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Noventum and the Service Science Factory have been working together to help establish a working framework for service organisations seeking to harness the power of the IoT. Damien Nunes, Dr. Dominik Mahr from the Service Science Factory and Rosanne Gresnigt, Noventum introduce some of the key concepts that have underpinned their work...

Recent advances in technology put Internet-of-things (IoT)-innovation on top of the management agenda across industries. IoT innovation is predicted to increase economic value by $11.1 trillion in 2025 (McKinsey 2015).

The Service Science Factory and Noventum collaborated to showcase the implementation of IoT in organisations.

What is the Internet-of-Things (IoT) and why is it relevant?

Over the past few years, computer technology has increasingly become a commodity as it has become cheaper, faster, more reliable, more efficient, smarter, smaller, portable and more connected.

It has given the opportunity to add new capabilities to the things (products and machines) that make up our lives. Consumer-focused examples include Philips Hue lights and the Nest Thermostat that knows via your smartphone when you have arrived home and automatically turns on your lights and heating.

But this is only a small part of the opportunities that IoT can bring.

The basis of all IoT innovations are the 6 principles listed in the graphic below. The power of IoT is to combine them in such a way that they provide new services and capabilities for your customers and organisation.

How can your organisation take advantage of IoT?

Top management often delegates the development of (IoT) innovation to middle and lower management. However, new ideas frequently face scepticism and even opposition across the firm. An example of this is the belief that IoT innovation often disrupts work practices as well as current product and service portfolios, thereby cannibalising existing revenues.

More so, some employees become worried about their jobs, and can even block innovations.

Fresh ideas, awareness of opportunities and positive attitudes across the organisation are what create the breeding ground for transformative innovation. This requires a user-centred, employee participative, explorative, iterative and routed approach like Service Design Thinking.

1. Set business focus: To leverage IoT opportunities, top management not only need to commit to drive IoT innovation but also clearly determine the strategic goals such as lowering cost, creating customer delight, building the brand or driving profits.
2. Introduce IoT Capabilities & Design Thinking: Before embarking further on this explorative journey it is important to recruit an interdisciplinary team. The team should understand customer needs (in the form of critical customer pains and gains), the context of the market they are operating in, and the potential capabilities of smart connected products. In addition, the team needs to be able to think in networks and eco-systems to be able to translate this understanding into new concrete service opportunities which are both valuable to, and in line with, the organisation's ambitions.
3. Ideate IoT innovations: The field of (service) Design Thinking provides various ideation techniques which are used by the interdisciplinary team to spark creativity. This results in ideas that embody both theopportunities that IoT can provide, and also the various perspectives of the market and the organisation.
4. Share, combine and prioritise ideas: The collective sharing of ideas strengthens the feeling of organisation-wide involvement, and collective prioritisation drives commitment. It is also an important period to receive feedback and identify if ideas can be strengthened by combining them with other concepts and initiatives.
5. Map the eco-system of the IoT innovation: IoT innovations typically involve a complex ecosystem of actors, components and connections. Visually mapping out eco-systems, on both macro as well as microscale, can reveal possible challenges to realise the IoT innovation.
6. Identify the business implications: Creating a clear understanding of potential benefits, required investments, and risks is crucial to driving any innovation. In addition, managers need to know what the implications on the organisation will be and what they can expect as ‘return on investment’.
7. Pitch to important decision makers: Especially in large international organisations with multiple divisions and functions, it is critical to have ambassadors who drive internal alignment. Pitch-like presentations towards (top) management and other parts of the organisation help to create a coalition of the willing, and obtain the commitment needed for further development and implementation.
8. In summary, the outcomes of the above process are not only great ideas but also form cross-functional teams that become ambassadors for their IoT innovations. The seven-step process is, in essence, a process for changing the mindset towards an IoT future. In the end, your employees are the basis for designing IoT Innovation – Not the technology.

What’s next?

IoT enabled services usually have a disruptive nature, and this realisation often affects all areas of the organisation. The implementation, therefore, requires a clear strategy and roadmap. Without this or an agile attitude towards unforeseen events, you risk losing not only the momentum you created in the IoT exploration phase,

 

Free IoT Readiness Assesment - Do you understand the value of IoT but don't know where to start? Have you already started on your IoT journey but want to get more out of it?

Click here to take the Noventum 5 minute IoT Readiness Assesment to get an overview of where you stand in relation to IoT and determine how ready your organisation is to benefit from it.

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De Kantoorspecialist, the Dutch wholesale supplier committed to improving life in the office, has just transformed its service operation from a patchwork of slow-moving parts into a fast, cohesive whole.

Established in 1989 and based in Veenendaal, De Kantoorspecialist is a Ricoh, Sharp and HP dealer that provides IT, print and document management services, audiovisual solutions, office equipment and furniture to workplaces all over the Netherlands. Its goal is to boost worker enthusiasm and productivity and generally make employees’ lives easier and more enjoyable.

Now De Kantoorspecialist is about to experience this philosophy for itself, courtesy of Asolvi and its leading-edge solution for print and document management providers, Evatic. Previously De Kantoorspecialist used a generic ERP system and a separate database for customer contracts and quotes. The software was not designed for print and document management providers and did not have contract or field service management components, which meant a lot of De Kantoorspecialist’s work was manual and labour-intensive.

Evatic collects real-time information directly from these machines and processes it according to a series of rules, automatically generating invoices, toner replacements and predictive maintenance alerts “We decided to implement Asolvi’s Evatic solution for a number of reasons,” says Evert van Engelenhoven, managing director of De Kantoorspecialist. “Evatic is all-encompassing and runs our entire operation, from sales to service. It’s specially designed for managed print services and enables proactive and cost-effective management of toner use and replacement, as well as automated meter readings and invoicing. We were also impressed by its excellent interface with Microsoft Office 365 and our accounting module, and the sophisticated contract management system which we’re also using for our audiovisual and IT services contracts.”

Evatic connects to all the multifarious machines in the field (MIF) that De Kantoorspecialist is charged with managing and maintaining. Evatic collects real-time information directly from these machines and processes it according to a series of rules, automatically generating invoices, toner replacements and predictive maintenance alerts. This saves time, cuts out wasted toner, reduces machine downtime and limits the number of field service visits required, all the while maximising asset lifetimes. Evatic makes managed print services smart by connecting printers and copiers to the ever-growing Internet of Things and empowering providers like De Kantoorspecialist to be more efficient, more productive and more proactive.

