Field Service Scheduling Software and What You Need to Know

Scheduling software has long been a foundational technology for field service companies allowing them to meet customer demands.

This article initially appeared in Field Service News – September 7, 2018

 

Michael Blumberg, President of the Blumberg Advisory Group lifts the lid on all of the key aspects of this crucial tool…

If you have spent any time in Field Service, you probably understand the importance of managing service delivery functions against key performance indicators (KPIs). Among the most critical KPIs in the Field Service Leaders track are First Time Fix (FTF), Service Level Agreement (SLA) Compliance or Onsite Response Time (ORT), and Mean Time to Repair (MTTR). These KPIs measure the effectiveness of a Field Service Organization (FSOs) in delivering quality service in a timely manner.

The inability to meet KPI targets may result in exponential costs, customer attrition and loss of revenue; whereas the ability to exceed customer expectations can result in customer appreciation followed by an increase in profit margins and sales. To effectively schedule/dispatch the right technician to arrive on time with the right parts and skillset plays a significant role in meeting these outcomes. This is definitely not a small feat for your typical FSO.

Scheduling and dispatching Field Service Engineers (FSE) poses a challenge for most FSOs, particularly those with more than 5 FSEs. The reason behind this is there are many variables and factors involved.

An FSO with only one or two FSEs and a few customers may not perceive scheduling to be a major challenge. The volume of service requests may be relatively low while the options of who, when and where to send them may be rather limited. Scheduling becomes more of a challenge as the volume of service requests (i.e., customers) and the number of FSEs increases.

Adding to this complexity are the business objectives and/or constraints an FSO must optimize to meet its scheduling requirements.

With additional constraints or objectives, the more difficult it becomes to produce a solid schedule. For example, if the objective is to only meet a response time commitment to the customer, then the decision is easy – assign the FSE who can arrive in a timely manner at the customer’s site.

If FTF, MTTR, and/or SLA Compliance targets are also part of the equation, it becomes even more difficult to produce that solid schedule. Adding a profit margin objective, high call volumes, multiple geographies, and a sizable pool of FSEs, the decision becomes even more overwhelming.

The reason why scheduling is so excruciating of a task is that there are numerous factors that an FSO would need to create and evaluate to determine the optimal assignment for each FSE.

This is a time-consuming activity that requires an extensive amount of computational power to achieve. Many companies have suffered from a loss of time and resources in dealing with confusion and potential human error. The solution is Dynamic Scheduling Software.

Dynamic Scheduling Software provides FSOs with the feature-rich functionality that streamlines, automates, and optimizes scheduling decisions.

This technology ensures the FSO sends the assigned technician to the right job having the proper skill set and arriving on time. These applications typically leverage a scheduling engine that optimizes FSE job assignment. Scheduling engines vary in their complexity ranging from those based on business rules to Linear Programming (i.e. goodness of fit) techniques, Operations Research Algorithms (e.g., Quantum Annealing, Genetic Algorithms, etc.), or Artificial Intelligence (AI)/Self-Learning applications.

The complexity of the scheduling problem, number and types of resources involved, duration of tasks, and objectives to be optimized play a role in determining which scheduling engine is most functional.

Critical factors to consider may include whether the scheduling engine can handle:

  • Multi-day projects or short duration field service visits,
  • People and assets (e.g., tools, parts, trucks, equipment) or solely people,
  • The number and types of KPIs that are part of the objective, and
  • Route planning requirements.

In evaluating Dynamic Scheduling Software, FSOs are also advised to consider the following criteria:

  • Cloud versus On-Premise Deployment Options
  • Speed and Ease of Implementation
  • Integration with Back-office Systems
  • Availability of Real-time Visibility by the Customer
  • FSO Requirements for Best of Breed or Integrated Enterprise Solution
  • Total Cost of Ownership
  • Return on Investment
  • Vendor Industry Knowledge and Experience

There are over a dozen software vendors who offer some form of dynamic scheduling functionality for field service.

Obviously, no two Dynamic Scheduling applications are alike. Each one has their points of differentiation. The best solution is a function of the level of importance the FSO places on each criterion and how each vendor meets these criteria.

Regardless of which vendor is selected, the benefits of Dynamic Scheduling are clear.

In fact, industry benchmarks show that companies who implement these types of solutions can achieve a 20% to 25% improvement in operating efficiency, field service productivity, and utilization. The impact on bottom line profitability and customer satisfaction is substantial. To enable FSOs to provide customers with an Uber-like experience and significant profitability, FSOs should consider deploying Dynamic Scheduling Software as part of their service delivery infrastructure.

Is Now The Right Time To Replace Your Field Service Management Software?

 This article first appeared in August 20, 2018 online issue of Field Technologies Online 

The market for field service management (FSM) software market is large and growing. In 2017, the market for cloud- based applications was valued at $1.2 billion by Blumberg Advisory Group, and we anticipate that the market will experience a five-year compound annual growth of 22.8 percent. In other words, it will more than double by 2022.  

Given the size and growth of this market, it is no wonder that dozens of software vendors are vying for share. Each vendor claims that their software will help field service organizations (FSOs) transform operations, keep up with industry trends, adhere to best practices, increase profits, and maximize customer satisfaction.

