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When it comes to assessing the link between productivity and technology should the figures governments are concerned about be re-evaluated, asks Professor Andy Neely of the Cambridge Service Alliance.

There’s been much debate in recent months about the productivity paradox - put simply there’s a long standing concern that technology, particularly information technology, does not seem to deliver the productivity gains that might be expected.

This concern has resurfaced in the UK, with the Government raising questions about why the UK’s productivity has not grown as much as other countries. In fact, George Osborne recently called the UK’s low productivity growth “the challenge of our time”.

The same topic came up in a recent email discussion with colleagues from ISSIP - the International Society for Service Innovation Professionals, this time prompted by an article in the Wall Street Journal entitled “Silicon Valley Doesn’t Believe US Productivity is Down”.  In essence the Wall Street Journal argument was that developments in technology are not captured in the Government’s productivity figures - apps that help people find restaurants more quickly or hail cabs from their phones clearly improve the efficiency with which we can do things.

Doing more with less is a classic definition of productivity - so these apps must be improving productivity,  argues the Wall Street Journal (and those it quotes - including Hal Varian, Google’s Chief Economist).

While I accept the argument that apps and associated technologies allow us to do more with less, I think there’s a need to unpack the relationship between these developments and measures of productivity more carefully.

Traditionally governments have measured labour productivity in terms of GDP per hour worked. As technology replaces labour, GDP stays the same or increases, while labour hours go down - hence productivity increases.

 

However, there’s an interesting new phenomenon which complicates the picture.

Take, for example, Uber. I’m a fan of Uber - the app is great. It’s convenient. I’ve never had a bad service from an Uber driver. I love the fact that I can rate drivers and they can rate customers at the end of journeys. I love the fact that the cost of the ride gets charged to my credit card and the receipt automatically emailed to me. But I also love Uber because it is cheaper - I pay less for a Uber car than I do for a black cab in London. Better service, pleasant drivers, and lower prices - what’s not to like?

Other firms have similar business models – think Amazon or Airbnb. Still others provide me a service for free – Google and TripAdvisor -  and don’t charge me for the information they provide, instead making their money through third parties.

When talking about productivity - or the lack of productivity - we need to think about the economic impact of these cheaper and/or free services.

Lower prices to consumers must mean lower GDP. The efficiency gains are there, but they are not being captured in productivity gains because the benefits are being passed on to consumers in the form of lower prices, rather than captured in the official GDP statistics.

Maybe a more nuanced discussion about productivity is needed where we look at both sides of the equation:  increases in value and hence GDP, and increases in efficiency reflected in lower costs to consumers.

 

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As we continue to bring you extracts from The Service Manager Handbook, published by Advanced Field Service here we look at three quick tips to help you manage your service P&L whilst keeping your field workers happy and motivated…

Download the full 40 page ebook for free by simply clicking here and completing the brief registration form

 

Mine your data to plan for the future

Today’s customers are flexing their buying muscles and exerting pressure on suppliers to fulfil ever more challenging SLAs. To stand a chance of meeting rising customer expectations, while maintaining profit levels, you need full visibility over your contracts and tighter control over your SLA management.

Setting realistic budgets and timescales

Having access to historical information on the actual cost of similar projects, contracts and large installations helps to ensure that future bid costs and resource requirements are accurately assessed and a realistic price proposed.

You want to win the contract but not at a cost that could break you!

There are many factors that will determine the price of the project to the client, but the cost and resources that are needed to deliver the contract are not always fully considered at the bid stage. Without formal systems in place, many service organisations find it difficult and time-consuming to compile this historical information.

 

As a result, bids are based on gut feel and best guess, running the risk of perpetuating profit-killing mistakes. With an accurate budget in place – covering all your materials, labour and subcontractor costs – managers will be able to track actuals against estimates and use this information for future planning.

Optimising parts management - Don’t tie up your cash 

If your organisation stores parts, you will be all too aware of the dangers of stockpiling when cash flow is so important. Rather than relying on best guess, automating the forecasting process to predict usage will avoid the pitfall of holding more parts than are required.

