In a recent presentation for the Field Service News Digital Symposium, Mark Hessinger, Vice President, Global Customer Services, 3D Systems, Corporation, outlined the benefits his organisation had witnessed having implemented an Artificial Intelligence solution provided by Aquant.

One of the areas that Hessinger referenced during the presentation was the reduction in repeat visits and the increase in first-time fix rates. This, of course, will have a significant impact on the bottom line of the service P&L with the truck roll almost always being the most expensive line on the spreadsheet. As the adage goes, if you have to send an engineer on-site once then you are breaking even, even if you have to send an engineer twice, you're losing money. So this improvement, in and of itself, was a massive plus in the presentation.

However, given the backdrop of 2020 where the world has radically changed as a result of the reaction to Covid-19, the question was raised during the Q&A that followed Hessinger's presentation whether Aquant's AI-powered triage tool could be suitable to help facilitate zero-touch or remote assistance services as well?

Could the Aquant solution help provide a mechanism for service delivery for those customers who require a guided self-help approach to issue resolution?

"I'd say the tool is a building block to enable us to get there," Hessinger answered when the idea was put to him.

"We need it integrated with the other systems and information because it connects them to the knowledge management, to the information. We're currently doing a proof of concept to pull in some AR (augmented reality) technology as well. We believe integrating the AR technology can help guide someone first using the AI tool to go in the right direction and then guide them remotely on how to execute a repair. If you put both of these pieces together, I think the quantity of remote resolutions will go up dramatically," Hessinger added.

 

"Typically, your field service engineer builds a good relationship with the customer and becomes part of the face of the company right. We still want to have those touch-points, but we need to make sure we're doing them differently..."

 

This leads us to an interesting question - in a post-pandemic world just how much has the perception of value shifted in terms of remote service vs on-site service delivery?

Often it has felt that there's been a more perceived value to a site visit than remote services. As we mentioned earlier, it is an expensive line on the P&L compared to a remote service. This was one of the reasons that many felt that remote assistance technologies such as Augmented Reality have never quite taken off in the way that we might have imagined. However, that has changed massively in the last five months in the eyes of many customers.

Yet, for the savvy service organisation, the on-site service call is far more than a mere maintenance operation. It is an opportunity to engage with the customer, to showcase the expertise within the organisation, and ultimately to secure ongoing business and even open up new revenue streams.

So the question is, how do field service organisations use remote service within their service portfolio as an active engagement channel as many have mastered with the service call?

As Hessinger explains "Typically, your field service engineer builds a good relationship with the customer and becomes part of the face of the company right. We still want to have those touch-points, but we need to make sure we're doing them differently. If I can see you on video, I've made a better connection than if I sent you a text message.

"We need to leverage how do we continue to build those relationships. If we were with a customer three times a year, and now we can do things better, only one time a year, we need to make sure we still have a high touch with the customer to build that kind of rapport and relationship."

 

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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

 

Having published a series of features based on excerpts from their latest white paper, Aquant's Edwin Pahk, has outlined the importance of field service companies measuring KPIs, now more than ever before. He has also identified for us the five KPI's he believes are crucial for service leaders to measure. Here in this bonus addition to the mini-series, Pahk concludes with an overview of the Aquant Workforce Performance Index...

 

Would You Like to Know More? www.fieldservicenews.com subscribers can access the full white paper on the button below. If you are yet to subscribe join 30K of your field service management peers and subscribe now by clicking the button below...

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In this excerpt from the first Field Service News Think Tank Debrief Sessions, ServiceMax's Coen Jeukens & Kieran Notter expand on the difference between data, insight, action and value.

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Standing on top of a data mountain or drowning in a data lake? 

"I think for many organizations, it's [harnessing the power of the data wihtin their systems] very difficult," begins Coen Jeukens, VP Global Customer Transformation, ServiceMax.

"They have run their service organizations for many years in a particular paradigm and when they are confronted with new tools or technologies it's very difficult to get a kind of sneak preview or an idea of what those new tools could bring," Jeukens continues. 

"Of course, from a marketing perspective, we have great messages about IoT data. But what that has brought us a lot of data lakes. So what I really liked in the statement of Jan van Veen  during the Think Tanks was where he talks about about data and insights, and then he talks about value. However, there is one particular step in between. Data can be converted into insights, but the insights must then be converted into an action and the action itself provides the value."

"Sometimes you can create an action on an insight, but if that action doesn't provide any value should you could still continue collecting the data and the insights for it? By looking at and rationalizing that, by looking at things from a methodological perspective, not simply just jumping on the bandwagon of each new technology, but really having a clear understanding of what's the objective and then reverse engineering what you need.