These claims are prompting many field service leaders to evaluate if now might be the right time to replace their existing FSM solution.  Being rational business managers, field service leaders need logical reasons to upgrade or replace their software. Of course, there are many reasons but some are good and some are not so very good. With more than three decades of experience with this topic, let me share with you five good reasons why NOW might be the right time to make a change:

  1. Your current system is costly to operate and maintain. Lets’ face it, if you are spending too much to operate and maintain your existing system, then it is probably time to replace it. Typically, companies that operate antiquated, disjointed, and/or fragmented systems experience higher IT operating expenses than those who do not. I worked with one client whose IT operating expense were 12 percent of revenue (while best in class is 4 percent). The cost savings alone was enough to justify the purchase of a new system.  
     
  2. Your existing FSM software is hindering growth. Depending on its feature functionality, your FSM software can either facilitate or limit your company’s growth. A few years ago, I helped a client expand into a new service business. Unfortunately, their existing systems did not have the required functionality to manage the transactions and workflow of this new business. As a result, my client had to postpone the launch of the new business until they could replace their system.
     
  3. You can’t get good data from your current software. This is one of the most frequently cited reasons for replacing software. If you can’t obtain good data on your installed base, equipment service histories, field service engineer skill sets, cost of service, failure rates, etc., then your company is at a disadvantage because it lacks the business intelligence to effectively plan and manage resources. 
     
  4. Your current solution is impacting KPIs. Ultimately, the success of your FSO’s ability to meet financial targets and keep customers happy depends on its ability to manage service processes against KPIs. For example, first-time fix, SLA/response time compliance, MTTR (mean time to repair), etc. If your company’s performance trails significantly from industry average or best in class, then it is possible your FSM is to blame. Perhaps its time to consider replacing your current system with one that does a better job and drives performance gains?
     
  5. Your current solution lacks flexibility and scalability. It is important that your FSM software can scale up or down without a massive investment in capital or labor. In addition, it should offer flexibility in terms of how workers can share and access data as well as flexibility or openness in terms of the ability to add on third party applications.     

There will always be software vendors who offer new and innovative applications to the field service market. The desire to keep up with industry trends and best practices will also drive purchasing decisions. Implementing a new solution can be costly and time consuming, even if the ROI exists. Therefore, the decision to switch should not be made lightly. You can use these five reasons to provide an objective framework for decision making.  

Field Service: A Mid Year Review

Opportunities, challenges, and what lies ahead

Now that we are half way through 2018, I wanted to take some time to look at where the Field Service industry is right now.  Here are some of my thoughts on the biggest struggles facing Field Service Organizations (FSO), where some of the greatest opportunities lie, and what trends to look for in the coming months and years.

Field Service Organizations must continuously strive to maintain customer satisfaction while operating within various business constraints (e.g., cost reduction, revenue targets, labor shortages, etc.).  The challenge is these objectives are often in conflict. On one hand, companies must keep customers happy; on the other, they must find ways to lower costs and do more with less. In addition, they must keep up with innovations in technology and find ways to deliver an exceptional customer experience. At the same time, they must find ways to monetize technology investments without gauging the customer on price. Meanwhile, field service leaders in these companies are bombarded by data and information about where to invest their time, effort, and resources. This of course presents a challenge of its own.

In broad terms, FSOs should be seizing opportunities that make the highest and best use of their most expensive resources, namely talent and capital. What does this mean exactly? The answer is investments that simultaneously fulfill multiple objectives such as cost reduction, quality and productivity improvements, revenue generation, and profit enhancement. While this may seem like a tall order, FSOs can achieve this outcome by leveraging technology and being more effective in creating offers that customers value. For many FSOs this also means seizing on trends like digitization, servitization, and Uberization.

Digital Transformation has been a hot topic and big buzz phrase especially in Field Service.  I think it is one of the most important topics for FSOs. Companies who do not embrace digital transformation will become laggards at best or irrelevant at worst. Digital transformation is how companies develop innovations that lead to a better customer experience, improved operating efficiency, and increased financial value (e.g., revenue, profits, earnings, etc.) in the marketplace.   Digital transformation is what makes servitization and Uberization possible.

Many in our industry talk about IoT but the question is how does it fit into a successful FSO. As with many disruptive technologies, a small segment of field service is far along the adoption curve, while the majority is either in the early stage of adoption or just now beginning to consider it. At issue, IoT adoption in field service is a function of market penetration in the product/technology market. Adoption is the highest among large, Fortune 1000 companies and innovative start-ups in industrial automation, building automation, and home automation because these are the companies who are the furthest along in terms of integrating IoT into their product solution sets.

Many FSOs think that IoT is the answer to all their problems. They think it will solve all their labor, cost, quality, and revenue generation challenges. They need to understand that a great deal of planning is required to effectively roll-out IoT solutions. FSOs need to develop a vision, strategy, business plan, and road map that considers when, where, why, and how IoT will be implemented. They must consider which technology platform to use, what type of applications and analytics will be performed, what problems it will solve, and how to price and package it.

I have been talking and writing about Augmented Reality and Artificial Intelligence a lot because I feel that these technologies are a perfect fit for the field service space. I first became aware of them over twenty years ago and have patiently awaited their maturity and commercialization. I am bullish on them because they solve very real problems that FSOs face like labor shortage, first time fix challenges, requirements to reduce costs while improving productivity, etc. They also enable new possibilities. For example, the ability to anticipate, resolve, or avoid service events. I also like the fact they permit the creation of new income streams for service providers.

Other important trends that Field Service leaders should watch would be service marketing and sales, cognitive and predictive analytics, 3D printing, and drones. There are of course many more including the use of block chain technology which lies out on the horizon.

