The Benefits of Service Lifecycle Management (SLM) Are Likely to Be Transformative For Your Services Organization!

Managing today’s service enterprise means planning and coordinating service on a global scale. It means delighting your customers – and your shareholders. And it calls for new technologies and business practices designed specifically to solve the Service Lifecycle Management (SLM) challenge. Based on these reasons, we believe that any services organization that strives to provide “best-in-class” field service in support of its customers must first implement a robust SLM solution in order to achieve its objectives.

While at first glance, it may appear that there are many alternative SLM solutions available; however, not all of them are designed with the same levels of functionality, applications, and comprehensiveness that the SLM market requires – i.e., the key ingredients for success. Simply listing and describing the potential benefits of SLM constitutes only half of the battle – prospectiveusers will still need to “sell” the concept of SLM to management in order to gain their “buy-in”.

The benefits of implementing an SLM solution are many – and are fairly universal (that is, applicable for virtually every services organization, regardless of type, size, or geography served). Users typically identify the following five areas of benefits as the most compelling talking points in selling the concept to management;

  1. Reduced Service Costs
  2. Streamlined Workflow
  3. Improved Service Levels
  4. Enhanced Quality and Growth
  5. Increased Customer Satisfaction
1.    Reduced Service Costs

Simply citing generic data regarding potential cost reductions does not generally entice management to look any further. In order to truly gain their attention, it must be specified exactly where the cost savings will be coming from – and to what extent (i.e., provide them with hard numbers). The good news is that a robust SLM solution can manifest quantifiable cost savings from several specific areas including:

  • Improved technician productivity
  • Improved Inventory/parts management
  • Optimized service delivery
  • Reduced time in the “service-to-cash” cycle

These areas of cost savings will very likely peak management’s interest – as well as entice them to ask for more detailed cost-saving information. For example:

Improved Technician Productivity

Through SLM, improvements in technician productivity can be gained in a variety of ways including:

  • Providing field technicians with real-time, direct access to customer service history, equipment repair records, product information, and inventory and parts availability enables them to provide the best service possible in the most cost-effective manner by eliminating time-consuming paperwork and forms preparation. As a result, the technicians are able to spend virtually all of their time (i.e., billable time) providing their customers with the highest levels of service and support, rather than simply collecting information and filling out forms.
  • Providing field technicians with specific service level information for each customer they serve so that they never unknowingly provide their customers with anything less – or more – than those levels of service that are specifically covered in their respective Service Level Agreements (SLAs).
  • Reducing overhead costs through the elimination of most paperwork, delays in communications, and the use of outdated systems that had previously required manual data entry or redundant data input.

Empowered by the data and information made available through SLM, field technicians can also serve as the “eyes and ears” of the organization with respect to identifying potential cross-selling or upselling opportunities for the company’s various products and services. For example, armed with recent service call activity data, a field technician can provide customers with fresh information on new product or service offerings that would ultimately benefit their operations in the long-run – while at the same time, identify potential leads for the company’s sales team. By doing so, customers will not only look at their field technician as “the person who gets things fixed”, but also as a “trusted advisor” – or the one they can count on to both fix their equipment, and provide them with recommendations for acquiring new products and/or upgrading their service level coverage.

However, while improved technician productivity is generally an eye-opener to management, there are still far more compelling cost benefits that can also be gained through an SLM solution.

Improved Inventory/Parts Management

SLM can also result in “hard” cost savings through improved inventory/parts management, as summarized below:

  • SLM enables services organizations to enhance their Equipment Asset Management (EAM) capabilities by allowing them to track specific component/equipment relationships, and monitor their inventories for the purpose of automatic replenishment. By developing – and following – tightly integrated inventory management processes, users are able to significantly reduce inventory size and related carrying costs.
  • SLM also provides technicians with access to real-time inventory information, as well as the ability to order parts directly from the field, rather than having to wait until they return to their home base, or gain access to a telephone connection. The ability to work with real-time parts/inventory information provides both the technicians – and the customers they serve – with immediate access to parts availability, while simultaneously updating inventory levels and triggering automatic replenishments.

Some organizations may also wish to implement “vendor managed inventory”, or “just-in-time” inventory replenishment models to support their customer base, so that once a needed part is identified, it can be ordered and shipped immediately from the vendor source to the customer site. These types of fast-track inventory models can be easily implemented and supported through SLM.