Your systems should give you the power to analyse your parts history, so you can recognise trends and fluctuations to ensure that levels fall within the desired optimum range and can anticipate demand at peak times. This will reduce the amount of cash held in unnecessary high numbers of parts, and reduce the overheads of managing your inventory, while ensuring that your engineers achieve maximum productivity by having the right parts at the right time.

Managing parts ‘on-the-move’

Your systems should also enable you to keep track of your van stock levels and usage, as well as automatically re-ordering and replenishing when nearing a minimum level.

A good service management solution can help to effectively manage your inventory of parts, enabling you to carry the right levels to meet customer demand, without restricting cash flow. Good planning will also help avoid overstocks by scheduling parts to arrive when you need them, and ensuring you are able to optimise fluctuations in demand and effectively manage

Monitoring and managing performance

KPIs are a vital tool for service organisations to effectively track, monitor and evaluate performance to achieve sustainable growth. It is vital to identify which KPIs align to your business success. Standard service management metrics include: [unordered_list style="bullet"]

• First-time fix rates
• SLA adherence
• Engineer productivity
• Job costing
• Call rates
• Net profit margin
• Stock value
• Customer satisfaction/retention

Without proactively monitoring KPIs, service businesses are vulnerable to problems that can seriously undermine both performance and profitability. For example, failure to regularly monitor sales margins could mean that a costly recurring mistake is discovered only at year-end.

Sharing achievements

All too often, key performance information is only available to managers and directors, with staff review periods that are too infrequent to proactively affect the outcome of future jobs.

 

Also, this information may only be available through a central source, which can lead to a feeling of ‘them and us’. Relevant information should be available to all members of the team. Simple, clear and targeted information – not complicated reports – will help them to take ownership of their utilisation, performance and deliverables.

Using systems that can provide this vital information in real-time, such as mobile or web-based reporting, allows field engineers to see if they are on track to deliver within the schedule allocated. If not, the issue can be raised at the earliest opportunity, the causes assessed and appropriate action taken.

Download the full 40 page ebook for free by simply clicking here and completing the brief registration form

 

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In this the latest feature from our serialisation of the The Service Manager Handbook published by Advanced Field Service we look at the most important part of any field service operation, the field service engineers...

You are also able to download the full 40 page ebook for free by simply clicking here and completing the brief registration form

Your reputation, spread by word of mouth or increasingly through social media and online reviews, is founded on the experience your customers have of your engineers.

Unfortunately, customers seem more likely to broadcast a negative experience than a positive one, especially in the consumer or domestic service sector. Some disgruntled customers have even taken to posting video blogs of their experience of poor service. A video goes viral; word spreads like wildfire; and your reputation is permanently damaged. So how can you develop a service team committed to building your reputation?

Free engineers to do what they do best

A happy engineer more often than not results in happy customers. What motivates them best is using their time in deploying their skills rather than in endless form-filling. Consider ways to free your service team from the routine dross that saps their time and motivation, and empower them to be more productive and efficient.

Talk to your workforce

Holding regular face-to-face meetings between management and the workforce on the status of the business and sharing any development plans will all help build a team ethos, visibly improving productivity and enabling individuals to see the bigger picture. Whereas they might see the introduction of a new process or technology as a threat; you know it’s essential to the viability of the business.

Make your engineers your eyes and ears

With their close, on-the-ground contact with your customer base, even the most junior engineer can be a source of intelligence, such as feedback on how your customers regard your products and services: are they generally happy or are there murmurings about changing their supplier or service provider? Your field team is also a valuable channel for communicating your vision of quality and also for publicising forthcoming product updates or new services.

 

 

Encourage ‘self-monitoring’

Some service companies are using modern technology such as GPS tracking to weed out the worst instances of misconduct among their engineers. Others are adopting a more complementary method where their engineers choose their priorities and self-monitor their performance, an enlightened approach that can pay dividends.

Information: the vital tool in your engineers’ kit

As previously mentioned, engineers need the right tools for the job: their physical toolkit and information about the product, such as parts, diagrams, nature of the problem and known workarounds, as well as information about the customer, including their service history, plus, of course, essentials such as their contact details and location.