Stay up to date and catch more of my insights by visiting Field Service Insights, a subscription-based, community site bringing you thought provoking perspectives on industry trends and best practices.

Walk Before You Can Run

A Blue Print for Creating an IoT Enabled Field Service Organization

Despite the enormous benefits of IoT, field service leaders face many challenges to implementing IoT platforms.   First, many of these leaders have not defined a clear outcome for IoT projects.   In other words, they haven’t created solid use case or achieved clarity around what types of actions, decisions, or benefits they can obtain from IoT.  The possibilities are endless and often overwhelming.   Second, these leaders need to create a clear road map with respect to when, how, and where they will implement IoT.  Questions often exist as to whether they should implement IoT on their existing installed base or roll-out with new product releases.   Applying IoT to an existing installed base may seem like a time-consuming and arduous task.  However, the benefits that a FSO can achieve when a large segment of their installed base is IoT enabled is significant.  Third, IoT produces a vast volume of data.  FSOs are often not sure how they will make sense of all the data or how they will ensure that actionable and measurable results will be achieved from this information.   Fourth and most importantly, many field service leaders are concerned that they must overhaul their entire service delivery processes prior to taking advantage of IoT.  This seems like an impossible order when they may have millions of dollars invested in the current ways of doing things.

Implementing IoT does not have to be this challenging or complex.  Ultimately, field service leaders desire a solution that helps them achieve actionable and measurable results in a reasonable time frame.  More importantly, they want a solution that does not bog them down with tons and tons of meaningless data and one that enables them to work with their existing service delivery processes and systems infrastructure.

Quite often, corporations that implement IoT solutions do so within the context of a Digital Transformation (DX) initiatives.  These initiatives typically involve a complete re-design of the service model.  While they have positive impact on the customer experience and share-holder value in the long run, they maybe counter-productive to the near term objectives of field service leaders to support their customers’ installed base on an efficient and productive basis.  This is because DX initiatives require corporate buy-in, multi function coordination, dedicated investment capital, and considerable time to implement, whereas field service leaders are more pragmatic and want results now.

The best approach for field service leaders is one that enables them to implement IoT in parallel to larger, corporate DX initiatives. By doing so, FSOs can realize short term gains within the context of serving their current installed base using the FSO’s existing infrastructure and service business model.  This approach reduces the requirement to re-design the entire business model and postpone the realization of results that are possible through IoT.

Field service leaders can think of this transformation as “a walk before you run” approach to implementing IoT.  It requires field service leaders to think of IoT in terms of moving from a reactive service model, to conditional, to prescriptive and finally to a predictive service model.  Reactive service is the modus operandi of most of today’s FSOs.  Service is provided when the customer acknowledges they have a problem and request a solution.  Conditional service represents the next phase in the transition to IoT.  It uses IoT technology to monitor the customers’ installed base and provide alerts to the FSO that service is required. This enables the FSO to be more responsive to customer issues, ensure first time fix, and minimize downtime.  A prescriptive model is one in which the alert includes a recommendation or instruction about what action the FSO should take next.  Predictive service goes one step further. It monitors the customer’s installed base to anticipate service events and take corrective action before they occur thus avoiding downtime altogether and eliminate operating costs and overhead from the service operation.

The time for FSOs to think about implementing IoT is when they are replacing or upgrading their Field Service Management Software.  Perhaps the requirement for IoT alone is the primary reason why a FSO would want to upgrade or replace now.  Assuming this is the case, FSOs are advised to seek out software vendors who offer IoT feature functionality as part of a complete solution. This will minimize the number of moving parts (e.g., vendors, applications) that need to be included in the solution.  This in turn will lead to reduced implementation costs, an efficient process, and less headaches for the FSO.  In addition, it will ensure that the IoT solution works within the context of existing service delivery processes and procedures as opposed to the other way around.  In this way, FSOs can walk before they run.

 

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The Hero’s Journey: Xerox’s Field Service Force Is Armed With Augmented Reality

This article first appeared in the April 17, 2017 edition of Field Technologies Online.

It’s not hard to imagine that in today’s market, your customer’s success is dependent on the speed and quality of the service provided by your company. This is the situation in the print market which is highly competitive. Many printers utilize similar state-of-the-art equipment and systems in their establishments and printing has become a commodity business. In a commodity market, suppliers compete based on time and cost. If a printer cannot turn a print job around quickly, say within 20 to 30 minutes, the customer will seek an alternative option.  So, it probably comes as no surprise that printers are highly dependent on their equipment suppliers to ensure that the equipment, so critical to operations, is operating properly and at full capacity during their typical working hours (e.g., three shifts/24 hours per day). Extended periods of downtime, output errors, and printing glitches (e.g., smudges, smears, color mismatches) are unacceptable.

Ensuring high levels of machine uptime and quality print output places increased pressures on manufacturers for service and support. Regardless of whether they are forced to deal with a hardware issue or an application error, customers demand rapid response and fast resolution. If service is not provided in a reasonable time frame, manufacturers run the risk of losing customers as well as click-through revenue.  As digital printing technology becomes more complex and sophisticated (think expanded features and functionality), customers need more support and manufacturers find that they must hire more field service technicians to keep up with increased service demand.