"As for technology, well, it's a great driver, and it's an enabler at the same time, but then you can start making sense of things," Jeukens adds. 

 

"For me, it's about having a vision of what you want, and then measuring what you need to put that in place and then collecting that data.."

- Kieran Notter, ServiceMax

 

"One of the things I've seen all my years is there's there's there's a huge amount of desire to collect data," comments Kieran Notter, VP Global Customer Transformation, ServiceMax. 

"To speak to the point Jan was making during the Think Tank, there is not always a vision to understand what to do with that data. I think a lot of the times we try and put in a solution before before we actually understand what the problem is," Notter continues. 

"I think that is often the issue, companies must understand what the problem they are trying to solve is, or the outcome, or the value that they're trying to drive, and then only collect the data for that. 

"If you think about a technician in the workplace, which is either a scenario where you're utilizing the technician to collect the data, or you're utilizing connected products. If we look at that human element, the humans will stop collecting it with accuracy if they think it's not being used or utilized. So for me, it's about having a vision of what you want, and then measuring what you need to put that in place and then collecting that data.

"Don't drown yourself in data," Notter concludes

 

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Servitization, outcome-based services and product-as-a-service are hot topics. However, we see little examples in the industrial sectors. Too often, there is a gap between the theoretical framework and the real practice. Here Jan van Veen, Managing Director, moreMomentum, outlines 3 critical steps to boost the success of your servitization journey...

Summary

We hear a lot about servitization, outcome-based services and product-as-a-service business models. However, we see little examples in the industrial sectors. Many manufacturers face serious challenges while developing and launching new service offerings:

• Clients do not see the value, have many objections and are not ready for it
• Lack of strategic support to invest in necessary capabilities and to develop their business model

3 of the root causes are:

• The gap between academic terms like servitization, outcome-based services and product-as-a-service and the practice is not being closed yet
• Poor definition of the critical business problems of clients which will be solved with the new offering
• The impact on the manufacturer's business is not clear yet

In this article I share some of the best practices for designing advanced offerings which will help you to overcome these challenges:

• Build deeper and broader insights in your clients business challenges and pain points
• Focus on specific customer segment, based on their needs
• Approach your business models more holistic

 

The Problem

Just as an increasing number of manufacturing companies, you may be looking for ways to thrive during disruptive change in your industry. This is an exciting journey of enhancing your business models with digital solutions and advanced services.

Some of the major trends that make this mission critical for your future success are:

• Digital technologies
• Digitalisation of clients’ operation
• New emerging business models
• Shifts in the value chain / ecosystem

The vision behind these innovations is:

• Develop advanced services and solutions to develop new and recurring revenue streams and increase long-term differentiation.
• Develop better performing and more efficient predictive maintenance services.
• Meet a broader scope of (latent) customer needs, beyond availability and condition of equipment like operational performance solutions.

Most service leaders and innovators, solution providers, academics and consultants use broad and abstract concepts to describe their vision, strategy, innovations and new offerings with container words like:

• Servitization
• Advanced services
• Outcome-based services
• Remote services

I often hear from service leaders and innovation teams that they struggle with challenges like:

• Clients do not see the value of the new offering or solution
• Clients see many obstacles and risks
• Clients are not willing to pay more for the new solutions
• Clients are not ready for the new solutions
• Lack of support from strategic stakeholders and other functions in their organisation

In essence, all boils down to the following 3 problems:

• The new solutions and services do not solve (new) critical business problem of the clients. The value or impact is not clear (other than potentially lower prices for the maintenance services).
• It is not clear how these services contribute to the overall business challenges and vision of the company as a whole.
• The service vision is too abstract for internal stakeholders to understand and endorse. Words like servitization, outcome-based services, remote services and product-as-a-service are too theoretical and do not clearly articulate a vision and strategy.

This is pretty frustrating, isn’t it?

 

The Solution

In this article I share critical frameworks which many service teams miss in their service innovation strategies. These are:

• Build deeper and broader insights in your clients business challenges and pain points
• Focus on specific customer segment, based on their needs
• Approach your business models more holistic

Build deeper and broader insights in your clients business challenges and pain points

To be truly outside-in and customer driven, you need to have a deep insight in the challenges and problems your clients are facing in their business. Deep customer insights should:

• Go beyond their requirements about uptime and maintenance of their assets
• Cover a time window of 3-7 years
• Be thought provoking eye-openers for your clients

You and your colleagues already have most information at hand. It is a matter of turning this information and knowledge into a compelling customer story, for irresistible advanced services.