However, while improved inventory/parts management ultimately benefits both the services organization and the customers it serves, there are still additional cost savings benefits that management can literally “take to the bank”.

Optimized Service Delivery

Optimized service delivery may mean different things to different people; however, the most compelling benefits of service optimization delivered through SLM are typically realized in terms of:

  • Minimized time to dispatch (i.e., quicker response time);
  • Increased first-time fix rates (i.e., fewer repeat failures and/or service calls); and
  • The ability of customers to perform self-diagnosis and problem resolution viathe Internet.

Ultimately, each of these benefits is realized through improved response time, decreased need for follow-up/repeat calls, and less equipment downtime. Even so, there are still several other types of benefits that will also be of significant interest to company management.

2.     Streamlined Workflow

Technology is the tool that assists services organizations in making their operations run more efficiently – but it is only a tool. However, SLM leverages best-of-breed service management solutions with industry best practices already built-in, thereby allowing practitioners to benefit not only from the automation of their current processes, but also by allowing them to redefine and improve their processes to deliver optimum results. These results are typically manifested in the following ways:

Integrated Processes and Technologies

Only through SLM can the practitioner benefit from a completely integrated and seamless solution that provides an instant 360-degree web-based view of the entire business. For example, when Sales or Marketing require information from Service Operations to develop targeted promotions to maximize cross-sell and up-sell opportunities, a robust SLM solution can give them exactly what they want– when they want it. Similarly, when Service needs real-time customer information from the Contact Center prior to making a call, SLM makes that information readily available.

A unified and modular approach, based on open industry standards, protects the users’ existing IT investments, lowers their Total Cost of Ownership (TCO), and paves the way for the deployment of the appropriate SLM modules – as required – as the organization grows.

Improved and Streamlined Processes

The end result of successfully integrating the organization’s processes and technologies is improved and streamlined processes – in otherwords, running the organization more efficiently. These benefits are typically manifested in the following ways:

  • Through an automated call management system based on CTI, IVR, dynamic scheduling and dispatch, and closure capabilities, services organizations can rapidly improve and streamline their call management process, thereby significantly increasing customer satisfaction and retention.
  • With the ability to apply contract templates, initiate automatic contract renewals, and build structured workflow processes, users can maximize their contract processing, resulting in more predictable revenues and improved productivity.
  • The capability to track, monitor, and automate stock based upon user-defined rules, in conjunction with the ability to support multiple warehousing strategies, also leads to improved and streamlined stock management levels at reduced inventory levels (also resulting in reduced inventory costs).
3.     Improved Service Levels

There are basically two ways to look at SLM – (1) as a tool for lowering the cost of doing business, and (2) as a means for improving existing service performance. While the cost savings may be very real, SLM can also be a significant contributor to the overall improvement in the levels of service performance for the organization. Complete charge capture, and maximizing cross-selling and up-selling opportunities are just some of the ways that play to both perspectives on SLM.

Complete Charge Capture of Service Delivery

SLM enables the complete capture of all parameters involved in delivering service (e.g., parts, T&M, expenses, ancillary services, extended warranties, etc.) ensuring that no billable charges are ever lost or overlooked, and ultimately improving invoicing accuracy. Through SLM, as soon as the technician closes a call and captures the customer’s electronic signature, that data can instantly be transmitted to the central billing system, thereby significantly streamlining and compressing Days Sales Outstanding (DSO).

An SLM system can also serve a useful role in assisting organizations in improving future product (and service) designs by identifying any flaws in their existing products based on both aggregate and product-specific service history. What’s more, by continually tracking product service history over time, any new or emerging design flaws can be identified as a particular product line moves through its maturity cycle, or as a new product line is introduced.

Maximized Cross-Selling and Up-Selling Opportunities

Through the capability of leveraging a Web-based customer self-service portal in conjunction with a dynamic self-learning knowledgebase, users gain the ability to offer new products/services at every customer interaction, resulting in increased revenues without increasing costs. A state-of-the-art SLM solution that embeds intelligent automation along with a robust product information management repository can arm all of the employees in the field with first-rate cross-selling and up-selling capabilities by prompting/alerting them of any potential sales opportunities (e.g., contract/warranty expirations, aging equipment, ancillary accessories, add-ons, etc.) at the specific time of interaction with the customer. Past Strategies For GrowthSM studies have shown that there is no better place to cross-sell or up-sell than at the specific point of customer interaction – and SLM is the only solution that provides field personnel with all of the tools they need to make it possible.