Customer Demands Become A Growing Concern

Xerox Israel found itself in a similar situation during the second half of 2016.  Increasing headcount was not an option because it would have had an adverse impact on operating margin. Maintaining the status quo was also not possible. With a 77 percent market share, Xerox’s Israel-based service management team understood that it had to find an innovative and creative solution to overcome this challenge. Otherwise, they would run the risk of losing market share. That’s when Xerox’s Customer Service Manager, Eyal Mantzur, became aware of Fieldbit Hero, an Augmented Reality (AR) software platform. The Fieldbit solution is comprised of smart glasses and software that enables collaboration of live streaming and recording of video, audio, images, and text.

Prior to implementing Fieldbit, Xerox’s customers would call the Xerox Welcome Center and notify them of their problem. The Welcome Center would dispatch a Field Engineer (FE) who would call back the customer and attempt to resolve the problem by telephone. Usually, the callback was made because the FE was at another customer’s site.  Often, the FE needed to travel to the new customer site to see the problem to diagnose and resolve it.  The net impact was that customers had to wait hours for an FE to arrive onsite to resolve hardware faults and application issues. This resulted in unhappy customers and, ultimately, lost business.  FEs were also not as productive as they could be while onsite because they were often multi-tasking on the telephone with other customers who required help.  A stressful situation for all parties involved!

New Realities, New Possibilities, Better Results

Upon learning of the Fieldbit solution, Mantzur and his team realized they needed to redefine their support paradigm to provide better service to customers and achieve better results.  They placed an experienced technician in the Welcome Center who was responsible to use Fieldbit Hero. He provided technical support to both customers and FEs, who would also have access to the application. By using this solution, the expert support specialist and FEs could observe the problem that the customer (i.e., machine operator) was experiencing and provide instructions, in real-time, in the form of AR content (e.g., video, images, text, etc.) on how to resolve the problem. If they could not resolve the problem remotely then they could provide the customer with a workaround until the FE could arrive on-site.  More importantly, they could provide the FE with the knowledge and resources (e.g., parts, repair instructions, etc.) needed to resolve the issue on the first visit to the customer site.

The Xerox team realized exceptional results in several areas of their service operation after implementing the Fieldbit.

  • Xerox improved remote resolution rates by 76 percent within four months of implementing Fieldbit
  • Xerox experienced a 67 percent improvement in First Time Fix (FTF) rates
  • FE utilization increased by almost 20 percent while the total elapsed time to resolve a service request (e.g., telephone time, travel time, onsite repair time, etc.) was reduced by two hours

Most of Xerox’s FEs are now able to handle at least one additional service event per day. These performance gains result in real cost savings for Xerox because the service team does not have to hire more staff to support customer demand and travel costs are reduced.

While these internal performance gains are impressive, the impact on customer satisfaction is even greater.  “The customer feels very happy and empowered when we help him solve the problem [using Fieldbit],” boasts Mantzur.  “He feels he is the service hero. The quality of interaction between customers and FEs as well as remote technical support personnel is also much better because everyone can see and talk about the same thing.  There’s no guessing anymore. With Fieldbit, customer satisfaction at Xerox improved significantly, to 95 percent, per Xerox’s most recent customer satisfaction research.  Furthermore, customers experience shorter periods of downtime and receive more accurate advice or recommendations on how to improve both machine uptime and the quality of print output.

Ensuring AR Buy-In 

Like many service executives, Eyal Mantzur was initially uncertain about what AR could do for his company.  He first learned about it from referral by  a colleague.  However, Mantzur notes that AR is a difficult concept to describe verbally. It is something that you need to see to understand. Mantzur had many pressing questions when he first heard about Fieldbit… Would it work, would customers be receptive, would the field service organization embrace it?”   These fears were quickly dismissed after seeing the product in action.  Things started to connect when for Mantzur when he realized Fieldbit could help his team see what the customer is talking about and then use AR content in the form of video, text, and images to show the customer and/or FE exactly what to do to resolve the problem.

The management team at Xerox clearly understood the value of AR. This was not necessarily the point of view of the field service organization.  Some of the FEs did not understand the power of the tool. Some were afraid of being replaced or marginalized by the tool. Mantzur overcame this challenge by showing his FEs how Fieldbit enabled them work smarter rather than harder. In doing so, he offered them a trade-off they could embrace – either continue to be stressed out by complaining customers, or enjoy a better quality of work and more satisfied customers by using Fieldbit. Once the FEs started using Fieldbit “they fell in love with it ” claims Mantzur.

Working Smarter — Not Harder — Is Better for Everyone

In summary, Fieldbit is fast becoming an integral part of Xerox Israel’s service and support strategy. The goal is for Xerox Technical Support Specialists to reside at the Welcome Center and provide first-level support to customers.  The number of specialists will also increase.  By utilizing Fieldbit, everyone from the specialist to the FE to the customer can work smarter, and FEs will no longer operate purely in demand mode. Instead, they will have more time to perform periodic/scheduled maintenance, which in turn will improve machine performance and print quality output.  “Instead of maintenance leading us, we will be able to lead maintenance”, claims Mantzur. “It will also allow the customers to be more productive during their normal business hours. They can do a better job at planning their workload. Our FEs will also be under less stress and experience greater productivity”.

In a highly competitive market like printing, manufacturers must constantly be on the lookout for ways to gain a competitive advantage.  The Xerox service organization is on the front line when it comes to ensuring customer satisfaction and loyalty.  Their FEs play a critical role in maintaining high levels of uptime and quality for their customers.  Mantzur’s advice for any service executive skeptical about using Fieldbit is to see a demo and experience it firsthand. “Most people won’t understand the power of Fieldbit until they see how the technology performs,” he notes.  Even the customer will not appreciate its value until they use it for the first time; then they will demand it all the time.”  It is for this reason that Mantzur believes Fieldbit provides Xerox with a competitive advantage and a source of differentiation in the market.