You can read more about this in ( “Build a Strong Customer Story in 7 Steps and Launch Irresistible Advanced Services” in the Handy Little Book, published by Field Service News.

Focus on specific customer segment, based on their needs

One size does not fit all. Different clients have different visions and strategies, different challenges and therefore different needs. When defining the (latent) customer needs for today and the near future, it is crucial to have some sort of segmentation of your important clients based on their (future) needs.

This segmentation will help you to develop a robust strategy which defines which customer segments you will target, with which new service offerings and which business models you will develop.

There are many ways to segment clients based on their needs, largely depending on the specific industry. I will share two generic patterns for customer segmentation which can be useful for you to take as a starting point. They are based on segmentations of innovative and successful manufacturers and service leaders. 

Two often used patterns for customer segmentation are:

• Maturity – Willingness to outsource of a business
• Maturity – Complexity of a business

 

This could be a useful pattern in industries where many of your (potential) clients tend to do most functions themselves instead of outsourcing the activities (like maintenance of equipment).

Along the vertical axis you can separate segments based on the maturity of their core capabilities and processes.

For example, in the industry of metalworkers this could be:

• Traditional craftsmen
  The entrepreneurs personally (together with their employees) manufacture the metal products themselves, love part of the manual work and working with their machines and tools. This is their pride. Little of the activities are put into structured processes.
• High tech workshops
  The entrepreneurs have invested in state-of-the-art tools to improve quality, consistency and efficiency. Their main focus is still on the technical side of the profession. Probably there is more structure in the workflow and processes, predominantly organised from a technical point of view. From a more economical point of view, the structure is not efficient yet.
• Lean manufacturers
  The entrepreneurs have a more economic view (or hired an operations director with economic competencies) and are working on efficient processes, workflow and organisation. They follow lean-six-sigma or similar approaches to optimise human resources, capital investment and materials.
• Value chain optimisers
  These entrepreneurs have a broader scope and are looking to their added value in the entire value chain, partnerships, vertical integration or specialisation. They may also develop more advanced value propositions to their clients like inventory management and delivery of the components they manufacture in small packages in the production line of their clients.

This is a very brief description. You should probably also look into functions like sales, marketing, engineering, internal logistics, inventory management, tools management, financial management, human resources management etcetera. You get the picture.

Along the horizontal axis you can segment your market into clients that tend to do as much as possible themselves versus clients that outsource many functions which are not part of their core-process. Clients in the first category probably have various dedicated departments, competence centres or teams for functions like process optimization and maintenance.

 

This pattern could be useful if you have clients with different types of operations with different levels of complexity.

The vertical axis is the same as in the “Maturity – Willingness to outsource” pattern.

Along the horizontal axis you segment your market into clients that have short and simple value chains versus clients with longer and more complex value chains. For example, again in the industry of metalworkers this could be:

• Jobbers or workshops that fulfil specific tasks like welding, cutting, bending, drilling etcetera and that manufacture intermediate components or semi-finished products
• Component manufacturers which perform several tasks to manufacture components, like engine blocks for the automotive industry
• Product manufactures, which manufacture complex products
• Machine manufacturers

Whatever pattern you use with these segmentations, you now have 4 (or more) segments in a logical structure. For each segment you can:

• Find a descriptive name
• Further describe their specific needs
• Define their characteristics to recognise them

For each segment you should:

• Decide whether you want to serve them or not. Or at least define which segments have your focus
• Develop a customer insight or customer story
• Develop specific messages to use in your marketing, sales and service delivery
• Develop and map specific services, offerings and delivery models
• Develop a specific commercial approach

When you are still in the early stages of developing advanced new service offerings, it often pays to focus on one specific segment first.

 

Approach your business models more holistically:

As soon as your advanced services go beyond the maintenance and the condition of the equipment your company manufactures and sells, you will be reconfiguring or extending the business model of your company as a whole. This means, you need to have a strategic dialogue and innovation process with strategic stakeholders.

To make this a fruitful and coherent process, you should avoid a discussion about product versus services. It starts with:

• A shared concern about developments in the industry
• The threats and opportunities for your business as a whole
• A vision about the future state of your entire business and what needs to change to achieve this

This will result in a few strategic priorities, one of which (hopefully) is services innovation.

Now I would like two share two useful frameworks that help to take the development of the business models to a more holistic – company wide – level:

• Generic types of business models for products and services
• Types of service value propositions

Note that these frameworks are not limited to services or products alone. They address the overall value proposition, which can be a combination of products, software, data and services.

 

In the matrix above, you can describe changes of your business model along two aspects.