Ability to Leverage Service as a Competitive Advantage

Through SLM’s Business Intelligence (BI) capabilities, users can identify, monitor, and track opportunities to offer customized and global service agreements based upon each customer’s unique usage levels. By doing so, the customer benefits from having its service needs and requirements fully met, and the services organization can maximize its total revenues in the field. SLM also supports the services organization’s ability to deliver proactiverather than reactivepersonalized service – at an affordable price – empowering it to exceed customer expectations and generate repeat sales.

4.     Enhanced Quality and Growth

While most of the benefits described thus far focus primarily on transitioning from the past to the present, enhanced quality and growth clearly looks to the future of the organization – and this is where SLM excels. The three main components of these forward-thinking benefits may best be summarized as follows:

Ability to Deliver Consistent Service Globally

The most effective SLM solution is one that is truly global, able to support customers using all types of equipment, in all applications, and in all geographies by using the same database. As such, the SLM solution must be designed to implement common business processes on a single system worldwide with support for multiple currencies, operation centers, and price books – and be able to support global, regional, and local views of the service operation.Even if your organization does not presently operate on a global basis, your SLM solution must be ready to step up to the opportunity if it arises.

Modularity for Supporting Growth

An SLM solution must also be able to grow with the organization. Few services organizations actively plan to reduce their operations over time; however, with today’s economic and competitive pressures continually limiting available growth opportunities, services managers have to take advantage of every real opportunity that comes their way – and the best way to do this is through system modularity. For example, few systems today can support a global deployment through a single application.

As the service business grows, it will also likely require additional solutions to support that growth. A robust SLM solution will be able to support the business through the availability of specific modules that can be easily – and seamlessly – added as it undergoes growth, or change. Only a scalable SLM solution can offer the precise configuration and functionality that can enable a services organization to continue to support a growing number of users as it, itself, grows in size and capability.

Improved Quality and Reduced Costs

Through SLM, users are also able toidentify defective, outdated, or unnecessary parts, resulting in both enhanced quality of service delivery and reduced costs. More importantly, the most cost-effective spare parts can be easily identified and stocked, and any individual line items that may be adding unnecessary costs to operations can also be identified and flagged.

5.     Increased Customer Satisfaction

Historically, for some operations managers, customer satisfaction has been nothing more than an inexact science that defies accurate reporting, consumes a great deal of time and resources, and is immeasurable in terms of actual results. However, the vast majority of services managers in today’s marketplace recognize customer satisfaction for exactly what it is – an essential building block for long-term, profitable relationships that ultimately leads to customer loyalty and repeat business.

Numerous studies have also shown that acquiring a customer is a great deal more expensive than retaining an existing one. What’s more, the level of service a company offers may ultimately be the principal deciding factor between whether a customer becomes loyal to its vendor, or decides to switch to a competitive vendor, platform, or service. By utilizing SLM to anticipate customers’ needs and requirements, improve responsiveness, and deliver consistent service, services organizations can improve the way in which their customers perceive the quality of their service offerings – and this will go a long way in their ability to transform customer satisfaction into true customer loyalty.

The principal benefits of facilitating the transition from customer satisfaction to loyalty are summarized below:

Ability to Anticipate Customer Service Requirements

SLM provides users with easy-to-use functionality, an intelligent knowledgebase, and a comprehensive customer repository to track problems and potentially identify many other problems before they occur. With this valuable information at their fingertips, users can offer more efficient scheduling for preventive maintenance (or implement an IoT-powered Remote Diagnostics / Remote Monitoring platform), and minimize the need for on-site visits and repeat service calls, wherever possible. As a result, customer satisfaction is increased, and costly unscheduled service visits can be minimized.

By having real-time, anytime, anywhere access to customer information, repair histories, parts availability, and technical product specifications, field technicians will always be properly prepared and empowered to complete all of their work during the first visit to the customer site, thereby saving both the service provider and the customer time and money.

Improved Responsiveness to Customer Calls and Service Delivery

SLM empowers Contact Center and field personnel with visual alerts, automatic escalation, scripting, and question trees, so they are able to respond to customers’ inquiries quicker and more completely. Through SLM, they will also have a full range of corporate knowledge stores readily available to optimize the customer interaction process. In addition, the integrated, multi-channel inbound/outbound capabilities facilitated by SLM provide for unparalleled customer support in all areas, including placing and tracking an order, updating records, making payments, receiving remote support, and scheduling a service call. As a result, there will be significant improvements realized with respect to first call resolution, decreased call center times and costs, and the ability to deliver consistent – and consistently high – levels of service.

