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Field Service News Editor-in-Chief, Kris Oldland talks exclusively to Graeme Coyne of Siemens about why an attitude of exploring continuous improvement is ingrained in the company’s DNA...

The Aston Spring Servitization Conference is a unique event in that it brings together both industry practitioners and academics to discuss the evolving trends in servitization – a key shift in business thinking that puts field service at the heart of a businesses success.

The presentations come thick and fast, and as would be expected by a conference hosted by a leading industry focussed university, there is reasonably heavy bias towards the academics when it comes to speakers.

And whilst the rapid fire format (around 50 presentations in two days) can foster a great deal of discussion and cover a wide and varied number of research areas across the spectrum of servitization, there is always a danger of death by power point when trying to cover so much ground in such a short period.

Therefore, when Siemen’s Graeme Coyne took to the stage armed with a presentation that featured just three simple slides, it was not only a bold approach but a welcome one.

 

Coyne, has two key qualities that are essential in a senior field service exec.

He is both genuinely approachable and easy to talk to, whilst having a deep rooted desire to continuously look for improvement.

After his presentation I caught up with him to talk through some of the key points that he raised during his 30 minute key note, which was well received by both the academics and the practitioners in attendance.

One of the first things that I wanted to pick up with Coyne was how the culture of Siemens as an organisation mirrored his own attitude towards adopting an approach that is all about continuous improvement, and how that translates across both product development and service delivery.

“We do it [focus on continuous improvement] across the company in every process we do – so it could be service coordination, how we deal with spare parts, and how we manage our service engineers. But we always look at it from the point of view of how can we do it better?” Coyne replied

“We use ‘plan, do, check, act.’ or GEMBA. We have two meetings every week within our department to ask ‘how can we do the service coordination part better?’ Somebody comes up with an idea, it’s discussed in an open forum, and if we think it is worth investigating we ask them to go out and develop the idea further.”

“We’ve had this philosophy for many years. It’s all about what exactly is the problem - can you define it? What’s the root cause and what are the options?”

 

“The main thing is to launch it, monitor it and then evaluate it. You have to keep going round in this loop and it is embedded in our culture.”

One area of Coyne’s presentation that particularly caught my attention, was when he spoke out quite strongly against the productisation of services.

Given Coyne’s experience this was an area that I was interested to dig a little deeper into.

What was it that drove his thinking on this?

“We are centrally controlled and have products that are developed from our headquarters and this can lead a view on services that begins with the product and then looks at what services can we develop for them. You then end up with product people devising a lead service and saying sell that service,” Coyne begins.

“My view is different. I’m in a region, and dealing with end customers."

"Essentially we know what someone like Unilever, Coca-Cola or Ford Motor Company want and come at it from a the reverse point of view and it’s very difficult to slot a productised service into the customer’s needs. It may not fit; it may not be what they want.”

 

Pushing a bit further on this I was keen to see if Coyne felt that this was an issue felt more keenly by multi-nationals, who all too often are further removed from their customers than smaller, more localised competitors.

In fact whilst Coyne does admit there is a danger for larger organisations to become disengaged from their client base, he also believes that if multinationals approach cooperation between different regions correctly there can be huge benefits in terms of knowledge sharing.

“What I’ve seen is people from the regions bringing in new perspectives and ideas. For example, twenty years ago I was based in Germany and I brought in a perspective from the UK, other colleagues brought in opinions from other countries like Finland and Italy.

“More recently we have begun to have regular meetings using video conferencing for up to an hour at a time, where we do best practice sharing."

"Basically we pinch with pride!” He says with a wry grin.

“For example, we’ve just found out our team in Belgium have an approach for a particular customer type and product type and we realised they’ve been doing what we want to do now in the UK for the last 17 years.”

“They already know what works, how much it costs and what the benefits have been. So we can take best practice sharing and use it and implement it in our country to suit our customers needs.”

Given the setting of our conversation, I was also keen to understand just how far along the path Siemens is towards advanced services and servitization.

“In terms of the move from SLAs to performance based contracts we’ve done it from certain places, in the world,” he begins.

“Very often where the customer themselves doesn’t have the wherewithal to do it [manage the service chain] they may rely on us. They rely on our management skills to be able to deliver something where we can have KPIs based on the quality of product they’re producing, the volume of product and improving productivity.”

“For many years in Siemens now we’ve had an approach to customers that says we focus on four things. Firstly can we improve their turn over? If they can make more things they could possibly sell more! We don’t control their market in the service world but we can give them the ability to do that.”

“We also look at how we can reduce their cost base, their utilisation of people, spare parts management; there are many things you can look at in reducing costs.”

“The third part is asset availability and using new technology like real time condition monitoring services to predict when assets need to be serviced and maintained. In that way we reduce downtime and become proactive rather than reactive.”

“The final part is to do with sustainability. Let’s look at the water industry for example - a regulated business that has to guarantee the quality of the water that they give to their consumers, if we can do something like putting in instrumentation products and calibrate them so that they don’t get penalised by their regulator, it further adds strength to our role in supporting their business and gives us greater customer loyalty.”

 

Of course whilst the shift towards delivering advanced services is heavily reliant upon changing the culture both within your own organisation but also amongst your customers also, technology – particularly the IoT is playing a critical role in enabling companies to be able to deliver such solutions.

But how big a challenge is it for a company like Siemens, with well over 100,000 assets out in the field globally (and some of these assets are 30 even 40 years old) moving to IoT?

“It can be hard but a lot of the equipment that is thirty or forty years old tends to be power related. Its drives, motors and other individual items that were never networked in any way shape or form” explains Coyne.

“Industry 4.0 is allowing everything to communicate. We have a lifecycle information service we offer where we will take the installed base from the customer, analyse it, and point out where they might be at risk.”

“We get situations such as a ship turning up in port with a bow thruster that needs a service - it might be thirty years old and they still expect us to do it.

There is no way that, that is connected in the internet and in future we will be much better at supporting our products as they will be fitted with Industry 4.0 compatible connectivity”

“But that is the dilemma we have in terms of looking after legacy products, and then looking to the future and saying if you specify this in these systems we are going to be able to support you way, way better. Rather than an adhoc approach you can plan it and manage it better.”

 

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