Be sure your engineers are fully aware of any recurring issues, such as a problem with a particular product, so that they can handle the situation with all due sensitivity. As previously mentioned, engineers need the right tools for the job: their physical toolkit and information about the product, such as parts, diagrams, nature of the problem and known workarounds, as well as information about the customer, including their service history, plus, of course, essentials such as their contact details and location.

 

Be sure your engineers are fully aware of any recurring issues, such as a problem with a particular product, so that they can handle the situation with all due sensitivity.

Mobilise your team

Information should also travel in the reverse direction: from the engineer back to base. Using their mobile device, engineers can send the customer’s sign-off back to the call control centre, along with any photographs or other supporting evidence, and details such as time to arrive on site and time to complete the job.

This information can be sent immediately to the contract manager to provide an instant report. A mobile solution is also a useful way to record exceptions to your usual high standards. In some cases, your engineer may be prevented from getting to the root of the problem. Was the equipment inaccessible due to a physical obstruction or the machine being unavailable for servicing?

A photo will provide supporting evidence should there be a query from the customer at a later date.

Room to grow

To maximise staff retention, it makes sense to create a rewarding work environment. A clear and defined development strategy and regular career mentoring are likely to encourage employees to stay. Pairing experienced engineers with new engineers will also speed up the learning curve and give individuals the opportunity to advance.

And those negative social media comments…?

Hopefully, the above tips will help to secure your reputation but if you do receive negative feedback online, you need to address it. If you respond courteously to comments – without being a pushover for compensation – you’ll be seen as a responsive, market-aware company.

Move the debate out of the public arena and offline as quickly as possible. You need to be vigilant but you can’t watch all social media channels all of the time. There are social media monitoring tools, such as Hootsuite, that will trawl the web for mentions of your company.

But once again, encourage your staff to report back on any negative social media they come across. Conversely, thanking customers for sharing a positive experience of your service is also well worth doing if you have the resources.

 

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Download the full 40 page ebook for free by simply clicking here and completing the brief registration form

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The next event of the Service Community will be the held on the 30th September 2015 from 12.30 to 17.00. We are very lucky to be hosted by the Aston Business School, where Professor Tim Baines, Director of the Aston Centre for Servitization Research and Practice leads one of the largest UK teams looking to support UK manufacturing be more successful through service based business models.

This special event is themed on a current key industry issue:

‘Using Big Data to achieve successful customer Outcomes’

Dr Andreas Schroeder from the Aston Business School will provide a perspective based on leading edge research as to how to overcome the challenges of leveraging the big data opportunity to deliver successful  customer outcomes.

We will then hear from industry speakers as to the hands on challenges their companies have faced in using data to create competitive advantage.

• Andrew Harrison will be talking about the how Rolls Royce Aerospace use the data they collect from their engines to deliver new services and reduce costs
• Jeremy Harpham from Pitney Bowes will present the role data is playing as this household brand transforms itself into a leading global e-commerce provider
• Marc Noble will tell us about the role data has played in  Inca Digital’s journey to service excellence

The format will be very informal to encourage as much dialogue as possible, and if there is time we will have a Panel Q&A.

To register your interest and reserve a place – please send your contact details to TheServiceCommunity@gmail.com

Please tell your colleagues about the event, which is free of charge.

For details of our last event in April where  35 professionals met at Fujitsu, Stevenage, see this link.

And for more background on this unique community of like minded people, see this link

 

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The field service industry never stands still: new technology, new market conditions, new entrants, new customer requirements…they all make it essential to keep a watching brief on the changing business and technology landscape...

To help field service professionals keep up to date with these ever shifting sands Advanced Field Service have produced their Service Manager Handbook, and Field Service News will be bringing you a selection of features from this excellent resource for Service Managers working in all verticals, for companies big and small, across the next few months.

You can also download the complete edition of The Service Manager Handbook by clicking here and completing the brief registration form.

It’s an interesting time to be in field service. We are on the cusp of exciting new technology becoming an integral part of the way business is conducted.