Along the vertical axis, you differentiate value propositions:

• From stand-alone offerings (like single products or services)
• To comprehensive and integrative solutions which cover a broad scope of needs and solutions

Along the horizontal axis, you differentiate highly standardised offerings from highly customised offerings.

This results in 4 types of business models, which I will further describe with document printers as an example:

• Product Business Model
  • Only printers, probably including service contracts
  • A wide portfolio of different models to choose from
  • Additional equipment for folding documents, putting them in envelopes etcetera
  • Getting the printer for free and paying for the ink only
  • Predictive and remote maintenance
  • Cloud storage solutions and Microsoft Office 365 still fit in this model, even though you pay a small fee per month
  • Retail banking
• Project Business Model
  • An assessment of the entire business, to define how many printers, which type and where
  • Connecting the printers to the network, configuring security systems
  • Designing, building and commissioning an entire print room for high volume printing and mailing of documents
  • Designing more effective and efficient processes
• Solution Business Model
  • Taking over the entire print room from clients, which could still be at your clients’ locations
  • Connecting the Salary Administration system to the print room to print all salary slips at the end of the month, put them in envelopes, and send them to the postal services
• Platform Business Model
  • In the printer industry the example may become a bit theoretical, anyway.
  • An online platform where clients can upload templates, designs and lists of destinations and pay for the job. The platform will split this in smaller jobs for various connected and certified print facilities across the world and process the financial transaction. (I am not sure if this kind of service ever existed).
  • In the Additive Manufacturing sector, we do see initiatives in this direction to allow manufactures to print metal spare parts anywhere in the world close to the customer
  • Other examples of today are Apples Appstore, iTunes, Spotify, Amazon, Uber and Airbnb.

 

This framework will help you to better articulate the kind of value and related business models you are aiming for. 

In this framework you can define your value proposition along the horizonal axis based on the scope of the services. There are several ways to add value to your clients (deliver outcome if you like). I will use the commercial truck industry as an example:

• Better products
  For example, improve fuel efficiency of the truck and engines.
• Better availability
  Your services can maintain and improve the availability and condition of the equipment. This could be quite advanced with real time data, smart diagnostics predictive analytics or supported self-help offerings using AR.
  For example, predictive maintenance to improve availability (and maybe also improve fuel consumption).
• Better application or use
  Your services can drive the output or performance of the equipment you delivered to clients by improving the use, configurations, settings and ongoing optimization tactics. These services can be onetime projects or ongoing support.
  For example: Reduce fuel consumption by improving the driving behaviour of truck drivers.
• Better processes
  Your services can also concentrate on the overall processes and operation.
  For example: Reduce fuel consumption (and other cost) by improving the route planning, combining jobs, choosing the right vehicles for each job etcetera.

Along the vertical axis you can separate your offerings in

• Effort based offerings
  You promise to do certain activities for which your clients pays, regardless of the result of the activities. It remains the responsibility and risk of your clients to manage the overall performance and take the right decisions.
• Performance based offerings
  You promise your clients a certain result and get a fee depending on this result. In the example of commercial trucks, this could be:
  • Guaranteed uptime and availability of the truck of 99% and penalties if the performance is below 99%
  • A fee per percent-point of reduction of fuel consumption
  • A fee per transportation job

 

How to use these frameworks?

Map your current business model(s) in one or more of the matrixes described above. Also map a few scenarios for the envisioned business model(s). 

This will help you and your stakeholders to have a more structured and neutral discussion about the major trends in the market, technology and competitive landscape as well as in what direction your value propositions and business models should develop. Any choice will have an impact on engineering, manufacturing, software development, marketing & sales and services.

What are the takes

If manufactures cannot successfully adjust their business model, they run a serious risk of falling behind existing and new competitors.

Clients are developing digital capabilities in all their functions. They will have other needs for services and solutions.

This is an important opportunity for manufacturers to grow their relevance for their clients and grow their business.

It is also a unique opportunity for digital native service providers and system integrators, which offer remarkable and complete solutions to the (new) problems of your clients. They are your new competitors.

Benefit

If you use these frameworks and embed them in your service vision, your innovation strategy as well as in your dialogue with strategic stakeholders, you can develop the;

• Shared concern for the business as a whole
• The strategic priorities for the business as a whole, one of which will be services
• Shared vision for the business as a whole, which includes services
• A specific shared concern for the services business unity
• The strategic priorities for the services business unit
• A shared vision for the services business unit

Rome was not built in one day

It is an iterative journey. It takes time and work. The frameworks above will help you to facilitate and structure this journey.