Making It Easier to Do Business – Making It More Profitable

In today’s increasingly fast-paced business environment, customers have very high expectations, and they will take no excuses for poor customer service. They expect fast, relevant, and accurate information from the companies they do business with, and they will accept nothing less. The self-service capabilities offered through SLM provide customers with all of the information they need – when they want it, anytime, anywhere. This, in turn, ultimately results in improved customer satisfaction and strengthened loyalty throughout the user’s customer base.

By implementing a state-of-the-art SLM solution, services organizations can positively impact all aspects of their business through improved invoicing accuracy, automated contract renewals, and the ability to offer customized service agreements – all of which are geared to improving their relationships with customers while simultaneously increasing revenues and reducing costs.

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Using Service Lifecycle Management (SLM) to Support Your Customers While You’re Servicing Their Equipment

Every day you deal with a multitude of customers who vary by type, size, installed base, usage, personality and everything else that ultimately differentiates one customer from another. However, one thing always remains constant – their business systems and equipment are critically Important to their day-to-day business operations. Despite this common thread that runs through virtually all of the customers you support, it is still important to recognize that each customer account will likely be different in terms of:

  • The various types, brands, models and numbers of units they have installed at their respective sites;
  • The ages of the individual units that are covered under their various Service Level Agreements (SLAs), or supported viaa Time & Materials (T&M) basis;
  • The usage patterns of the equipment at their individual locations (i.e., continuous intermittent use; single vs.multiple shifts; simple vs.complex multifunctional peripheral applications; and so on);
  • The volume, capacity or throughput they regularly execute; and
  • Many other unique and/or specific differentiators.

For some of your customers, their equipment is an integral component of what they do on a day-to-day basis. Customers in all industry segments, whether it be legal, financial, medical, real estate, government, or other highly-demanding markets, will tell you that their systems and equipment are essential to their business operations, and that when their equipment is down, their production is severely affected. For some, even a small piece of connected equipment may be the only means they have for providing their customers with a receipt, order confirmation, or other important transaction-generated documents. In fact, for many in the latter category, their reliance on the equipment you support may be even more critical to them (at least on a relative basis).

Regardless of the specific industry market segment or type of customer, there will always be a basic level of reliance on the business systems and equipment they have installed at their facility. In addition, you will find that your customers will also be relying heavily on your organization to ensure that their equipment is always up and running as required – and as expected. As such, it is important to recognize that in the customer’s mind, if the equipment is not working optimally – regardless of the technology that may have been built into it – it is worthless.

Since there is just so much that the customer is either inclined or permitted to do in order to get the equipment back in working order following a failure, in most cases, your field technicians will be the sole entities that they can count on to make that happen (that is, aside from remote monitoring and diagnostics, etc.). Accordingly, they will need to approach the servicing and support of the equipment with a great deal of professionalism and responsibility. Customers usually do not care whether the cause of an equipment problem is due to a hardware or software failure; a paper jam; or whether it was the unit’s fault, their fault, or nobody’s fault in particular. All they know is that when they needed to use the equipment, it simply did not work.

This is typically where the organization’s field technicians come into the picture. In many cases, they represent the only “real” physical manifestation of the service and support that keeps their equipment up and running – or at the very least, they may represent their first line of service and support defense. Your customers may rely heavily on the equipment itself to support their day-to-day business operations; but they rely even more on your organization and your field technicians to ensure that the equipment can continually do what it is supposed to do.

This is a unique area where most services organizations – and their dealers and distributors – can use some help! The good news is that there is a Service Lifecycle Management (SLM) software solution available for users in every industry, size and geographic coverage segment. The implementation of anSLM solution can provide a comprehensive set of integrated business solutions that empower strategic initiatives while driving tactical execution.