At the same time, field service companies still face pressures to achieve more, at less cost, on a day-to-day basis. Advanced Field Service believe that when we reflect on 2015/2016, we will see that it is a time of consolidation, in which managers concentrate on improving efficiency and productivity levels using their existing processes and optimising their existing technology, rather than rushing to adopt leading-edge solutions. In the second edition of the Service Manager Handbook from Advanced Field Service, is therefore focused on optimising your processes and making your systems work harder for your business.

 

It shows how gaining insight into every corner of your business equips you to identify and understand those areas that are under-performing and to uncover and model best practice within your organisation.

Having the power to access critical data across all areas of your service business, make informed instant decisions and manage your operation – from the time the customer logs a call to a satisfactory conclusion – will keep you at the front of a highly competitive field. In this the first part of this new series we take a look at the most important part of any service business… the customer. We’ve all heard the old adage that the customer is always right, but that only holds true if they are the right customer. 

Modelling your ideal customers

In an effort to maintain business viability – and keep your engineers working out in the field – it can be tempting to take on low-margin clients. If business is thin on the ground, this is understandable. However, to build a sustainable business, you need to focus your resources on the jobs, contracts and clients that have most potential for profit, rather than trying to be all things to all clients.

Furthermore, all the following whittle away at your profit margins, and you can probably think of other time and resource wasters:

• Scope creep, where the job is bigger than first appeared
• Doing favours for clients (“While you’re here, can you just look at this…”)
• Providing free credit to late payers who go beyond your payment terms
• Providing an ‘archiving’ service, whereby customers call you to find out when a service or repair was last done[unordered_list] 

It’s worth stepping back and analysing your client base to identify: Clients who are already profitable: 

• How can you quantify for them the work that you do, so that it is recognised and suitably remunerated?
• How can you keep these clients ‘locked in’ by delivering service beyond the agreed service level agreement (SLA) but without draining your resources and revenues?

Clients who could become more profitable:

• How could you better manage the time you spend on their projects?
• Can you identify where you are providing more than you agreed within the contract and budget?
• Do you have an evidence base that will support you in negotiating with clients to pay more or expect less?
• Can you let them self-serve on their documentation through a customer portal to reduce calls on administration matters?

Clients who are unlikely to ever become sustainably profitable: 

• How could you readdress the balance and bring these clients back within acceptable parameters?
• If the evidence shows these clients are always going to be an excessive drain on resources, do you need to make the difficult decision to agree to go your separate ways in order to free up your engineers’ valuable time for more profitable jobs?

 

By gaining a better understanding of every client’s worth to the business, you’ll be well placed to decide where to invest your resources for optimum return, both in retaining clients and pursuing new business.  

Want to know more? To download the full 40 page eBook edition of The Service Managers Handbook 2015 instantly click here and completing the brief registration form.

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Whilst the trend towards Servitization is rapidly becoming increasingly important for manufacturers and one that will have a significant impact on how field services operate, it is often viewed as a complex subject.

However, one man who has been involved with the movement since its early beginnings is Dr Michael Provost. His excellent book “Everything Works Wonderfully: an Overview of Servitization and Physical Asset Management” (www.everythingworkswonderfully.com) is a distillation of his knowledge and experience in this area built up over nearly four decades, making it a much more accessible topic.

As an introduction, Mike opens his book with an excellent short story that neatly summarises the concept of Servitization. Field Service News is pleased to be able to share it with you here…

A Short Story

Anna Edwards* was a very happy woman. It was her last day as Managing Director of Precision Powerplants* and she was looking forward to a few months of rest and relaxation on the sunny Côte d’Azur with her husband Chris* while she pondered her next move. She knew that she was leaving the company in good shape for her successor (whoever that happened to be: there were several candidates from both inside and outside the organisation who were being put through the on-going ‘beauty contest’) and felt very satisfied with the progress that the organisation had made on her watch and the transformation that she had overseen.