Manufacturers and service leaders with successful advanced services have used these kinds of frameworks for a long time and still are. This allowed them to achieve quick, continuous and more radical innovations and thrive in disruptive times.

 

Conclusion:

For quite a few service leaders, the journey of service innovation is a tough one. Their clients do not see the value of new advanced offerings, they do not want to pay for them, and internal stakeholders do not provide the necessary support.

Some of the key reasons are;

• The critical business issues of the clients are not clear and are not addressed with the new offerings
• The business value of the new offerings and business models are not clear
• The envisioned business model(s) are not clearly described

Litmus proof

I would like to challenge you with the following questions.

Can you describe your services vision and strategy in concrete words? Without using words like;

• Advanced services
• Servitization
• Product-as-a-Service
• Remote services
• AR, AI, IoT

Does your services vision start with a description of;

• Major trends in the industry of your clients
• How challenges and priorities of your clients are changing
• How that will change their needs

 

Recommendation

If you want to be leading the transition of your business and industry, I would recommend you to;

• Define a clear shared concern with your strategic stakeholders;
• What are the developments and trends?
• How are customer needs changing? (our worksheet “Build your Customer Story” will be useful)
• What is the (potential) impact of these changes for your business?
• Does your business want to act on this by innovating the business model?
• Together with your strategic stakeholders, consider various options for developing the business model(s) and assess how these business models would help your business to thrive
• Agree on the innovation strategy and next steps
• Iterate!

 

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Further Action: 

• Read more about Servitization and Advanced Service @ www.fieldservicenews.com/blog/tag/servitization-and-advanced-services
• Read more exclusive FSN articles by Jan van Veen @ www.fieldservicenews.com/blog/author/jan-van-veen
• Connect with Jan van Veen on linked in @ www.linkedin.com/in/janvanveen1
• Follow moreMomentum on twitter @ twitter.com/more_momentum
• Schedule a discovery session with Jan van Veen @ moremomentum.eu/discovery-session

 

In the final excerpt from this exclusive Field Service News Digital Symposium Presentation we look at how SPACE1's clever use of Artificial Intellignece could rapidly spped up the time it takes to get field service technicians out of the classroom and into the field...

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In this excerpt of the first Field Service News Think Tank Debrief Sessions we hear from Daniel Brabec VP Global Customer Transformation, ServiceMax as he discusses the deeper layers of value that can be found through digitalisation...

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The multiple touch points of a digital transformation project: 

One area that really came to the fore in this series of Think Tanks was that while at conferences and in the pages of trade journals such as Field Service News we often tend to primarily focus on the efficiencies and the improvements to the bottom line that digitalization can bring, or occasionally we may focus on the other end of the spectrum when we start looking at the various different potential revenue streams enabled by the use of tools such as remote assistance for example.

However, there are so many other areas of the business that digitalisation in the field service operation that connect disparate parts of the business to the field service operation such as marketing, R&D or sales.

As Jason Smith, Director of Field Service, EMEA, 3D Systems Corporation commented: 

"One thing that the embracing of digital and the flow of data that comes with that allows for is the coming together of all of these varous touch points that allows a business to operate as a much more effective whole.

“Everything has to be about data, so we need the best data coming off the machine through the customer to get the right diagnostic in place. Industry 4.0 and connectivity is really helping with that.

“However, we still have a culture amongst engineers where they need to recognise that they are also responsible for the solution. What they have found and how they build up their experience is empirical - they’ve been able to build on that knowledge and telling others, that knowledge capture is key to the whole thing. It’s not just what is wrong with the machine its what did you do to fix it and how can we put that back into a closed-loop cycle so we are constantly improving and evolving the solution.

“We’ve touched on some of the tools to do that and Artificial Intelligence is of course one such tool but making sure that you have that closed-loop in place and its not just one-way traffic is the key to that culture change and so making sure engineers are part of it and recognise it I think is going to be key to improvement.”

 

And Jan van Veen, Manging Director, MoreMomentum also commented: 

"Data is absolutely important; there is no doubt about that. But the value is not in the data; neither is it essentially in the insight.

"What we are seeing is a number of different mechanisms kicking in that are all related to digitalisation. There are several of these. There is the disruptive element in how we are working, but also in the markets we serve at large.

“Some companies will follow the curve, others will be entrants into the market that drive us as a sector to work in a better way, and others will be unable to keep up and will fall away.

“Also, at some point we begin to see a type of de-materialisation. So we get less products being involved as some are taken out of the equation. For example, we don’t have generally have a need for a camera or a calculator anymore as our phones can handle both those functions.