“With Evatic, we’ve entered the realm of smart printing and smart service management,” says van Engelenhoven. “We’re looking forward to having more control of our processes, a better overview of our profitability, and a reduced need to keep hiring more staff as our customer base grows.”

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Barrett Coakley, Product Marketing Manager, ClickSoftware offers some crucial advice in the complex and crucial area of change management...

Organisational change is hard but, given constantly shifting market conditions and the rate new technologies are released, dealing with transformation is now a requirement at most firms.

However, McKinsey reports that 70% of change programs fail to achieve their goals, largely due to employee resistance and lack of management support. With that type of failure rate, you might be wondering why even bother. Nonetheless, when done correctly, change management can have an enormous impact on employee engagement, operational efficiency and financial success.

There are three areas that are causing change within field service teams that leaders must address Field service organizations are being asked to address multiple reforms but there are three areas that should be high on your change management list; talent management issues, technology advances and new customer attitudes.

Here are some recommendations to help your field service group succeed on this change management journey.

Talent Management

According to The Service Council, 70% of service organizations report they’ll be facing a pinch as they lose workers to retirement in the coming years. The retirement of baby boomers has the potential to leave a vast knowledge and experience gap on many field service teams.

There is hope, however, as the 75 million large millennial generation has entered the workforce and they have the skills to fill these open positions.

However, field service managers must understand the drivers that motivate millennials and how they differ from the retiring baby boomers, including:

• Tech savvy: The millennial generation grew up with all things digital. They embrace technology and expect the organizations that they work for to provide the most current technology for them to perform their job.
• Mission: Millennials are looking from a deeper meaning from work. They want to feel that they are having an impact both on the company as well as greater society.
• Retention: You might have some members on your field service team that have worked in the group for 10-20+ years. Millennials, however, tend to change jobs frequently. In fact, Gallup revealed that 21% of millennials report changing jobs within the last year, which is more than three times the number of non-millennials.

Here are some areas your field service team should focus on to facilitate the changes this generation will bring to your team.

Offer Incentives:

While you might think a raise would be sufficient for millennial retention, you should instead focus on benefits you could offer.

According to Gallup, millennials are more likely than any other generation to say they would change jobs for a particular benefit or perk. They especially appreciate perks that directly impact their lives and the lives of their family. It makes sense considering many millennials are starting families, have large student loans, and desire a work-life balance.

Popular benefits for Millennials include:

• Paid paternal and maternity leave
• Student loan reimbursement
• Childcare reimbursement
• Tuition reimbursement

So instead of just offering a pay raise next year, poll your workforce to determine what they truly value.

The responses might surprise you.

Development opportunities: The best way to attract millennials is by leveraging two of their biggest desires—development and purpose.

67% of millennials are engaged at work when they strongly agree that the mission or purpose of their company makes them feel their job is importantFor instance, Gallup reports that “rallying millennials around a mission and purpose dramatically increases their employee engagement: 67% of millennials are engaged at work when they strongly agree that the mission or purpose of their company makes them feel their job is important.”

Focus your attraction and retention strategies on delivering learning opportunities and career development. This way millennials are assured that their jobs provide plenty of opportunities for skill development and career advancement.

Keep in mind millennials may want to pursue independent project work, attend conferences, take classes, and join professional organizations.

Give them the flexibility and resources to do so, whether this means tuition reimbursement, or time off work to ensure they are fulfilled.

The Impact of New Technology

New technologies like the Internet of Things (IoT), artificial intelligence (AI), machine learning, and data analytics are having a huge impact on field service operations.

These new technologies are providing real-time insights into field assets that can be used to predict when a piece of equipment might fail, allowing for proactive maintenance. However, with all of this technology, there comes the need for change across your field team in order make sense of all this new information. Here are a few steps you can take to make sure your team is prepared for the impact of technology on your field service group.

Make a Plan:

First off, you will need a plan to prepare for the impact these technologies will have across your field service organization. For example, you will need to train field engineers on how to potentially service IoT-based equipment, build a roadmap for incorporating new devices, and identify which technician or dispatch behaviours will change based on this new technology.

Will customer issues be identified at a server level when equipment fails? What does this do to the dispatch workflow? Are you incorporating wearables at an employee level to improve communication or field-based efficiency? What software will you need to ensure these devices operate smoothly within your current frameworks and infrastructure?

Create a roadmap that accounts for the short, and long-term implications of devices, services, and technician needs.

KISS Principal:

Albert Einstein once stated, “Everything should be made as simple as possible, but not simpler.” This is where the KISS principle comes into play during change management exercises. Stepping up to the challenges associated with all of these different technologies is difficult and complicated.

Everything should be made as simple as possible, but not simplerWith any digital transformation, the best possible course of action is to simplify by starting with small, simple changes. Select a small behaviour, or wearable device that your customers are using, and optimize around that. Then, scale what you have learned across more devices, customer behaviours, and internal processes. With a change this impactful it is best to keep it simple, sir.

Uberization of Service

As Amazon, Uber, Airbnb and other upstart organizations continue to heighten customer expectations, field service organizations have struggled to keep pace with these new demands.

Customers now expect transparency around service delivery such as the real-time location of the field technician responsible for the appointment as well as personalized communication preferences like text or email.

However, the delivery of exceptional service requires changes to the technician’s traditional role and skill set.

Here are few areas that should be looked at to change.

Product and Service Training:

Field service professionals understand the inner workings of the products they maintain but they might not be knowledgeable enough to upsell a new product or service to a customer.

To enable this ability, sales and marketing training should be provided to field service professionals so they understand the features and benefits of different services. Sales and marketing is a new type of training and skillset for most field service professionals but one that can really benefit the top line.

Increasing revenue is an important focus for many organizations but it is proving to be a difficult one as 76% of field service providers report they are struggling to achieve revenue growth, according to the TSIA. Sales and marketing training could be the support ticket that helps change this trend.

Soft Skill Training:

Field service professionals are now required to interact with clients in a way that elevates the customer experience, resulting in upsell opportunities and less customer churn.

