Now that the economy is (apparently) improving, many services and supply chain organizations find themselves in situations where they are trying to support a growing customer/market base with antiquated (legacy is more politically correct) service management systems that are no longer up to the job.
As a result, many are investing in new technologies and mobile apps to support their service and supply chain operations. This has, in turn, caused the Service Lifecycle Management (SLM) solution providers to expand their offerings to now include Reverse Logistics and other new-to-them functionalities.
Pricing models for new technologies are also in a mode of change – largely stimulated by the proliferation of Cloud-based solutions. For example, a $1 million SLM solution, paid for on a perpetual license basis, requires a large lump sum capital expenditure upfront – plus an annual maintenance contract for the duration.
However, the Cloud has allowed organizations of all sizes to implement their SLM solutions on a either a perpetual license basis or – as an alternative – a subscription model basis that requires only a fraction of the total cost to be paid on a monthly basis. Many services executives are finding that it is easier to acquire their SLM solution on a monthly payment plan (i.e., that they can charge on their company credit card) than having to go through all the red tape and paperwork to come to terms on a perpetual license contract.
Finally, more and more service and supply chain organizations now recognize that even the best systems and solutions, by themselves, won’t get the job done. A majority (for the first time in our surveys) are now citing the ability to implement and/or improve their KPI (i.e., Key Performance Indicator) measurement and tracking as the top strategic action they will be taking to bolster their service and supply chain operations performance.
The net net is that the market recognizes that now is the time to stake their claim to a larger share of the pie – however, they also recognize that they will need the proper solutions, tools, technologies and resources to actually make it happen. The opportunity for growth is here – but there’s no way to accurately forecast how long the window will remain open.