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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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Rosanne Gresnigt and Hilbrand Rustema at specialist service management consultancy Noventum tackle one of the big challenges all field service organizations face - aligning the core functions of service and sales...

It’s one of the questions we hear so often. How can a company build a scalable service sales and delivery model? With increased commoditisation, pressure on growth and margins are forcing companies to think outside the box when it comes to their services.

Service businesses need savvy innovation programmes, which allow them to evolve quickly and nimbly – they need to create new customer-oriented offerings, quickly adapting to changing markets. However, navigating the right path to service transformation isn’t always straightforward. Most common approaches, Big Bang and Incremental, carry risks and yield surprisingly low success rates.

There’s an alternate path, however, increasingly being adopted by today’s more successful and forward-looking service organizations: ‘The Service Factory’.

The Service Factory approach is an agile, systematic, highly successful, low-risk approach to service transformations enabling companies to adopt innovations in tandem with today’s fast-changing customer and market needs.

How does it work?

The Service Factory approach is an analogy to an actual factory and consists of three core steps:

• Creating and maintaining a high-level vision of the future for your business with a defined portfolio of services that you want to offer to your customers
• Defining a precise architecture of your business model components that you need to sell and deliver the services in the portfolio
• Defining a roadmap in which the components are improved step-by-step according to new and changing requirements

In further detail, having developed a high-level vision of your organization’s future services portfolio, the approach requires that you break down your business into sales and delivery model components; Request Management, Diagnosis, Planning, Maintenance Engineering and Knowledge Management are examples of valuable components in your Service Factory.

Each component is then looked at from the following perspectives:

• Management Practices
• Processes
• Performance Metrics
• IT functionality

Businesses implementing this approach must:

• Have a clear vision of how the business will develop in years to come.
• Set out well-defined long-term business objectives
• Develop an understanding of what components are required and what they should look like.

Using this holistic approach, businesses can embark on an ongoing process whereby a new component is implemented every 6-8 weeks.

As such, the Service Factory is a high-paced, focused approach involving fixing, raising and maturing the level of the business, component by component.

Where to begin?

A thorough assessment of the business is a good place to begin.

Companies can start by benchmarking Key Performance Indicators (KPIs) like Customer Experience, Productivity, Gross Profit Margins and Growth Rates against top performers in their industry and proven standards.

This will enable the company to identify what the biggest areas for improvement are. As a next step, a more qualitative assessment can help to identify the root causes of under-performance and best practices.

By prioritizing the opportunities that are derived from such assessment, based on time/complexity to implement and expected added value for the company, a service transformation roadmap can be created.By prioritizing the opportunities that are derived from such assessment, based on time/complexity to implement and expected added value for the company, a service transformation roadmap can be created.

As Europe’s leading Service Management experts, Noventum has developed a comprehensive library of industry benchmarks and best practice industry standards for components covering all the major capabilities of a Service Factory.

They are developed and updated frequently based on our research activities and our work with leading service businesses across the globe.

Start with Self Assessment:

To help you move forward we're pleased to offer you access to our free online self-assessment tool which covers a limited scope of functional service business areas which is available @ www.noventum.eu/fsm-assessment-demo

This assessment will take approximately 30 minutes of your time and then upon completion of the assessment, you will directly gain access to your personalized report of opportunities that could help you to improve your own business and get your sales and service operations more closely aligned.

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