64% of consumers have switched providers in at least one industry due to poor customer service.Preventing customer churn is especially important as Accenture reported that 64% of consumers have switched providers in at least one industry due to poor customer service.

To provide a higher level of personalized service requires better soft skills, something not every person has, but this ability is a key to this new service delivery model. In fact, study conducted by Development Dimensions International found that for every $1,100 invested in soft skills training, employers earned an average return of $4,000.

Training soft skills can help a technician provide more empathy towards the customer, improve communication and the ability to provide a more personalized experience.

Soft skill training is especially important for millennials as they often lack these abilities. An investment in soft skills training is worthwhile for any organization but can be particularly important in delivering a great customer experience.

Conclusion

The key to handling all of these changes is a commitment from all involved. In fact, McKinsey found that when people are truly invested in change it is 30 percent more likely to stick.

However, making the challenge even more daunting is that organizations no longer have the luxury of implementing changes over a 3-5 year period of time as in the past.

Change is no longer a periodic event, but one that is constant as the market and technology continue to evolve at faster and faster rates. Field service teams need to prepare now.

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Data collation has become perhaps one of the most important factors in delivering the levels of standards that today’s empowered customers demand. However, many companies are now finding themselves struggling to turn the vast amounts of data being generated today into meaningful insight. Bill Pollock, President for Strategies for GrowthSM explores how field service companies can find a balance between flood and thirst...

Many reports have been written about services organisations (and businesses of all types) “drowning in data lakes”. However, the key to success is to establish early on what data is needed to effectively run services operations, and focus specifically on those types of data when collecting and processing the reams and reams of data points generated from your IoT-based systems.

Too much data is … well, too much data, if you don’t have a plan to harvest it effectively.Too much data is … well, too much data, if you don’t have a plan to harvest it effectively.

The most important asset a services organisation owns is the cumulative knowledge and expertise it has acquired, developed and utilised over time to support its customers’ systems and equipment – and, in many cases, the entire customer enterprise.

Some of this knowledge may be in the form of bits of information stored in a database, while other knowledge is often manifested in the form of new systems, tools and technologies that have been placed into use.

However, knowledge can only be built on a strong foundation of data and information – and these key components of knowledge must be inherently accurate, clean, well-defined, and easily accessible.

Today, everybody talks about data analytics, but many often confuse data with information and knowledge. Basically, data is a core corporate asset that must be synthesised into information before it can serve as the basis for knowledge within the organisation. As such, data may be defined primarily as:

• Facts about things, organised for analysis, or used to support or make decisions; or
• Raw material from which information is derived to serve as the basis for making intelligent decisions.

Information, on the other hand, is defined as:

• Collections, or aggregations, of usable facts or data;
• Processed, stored, or transmitted data; or
• Data in context, accompanied by precise definition and clear presentation.

Finally, knowledge may be defined as:

• Specific information about something; that is, the sum or range of what has been discovered or learned;
• Information known, and presented in the proper context; or
• The value added to information by people who have the experience and/or acumen to understand its business potential.

The quality of the data that an organisation collects, measures and distributes is also a key factor in database building. To attain an acceptable level of data quality, the organisation must be able to mine its data whilst focusing on key areas, such as:

• Clear definition or meaning
• Correct values
• Understandable presentation format
• Usefulness in supporting targeted business processes

However, regardless of the state of the organisation’s data assets, there must still be a balance of data, process and systems in order to meet the company’s stated business objectives, which generally focus on things like:

• Increasing revenues and margins
• Increasing market share
• Increasing customer satisfaction

However, if there is not a match between data quality and the application of that data, then the entire process will ultimately become a fool’s errand (i.e., garbage-in; garbage-out).

Regardless, data is ubiquitous – it is used to support every aspect of the business, and is an integral component of every key business process. But, the usefulness of the data is only as good as the data itself – and this is where many organisations run into trouble.

You don’t go to work wearing 12 watches; you don’t buy 48 oz. of steaks, per person, to put on the grill for a summer barbecue; so, why would you pay for more data than you will ever needAs such, services organisations need to be able to identify which data is “need to know” vs. which data is only “nice-to-know”. Nice-to-know data is ultimately way too expensive to collect, process, analyse, monitor and distribute; however, need-to-know data is not only invaluable – but critical to ensuring the operational and financial well-being of the organisation.

For example, you don’t go to work wearing 12 watches; you don’t buy 48 oz. of steaks, per person, to put on the grill for a summer barbecue; so, why would you pay for more data than you will ever need when you can harvest just what you need for now (plus whatever else looks like you may need in the future)?

The quest for knowledge is the key that can unlock the potential applications and uses of the organisation’s existing – or planned – databases.

In fact, most businesses are already sitting on a goldmine of data that can – and should – be transformed into actionable information and knowledge with the potential to:

• Enhance and expand their existing product, service, supply chain, CRM and operational databases;
• Create knowledge-oriented delivery systems for new, or enhanced, value-added products, services and support; and
• Differentiate itself from other competitive market players.

Knowledge that was previously unknown – or unavailable – such as profiles of potential buyers, or specific patterns of product/service usage may be uncovered and put into practical use for the first time. The end result can lead to anything ranging from improvements in operational efficiency to improved service delivery performance, more accurate parts forecasting, and higher levels of customer service and support – all based on a strong foundation of data collection, measurement and distribution.

Consider your data repository as a storage space for all of the data you will need today, tomorrow and in the future. If large enough, put it in a data lake – but make sure you don’t use Loch Ness for what a smaller data lake can do for you more efficiently.

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Scott Berg, CEO at ServiceMax, from GE Digital explains why for those organisations getting the results that matter, the Industrial Internet of Things alone isn’t enough to transform their service offering...

Complex machines power the world’s largest industries, from offshore rigs to networks of medical devices, to massive wind turbines.

Over the last decade, we’ve seen everything from treadmills to coffee makers digitized in pursuit of smarter, better and faster machines to get better results. Industrial companies are adopting digital strategies and require a distinct understanding of connected machinery to do so successfully. It’s no surprise that these machines require thoughtful, technical and predictive maintenance.

