Variable Workforce:

The New Field Service Paradigm

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The use of third party workers has become a common practice for Field Service Organizations. A driving force behind this trend is the economics of associated with managing a large pool of labor. Maintaining a field service workforce on a full-time basis represents a short-term, fixed cost for service providers. At issue, field service demand is variable in nature and becoming increasingly more volatile. This is occurring for a number of reasons including but not limited to the shift from reactive to proactive service, improvements in the ability of companies to resolve services issues remotely, cyclical events in the global economy, and technology changes (e.g., refreshes, consolidations, and upgrades).

One of the ways to deal with the peaks and valleys in field service demand is through a Variable Workforce (VWF) model. This type of model enables a field service provider to convert short-term fixed cost into a variable expense by utilizing third party workers. There are a number of options available to companies who want to implement VFW model. These include

1. Implement Master Service Agreement (MSA): with one or more companies: Under this scenario an OEM, ISOs or VAR, collectively referred to as the client, contracts with one or more field service organizations (FSOs) to provide on-site service as needed through a Master Service Agreement (MSA).

2. Manage subcontractors on their own: Another option is for a company to build its own variable workforce model. This requires that a company hire and on-board, independent contractors either directly or through a staffing company.

3. Turn toward a “Sharing Economy” model: Companies who are willing and able to manage teams of individual workers can turn to a sharing economy model. In this scenario, a company would use an Internet platform, also known as a Freelancer Management System (FMS), to recruit, on-board, train, dispatch, manage, and pay individual contractors.
The sharing economy model offers substantial cost savings to a company who is willing to pursue this course of action. Improvements in service quality and productivity are also possible as freelance contractors are typically more engaged and motivated since their income is directly proportional to the quality of work performed and number of assignments they accept.

The Freelance Management System Defined

According to the Staffing Industry Association (SIA), an FMS is a category of Workforce Management technology that enables self-management of a contingent workforce. To be considered an FMS, the technology most include the capability to 1) match freelance workers with assignments, 2)issue work orders, and 3)process payments to freelancers.

FMS solutions are available as either Enterprise systems or SaaS based solutions. At their core, they provide functionality to initiate, manage, complete, track, and evaluate work performed by freelancers. Additionally, they may include the ability to find and recruit freelancers through a marketplace functionality as well as additional services such as insurance coverage for freelance workers and the ability to manage work though mobile communications technology.

I recently authored a whitepaper, sponsored by Field Nation, titled “The Variable Workforce Model – An Optimal Solution for dealing with Field Service Uncertainties”. It discusses how FMS is creating improved outcomes for companies involved in field service. More specifically, it measures the benefits that can be achieved through an FMS platform and defines the key characteristics of an optimal solution. To learn more, download your FREE copy today.

Why reactive service is a thing of the past?

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In this week’s blog I am sharing an article written by Sarah Nicastro. She is editor-in-chief of Field Technologies Magazine and  Field Technologies Online.  Her publication covers topics related to mobile computing, field service software, and fleet & asset management. This article, in which I was quoted, originally appeared in the August 2015 issue of Field Technologies Online.

I’m sure you’re no stranger to the IoT buzz that has taken the industry by storm the past year or so. And you’re going to keep hearing that buzz – IoT isn’t going anywhere. In fact, according to Gartner, the number of deployments of connected devices is forecasted to increase by 30% in 2015, with the total number of connected devices to reach 25 billion in 2020.

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Why the rapid growth? IoT solutions enable a shift from reactive to proactive service. Reactive service – customer calls with an issue, service provider responds – is quickly become a thing of the past. Customers are beginning to understand that they don’t need to settle for such a model. M2M and IoT-enabled proactive service, often referred to as predictive or preventative service, is becoming the new normal.

In a recent column written by Michael Blumberg titled Strategic Forces Shaping The Deployment of IoT & M2M, he points to two of the drivers of this shift: social forces and economic forces. On the social side, Blumberg says, “For service providers, it is no longer just about finding ways to reduce the time and cost associated with troubleshooting and maintenance. In order to optimize productivity and efficiency, and to facilitate innovation in a service business, you need data. While service executives have understood this for some time, end-customers now understand and appreciate that they also need access to this same data in order to optimize the operations and processes that comprise their enterprise.” So you’ve known the value of data and how it drives action and decision-making for quite some time, but your customers are now recognizing the value of data too. And this is contributing to an increase in use of IoT solutions that provide data that both your operation and your customers find great value in.
Costs Of M2M, IoT Come Down

As for the second force discussed, economic forces, the premise is simple – the cost of implementing M2M and IoT solutions has decreased rapidly in recent years. This makes the technology more attainable for a wider group of users, and as adoption continues to rise we’ll see a cycle of increased familiarity, greater adoption, and lower costs.

