, it's realistically about establishing an understanding from the top level. I personally the key is aligning the goals that people need realised.
"I mentioned earlier about understanding whether the supply chain is service's friend or foe. If you think about the fundamental goals that are required by these two organizations, with the supply chain needing to reduce inventory and service wanting more inventory, so it can increase its first time fix rates.
"On outset, that sounds like an argument, so there needs to be an alignment in the business. If you move into a siloed business you're not going to help anybody, the customers or yourself. So there has to be some sort of alignment. You'll find that that becomes possible maybe with some of these Tiger teams, where they can bring in people from each area and then they're freed up to do the 'free thinking' that isn't constrained by their their MDO's or their KPIs, or their compensation packages."
"It's about understanding what that is and then of course, there's always the other aspect which is when you come up with these great ideas and these visions, does your customer want to join in with that that vision? Are they acceptable to it or indeed, are they actually against it? Then if you find the ones that are acceptable to the idea, can you actually manage it? What infrastructure do you have to actually manage the offering that you're giving?"
"However, I think the world is dictating a newer approach. You know, when we heard from Coen and Daniel earlier and talking to all of the members of the Think Tank, we're looking at new initiatives, new intelligence, new ways of doing business."
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Aug 21, 2020 • Features • Ageing Workforce Crisis • Recruitment • Managing the Mobile Workforce
There is a Tsunami of youth unemployment awaiting us at a time when we face a crisis of an ageing workforce. Surely it is time to join the dots before it is too late writes Mark Homer...
There is a Tsunami of youth unemployment awaiting us at a time when we face a crisis of an ageing workforce. Surely it is time to join the dots before it is too late writes Mark Homer...
The world has never been more unpredictable, such a statement invites a variety of responses that ranges from complete agreement to denial or a more middle of the road response; possibly augmenting the discussion with words of caution or even scepticism. My own view is the world has always been unstable and unpredictable, but I do think we are heading into uncharted waters.
I suspect the majority of Service Leaders would agree that increased economic pressure, social compliance and even more operational uncertainty is ahead.
Furthermore, this uncertainty in itself is more than likely to have the greatest impact on our futures, our service industry and especially the way we work. Throughout this COVID crisis a large number of our field service colleagues have been quietly continuing to supply service and continued to maintain critical equipment to ensure the continuity of availability and supply.
Many have willingly accepted a greater personal risk to themselves going about this essential work given the potential infection risks they continue to face. We should all take the time to thank, acknowledge and appreciate their amazing contribution throughout this crisis and continue to celebrate what an interesting career it is to be in the service industry. This is exactly the time to promote just how critical the service industry is to our modern society.
"During this crisis, I have listened to many service leaders describing how they are deferring more routine maintenance and preventative work. Consequently, increasing their work backlog to record levels, thus increasing future demand..."
- Mark Homer.
However, under the surface brews the swirling currents and early signs of a storm, a skills shortage. For the last few years I have been commentating on the rise of the Service Gig economy, the increased use of third party labour and the increasing reliance on third party contracting firms to help Service leaders smooth the peaks and valleys of fluctuating service demand.
I have been to many conferences where presenters have warned of the potential for increased widespread industry skill fade; largely due to our baby boomer generation now retiring from the global pool of available technicians and allied service trades. The continued trend to also sweat capital assets and eke out just a few more years of operational asset life before eventually total failure, parts obsolescence, lack of knowledge in the field force to service such assets and available options for final asset replacement.
Also, during this crisis, I have listened to many service leaders describing how they are deferring more routine maintenance and preventative work. Consequently, increasing their work backlog to record levels, thus increasing future demand.
I was really struck by an article in the Sunday Times by Kenneth Baker last week. Lord Baker is chairman of the Baker Dearing Educational Trust and a former UK Government Education secretary; he warns of a youth unemployment tsunami. Citing that sadly many apprenticeships that were approved this year have already been cancelled by companies, including Bentley, JCB, Netflix, Rolls-Royce and Warner Brothers.
More cancellations will follow. He makes the call for more technical training and technical skills development, calling on the UK Prime Minister, Chancellor and current Education Secretary to make changes that facilitate more courses to be available and that training is better than unemployment. He illustrates how the Government might fund this change.