How different from the situation a decade ago, when she had taken over from the previous incumbent (now long forgotten) who really hadn’t understood the business and was forced to retire early. Sales and profits were falling, the share price had flat-lined for several years while the rest of the market soared and the City was muttering that the company had lost its way. A scathing analyst report entitled Always Jam Tomorrow: Beware of Perpetual Promises had ruffled a few feathers and made the Finance Director really angry. Competitors were offering deals that even the company’s most loyal customers couldn’t refuse and the organisation’s reputation for well-engineered power units just wasn’t being reflected in profitable sales. Great products (as even the writer of ‘that’ analyst report had acknowledged) but a lousy business, competing on nothing but price… Anna had taken on the job knowing that she was placing her professional reputation on the line. What should she do? She was starting to get worried.

 

She decided to bring in Peter Carpenter*, an old friend from university whom Anna admired for his out-of-the-box thinking, no-nonsense tell-it-how-it-is approach and excellent people and communication skills. She sent Peter home to have a ‘big think’, telling him to stay away from HQ and the alpha gorillas all trying to outdo each other with short-term slash-and-burn fixes which Anna felt were the painful road to corporate oblivion. Peter’s brief was simple: produce a plan for getting out of the ‘commodity trap’ that the company had fallen into and do it quickly before the inevitable crisis came and the whole organisation would be brought to its knees.

Peter had been musing about how to save the company for a few weeks when Sara* burst in to his study as he was casually doodling on a notepad. “The boiler’s broken yet again, Peter!” she fumed. “I’ll have to cancel my day in town while I wait for the man to turn up to fix it. I bet he won’t even have the right parts in his van either! Why couldn’t the thing let me know that it was going to break, so I could arrange the repair at my convenience? Why can’t it tell the repair man what’s wrong? I don’t give a damn about boilers: all I want is hot water and a warm house! Looking after it is nothing but hassle!” She stormed out, clearly not at all pleased.

Just then, Peter had his ‘eureka moment’. Were customers thinking like this about power units? After all, they had businesses to run and their own customers to serve and didn’t want to worry at all about power sources. Were the units that they had bought just an irritating distraction to them, requiring time, effort and expertise to look after that they really didn’t have? What if Precision Powerplants used its expertise to look after the units it made (after all, the company had designed and built them, so no-one else should know them better) and charged for the power delivered, not the physical units? Would this idea get the company out of its death spiral?

Peter’s mind began racing as his thoughts kept flowing. Customers would probably be happier making regular payments for guaranteed power, which would smooth out ‘lumpy’ cash flows and could add up over time to more than anyone would pay for ‘bare’ units. The company could shut out the ‘cowboy’ sales and service providers who were beginning to eat into its aftermarket business. It could also build up expertise that could be used to make the next generation of power units currently under development more attractive to the market. The organisation might even be able to offer this service to the owners and operators of competing products (after all, the laws of physics were identical for everybody and there were plenty of staff that the company had ‘poached’ with experience of competitor offerings) and thus eat its competitors’ lunches as well. After a few sleepless nights, Peter had even come up with a name for his new initiative: Megawatts, when and where wanted, or MW4 for short. Perhaps Helen*, who had just graduated from that incredibly expensive art college in Venice, could help him design a logo…

 

Peter began to ask questions and research his idea in more detail and discovered that many of the capabilities needed were already in place: they just weren’t being brought together into a coherent whole. Peter found people in the organisation who had, despite some management objections and hostility from other co-workers, devised ways of mathematically modelling unit performance and creating actionable information from the data that could be gathered and transmitted from equipment in service: there were also experts in Spares and Repairs who knew how the units should be looked after. All this valuable and unique knowledge had been ignored by Engineering and Manufacturing who just wanted to design, make and sell units before pushing them out of the door ASAP. Something would have to be done to move the organisation from a product to a service mindset, Peter decided, if his idea was to succeed.
* Note: the company and characters are fictitious, but the scenarios are based on experience.

Look out for the second part of the story, coming soon!

Please note that this short story has been previously published in the following:-
Provost, M. (2014). Everything Works Wonderfully: an Overview of Servitization and Physical Asset Management - a Short Story. Asset Management and Maintenance Journal, Volume 27, Issue 5, September 2014, pp. 43-45. Mornington, Victoria, Australia: Engineering Information Transfer Pty Ltd.

 

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Operating a successful field service operation today is a challenging experience. A study recently commissioned by Trimble revealed the main factors UK consumers look for when selecting a field service provider, their expectations and biggest frustrations. John Cameron, General Manager Trimble Field Service Management explains more...