If you aren’t already looking at how M2M and IoT can play a part in your operation, now is the time to do so. Not only can the technology enable your organization to operate far more efficiently, but it will allow you to embrace the shift from a reactive service model to a far superior, proactive service approach.

Meeting Market Needs: An interview with Marne Martin, CEO of Service Power

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Last week, I conducted an interview with Marne Martin, CEO of Service Power, a leading provider of workforce management solutions. I was intrigued by recent developments in her company, most notably their release of Nexus FS, a new cloud-based software.   My interview with Marne provides some interesting insight on her company and her perspectives on the market for Field Service Automaton.

Michael R. Blumberg (MRB): Congratulations on Service Power’s progress. It looks like you are continuing to gain momentum in the market. Interim results for H12015 are very encouraging.

Marne Martin (MM): Thank you. Service Power is going through a revitalization campaign. We’ve concentrated on strengthening sales execution, managing our expenditures, making investments in new technology, and migrating to the Amazon web services platform. Our efforts are producing positive results that are the building blocks for the future.

Marne Martin 

MRB: Service Power is obviously gaining traction in the market with its core mobile workforce management software, including the patented ServiceScheduling route optimization software. Why release NexusFS™ (“Nexus”)?

MM: ServicePower’s feature rich ServiceScheduling and ServiceMobility solutions are great for the enterprise market where an enterprise might already have CRM, ERP, etc. already. Nexus FS ™ provides an easy to use, easy to implement solution for SMBs and enterprise customers who require field service management functionality separate from their existing CRM/ERP solution or simply a new all in one solution.

MRB: What perceptions existed in the market about ServicePower prior to launching NexusFS™?

MM: A criticism that we heard was that even though we had a well proven and robust scheduling, dispatch and claims products in terms of their features and functionalities, we were not prioritizing the user experience to be able to tailor UI views and information for the different types of users in an organization, as well as simplify integration challenges for customers. NexusFS™ gives customers a one size fits all solution through which we also have ready-made integrations to our other applications through our Restful API integration layer. It provides a full front-end solution that can be deployed all in one, or on a modular basis to fill gaps in a technology portfolio.

MRB: Obviously you’ve done your homework. How did you validate your assumptions regarding market wants and needs for the NexusFS™ application?

MM: Like many vendors, we relied on competitive market research to better understand our market position and opportunity. I also brought in people with alternative perspectives to validate our assumptions and test our conclusions. It is always my belief that teams of high performing individuals are the ones that create great companies and technologies.

MRB: What resistance did you get from the shareholders in your company when you told them of your plans to release NexusFS™?

MM: I presented shareholders in fall 2013 with a three year plan. It required that we focus on people, process, product first – and then profits, although we of course did commit to managing tightly expenses. This has required us to prioritize and make choices, to focus on efficiency and output internally, and we have been able to drive clear progress in all four areas as you can see from the interim results recently released. Shareholders weren’t certain back in 2013, and even in 2014, we would be able to bring out new products using internal talent and funding, but we have been able to accelerate our output migrating to a fully agile process and using small internal dev teams like “skunkworks” teams. Certainly there are some shareholders that desire us to focus only on profits and not invest in technology, but what creates a new trajectory for the company is the investment in products and marketing first, and then of course sales execution on an increasingly larger scale thereafter. 

MRB: What makes you think the is sustainable?

MM: Investors want to invest in sensible things and are happy to put cash into companies that are prepared to grow steadily and deliver a return on investment.   We have proven our ability to make the investments in our products, generate new cutting edge technology, so the next step is to add scale through our direct efforts, as well as do more in partner enablement related to indirect channels. This is all related to being able to deliver investors consistent topline growth linked to bottom line profitability, which is what they want. We must therefore show investors not just strategic results but also share tactical execution feedback with them metrics and progress, which we are doing. Examples of these touchpoints include getting NexusFS™ to market, managing the internal cost of development, migrating to the cloud and therefore more efficient IT and support structures, increasing the penetration and footprint of our existing applications, building out our professional services capabilities, and of course implementing new logos.

MRB: Thank you Marne, we look forward to learning about ServicePower’s continued success in the market.