As a service industry we are in desperate need of that new talent. Now is the time for us to all get involved with schemes that encourage people to join our industry.
To come together to promote the range of interesting and rewarding careers that will in turn help address both the skill fade and skill shortage that we will all likely face in coming years.
Let’s start promoting our industry, recruiting new talent and in the words of Lord Baker to train, train, train.
Mark Homer is an independent commentator, who specialises in Digital Transformation within the Field Service Industry.
Aug 21, 2020 • Features • Think Tank • Servitization and Advanced Services
In this excerpt from the inaugural Field Service News Think Tanks Debrief Session, Coen Jeukens expands on how we must reframe the Service/Product conversation
In this excerpt from the inaugural Field Service News Think Tanks Debrief Session, Coen Jeukens expands on how we must reframe the Service/Product conversation
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The many guises of servitization:
The question of how we must realign the relationship between service and product as we move towards a more service-centric economy has been discussed at length across the pages of www.fieldservicenews.com. We've been tackling this conversation with representatives of various corners of the field service world, not only geographically but also from industry and from academia.
The consensus, that was also echoed in this Think Tank is that collectively we need to reframe what what these conversations around servitization mean. That is because there are now very many different interpretations of servitization, through-life-services, outcome -based-services and advanced services.
At the very least companies need to be able to define their understandings of what servitization means to them, they need to then reframe that conversation internally first, so they can take it forward externally.
Speaking during the Think Tank Christo Roux, Director, Field & Workshop Services, Outotec commented:
“We talk about bundling our offering. So in terms of servitization it has come down to long term service agreements which may include consignment stock, service level agreements, partial or full presence on site, 24 hour call services and so forth.
“For us that is as far as we are going in terms of servitization.
“But outcome-based services in our world is definitely a discussion being held, but the general consensus would suggest that it might have to be something that is separate to this initial approach.
“I don’t today see it as something we could integrate into our field service offering particularly easily - so we will still definitely go with our long term service agreements. Through these we have an expected revenue base and also a better resource loading capability and then we can supplement this with all the spot resources we can do as well.”
In the sameThink Tank Maarten Wijnheijmer, Global Aftermarket Sales Director, Howden commented:
“Even if the official strategy is to prioritise aftermarket and at the top level that is the story, you also need to see what is happening two layers lower in the organisation, which is where the day to day decisions are made. Strategy doesn’t land on its own and it is not always understood by the top what is needed to implement their vision to generate more aftermarket business.”
Also sat in that Think Tank was Coen Jeukens, Vice President, Global Customer Transformation, ServiceMax.
"Again, this story is just like the previous comment," Jeukens reflected when discussing the Think Tank in the debriefing session.
"It starts with the voice of the customer. I think that if we see that the customers are getting more mature and more demanding, we can see that apart from buying a product or buying the services, they simply want to have the output or the value of a product and I can really see that in Christo's comments here because it takes two. It takes the field service organization to make a conscious decisions, how far do we want to go in the maturity of our service offerings. However, of course that has to align with the maturity of the customers. Simply, it would be a waste of time if they would invest in servitization offerings, when the customers are not there to buy them."
"I think in every vertical in every market, every customer out there has their own dynamics in the market and service companies can really tap into that," Jeukens continues.
"Going back to the example of my previous employer, we started by looking at the voice of the customer, and we were selling safety and security systems. So that could be something simple as a camera system or a security camera system. Now the customer can buy a bunch of security cameras and they can maintain them themselves. We as the solution provider could buy or sell those cameras and we could sell associated maintenance contracts with them in this scenario what we would do is over the lifespan of the system is ensure that the customer receives the camera feeds
"However, we we saw that more and more customers were saying well that is not what we want. If you look at an airport for example there would be thousands of cameras. Just try to imagine the control desk where somebody is looking at thousands of camera feeds. It is unmanageable so that was not what the customer wanted.
"The customer wanted to have the insights. They only wanted to see the feeds of the cameras which need actionable items. So if you look at what customers really need, you can really start selling those new types of services. We had the privilege to have a number of customers who really valued that type of service."
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