The findings were extremely insightful, revealing that today’s consumers typically expect more and are not shy of complaining, leading field service companies to have to look at new ways to balance service excellence with cost.

Consumers say fix it the first time

Getting a problem fixed on a first visit is the biggest expectation for UK consumers. Indeed, in Trimble’s study, which surveyed 2000 British adults, over half (52 per cent) considered fixing the problem on the first visit to be the most important factor in determining their satisfaction.

However, field service organisations are struggling to fully achieve this as nearly one in four UK consumers report that a return visit is required. Poor inventory and an inexperienced workforce are the most common reasons for this. 40 per cent of UK consumers complain that their technician did not have the appropriate tools or parts to fix the problem on a first visit whilst 27 per cent said that the technician lacked the skills to complete the job.

 

Problems such as this often transpire for field service organisations that schedule daily tasks based on a technician’s allocated territory. However, it is more effective to select the most knowledgeable technician, or one who has the right tools and parts in their vehicle. Adopting intelligent scheduling engines is therefore crucial as they incorporate technician knowledge, parts availability and capacity into the scheduling process to ensure that the technician arriving on site is actually the person who can resolve the customer issue on the first visit.

Short appointment windows a key factor in customer choice

Today’s consumers increasingly expect field service businesses to provide more convenient appointment options to accommodate their busy schedules. However it is apparent that consumers are failing to receive this, as long appointment windows and wait times are considered to be one of the nation’s biggest frustrations with using a field service provider.

In Trimble’s survey, more than 50 per cent considered 1-3 hours to be an acceptable appointment window, yet 36 per cent report experiencing wait times of far longer, in some cases up to eight hours.

By coupling an intelligent scheduling engine with a self-learner tool, field service businesses can look to improve service delivery times through enhanced schedule accuracy, improved productivity and workforce utilisation. The software tool uses a unique algorithm to learn preferences for each technician and will allocate tasks accordingly. This includes which mobile workers normally service particular areas and what skills technicians have and to what degree they are qualified to do certain types of work. The first step to managing productivity requires field service managers to get the right people with the right skills with the right assets to the right place within a set time, and a self-learner tool significantly helps in achieving this.

Price and customer service equally as important

When selecting a field service provider, customer service and price were revealed as being equally as important to UK consumers. Field service organisations must therefore look to balance these if they are to achieve customer satisfaction, retention and profitability.

Over half of UK consumers (55 per cent) said they would refuse to use a service provider again if they were delivered a poor customer experience and with today’s consumers increasingly tech-savvy, it is very easy for them to complain to the masses. If left unhappy, half of consumers would complain formally to the company, 1 in 5 would complain to their technician and 1 in 10 consumers would take to social media to air their woes.

 

Consumers also find lack of communication with a company or service technician prior to arrival to be a major problem and consider being kept up to date on the day about arrival to be the most important factor when selecting a service provider. It is no longer acceptable to say anytime during the day. In fact almost half of consumers have to take annual, sick or unpaid leave to wait for delivery and service.

Field service businesses have a real opportunity to leapfrog the competition by providing excellent service to every customer and technology is available today that can help them to achieve this. The key is making and keeping commitments and then ensuring the customer is informed along the way.

To achieve this, more and more organisations are integrating their work management capabilities into mobile applications, which they can then offer to their technicians to allow them to share, store and view job data while out in the field, offering them a virtual link to the back office that helps to inform and empower them.

The range of information offered through a mobile application can include previous work history of jobs and upcoming work details. For example, if a technician is en-route to a customer, a quick look at service history on a mobile phone can inform them that the customer has complained multiple times to the helpdesk about a product/equipment failure.

This is vital information that can help the technician approach the customer with more care, helping to maintain a good customer service. Furthermore, when a technician reviews and accepts a job within a mobile application, the mobile device’s navigation tool can help them find the most efficient route. The technician can then pull up the customer’s details and call them to confirm when they will be arriving on-site.