Companies now more than ever are in the business of keeping machines running to ensure that the absolute most value is derived from each piece of equipmentCompanies now more than ever are in the business of keeping machines running to ensure that the absolute most value is derived from each piece of equipment. Our customers report, on average, a 19% increase in productivity since implementing Predix ServiceMax. That basically means that we can add an extra day to the technician’s week without working overtime.

ServiceMax from GE Digital is helping the world’s largest companies on their digital journey, starting with service delivery. What is fundamental to our understanding of Field Service Management (FSM) is the scale at which we provide service. We are meeting our customers at a global, enterprise level. As the industry adopts the Industrial Internet of Things (IIoT) we think about service in a big way and help companies on their digital journey.

We are 100% invested in making sure our customers are getting absolutely all the value they can from the equipment they have and how it’s being used.

Why IIoT won’t be enough to transform service

IIoT-enabled devices and data insights alone are not enough to paint a clear picture of service in the future. Talk of IIoT is everywhere, from budgets to yearly planning, to newspaper headlines. At the end of the day, data informs a procedural change within only one part of a machine at one point in time. Decisions are made on a limited set of inputs, whether that be wear and tear of a specific part, or work order history.

You might say that using IIoT alone is tunnel vision.

Meaningful service is going beyond IIoT, and Asset Performance Management (APM) is the catalyst: it opens up data to more contextual inputs from the broader ecosystem. APM harnesses the behaviour of the machine and goes beyond a simple exercise in efficiency.

It’s important to understand the key is not solely APM, FSM or IIoT. Rather, it’s all three working together to create a holistic solution.It’s important to understand the key is not solely APM, FSM or IIoT. Rather, it’s all three working together to create a holistic solution.

APM monitors the behaviour of the machine, and the FSM platform brings it all together to inform how, when, and why we choose to service or replace a machine. It monitors machine health directly after a repair, and cycles that information into future repairs, to close the loop of service.

The powerful combination of APM and FSM provides a complete view of a product and establishes lifecycle management strategies. The result is a service product management solution that has up-leveled a traditional connected device strategy, incorporating a business’s bottom line. This has saved our customers millions of dollars.

Digital industry brings dynamic results 

Field service in the industrial era is more than a one-time project. Done well, it is an industrialists guide to a digital future, providing vital insights and outcomes for customers. The new era of field service will be marked by connectivity and share a fundamental goal of zero downtime for critical equipment.

There will be industrial behemoths and then there will be digital industrial behemoths.

Field service is evolving into a system that doesn’t forgetField service is evolving into a system that doesn’t forget: an APM-integrated platform incorporates past data to make decisions about parts, technicians, and compliance in the present. And then the magic happens: the system integrates several data factors based on the outcomes of similar work orders and controls for a business perspective: how much time and money can we afford to spend here? That data is translated to actionable insights for technicians on the ground, meaning they are not working towards a static goal of ‘machine repair.’ Instead, technicians are working towards a dynamic outcome: machine uptime.

We are reaching a point where FSM is simultaneously smarter than us yet utterly useless without the most vital component of service: humans. Technicians close the loop between data and predictions by recording the actions they take.

They have the training, the expertise, and the context for each work order with a FSM platform at their fingertips. And the result is that not only is complex machinery functioning smoothly, but FSM is providing the savvy digital industrialist an avenue to a more prosperous day on the job tomorrow.

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Having been widely touted as a technology that wouldn’t just improve service delivery but would completely revolutionise the way we even approach field service operations the Internet of Things has rapidly become an ever-present discussion topic amongst field service companies - but has the IoT revolution finally happened or is it still just the realm of those at the leading edge of adoption?

We ask three experts to give us their opinions on IoT in field service...

What are the core benefits of IoT for field service organizations?

Mark Homer, Vice President Global Customer Transformation at ServiceMax from GE Digital: One of the biggest challenges in field service is having advanced warning, visibility and insight into the equipment assets configuration, operational health and state, verification of location – before turning up onsite.

IoT is extremely beneficial in this regard.

It can tell you all of the above, as well as its environment, its connected to an echo system its configuration – including factory settings and as installed, localized configurations, additions, configuration changes, software and firmware settings or modifications as it’s currently operating and maintained).

IoT can also provide you with the current maintenance build, MBOM history of what parts have been changed, swap-outs, inspections, prior faults, diagnostics and lubrication, wear and tear process flow counters etc.

Using connected field service, IoT enables field service organizations to see visibility to all these and many other operational aspects of the installed asset/equipment prior to an engineering visit.Using connected field service, IoT enables field service organizations to see visibility to all these and many other operational aspects of the installed asset/equipment prior to an engineering visit.

The ability to see an asset’s health, performance, usage, RCM data, and access to a unique digital twin of this physical asset are all now possible in the field.

This empowers predictive, condition-based maintenance, as well as saving time and money, increasing first-time fix rates and customer contract renewals, and decreasing costs, overheads and streamlining supply chain issues for service call outs.

Gary Brooks, CMO Syncron: With the Internet of Things (IoT) becoming more mainstream – the market is expected to reach $267B by 2020 – companies across industries and verticals are starting to prepare for the impact this game-changing technology will have on their business.

Leading manufacturers like Caterpillar are investing heavily in connected machines to allow equipment to pass information from one to another, ultimately pro-actively repairing equipment before it fails.

This shift in thinking from a reactive, break-fix service model to one focused on maximizing product uptime is a fundamental change to how manufacturers handle service today, and IoT is at the core. Major benefits of incorporating IoT data into field service include:

• Quicker resolutions. IoT data can provide more diagnostic information, so a technician can arrive to a job site and immediately know the steps necessary to make a repair. IoT can identify what part needs to be replaced, and trigger action to either pre-emptively replace the part before it fails, or take immediate action if downtime does occur. Using IoT data effectively ensures that technicians are equipped with the correct parts, and can make a repair on their first visit.
• Happy customers. Customers are happy when their equipment is up and running, and any unnecessary downtime leads to dissatisfaction and frustration. Service parts availability is the linchpin to any successful service organization, and IoT data can help service organizations better manage their service parts inventories to ensure downtime is rare or completely eliminated.
• Increased revenue. When technicians are stocked with the appropriate parts and are able to repair issues on the first time, quickly and correctly, not only are customers content, but technicians are able to make more visits to more customers each day – ultimately resulting in more business and ROI for the manufacturer.

