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Connected Customer Experience

Systems of Support for your Servitization Journey

Author Michael R Blumberg on Nov-29-2019

This article first appeared in the November 4, 2019 edition of Field Service News

Much has been made of the potential benefits of adopting at least some Servitization strategies within a service portfolio. However, the processes that need to be put in place are complex and a delicate balance between increasing profitability and overcommitting on contractual obligations needs to be struck. Here, Michael Blumberg, CMO of Mize, offers his guidance as to what systems of support are required to achieve a successful path towards Servitization...

It is important that any company, regardless of where they are on their Servitization Journey, has the right systems in place to support this journey.

These systems must not only manage service delivery but also enable the service provider to scale their business.

Essentially, there are three (3) types of systems or applications that need to be implemented. These are:

  1. Systems that manage contractual obligations
  2. Systems that manage service delivery
  3. Systems that manage recurring revenue growth

Let’s examine these systems in more detail.

Systems that manage contractual obligations

Companies on their Servitization journey must implement system functionality that tracks and manages service contracts and obligations to customers. Without this type of functionality, service providers may find that they are either giving too much service away for free and losing money or not providing enough service and jeopardizing customer satisfaction.

Ideally, this functionality will provide information about what level of service this customer is entitled too. More specifically, it will provide specific business intelligence about the type of processes covered, the types of resources available/utilized, and the level of performance provided.

For example, a Durable product manufacturer or service provider will need to know if the customer is entitled to field service or only remote support. If field service, then are spare parts included in the contract. Does the contract include a response time or uptime commitment guarantee?

This information can be tracked and maintained through Service Contract and Warranty Management software functionality. This type of functionality is critical regardless of whether the service provider or Durable Products Manufacturer is providing basic services such as break-fix/field service, or more advanced outcome-based services such a “pay-for-use”. Managing customer expectations and meeting commitments and obligations is required no matter what offer the customer purchased.

Systems that manage service delivery

Don’t overlook the importance of your service delivery infrastructure in the Servitization journey. It is the engine that delivers on the promise of Servitization. The infrastructure must be aligned with current and future needs of your customer base Some companies are in the very early stages of their Servitization journey, providing only basic support services, and require service management functions such as field service, remote support, and service parts. Others may offer more advanced, outcome-based services such a “pay for use” or “cost down” commitment. These companies are likely to benefit from IoT and AI-enabled solutions that help anticipate and avoid downtime.

It is important to implement systems that are agile enough to support your long-term Servitization Journey. An advanced service offering, such as “pay for use” may not be practical or feasible today. However, your service system of record must be able to support these requirements in the future through add-on functionality or the ability to connect with third-party solutions.

Likewise, advanced service offerings often build upon basic offerings.

Even though your company may be ready for IoT enabled solutions, a robust service parts logistics or field service management functionality will still be needed to deliver outcome-based services.

Systems that manage recurring revenue growth

Building a profitable, recurring revenue stream is the name of the game when it comes to achieving the ultimate outcome of Servitization. As such it is important that service providers implement systems that support the marketing and sale of services. One of the ways they can do this is by implementing functionality that facilitates the ability to configure, price, and quote service offerings.

To ensure high attachment, service providers need access to functionality that facilitates their ability to modify or customize contract coverage, entitlements, pricing, billing cycles, terms, and conditions, etc. Since many companies enlist service technicians in the business development process, the systems must also be designed to make it easy for technicians to sell service plans, parts, and accessories.

Customer retention is also critical to building a sustainable recurring revenue stream. Staying in touch with customers on a periodic basis keeps your company top of mind. This is where marketing automation can be effective.

For example, automated email notification to a customer that an outcome was met or that a contract is up for renewal all help to ensure high renewal rates.

In summary, systems of support are required when embarking on any journey. This is no different for the Servitization Journey. Without these systems, companies will never get to their destination. Ultimately, the Servitization journey will result in building a profitable recurring revenue through the provision of a broad portfolio of basic and advanced services.

That’s why it’s critical that service providers implement a triad of systems that manage service obligations, service delivery, and service revenue growth.

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Transparency Is A Virtue In Business

Author Michael R Blumberg on Nov-15-2019

This blog post was written by Sam Klaidman, Founder and Principal Adviser at Middlesex Consulting. He helps clients grow Service Revenue and Customer Satisfaction by defining service contracts and other services that meet customer’s needs and create value for them and their customers.

When we talk about customer satisfaction, we eventually arrive at talking about how experiences compare to expectations.  The more the two are aligned, the more satisfied and trusting your customers feel. 

On the other hand, we like to work with companies who “empower” their employees to take care of the customer.  Sometimes this works and sometimes it turns out really badly for either the customer or the business. 

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Enlisting your Service Technician in Proactive Business Growth

Author Michael R Blumberg on Sep-9-2019

This article is guest post from Jim Baston. He is President of BBA Consulting Group Inc. and Author of the book: Beyond GREAT SERVICE-The Technician's Role in Proactive Business Growth

There is a lot of time and resources spent today on trying to engage field service technicians in generating new business from existing customers, and for good reasons.  Field service technicians are in a unique position in that they have insight to the needs of their customers which is unmatched by anyone else in the organization.  They know the technology, understand their company’s capabilities and know the equipment the customer is using and what they are trying to achieve with it.  They also generally have the trust of the customer.  Who is better at identifying products and/or services that the customer can use to make improvements to their facilities and operations?

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Connect Technicians to the Right Knowledge, Help, and Part at the Point of Service

Author Michael R Blumberg on Sep-3-2019

This blog post is based on an interactive workshop and presentation by Mize and Electrolux at Field Service Amelia Island 2019 on August 19th to August 21st, 2019 at the Ritz-Carlton in Amelia Island, Florida.  The workshop was presented by Michael Blumberg, CMO and Andrew Thomas, FSM Product Manager from Mize, and Danny Dailey, Senior Technical Manager of Electrolux.

Download Workshop Presentation from Field Service Amelia Island 2019

Download Workshop Presentation

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Does your Technician have the right parts to complete the service job?

Author Michael R Blumberg on Aug-8-2019

It is not uncommon for companies in the Consumer Durables Industry to lose control of the customers’ experiences during the product ownership cycle after the sale. This is because a customer may interact with many different groups or channels after the sale including Contact Centers, Dealers or Service Centers, Third Party Administrators, Parts Departments, or Field Service partners as part of the relationship with a company.   At issue, these groups may act as a series of unconnected departments or individuals.  However, customers expect these groups to act as one unified entity. 

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Service Knowledge: The Ultimate Key to Enabling a Higher First Time Fix

Author Michael R Blumberg on Aug-8-2019

This article first appeared in the Jul 25, 2019 edition of Field Service News

First time fix rates have always been and likely always will be the number one KPI that Field Service Companies focus on, but it is an elusive number to hit, Michael Blumberg gives his expert advice...

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