“Another phase we will see is demonetisation, where digital products become so prevalent that they become much cheaper and then finally alongside this we also see democratisation where digital services become available for everybody at an affordable price point.

“We are in the early phase today as we talk about data coming from equipment and what we can do with that. But I think the real challenge is how are we going to turn it into value. Not insight, but services and value propositions using the data.

It certainly seems evident that companies find more than one benefit when implementing some aspect of a digital transformation. However, do companies tend to go into these projects with one vision of what they they're trying to achieve and then actually discover new potential improvement opportunities on along the way or do they have already have a comprehensive understanding of the many facets of their digitalisation roadmap?

"It's a really interesting question," mused Daniel Brabec, VP Global Customer Transformation, ServiceMax during the debrief session. 

"If you think about where the actual change comes from, where the internal drive comes from, a lot of times, it'll be on some initiative that's been directed down via the executive team that doesn't necessarily have a touch with service. For example, the CFO might come back and say service is costing us too much money, we need to reduce x and y. And we need to make sure that we're cutting all of our costs here and there and to do that, we need to get our first time fixed rate up to X percent because it's currently at 53%."

 

"There's a lot of really quick wins for organizations to change and do things that are not hard for them in that digital transformation..."

- Daniel Brabec, ServiceMax

 

'What what we find when I work with a lot of these companies is because they're they're so archaic in nature, they don't have any digital tools, they may still be on on a whiteboard or pen and paper out in the field that they know they need to move the needle in one area. But as we start to discover they have a lot of opportunities in other areas that can make a huge impact on their business as well that they haven't even considered," Brabec continues.

"I think pulling all these different departments together to actually discuss some of the potential solutions is key to understanding you know, how they can collaborate and how they can actually enact some of those changes that we're starting to prescribe for them."

"In fact, one of the things that we do is to help our customers is called a maturity assessment," Brabec explains. 

"We'll work with various individuals in the organisation and get their take on where the service team is across various dimensions to to kind of understand as an organization, are they high or low and where can they really move the needle.

"There's a lot of really quick wins for organizations to change and do things that are not hard for them in that digital transformation. That can really move the needle for them as an organization and free up more opportunity to make more of those changes into the future."

 

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In this excerpt from the inaugral Think Tank Debrief Session, Kieran Notter, VP Global Customer Service, ServiceMax reflects on the conversations around whether knowledge is the key differentiator for OEMs when it comes to service delivery... 

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Is knowledge the key weapon in the OEM's arsenal?

During this conversation everyone around the table was an OEM, which allowed us to dig deeper into what the group thought were the key differentiators between OEMs and third party service providers when it comes to differentiating service.

While brand reputation does of course play its on part in the discussion, it was clear amongst the group that it was knowledge and experience that really allows an OEM to shine through.

Jason Smith, Director of Field Service, EMEA, 3D Systems Corporation commented: 

“In previous companies I’ve worked at, when we have tried to push advanced services out to the market, one of the major challenges we faced was that there was little value in trying to convince customers, who didn’t see the value in connected services as a solution. In fact, this is reflected in the approach we’ve adopted at 3D Systems. If a customer is on a maintenance contract and under warranty, then we will connect the machines for free.

As far as we are concerned, in terms of the connectivity, the hardware aspect of the equation, which is where people typically perceive as the value, actually has very little value.

What I discovered, certainly in my previous role, is that the value is in the data which is provided and the insight that provides - particularly when your offering is part of a system. Companies really have to separate the hardware from the knowledge because the value proposition is at opposite ends of the scale.

Hardware is worth a couple of thousand dollars, but the knowledge is where the real improvements are. One project we did in my last company based around such a premise yielded savings to the customer of €2.5M a year. It is in the data and the insight within that data - that is where the true value sits. However, it is only by having case studies and actual data that you can quantify and describe this value.”

Peter Deeming, Service Tools Manager, Varian commented: 

“Reflecting on the three models Jan outlined of ‘do it with us’, ‘do it for us’ or ‘we’ll do it ourselves’, I would add a fourth model into this in that a third-party service contractor could also do the service work as well.

“In terms of service we see third party service companies as competitors and one of the edges the data gives us is that we as an OEM can get data from our entire install base and a contractor cannot do that. This gives us a far greater depth of knowledge and insight that we can bring to the customer - something that gives us a distinct competitive advantage.

“This demonstrates that the value isn’t in the hardware, or even getting the data from one machine. But when you can get the data from all of your machines and exploring the trending and apply some AI and get all of the analysis, then you get some phenomenal insights, and that is where the true value lies.”