Mark Brewer, Global Industry Director for Service Management, IFS: The Internet of Things (IoT) and so-called “digital twin” technologies are poised to have a huge impact on the service sector; reducing costs, maximizing data analytics, and extending the lifespan of products.

IoT allows field service organizations to become proactive and predictive by identifying equipment issues and mitigating the problem before it cascades into dreaded unplanned failureIoT allows field service organizations to become proactive and predictive by identifying equipment issues and mitigating the problem before it cascades into dreaded unplanned failure that impacts business performance and safety.

When embedded into the right field service management software, service organizations can analyze and visualize real-time operational data from connected machines and devices and automatically turn the information into immediate and predictive actions. This, in turn, delivers service level improvements and drives better business intelligence and flexibility.

Another core benefit of IoT for not only service organizations, but any asset-intensive company wanting to optimize their service offering is the ability of predictive maintenance. The Predictive Maintenance report forecasts a compound annual growth rate (CAGR) for predictive maintenance of 39 percent over the time frame of 2016–2022, with annual technology spending reaching £7.96 billion by 2022.

Has IoT become prevalent amongst field service organizations as yet, or are those now utilizing IoT within field service delivery still leading edge? 

Mark Homer: It’s a hot topic. We see that most CSO are aware of IoT, and many prospects and customers are activating in IoT as well as the Industrial Internet of Things (IIoT), participating in one or two pilot or POC projects.

As an industry many service technicians have been collecting data from machines for years, typically through interface cables (e.g. RS232, Bluetooth collection of binary OT data, or early telematics).

Many Technicians are also used to reading meters and process counters, sampling lubrications and collecting photographic and thermography imaging as part of their work order completing debrief process.

IoT makes this process real time.

Gary Brooks: While many manufacturers are collecting data from sensor-equipped products in the field, few are actually using it to improve their service operations.

As the cost of sensor-equipped parts decreases and more data becomes readily available, it will become more important than ever to invest in human capital and technology that support a service model focused on maximizing product uptime.

Companies that do this in the next 12 to 24 months will be equipped to succeed.

Mark Brewer: Whilst IoT solutions are not yet prevalent in the majority of field service organizations, those utilizing IoT solutions and rolling them out at scale will be the winners over the next few years. Sensors are increasing in sophistication and are transmitting increasing amounts of data. With IoT sensors, the asset or machine becomes “smart” and is placed at the centre, sending data back to the service centre and enabling diagnostics to determine issues that may arise in a day, week or months’ time.

It’s this predictability that will enable field service organizations to deliver next-level customer satisfaction.

However, any IoT driven business requires data acquisition (communications and networking), analytics and business software to work in unison.

The problem is that very few companies have all the skills in-house to do this on their own. As such, savvy field service organizations will look to seek out IoT experts and form partnerships with them to take their business to the next level.

What steps are needed to introduce IoT processes into a field service delivery workflow?

Mark Homer: I am a great fan of using IoT education kits that are widely available and brilliant for educating technicians through practical and fun training labs - for example, the GE Predix IOT kit which you can find @ http://fs-ne.ws/1CJ730iXfcT

Mark Brewer: Firstly, companies need to be careful of integrating IoT for IoT’s sake.

By 2020, more than seven billion business devices are expected to be connected, but smart tech does not always add value. Misuse can lead to security vulnerabilities, with the network chain becoming more exposed to cyber threats. Organizations, therefore, need to first consider the business case for IoT.

A lot of IoT solutions mostly focus on a single element of IoT; for example, connecting the devices, or big data analytics - rather than providing a complete end-to-end IoT solution.Once this is understood, companies must start small - ideally by trialling a proof of concept. Before globally rolling out IoT solutions as part of their business, organizations need to check that the equipment, gateways and sensors work; that they are capturing the right data, and that they have all of the correct business applications in place to make sense of that data.

Next up is choosing a best-in-breed software application that can be easily integrated from inception with enterprise resource planning (ERP) software, or whichever management software the business has implemented. It’s important that the solution is completely mappable to the back end, closing the loop from device to business application.

A lot of IoT solutions mostly focus on a single element of IoT; for example, connecting the devices, or big data analytics - rather than providing a complete end-to-end IoT solution.

Field Service organizations need solutions that make the critical connection between analytics and transactional applications, which turn analysis into action and then into value.

Is adoption of IoT essential for a field service company to remain competitive?

Mark Homer: Yes, obtaining more accurate data from your connected assets will provide deeper understanding and insight into how your customers use and operate the equipment and assets you provide and thus enable you to derive a clearer understanding as to the value of that provision to your customer and their end customer or the upstream or downstream supply chain.

By understanding the asset performance, availability, and its RCM (condition and status), the asset true through life cost (cost of the asset throughout its whole life and its ultimate replacement) the servicing costs of inspection, maintenance, breakdown in the event of unplanned downtime is all critical as it allows for future innovation to improve future profit, performance and efficiency of the assets and the workforce maintaining it.

Connected products are also able to provide R&D with amazing data to give deep visibility into how a customer truly uses the equipment you provide.

This, in turn, is assisting the product development lifecycle in designing easier to use and maintain products.

Gary Brooks: As more products are equipped with smart sensors and complete autonomy becomes a reality, it will be more important than ever to shift from a reactive, break-fix service model to one focused on maximizing product uptime, or preemptively repairing equipment before it ever fails.

The best way to achieve this is to leverage IoT data to ensure parts are pre-emptively replaced before they fail.

Manufacturers must reinvent their service organizations, adopting sophisticated solutions and new business processes to optimize service parts inventory levels and prices while maximizing product uptime, which not only leads to improvements in revenue, gross profits and operational efficiency but also the overall customer experience.

Mark Brewer: By 2020, around 25 percent of asset-intensive companies will adopt IoT and digital twins to optimize service.

Whilst this doesn’t seem tremendously high, with the general shift towards servitization and the demand from consumers to have an all-encompassing customer service experience, more and more organizations in industries like manufacturing and construction, and logistics companies, in general, will be utilizing IoT technologies to expand their service offerings.