The power of technology

To conclude, Trimble’s latest research looking into consumer’s biggest expectations and frustrations with field service providers ultimately suggests that success is achieved by managing productivity and ensuring field service managers get the right people, with the right skills with the right assets to the right place within a set time, whilst keeping the customer informed along the way. Having the appropriate technology in place to achieve this is therefore essential and key to helping businesses meet customer expectations and maintain ongoing brand recognition.

Trimble’s independent study was conducted by OnePoll, a worldwide market research agency. For a summary of the report, visit: http://ow.ly/MdyUU

 

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Channel partners can impact on delivery of  appropriate levels of customer service and support.  Yet, establishment of a channel partner relationship can be a very difficult, time-consuming and highly political business endeavor.  Bill Pollock, President, Strategies for Growth, suggests five key steps to creating successful alliances.

Many services organizations have begun to use channel partnerships to enhance their ability to reach, and support, an expanded market base. However, the use of such indirect business channels requires that the organization takes its partnership role very seriously in order for it to bring forth the desired marketing and economic benefits. This becomes particularly true with respect to the potential impact of the channel partnership on the company's ability to ensure that its ultimate customers are receiving the appropriate levels of customer service and support throughout the entire customer service process.

The true test of any services channel relationship may be measured in terms of answering the following three questions:

1. First, will the channel partnership allow the business to more efficiently provide the products and services that correspond with the ultimate requirements of the marketplace and, consequently, are also valued by the dealer/distributor and VAR communities;
2. Will the partnerships into which the business enters be of value for all participants, providing leverage for each to gain additional market share and/or attain additional revenue; and
3. Will the ultimate customers (i.e., end-users, equipment operators, consumers, et al) receive sufficiently high, and consistent, levels of customer service and support.[/ordered_list] 

Most businesses that enter into such partnerships believe that within each channel relationship, they can provide valuable assistance to their partners by assisting them in:

• Creating a sales and marketing infrastructure whereby they can more easily deliver the product and service offerings that they wish to provide to their own customers;
• Facilitating the launch of new product and service offerings to both existing and prospective market segments;
• Continually expanding, and improving upon, each partner's respective product and service offerings; and
• Offering both an existing customer service infrastructure as well as guidelines for supporting their partner's customers with the desired levels of service and support.Place your list items here

However, the establishment of a channel partner relationship can be a very difficult, time-consuming and highly political business endeavor. As such, it is critical that a formal process is involved in moving forward. This process may involve the following steps:

1. Partnership/Management Meetings

The first meeting between an organization's key executives and its potential partners is critical to initiating the partnership process. The result of this meeting will also determine the direction and speed with which the two organizations will pursue reaching their partnership goals, including identifying the degree of interest in alliance between the companies; generating enthusiasm for the rollout of the product and service offerings to the partner's customers; developing a consensus on the objectives, next steps and timeframe; agreeing on the levels of service and support to be provided; and establishing a formal agreement.

2. Establish the Alliance

Establishing the actual alliance is what sets the partnership in motion. At this stage, the objectives become to conduct the internal (i.e., partner) launch; ensure that the sales forces are entirely aware of, and educated about, the joint product and service offerings; and that they are able to consistently articulate and deliver the benefits of the joint offerings to the targeted customers. It is at this stage of the partnership process that the policies and procedures for delivering "seamless" customer service and support, across all company/organizational boundaries, are also established.

3. Generate Market Interest and Demand

Once the initial steps have been successfully completed, the program focus should shift to the generation of market interest and demand. The primary goal of this step is to generate awareness of, and demand for, the product and service offerings from among the partners' joint customer bases. The primary issues addressed as part of this step are the identification of the key influencers and sources of information for the purchase decision makers; implementation of ongoing programs of communications with customers and other market influencers; formal market launch of the product and service offerings; gathering of feedback/response from external audiences; communication of that feedback/response to appropriate internal audiences; and development of customer testimonials and references to be utilized in ongoing marketing programs.

4. Identify Segment Priorities

Based on the results of the previous steps, the objective should now focus on the identification of the targeted customer segments that most value the partners' "new" product and service offerings, and what specifically are their needs and requirements for customer service and support. The key issues to be addressed here include defining a common set of needs and requirements to be fulfilled by the product and service offerings; identifying common characteristics with which to categorize and describe the key customer segments; focusing all marketing, sales and customer service activities on these defined priorities; and capturing new business development opportunities in other areas as they occur.