It was interesting to note as the conversation evolved during the Think Tank, how we started to see the groups thinking crystallise as agreement emerged that the true value an OEM service organisation can bring to the table is based on deep product knowledge and operational best practice.

This was a theme that occurred across a number of conversations during the Think Tank's held in this period but this definitely came to the fore in this session.

Reflecting on this point during the Debrief session Kieran Notter, VP Global Customer Transformation, commented:

"With knowledge, you can start to offer more things.Then with knowledge, you can also manage those things and set the expectations for your customers and yourself."

"We can talk about entitlements and SLA (service level agreements) but if you don't have the knowledge on how to manage them, then that's an empty promise, and therefore you're going to upset your customer," Notter adds.

 

"How many people beyond service realize that, that service data is really useful to them?"

- Kieran Notter, ServiceMax

 

"So to get to that movement of how you do your contract entitlements and SLAs, or even moving further into the outcome based world, you have to have the knowledge to understand fundamentally how you price it, how you make it into a business, but also how you can make your customer successful - because you need to create that partnership to be successful," Notter reflects. 

"Then there's also the secondary element as well, which is understanding of how to use that knowledge outside of service. Most people taking part in this Debrief session will have an idea of how they would like to use their data if they can harvest it and mining. Yet, how many people beyond service realize that that service data is really useful to them?"

"If you think about the supply chain and how service data can be used there to actually work hand in hand, to create a supply chain, rather than a demand chain. Also, if marketing have the data that's coming from these products, they can do targeted marketing - marketing, that is very specific to the customer and the products and the services that you're providing currently, which gives you the knowledge and ability to make up-sells and cross sells."

"Another aspect here is that there always seems to be a little bit of a push and pull between sales and service," Notter continues.

"Service was once called aftersales but we all understand nowadays that it's moving more into the forefront because you may sell the machine once, but then you maintain it for the next 10 to 20 years. When that maintenance is getting to a point that you need to upsell, then you have the data already. For example, you may know when the machine is being overused creating an opportunity to maybe sell another unit, or indeed it needs to be serviced.

All of this data works in so many different areas to drive different areas of growth and you can see that in Jason's statement of €2.5M savings a year. You can see where that value is actually coming from."

 

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Ahmed Gharbaoui is a Global Subject Matter Expert in Business Growing by Service approach. Here he puts forward a three step plan for field service organisations to build recovery from the colossal impact of Covid-19...

Organizations in your industry have reported that their business is heavily impacted by the COVID19 outbreak, predicting it will take two more years to reach their Q1 2019 P&L levels again.

Long-term loss of market share or even disappearing from the marketplace are real concerns. In that context, a swift influx of cash Is often needed to stay afloat, but external sources of cash may not even be enough to survive the fierce competition.

If you are wondering what step to take to bring swift influx of cash AND address the quick changes in the market place, you may want to tap into Aftersales services and digital resources which proven to be one of the fastest ways to uplift profitability besides strengthening the relationship with your supplied assets end-users through increased customer satisfaction.

Being capital equipment driven for years can make that shift challenging, but it doesn’t have to be that way. With the right strategy and support, remarkable results can be achieved faster then expected.

Here below highlights of 100 days survival and lasting growth via the 3 pillars approach:

 

Increase Business Resilience :

It is about evaluating and increasing ratio of reoccurring stable profitable revenue.

• Assess Aftermarket/Service share/ratio from total Business
• Assess reoccurring business contribution from Aftermarket Revenue.
• Example ratio of Service Agreements
• Recommend priority focus and define road map taking into account digital support solutions, planning and operational processing.

 

Bring Aftermarket Operations Transparency:

Service Operations usually is considered as space where errors and quality issues are hidden.

By understanding space and setting improving plan. This would be a fast way to improve cash and profit to the bottom line.

• • For example, Check existence and viability of returns/redos tracking
• • Assess your improvement processes
• • Set based on the findings and benchmark with best in class immediate quick-fixes and mid-long term sustainable improvement roadmap.

 

Boost Sales Efficiency by:

The level of understanding of an organisation’s aftersales people resources is an important step towards survival and sustainable growth. In following, quick highlight of priority actions.

• For example, assess current aftermarket organization and level of importance in the leadership team.
• Assess the profile and ratio of salesforce versus execution teams
• Then, immediate and targeted actions can be set in terms of sales capacity planning and transformational strategy.

Here are a few short, mid and long-term success stories you may relate to by thanks to the 3 pillars approah:

North American Global leader of Compressed Air Systems OEM:

In order to improve business resilience and boost overall P&L, after first unsuccessful attempt to merge Capital Equipment Sales team with Aftermarket Sales representatives one Account Managers team, + 40% experienced sales team members left for competition. By practicing sales assessment tools the entity could increase its Service Sales share by +30% from first quarter of its implementation. And importantly transforming equipment sales team to solutions Sales organization, dealing with and users challenges and ready to face new future!