IoT technologies have the potential to enable companies across all industries to measure aspects in a detail and quality that has never been possible before; empowering businesses with assets’ performance indicators.

Leveraging IoT solutions can help organizations measure essential key metrics, such as availability, reliability, maintainability, supportability, cost of ownership and end-result, allowing them to operate more like service industries.This enables companies to find the most profitable models - turning service into opportunity.

Leveraging IoT solutions can help organizations measure essential key metrics, such as availability, reliability, maintainability, supportability, cost of ownership and end-result, allowing them to operate more like service industries.

For example, previously, the manufacturer’s knowledge of a product stopped once it left the factory. But now, via the feedback made possible through IoT, manufacturers can start to learn the usage, behavior and performance of these products in the real world, and can even make engineering changes to improve them over time.

Another example is construction machine manufacturer Caterpillar. The company has been able to fit its equipment with smart sensors to measure tire pressure, temperature, oil levels, and so on. It is a win-win for customer and service organization alike; minimizing equipment downtime and enhancing product development and improving service efficiency.

The approach is said to have saved Caterpillar millions of dollars already.

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Bill Pollock, President of Strategies for Growth explains why the future of the field service sector is going to be fully dependent on the emerging technologies that are driving ever greater connectivity...

Connected Field Service empowers Field Service Organizations (FSOs) with the ability to monitor equipment remotely, and transmit data into the business’ database in real-time.

The greatest manifestations of this increasingly pervasive technology may be best described in the following terms:

• Traditional Field Service Management (FSM) tools have long since taken their place in the everyday service operations of a large majority of FSOs
• Field technicians have been effectively repositioned as industry experts, equipped with data that helps improve productivity while delivering higher levels of customer service, and attaining enhanced levels of customer satisfaction
• Keeping up with the latest technology is an ongoing challenge for most FSOs – but one that is necessary to maintain their competitive position in an evolving competitive landscape
• Establishing a formal KPI program – with the flexibility to add new types of KPIs to address new ways of measuring connected field service performance – is becoming increasingly important.
• The more progressive companies have already begun to migrate toward newer, alternative business models, such as servitization or selling “power by the hour”.

As such, and by harnessing the power of the IoT combined with pervasive functionalities of a Cloud-based CRM platform, more and more FSOs have begun to shift away from the traditional “breakfix” repair model to a newer, “never-fail” service model. The combination of these new technologies with the adoption of alternative business models, are allowing companies to more effectively manage the entire business operations of the enterprise, rather than just its service operations – again, made possible through the advent and proliferation of connected field service.

Fast forward to today, we believe that the future of IoT-powered FSM solutions, particularly those built on a CRM platform, is quite bright.

Why? Because the value proposition is clear – and universal – across all segments and participants involved in the provider-customer services transaction:

• For services management – it provides a set of configurable tools, working in real time, that are necessary to make the critical decisions needed to run a successful services organization;
• For field service professionals – it provides immediate access to valuable data and information, and eliminates much of the cumbersome and repetitive paperwork required in the past;
• For the organization’s services customers – it provides the ability to initiate service requests and monitor call status directly via the Web (i.e., via a customer portal);
• For the parts/inventory organization – it sets the stage for controlled inventory and parts replenishment that helps keep costs down; and
• For the back office – it facilitates the streamlined flow of information between and among dispatch, finance, purchasing, parts/ inventory and all other relevant stakeholders within the organization.

The staggering amount of data that can be generated through a connected field service environment also brings to the table several new data-related capabilities for FSOs, including the ability to:

1. Collect whatever data that is needed to improve a process, or improve a product, based on its measured, monitored and tracked usage
2. Switch to a lower-cost predictive model vs. the more traditional – and more expensive – preventive maintenance model
3. Determine which services to offer to customers that the organization cannot offer today (e.g., a next-level guarantee against downtime, which can be turned into a premium service, etc.)
4. Sell, cross-sell and up-sell new services, packaged as competitive differentiators
5. Create a more effective KPI program that can measure, monitor and track both the still relevant traditional KPIs, as well as the “new” KPIs that are being created using connected field service

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Michael Blumberg, President of Blumberg Associates and Founder of Field Service Insights offers us an in-depth look at how the key market forces that influence service revenues...

I am often asked by clients to help them implement strategies to grow their service revenue.

Often these engagements occur because a client perceives that they are not getting their fair share of revenue and it's impacting the profitability of their company.

Developing new revenue streams does not happen by magic, a consultant doesn’t just waive his wand and suddenly sales take off. Increasing top line service revenue takes a little work but the results of this effort can pay off  handsomely.

All too often, Field Service management teams attempt to solve their revenue woes without first understanding their root cause.

They assume that the reason why more customers are not purchasing services from their company is that they price is too high. After all, that’s what their customers are telling them, so it must be true.

Companies that get caught up in this line of reasoning often find themselves implementing sales strategies based on some form of price concession, discount, or gimmick.

For example, charging the customer a small upfront contract fee for the right to purchase Time & Materials (T &M) service at a discounted rate, or treating service contracts as though they were a paid-up T & M retainer and allowing customers to carry unused portion of the retainer into the next year.

The assumption behind these pricing strategies is that more customers are likely to purchase the service because it is more affordable.

Unfortunately, the logic behind this line of reasoning is a bit flawed. Sure, the company may be able to secure more equipment under contracts through price adjustments. However, they will more than likely need to sell more service contracts to achieve the same gross margins as before the increase.

A company with a 40% Gross Margin target would need to generate an additional 35% in service revenue if they were to lower their prices by 10%.For example, a company with a 40% Gross Margin target would need to generate an additional 35% in service revenue if they were to lower their prices by 10%.

At issue, price may not necessarily be the only reason why companies don’t buy service. This assumption would hold true if all customers are price sensitive. The truth is all customers are not. It typically a small percentage.

More importantly, customers will always point to price as their primary reason for not buying services if they are not presented with other compelling reasons to buy.

The reason many customers do not purchase service is because of the perceived lack of value.

Customers think prices are too high when they do not recognise or understand the value they will receive from the service provided.

The problem is that it is difficult to articulate the value of service.

Most companies, particularly manufacturers, don’t know where to begin.