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Field Service Management

Current State and Future Outlook

This Q & A first appeared on Mobile Reach as part of their Field Service Management Expert Interview Series. 

In what ways do you think field service management is changing? What are the future areas of growth?
Field service is becoming a technology-intensive business function. Technology enables field service organizations to build “Uber” like service offerings which are always available on-demand and in real-time. The future growth will come from adopting disruptive technologies like mobile, augmented reality, GPS, IoT, etc., to make this happen.

Speaking of IoT, what role do you see it playing in field service management?
I see the Internet of Things playing a very important role in field service management. It provides field service organizations and individual field service engineers with real-time visibility into status, health, and the condition of equipment they must support within their installed base. With this knowledge, field service organizations can be more effective at solving issues remotely, and field service engineers can be certain to have the right skills and resources (e.g., spare parts) with them when they arrive onsite to resolve an issue.

How are mobile technologies changing the way FSM organizations interact with their customers?
Mobile technologies provide field technicians with instant access to information about equipment history, spare parts availability, and technical knowledge. This helps them be more effective in doing their job for customers. In addition, they can use the technology to receive real-time updates and alerts about customers’ equipment. Furthermore, field technicians can utilize mobile technology to capture business intelligence about their customers that can then be utilized to upsell and cross sell additional services.

You mention upsell and cross sell. How can field service organizations use mobile technologies to drive revenue and competitive advantage?
Field service organizations can use mobile technologies to capture information about their customers’ machine population. For example, they can record data about what equipment they own, how long they’ve owned it, whether it is under a service contract, when the service contract expires, and their level of satisfaction with their current service provider. This information provides market intelligence that can be used to upsell and cross sell additional products and services. Companies can also drive revenue and competitive advantage by using mobile technology to capture customer satisfaction data and other relevant market research that would help improve performance and lead to the development of innovative products and services. Organizations should coach and train field technicians on how to sell and establish sales oriented KPIs for the organization.

How is the broader economy affecting field service management? How do you see this changing over time?
The current economy has a very positive impact on field service management. In an “up” economy, such as the one we are currently in, customers usually invest heavily in new equipment which means more service in the form of installations and service contracts. They are also more likely to spend more on services by purchasing premium service offerings that they may have not purchase in a down economy. I see the economy and the field service industry remaining strong for the next several years. However, even a down economy can have a positive impact on field service. Investors view field service as a defensible business in the sense that it is not hurt by cyclical economic trends in the way that industries like automotive or luxury goods are. Customers still need field service even when the economy is performing poorly. In fact, they are likely to increase their dependence on field service to extend the life of the equipment they currently own instead of buying new products.

What is role of the Chief Service Officer and how will this position evolve going forward?
The role of the Chief Service Officer is to drive customer satisfaction by managing service delivery against KPIs. In addition, their role is to serve as an internal advocate/champion within their organization for service. This means they work toward obtaining investments and resources when needed to improve customer satisfaction and service delivery performance. The role is evolving in the sense that CSOs are being tasked with responsibility for managing field service as a profit center as well as taking a leadership role in developing business strategy and driving innovation within their organizations.

What are the top three KPIs that you recommend FSM organizations focus on now?
My top three KPIs are First Time Fix (FTFR), Mean Time To Repair (MTTR), and customer satisfaction (CSAT). In the future, as field service generates greater value for companies, the KPIs are more likely to focus on financial metrics and customer outcomes such as gross margin, uptime availability, contract attachment, and renewal rates.

How can FSM organizations integrate big data without becoming bogged down with information overload?
They should consider the problems they are trying to solve before trying to find a big data solution. Once they have a clear understanding of the problem, they can determine if a large data set is required to solve it and, more importantly, identify what types of big data analytics are required. Does the problem require descriptive, diagnostics, predictive, or prescriptive/cognitive analytics? Lastly, they must understand that from a data solution perspective these analytics build upon each other. In other words, you can’t run until you learn how to walk. Trying to implement a prescriptive/cognitive big data analytics solution is pointless unless you have effectively addressed problems that can be solved through descriptive, diagnostic, and predictive analytics.

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Should Technicians Sell to Your Customers?

I attended a very interesting session at WBR’s Field Service USA 2017 Conference a few weeks ago.  It was billed as an “Oxford Style Debate: Should Technicians Sell to Your Customers?”  The debate about whether technicians should sell has been around for decades.  I know that has been a hot topic of discussion since I’ve been in the industry and I started working as a consultant in 1985.   While the topic has been discussed in countless articles and conference presentations, this was the first time I’ve heard it presented as an open debate.  I found it refreshing because it gave conference participants the opportunity to ask questions and challenge conventional wisdom which helps in formulating one’s position on a subject.

Arguing for technicians as sales people were Tom Vorin, VP of Customer Services, ISCO International and Ron Zielinski, VP, Global Customer Service Coherent.    Arguing against Technicians as salespeople were Andrew Kovach, VP US Lifecycle Services, ABB and Chris Westlake, VP & GM of Services & Electrical Businesses, RK.  Each side did an excellent job in presenting their case.