Companies that install, repair, and maintain business systems and equipment can increase their competitive advantage, grow top-line revenue, and bolster bottom-line profitability through the use of an effective SLM solution. Among the basic features and benefits of SLM functionality for a typical Field Services Organization (FSO) may best be summarized as follows:

  • Comprehensive Contract and Service Level Management
  • Service and Sales Integration
  • Increased Help Desk/Contact Center Effectiveness
  • Field Service Efficiencies

Comprehensive Contract and Service Level Management

Through SLM, customer contracts and Service Level Agreements (SLAs) can be structured in ways that best fit the business, as well as the businesses of their respective customers. Key items such as maintenance and repair service; preventative (or predictive) maintenance; remote monitoring, diagnostics and repair; and draw-down contracts can all be easily established and managed. As such, the organization’s services management can be assured that all of the obligations of its customers’ SLAs are well-planned for – and met – and that all of its mission-critical commitments to the customer are being honored.

In this way, services revenues are maximized, and there is little risk of experiencing lost revenues. Company representatives can quickly and easily verify both the customer and vendor entitlements, thereby eliminating any costs that might otherwise be associated with providing customers with parts, consumables or services they are not entitled to under the terms and conditions of any existing warranties or contracts. This also ensures that any and all dealer claims will be quickly processed.

Service and Sales Integration

The Service and Sales Integration functionality of an SLM software suite can be relied on to enable the manufacturer’s and dealer organizations’ field service technicians and contact center personnel to more thoroughly service the company’s accounts, while also driving increased revenue in the process. By placing intuitive, easy-to-use sales tools into the hands of the appropriate service employees, the number of new opportunities to up-sell and cross-sell equipment, parts and consumables to existing customers will increase multifold.

The organization’s service technicians are out in the field every day talking to, and interfacing with, its customers; why not also provide them with the tools and resources they can use to close – or at least open –additional sales opportunities within this virtually captive customer base!

Increased Help Desk/Contact Center Effectiveness

SLM can also allow the organization to increase its call handling efficiencies, especially in the areas of first-call resolution and call avoidance rates. This will ultimately result in the lowering of internal service costs, and commensurate improvements in existing levels of customer satisfaction and retention. In many ways, business systems and equipment services have been somewhat commoditized over the years, and the only way that one services organization (or its dealers) can establishment a competitive advantage over another is to differentiate (i.e., improve) the way in which they support the customer base after the initial sale.

The best way to do this is to provide superior levels of help desk and call center support empowered by a robust SLM capability. By arming your call center personnel with accurate and up-to-date customer and installed equipment base information – be it entitlement, configuration, or marketing campaign data – the organization will be able to greatly increase its ability to sell, cross-sell, and upsell its entire portfolio of products, services, parts and consumables.

Field Service Efficiencies

Leveraging the field service automation tools inherent in the SLM software allows the organization to optimize its field force capacity utilization, resulting in significant operational efficiencies as field technicians quickly become empowered to increase revenue generation and recovery. By streamlining and managing the invoice process, billing cycles will be lowered, as will other key areas, such as Day Sales Outstanding (DSO), etc.

These improvements will almost immediately go directly to the bottom line as you will be able to manage your cash flow and receivables much more effectively. Similarly, by streamlining and managing your service inventories (such as trunk stock) more effectively, you will also be able to realize significant inventory cost reductions.

What many OEMs and dealer organizations seek is an end-to-end, enterprise-wide SLM solution that addresses the complete equipment/service lifecycle, from lead generation and sales quotation, to service and billing, through asset retirement. They are looking for a solution that both integrates and optimizes the critical business processes that all services organizations have to face with respect to providing their customers with the levels of service and support they require.

Services organizations that provide their customers with any combination of products, parts, services and consumables must be able to not only fix the customers’ equipment, but to fix the customer as well; however, the ability to do so may vary greatly from one organization to another. However, the most successful organizations will ultimately be the ones that have the right mix of management, personnel, tools, resources and solutions (i.e., Service Lifecycle Management), all working together to provide their customers with the levels of service and support they require – and expect!

The Global Warranty Services Community Is Reflecting a Return to Growth – and Profitability!

[The following Blogpost is an edited version of the article originally published in the May 3, 2018 issue of Warranty Week (i.e., accessible at: http://www.warrantyweek.com/archive/ww20180503.html.) For more information on the “The State of Warranty Management in 2018 – and Beyond”, we invite you to register for our upcoming Webcast on Thursday, May 24, 2018. To register, simply click on the following Weblink: http://app.demand.ptc.com/e/es.aspx?s=2826&e=2100908&elqTrackId=c346145430f045a9a4a8ab0ad69df3d1&src=View_Online&elq=ec4b7ad031c5442e85dca16a47774a24&elqaid=29101&elqat=1.]