The more distinctions that can be made about a service, the more tangible it becomes, and the higher the probability that more customers will buy it.As consumers, we’ve all become accustomed to describing value in terms of the tangible aspects of a product. For example, its size, colour, workmanship, reliability and price. However, service is an intangible. How does one describe the value of something that is intangible?

The answer is by making distinctions about it. In other words, by describing the service in terms of the problems it solves, the outcomes or results it create, and/or the time it takes to complete.

Indeed, time is usually one of the biggest value drivers in field service.

Consider this, the more distinctions that can be made about a service, the more tangible it becomes, and the higher the probability that more customers will buy it.

Assuming no difference in price, which service offering sounds more appealing?

• A) a service contract that simply provides parts and labour or,
• B) one that provides 7-day by 24- hour coverage, parts, labor, same day onsite response time, remote support, and guaranteed uptime.

My hunch is that you picked B. This offering provides more value. Don’t you agree?

Unfortunately, most companies are not making these types of distinctions about their service offering.

It is should comes as no surprise that customers think the price is too high and don’t buy service contracts, and instead choose to take their chances and purchase service when needed on a Time & Materials basis.

Don’t misunderstand me, I am not urging field service companies to sell service features or outcomes they can’t deliver.

On the other hand, I am recommending those companies who are struggling with selling service contracts consider whether their service offerings or portfolios are defined with the customers' perception of value in mind.

For the service to have value, it must be described in terms of the experience or outcome provided.

Does it save time or money? Does it increase machine utilization? Does it improve the quality or cost of operations?

By defining the portfolio in this way, Field Service companies can test different offerings through competitive analysis, survey research, and conjoint (i.e., trade-off) analysis.

They would, of course, need to ensure they can deliver on the promise of the portfolio prior to offering it to the customers.

Conducting this type of research, also allows companies to determine which service offerings are most optimal or in demand by their customer base.

All things being equal, Customers will always choose the service offering the provides more value as defined by more distinctions In addition, distinctions provide the basis for differentiation and creating a competitive advantage. All things being equal, Customers will always choose the service offering the provides more value as defined by more distinctions then one that does not.

Some segments of the market may even pay a higher price for high value services particularly if they cannot purchase them elsewhere.

With the trend towards offering anything (e.g., products) as a service (XaaS) and Smart (i.e., IoT) Services, Field Service companies will need to become more adept at selling outcomes.

To do so they must be able to describe distinctions and articulate value. XaaS and Smart Services will not just sell themselves.

Field Service Executives are advised to start developing these skills now with service offered on existing equipment so they learn to be proficient at selling service contract when their XaaS and Smart Service programs are actually launched.

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Blockchain, the technology developed to enable the crypto-currency Bitcoin has become the latest big buzz phrase technology across industries worldwide, but is it just hyperbole or can it be an important factor in the future of field service?

Business across the world are turning their attention to BlockChain right now and in the majority of cases, the main focus of this attention is centred around Bitcoin, the first globally recognized digital (crypto) currency that has hit the headlines largely for huge spikes and dips in its value across the last 12 months.

However, whilst Crypto-Currency is the most widely understood application of Blockchain technology, there may be a number of other applications which could be far more important to how the field service sector operates.

Blockchain 101

So for the uninitiated lets first get our heads around exactly what BlockChain is...

To begin a blockchain is a continuously growing list of records, called blocks, which are linked and secured using encrypted codes. Essentially, each block will typically contain a cryptographic hash of the previous block, alongside a time stamp and the transaction data.

Perhaps the most critical point to comprehend about blockchain is that by design, a blockchain is inherently resistant to modification of the dataPerhaps the most critical point to comprehend about blockchain is that by design, a blockchain is inherently resistant to modification of the data. The technical language is that it is “an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way”.

When used as a distributed ledger, a blockchain is generally managed by a peer-to-peer network which adheres to the same protocols for validating new blocks collectively. What this means is that in practice, once the data is within in any given block it can not be altered retroactively without the alteration of all subsequent blocks. The particularly clever part here is that as each peer within the chain is working as part of the collective, such a change requires the collusion of a majority from the network - this makes pulling a fast one anywhere along the line pretty much near impossible.

Thus blockchains are inherently secure by design.

For the more technically minded amongst us, one could suggest quite rightly that the establishment of blockchain has meant that decentralized consensus has become realized, with blockchain ‘exemplifying a distributed computing system with high Byzantine fault tolerance’

For those of us who are perhaps more interested in the outcomes, however, essentially what we need to know is that due to the way they have been designed they are highly suitable for the recording of information that needs watertight security - such as medical records and of course financial transactions - which is where it all began.

Whilst Blockchain is rapidly gaining attention, it is the crypto-currency that it was created for use with, Bitcoins, even more widely recognized within the mainstream.

Blockchain was invented by wonderfully mysterious Satoshi Nakamoto back in 2008 as Bitcoin’s public transaction ledger.

Indeed it was the invention of the blockchain that allowed bitcoin to become the first digital currency to solve what is known as the ‘double spending problem’, without the need of a trusted authority or central server - essentially making crypto-currency viable.

So it’s just a new way of taking payment?

Well no, as we alluded to at the top there could be a lot more to how Blockchain plays a role in field service which we’ll go into shortly - but whilst we are at it there is certainly a case for adding crypto-currencies to the list of how your organisation receives payment for the services delivered - especially if you are serving the consumer directly.

Certainly whilst crypto-currency is by no means a mainstream payment method as yet, an increasing number of businesses are starting to accept it and with a lower barrier to entry than accepting plastic, any business in any industry has the ability to adopt crypto-currencies.

In Japan alone, an estimated 260,000 businesses were reported to offer the cryptocurrency as a payment channel in 2017.In Japan alone, an estimated 260,000 businesses were reported to offer the cryptocurrency as a payment channel in 2017.

But what are the benefits of accepting cryptocurrencies such as Bitcoin for a business?