The argument that Vorin and Zielinski presented was that companies who have technicians sell create additional value not only for their company but for their customers.  In other words, their customers appreciate the fact that their technicians can identify new products and services that help improve their situation and/or business.  Since they already view their technicians as trusted advisors, customers are more likely to listen to technicians’ suggestions than if a sales person approached them directly about buying more products or services.  Basically, technicians are perceived to be objective when advising customers of their options and thus carry an air of credibility around themselves.

Kovach and Westlake’s argument against technicians as sales people centered around three issues. First, technicians are not comfortable in a sales role. If they like to sell, then they would have pursed a career as a sale person.  Second, putting technicians in a sales role can hurt the brand and jeopardize the level of trust that already exists.  After all, customers are not stupid and will quickly catch-on that they are being sold too.  Third, and most importantly, technicians must stay focused on their job of solving problems and keeping customers happy.   Anything else is a distraction and disruptive to the customer relationship.

Of course, each side had an opportunity for rebuttal and the audience had a chance to express their opinion and vote on which position/argument they favored most. The vote occurred before and after the debate.   Although a larger percentage of the audience were in favor of technicians selling before the debate occurred, Kovach and Westlake changed several people’s opinions about whether technicians should sell.  Ironically, after the debate Kovach and Westlake revealed it was staged, that they were asked by the conference organizers to take the against position, and that they do involve their technicians in the sales process.  Basically, they have them identify opportunities and refer them to the sales force.  In describing the sales role of technicians, Vorin and Zielinksi also implied that their technicians work in a similar capacity.    Both sides agreed that the “debate” was all in fun and it provided a fantastic opportunity to present ideas on the best way to involve technicians in the sales process.

In case you are wondering, I agree that technicians should not be selling to customers.   However, neither side of the debate was really arguing that technicians should sell.  They were basically suggesting that technicians can play a role in the sales process by uncovering customer pain points, identifying solutions, and referring business opportunities to the sales force.    Quite frankly, unless, a technician has a sales quota, can overcome objections, and close the sale they are not actually sales people.  I also think that if their compensation is not based in part on some form of sales incentive or commission for closing business then they will never be fully committed to sales.

However, I would not argue for placing technicians in a direct sales role as it could be disruptive or damaging to business.  On the other hand, any company that is passionate about growing their top line revenue, increasing customer satisfaction, and improving their market share needs to adopt a “sales” oriented approach where everyone in the company plays a role in the sales process.  That’s why I agree with the proposition that technicians should be play an important role in uncovering customer pain points, identifying solutions, and referring business opportunities to the sales force.   Bear in mind, the systems, performance metrics and processes need to be in place, and the proper training and coaching needs to be provided if they are going to realize success in this role.

I’d love to read your perspective on this subjective. Do you think technicians should sell to customers?  If yes, please share your experience in the comments section of this post.   Let me know what works and doesn’t work.  If you want some advice or suggestions on how to make it work then schedule a free consultation today.

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What’s on Service Director’s Minds

Nick Frank is a Co-Founder of Si2 Partners and this article is based on one first posted in Field Service Matters.

With customer expectations on the rise, field service organizations are constantly fighting to keep up. The service industry has shifted from a cost-centric and reactive approach to a value-centric and proactive approach. But aside from more demand from the customer, the transformation has also opened up new opportunities for service technicians, process, and technology.

Recently, I met with service and operations directors from the United Kingdom’s biggest organizations gathered at Field Service Summit. Field service leaders from manufacturing, telecommunications, and utilities met to exchange ideas and discuss opportunities and trends. Here are the most important topics they addressed.

On dealing with near-impossible expectations

Thanks to on-demand services such as Uber, customer expectations are higher than ever. Your customers want faster resolutions, more visibility into their service, and real-time communication with their technicians. But disruptions happen, and sometimes the customer wants more than you can give them at that moment. Here’s how the experts are managing customer expectations:

Set realistic expectations & don’t over promise

What do you do when the customer wants more than you can handle? Start by setting expectations. Before the service visit, know exactly what the customer wants accomplished and when. You always want to strive for a quick, first-time fix. But don’t over promise if you can’t deliver.

Let’s say a customer wants a tech to fix their washing machine the same day they call, but your techs are already booked for the day. Since it’s not an emergency situation, let the customer know they’ll have to wait, and schedule them for a different time slot. They might be upset that you can’t help them as soon as they’d like, but they’ll be more upset if you’re unable to deliver on a promise.

Let the customer set their own (controlled) expectations

Better yet, give your customer a range of options so they can set their own expectations. Most field service directors at the summit found that their customers want to be partners during the service process. Involve customers by allowing them to set their own expectations for the service visit. Just make sure to do so within in a controlled environment.

For instance, give them open time slots to choose from before they decide on their own. And if they want a higher level of service that will take more time and labor, let them pay more for it. This way you’re giving the customer more control throughout the process, but maintain manageable expectations.

On developing service technicians

Most of the experts at Field Service Summit agreed that the people side of the service delivery is crucial. In other words, your techs, along with their attitudes and capabilities, determine the successful delivery of solutions for your customers. Think about it. Your techs make up most of your company’s interactions with your customers. As the face of your organization, it’s important that the tech makes a good impression. Here’s what the experts advised for developing technicians:

Help your techs become brand ambassadors

It’s crucial for technicians to have the right technical skills, but attitude and image are just as important. Coach your techs on how to represent the brand and company values during their service visit. They should be courteous, engaged, and dressed appropriately. Your customers should feel confident in their tech’s ability to solve their problems and think of them as trusted advisors.