5. Refine Product and Service Offerings

The final step is actually the first step in revisiting all of the actions and activities that have led to this point. The primary mechanism for ultimately refining the product and service offerings, and the corresponding levels of required customer service and support, is to incorporate the principal issues of customer feedback and response directly into the partners' respective portfolios.

Overall, supporting the ultimate customer may involve all of the organization's channel partners. The most successful channel partners will be those that can maximize the impact of their relationships once they have successfully completed an effective process for selecting the most appropriate partners at the outset; arranging for the establishment of mutually beneficial partnership agreements on a contractual basis; developing and implementing a plan for working together; establishing reciprocal programs for ensuring consistently high levels of customer service and support; and jointly marketing and promoting the full portfolios of each of the partners' products and services.

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The main difference between being able to make unhappy customers happy, and happy customers even happier, is the point of initiation. At least with unhappy customers, even if you do not know why they were unhappy before contacting them (or having them contact you), you can rest assured that you will get the chance to learn very quickly writes Bill Pollock, President of Strategies for Growth^SM

Ironically, however, it may actually be a bit more difficult to make a happy customer even happier than it is to make an unhappy customer happy in the first place – and you certainly would not want to accidentally do something wrong that might make them unhappy instead.

It’s all a matter of listening, understanding, responding effectively and working under the auspices of an intuitive set of guidelines that should largely come as second nature to the vast majority of the organisation’s customer contact personnel (including yourself).

What we have seen from our research is that the best approach for making happy customers even happier is to focus on the following guidelines:

• Make sure that you and your customer services team understand how the customer uses its systems and equipment as part of their ongoing business operations – make suggestions occasionally on how they can improve efficiency, save some money, go green or reduce waste, etc.
• Take steps to better understand the difference between the customer’s wants and needs – provide them with targeted information and advice that they can use to concentrate more on what they “need”, rather than on what they think they “want”.
• Understand the customer's plans for future expansion, downsizing or consolidation – make the appropriate recommendations for updating and/or modifying their existing service level agreements, or upgrading to newer or different models and technology.
• Keep track of the things you have done in the past to make them happy – do more of the same, and learn what other things or actions would also make them happy.
• Customers love to feel they are getting something for nothing – any documentation or materials that you believe may help your customers to utilise their systems and equipment more efficiently, or provide them with additional product or service information, will generally be gladly accepted.
• Customers also love to hear what other users like themselves are doing with their equipment – so, without divulging any customer-proprietary information, occasionally provide your customers with examples of what some other companies are doing, again, to improve efficiency, save some money, or reduce waste, etc.
• Provide your customers with new product or service information before it is otherwise widely distributed or disseminated – customers always enjoy receiving information before it is distributed to the general public.
• Share your organisation’s thought leadership collateral with your customers – most customers especially like to be made aware of White Papers or Case Studies that help them to understand the enhanced value propositions of the equipment and services they are using, or how their peers have benefited in ways they may not have anticipated through the use of your products and services.
• Provide a more "personal" side of your communications with your customers in order to establish a closer, and less formal relationship – but, be careful not to get too "personal"; just close enough so they feel they can depend on you to act as their surrogate within the company whenever a problem becomes larger than what both you and they, can handle by yourselves.
• Strive toward making your relationship with your customers a true "partnership", rather than just merely a “vendor-customer" relationship – this is the true essence of Customer Relationship Management, or CRM.

Of course, all of these guidelines are merely just words written in a magazine article; the true test can only be exercised by you and your customer and technical support teams on behalf of the customer.

In any case, you should always feel comfortable in relying on your own instincts in order to initially assess the situation, determine the appropriate course of action, and override any of these (or any other) guidelines on the basis of your accumulated expertise and experience.

If you are truly going to succeed in establishing – and maintaining – a strong relationship with your customers, then you must first have both the capability and the confidence to use your own judgment in taking the specific actions that will make your happy customers even happier.

 

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