US Global engine and powergen OEM: Declining Engines & Powergen:

Aftersales Business Unit of +100 M USD due to heavy dependency on parts, swiftly grew their service business by +60%. Additionally Executive team were convinced to aggressively expand dedicated sales team from 3 to 10 headcounts in very tight P&L context. Bringing additionally + $1 M USD by extra headcount profitably.

European Global Compressed Air System market leader:

Despite declining economy due, they achieved notable uplift in Compressors aftersales revenue from $17M USD to $26M USD with enhanced Operational Efficiency and EBITA across multiple Countries. Additionally launched new digital service offering after connecting +1200 units which boosted Service Agreements revenue and profit reoccurrence.

If you’re an industrial goods manufacturer looking for cash oxygen in a less than 100 days and you’d like to set the foundations for sustainable growth beyond mere survival, we should talk. My email ID is growbyservice@gmail.com

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Further Reading: 

• Read more about Covid 19 and Field Service @ www.fieldservicenews.com/en-gb/covid-19
• Read more about Managing the mobile workforce @ https://www.fieldservicenews.com/blog/tag/managing-the-mobile-workforce
• Read more about Field Service Leadership and Strategy @ https://www.fieldservicenews.com/blog/tag/leadership-and-strategy

During a recent Field Service News Digital Symposium presentation on the use of Aquant's Artificial Intelligence tool within their service triage process, Mark Hessinger, Vice President of Global Customer Service, 3D Systems Corporation, touched on perhaps probably the most pervasive issues that our industry faces.

That issue is how do we stop the tribal knowledge contained in our ageing field service workforce walking out the door. It is a challenge we are seeing emerge across all regions and all industries.

It is a well-documented issue. Many field service companies are currently staring down the barrel of an ageing workforce crisis while struggling to engage with a future generation of workers. Some industries may have a slight advantage, companies at the cutting edge of technology such as 3D Systems for example, who will likely attract bright young minds eager to embrace a technology set to be a fundamental part of the future. Yet, even these companies generally still face higher rates of attrition than acquisition when it comes to talent.

This is perhaps why this presentation by Hessinger resonated so strongly with its audience. As Hessinger went through the multiple benefits of implementing Aquant's AI-powered triage tool, this was one aspect that really struck a chord.

3D Systems had, via Aquant's AI, found the keys to unlock much of the core knowledge locked away in the vast pools of data that all service organisations will hold. They found a way to keep the decades of tribal knowledge within their walls.

"Like other companies, we do have [staff] turnover," Hessinger explains.

 

"We were able to use all that information we had, to continue to support the product so that that was a nice real-life outcome of using the the Aquant tool..."

 

"And on certain product lines, we don't have a lot of printers installed, so we don't have a lot of people trained. For example, on one Multijet printer, our subject matter expert chose to retire a couple of years earlier than we expected. So everybody started to get a little nervous as we only had one other person who did not have the same depth of experience on that product."

"Yet, that person told me, 'you'll be fine, it's all captured in the Aquant tool. I validated that it works,'" Hessinger commented as he outlined a perfect example of a challenge many service leaders may recognise. As Hessinger explained, it was a situation that soon became even more challenging.

"Shortly after that, our second person that knew that technology also left," he continued, "so there I am without our two tech support people for this product line. However, we were still able to continue to run and support customers and actually, we haven't had any escalations on that product in the last nine months since those guys left.

"That is because we were able to use all that information we had, to continue to support the product which is a nice real-life outcome of using the the Aquant tool," he adds.

Essentially, what Hessinger and the team at 3D Systems implemented was an additional AI 'trainer'. They found a technological solution to a human problem. Ultimately, the AI allowed 3D Systems to make that transition from losing two central members of staff on a specific product line. They managed to stop that tribal knowledge leaving the organisation.

This also appeared to be something that could be almost universally applied to any field service scenario - indeed for any organisation that held sizeable layers of data that is currently a massively underutilised information resource. What came across in Hessinger's presentation was that the was already buried within their systems - Aquant surfaced it, neatly and effectively.

As Hessinger explained "Typically we require our field service or tech support personnel to document in the case what happened and that's written down. When you go back and look at it at those notes, [it is usually] because there was a similar case at some point and you start searching for cases to find the information, those are the times you go digging for it.

"Yet, now you're not digging for it. It's accessible and there, everything you've captured," Hessinger explains.

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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