Make customer feedback part of the service process

The best way to learn how your techs are performing is by asking the customers. Consider making customer feedback part of the field service process. Send your customers a survey immediately after the service visit so they can respond with the visit fresh in mind.

If the feedback is positive, send it directly back to the tech. In addition to learning what he or she did right, the tech will also feel good to know they had a positive impact on their customers. If the tech gets a negative review, have a manager deliver feedback. Set a meeting to discuss their performance and talk about ways they can improve for next time.

On the importance of service value over price

As products are commoditized, quality service and positive customer experiences become main competitive differentiators. Field service directors at the summit noticed that customers today are less competent technically, and care more about the outcome. Being said, it’s important to constantly communicate the value of your service, especially if you have not been as visible to the customer. Make sure they know what’s been happening in the background, and throughout the service process.  Here’s what the experts advised:

Demonstrate value with proof

As your company grows, be sure to document a service portfolio. Get your customer support team on board with your company’s value propositions and demonstrate them. Work with your customers to build case studies (with numbers) to use as proof points for potential customers.

Be a business partner

Just as customers should see techs as trusted advisors, they should see your company as a partner invested in their success. Customers are looking for more than just a fix — they want solutions. And they want advice on their assets in case the problem arises again. Let them know you’re always there for them, even when they’re not due for a service visit.

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Driving Revenue Growth without Losing Sight of the Customers

CUSTOMER SATISFACTION

Several months ago, Derek Korte, the editor of Field Service Digital solicited my opinion for article titled “Expert Roundtable: Never Lose Sight of Customer Satisfaction”.    The basic question that Derek asked was “How do service leaders ensure the important work involved in managing a service business get done while still keeping the needs of customers involved?”  After all, Derek pointed out, Field Service leaders have a lot on their plate. They must continuously balance the need to improve the quality, productivity and efficiency of service operations with the strategic objective to drive revenue and growth; all while never losing sight of keeping customers happy.

This dilemma is a challenge facing all businesses not just Field Service.  When it comes to practical advice, Peter Drucker said it best, “the goal of any business is to get and keep customers.”  This quote provides a good lesson for Field Service leaders.  Driving revenue and growth, and maintaining customer satisfaction is not an either-or proposition.  They are one in the same.

To achieve superior outcomes in these two areas, Field Service leaders must view themselves as business owners.  They must view themselves as owners of a business franchise called “service” whether they are equity owners or not.  In other words, they must adopt an “ownership” mindset.

To succeed as business owners, Field Service leaders must first have the right “seats on the bus” otherwise known as the right functions that manage their service business.  This includes functions such as service delivery operations (i.e. dispatch, field service, parts management, etc.), accounting & finance, sales & marketing and others.  Without the right functions, the business cannot perform.

Second, Field Service leaders must make sure they have the right people in those seats. This means they must find talented people to manage these functions.  The people can be groomed from within the organization or recruited from outside.  Regardless, field service leaders must develop performance standards by which personnel must adhere.  These standards should consider the characteristics, skill sets, experience and behaviors that service personnel must possess.

Third, Field Service leader must have clear outcome of where they are heading.  If they are going to drive growth, then they must have a map to help them reach their destination.  In business, another term for a map is a strategy and/or plan.  Without a clearly defined strategy or plan to follow, a business can’t go very far.

Fourth and finally, Field Service leaders need to make sure their bus (i.e., their organization) is running efficiently. That it has a clean engine, good tires, etc. They also most make sure they have a GPS or dashboard to help them monitor their performance, the direction in which they are heading, and the speed at which they are going.  The engine, tires, etc. are a metaphor for state of the art service delivery infrastructure and related technologies that make superior service possible.  The GPS and dashboard are the Key Performance Indicators (KPIs) and operating benchmarks that help Field Service leaders keep course on their direction.

Now it’s your turn to answer the question: “How do service leaders ensure the important work involved in managing a service business get done while still keeping the needs of customers involved?”   What have you found that works and doesn’t work? If you’d like to read about other experts’ perspectives on this topic then read Derek’s online article.

Please also feel free to schedule a free strategy session with me today if you need more insight and guidance on how to improve service operations and drive revenue and growth while maintaining a high level of customer satisfaction.

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The 8 Solutions & Benefits Driving the B2B Extended-Services Marketplace

This week’s post were are pleased to share an article by Ron Giuntini, Principal and Remanufacturing/PBL/Outcome-Based Product Support Subject Matter Expert. Blumberg Advisory Group and Giuntini & Company recently performed an in-depth global survey of the configuration and marketing of Extended-Services agreements, with a primary focus upon the B2B marketplace. 

Ron Giuntini

As defined in this post, an Extended-Service is a:
  • B2B standard or customized agreement bundled as a
  • portfolio of services engaged in the
  • maintenance management of
  • specified-machines for a
  • defined-period at a
  • fixed-fee with
  • entitlement-assurances
A brief example of an Extended-Service agreement:
  • commercial buyer will be committed to a 3-year agreement at
  • $1,000/month fixed-fee in which the
  • seller will manage a portfolio of services engaged in the
  • maintenance management of
  • 3 specified-machine units located in San Diego
  • Two of the services within the portfolio are:
    • Supplying all technicians, parts and tools employed in the correct-failure (e.g. break/fix) unplanned maintenance process, but the buyer will be overseeing the process. There is an entitlement-assurance that the resources will be on-site within 2-hours of a buyer’s request, within any 24/7 period.
    • Supplying technicians and tools employed in the annual inspection planned maintenance process, as well as overseeing the process. There is an entitlement-assurance that the resources will be on-site within a 2-week window of the planned event and that the process will be completed within 4 hours during a period other than 0700-1600 from Monday to Friday.