There are plenty of positives in doing so but some key reasons cited in an article on business.com include:

• Eliminate chargeback fraud: A Bitcoin transaction is immutable. Once a client has paid for a product or service, the money is in your account. Unlike credit card payments, charges cannot be reversed.
• Immediate availability: There is no third party-dependent waiting period the way there is with bank-owned payments.Once payment is successful, the transaction amount is in your wallet and accessible immediately.You can convert Bitcoin into your local currency fiat at the end of each transaction, at the end of each working day or according to a custom set schedule.
• Lower transaction costs: Credit card payments usually end up costing you a 2 to 4 percent fee.With Bitcoin, this amount is a low flat fee, not a percentage of the transaction.
• Attract new customers: As Bitcoin rises in popularity, more users seek out participating businesses. This can mean exposure to a clientele you didn’t have before.
• Garner publicity: Bitcoin makes the news in a way fiat currency can’t. Local, national and even international news outlets are reporting on businesses taking Bitcoin payments, giving you an opportunity for free publicity.

Fixing the holes in the Internet of Things

However, as mentioned above, within the field service sector Blockchain has a huge amount more potential than just facilitating an additional means of receiving payment.

Firstly, there is its potential application within the Internet of Things - which is set to become the fundamental backbone of service delivery in the future - although widespread mass adoption is still arguably held back due to security concerns, a very real example of which being realized back in October 2016 when an unprecedented distributed denial of service (DDoS) attack involving an estimated 100,000 compromised devices in the Mirai malware botnet nearly brought the Internet to its knees in 2016 provided a clear indicator of the precarious state of IoT security.

The root of such weaknesses lies essentially within the security architecture of the IoT itself.

IoT architecture relies upon a distributed client-server model which uses a central authority to manage both the IoT devices as well as the data generated across an IoT network.

For IoT data to be trusted, all trust requests are aggregated into a single location which creates a sole point of security intelligence that can compromise IoT security. This is how Mirai-style botnet attacks can succeed.

Basically, during such an attack, IoT devices are unable to adapt their behaviour because they are not considered “smart” enough to make security decisions without the help of the central authority.

In an interview with computerweekly.com Joseph Pindar, Director for Strategy in the CTO office at Gemalto, and co-founder of the Trusted IoT Alliance, a non-profit group that advocates the use of blockchain to secure IoT ecosystem outlined why he believes Blockchain could hold the answer to true IoT security.

Pindar explained how blockchain removes the single point of decision-making that leads to failure, by enabling device networks to protect themselves in other ways, such as allowing devices to form group consensus about what is normal within a given network, and to quarantine any nodes that behave unusually.

Blockchain can play a crucial role in building trust in IoT dataIn addition to this blockchain can play a crucial role in building trust in IoT data by enabling what Pindar called the five digital security primitives: availability, auditability, accountability, integrity and confidentiality.

In blockchain, data is automatically stored in many locations and is always accessible to users.

For auditability and accountability, a private, permission-based blockchain is used – where all users are authorized to access the network – and because all data stored on the blockchain is signed, each device is accountable for its actions.

With regards to integrity, blockchain is as we’ve outlined above a public ledger of data entries.

With every entry, deletion or correction of data being confirmed across the network across a fully verifiable complete chain of events.

Further to this, there is also another perhaps less obvious but equally important benefit of utilizing Blockchain within IoT systems which Pinder raises.

There is a fairly widespread mindset amongst IT executive management regarding securing the industrial Internet which is that once a sensor, device or controller has been deployed and is working, it cannot be touched.

“Even if there is a known security vulnerability, it is not worth fixing it, because there is a chance that the security patch would cause problems elsewhere in the system that no one knows how to fix,” explained Pindar when speaking to Computer Weekly’s Aaron Tan “But as cloud computing has demonstrated, there are continual failures of devices and systems when operating at very large scale.”

“Simply put, it is not possible to manage large-scale systems that are fragile and not resilient to failure – as is the case with many current industrial IoT and OT systems.”

And the solution to this which Pindar recommends is to allow continuous deployment of software updates, alongside blockchain technology after devices have been deployed, with little or no downtime through an over-the-air update system - something he believes delivers both cost and operational efficiency when delivering over-the-air updates and patching to IoT devices and sensors.

With the IoT becoming more and more prevalent amongst field service organizations, the suggestions Pindar makes regarding the application of Blockchain in such systems should indeed be an important consideration for field service organisations as they establish their IoT processes.

The final piece of the 3D printing puzzle?

However, there could be yet another important place for blockchain within the field service sector, it could just be the missing piece of the puzzle in resolving one of the biggest challenges within our sector, namely managing the spare parts supply chain.

3D printing has for a long time been touted as a potential solution to getting parts needed to engineers as soon as possible, but one potential hurdle has always been how organisations control the licensing of the spare parts to ensure that firstly if the customer has 3D printing capability on-site - which has been one suggested use case, how can the provider ensure they don’t simply print off as many parts as needed once they have initially received the schematics file.

Similarly, by sending the parts data across in a digital file, the potential for such a file to make its way into the hands of unscrupulous third parties happy to make unauthorized parts for sale elsewhere is also a cause for concern for many organizations. Frankly, the risk to their IP and the significant loss of revenue this could lead has meant that many OEMs still view 3D printing with a distinct lack of trust.

However, could Blockchain perhaps hold the solution to such fears?

This certainly seems to be the thinking behind one Italian startup called 3D-TOKEN, which aims to integrate Blockchain and 3D printing technologies, in order to create a “unique, decentralized, global Just-In-Time Factory 4.0 for this century’s digital revolution.”

If successful it could certainly set a precedent for how Blockchain and 3D printing could work in harmonyAside from cramming as many manufacturing buzz phrases into their mission statement as possible, it seems it is certainly a concept that could have a potentially huge impact on service organizations within OEMs.

The goal for 3DToken is to connect thousands of 3D printers in a network hub based in Blockchain. In short, the plan is to create a Blockchain-managed network hub of desktop 3D printers.

The project will be used to bring just-in-time small-to-medium scale digital manufacturing to a new level.

Coin Telegraph described the startup as being capable of “accelerating the 3D printing market to its full potential” by changing up industry norms on product cost and time to market.

Whilst this project is still very much in its infancy, they have made impressive progress to date and although the focus on desktop 3D printers would suggest a consumer-centric approach initially as opposed to something suited for industry, if successful it could certainly set a precedent for how Blockchain and 3D printing could work in harmony, and the concept should at the very least give many OEMs food for thought as to how they could harness the potential of 3D printing. Especially as a means of bypassing much of the often highly complex service supply chain.

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