Extended-Services are not only applied to the top level of a Bill Of Material [BOM], a machine model, but as well as for lower levels (e.g. subsystems, components). Note that the parts suppliers of an Original Equipment Manufacturer [OEM] often have developed their own Extended-Services solutions independent of the OEM or the OEM’s distribution channels. For this post, all Extended-Services will be referred as applying to the top BOM level of machines, though they will as well often be applicable to lower level BOMs.

The 8 Solutions Driving the B2B Extended-Services Marketplace:
  1. Attachment 
    The sale of the Extended-Service is “attached” to the transaction supplying a specified-machine to the buyer (e.g. machine sale, lease, & sharing). The limited manufacturer’s warranty is bundled into the Extended-Service.
  2. Warranty-In-Effect Conversion 
    An Extended-Service is offered to an enterprise without an Extended-Service agreement attached, but with specified-machines under a limited warranty that has yet to expire. The remaining life of the limited warranty is bundled with the Extended-Service.
  3. Warranty-Expiring Conversion 
    An Extended-Service is offered to an enterprise for specified-machines without an Extended-Service agreement attached; machines are under a limited warranty that is expiring.
  4. Warranty-Expired Conversion 
    An Extended-Service is offered to an enterprise for specified-machines without an Extended-Service agreement attached; machines are under a limited warranty that has expired.
  5. Up-Selling 
    Extended-Service revision in which deliverables have been expanded.
  6. Down-Selling 
    Extended-Service revision in which deliverables have been reduced.
  7. Cross-Selling 
    Extended-Service revision in which an expansion of specified-machines has occurred.
  8. Renewal 
    Extended-Service agreement expiring in which a new agreement is developed for the specified-machines covered by the previous contract; up/down-selling and or cross-selling may occur as part of the renewal solution.

Recently, Blumberg Advisory Group and Giuntini & Company performed an in-depth global survey of the configuration and marketing of Extended-Services agreements, with a primary focus upon the B2B marketplace.

Below is the survey’s key findings related to B2B Extended-Services solutions:
  • 36.5% of the machines supplied by an enterprise are attached with an Extended-Service agreement.
  • 19.9% of Extended-Services sales occurred after the attachment period; when a limited warranty was either still in effect, expiring or expired.
  • 56.5% of machines supplied were covered by an Extended-Service sometime during their lifetime.
  • 72.4% of expiring Extended-Service agreements were renewed
  • 59.6% of existing Extended-Service agreements were revised as a result of an up-sell, down-sell or cross-sell.
  • Majority of the sellers of Extended-Services anticipate higher sales over the next two years as a result of intensely targeting renewal rates and configuring more customized solutions.
  • Note that some of the statistics above would need to be modified if the Extended-Services seller also engaged in cross-selling specified-machines that they did not supply to the buyer.

It is my belief that an enterprise should strive for at least a 75% of the specified-machines they have supplied being engaged in an Extended-Service agreement throughout the lifetime of the machine; the caveat is that to reach such levels there are many strategic and tactical issues that the seller of Expended-Services must address.

The Seller’s Benefits of Extended-Services are the following:
  1. Recurring Revenues 
    Provides a significant repeatable source of cash flow; a hallmark for investors to favorable assess the financial stability and in turn market value of an enterprise.
  2. Profits 
    Provides a level of profit margins that are higher than that of the transaction supplying the machine; again attractive to investors.
  3. Relationships 
    Creates a long-term relationship between the seller and buyer. Increases the “stickiness” of the relationship that enables greater opportunities to sell a stream of Extended-Services throughout a machine’s lifetime.
  4. Production Learning Curve Mitigation 
    Provides the recurring revenue positive cash flow to support the production losses of machines in their early production life cycle stage due to the “production learning curve.”
  5. Data Collection 
    Provides a stream of valuable detailed information acquired from the seller’s service operations; design flaws employed by design, poor parts quality from suppliers for purchasing, poor quality of assembly for production and more.
 The Buyer’s Benefits of Extended-Services are the following:
  1. Operating Expense [OpEx] assurance 
    Expenditures incurred in machine maintenance processes defined in the agreement are fixed. Note that “supplemental” charges, incurred as a result of activities performed that are outside of the activities defined in the agreement, can often become a point of contention between the buyer and seller.
  2. Investment reduction
    Direct investment in parts, and indirect investment in facilities, tooling, test equipment and more involved in managing maintenance processes are often materially reduced.
  3. Machine employability increase
    Incentive of seller, through entitlements related to machine uptime/availability, to achieve high levels of employability through robust management of maintenance processes.
  4. Regulatory compliance assurance 
    Seller’s Body Of Knowledge [BOK] regarding federal, state and local regulations is often more comprehensive than that of the buyer; avoids potential fines for buyer.
  5. Adjusted machine asset value increase 
    Seller’s records management of work performed and entitlements to manage adjusted machine values can decrease depreciation, and resulting in a favorable impact upon the income statement.  
In conclusion Extended-Services has evolved from a “minor” factor in the capital goods machine marketplace to one that is obtaining greater visibility within the financial community, in turn resulting in a greater focus by the C-Suite, and in turn resulting in a greater tactical focus of an organization.