After conducting its fourth annual Warranty Chain Management Benchmark Survey, Strategies For Growth℠ president and principal consulting analyst, Bill Pollock, has put together a results package consisting of an Analysts Take paper and companion Webcast on the subject of “The Global Warranty Services Community Is Reflecting a Return to Growth – and Profitability”. The Webcast will be hosted by PTC iWarranty on May 24, 2018. PTC will also be making the companion Analysts Take paper available via download at the same time.

According to, Pollock, “The 2018 survey results reveal that nearly three-quarters (71%) of respondents believe effective warranty chain management to be at least ‘very important’ to the overall financial performance of the business, with just under a quarter (22%) believing it to be ‘extremely important.’ The results further reveal that this sense of importance continues to increase substantially, year-over-year, as one-quarter (25%) believe effective warranty chain management to be ‘more important than one year ago,’ compared to only 3% believing it to be ‘less important’ – a ratio of roughly 8:1 citing ‘more important’ over ‘less important’. As such, we know the segment is based on a sound foundation moving forward.”

Managing Extended Warranty Programs

Presently, 85% of respondent organizations manage at least some portions of their extended warranty programs in-house, including 78% that do so entirely. As such, it becomes incumbent to ensure that they have the most effective tools and resources available to maximize the impact that sales of extended warranties can bring to the bottom line. Metrics such as warranty accrual and warranty renewal rates become critical in their respective efforts to maximize projected revenue streams and build a stronger customer account portfolio over time.

The survey results also reveal that, presently, more than a third (36%) of respondent organizations expect their annual warranty budgets to increase over the next 12 months – with 20% expecting increases in excess of 10%! During the same period, only 17% expect decreases, with most (i.e., 14%) being of less than 10%. All told, the ratio of organizations expecting increases in their annual budgets is more than twice that of those expecting declines. 

Warranty Management Organizations Are First and Foremost, Customer-Focused

The respondents to the survey have also once again clearly identified the specific drivers that are pushing them to aspire to the attainment of higher levels of performance. In fact, they have provided responses that solidify that there are three main “clusters” of factors that drive their respective businesses: Customer-focused, Product Quality-focused and Revenue/Profit-focused – and in that order.

For example, among the Customer-focused drivers, post-sale customer satisfaction issues (58% – up from only 42% in 2017!), the desire to improve customer retention (42%) and customer demand for improved warranty services (35%) remain as the top three drivers with respect to optimizing overall service performance. No other drivers are cited by more than just over one-quarter (28%) of respondents.

The next “cluster” of drivers is Product Quality-focused, and is represented solely by dealing with inferior/deficient product quality at 28%. The third “cluster”, Revenue/Profit-focused, is comprised of two closely-related drivers: internal mandate to drive increased service revenues (26%) and internal mandate to improve service profitability (25%). As such, the warranty chain management community has made it clear that it is squarely focused on, first, satisfying – and retaining – its customers; second, dedicated to improving product quality-related issues; and third, mandated to drive increased warranty revenues – and profitability – through improved warranty management services – again, in that specific order.

These results signify a continuation of the relative “normalcy” that has characterized the Warranty Chain Management segment over the past several years – that is, a return to focusing on customers, rather than spending most of their time and resources wrestling with cost reductions and other financial issues. Obviously, while financial considerations are still critically important, the industry focus has shifted back, as it always does, squarely on the customer’s needs, requirements, preferences and expectations.

The Benefits Realized by Improving Warranty Management Activities Are Many

The number one benefit realized by warranty management organizations through the improvement of their respective activities is improved customer satisfaction (62%). No other single factor is cited by more than 38% of respondent organizations. The next greatest benefits cited by respondents include: reduced service and warranty costs (38%), enhanced product and service performance (35%), improved warranty operational efficiencies (33%) and improved customer retention (33%).

Based on the survey results, Pollock suggests that, “the top benefits realized by improving warranty management activities closely align with the key drivers that influence services organizations; namely, that they need to continue to place their principal focus squarely on the customer, with the end goal being to improve customer satisfaction and retention.”

Complacency with Their Current Warranty Management Solution

However, building upon the survey findings from previous years, a majority of warranty management solution users are notas duly impressed with the vendors that are currently providing these solutions. For example, Pollock claims that “only 40% of respondents are presently ‘satisfied’ with the services and solutions provided by their primary warranty management solution vendors – including a stunningly low 2%, or only one-out-of-50, who are ‘extremely satisfied’. These percentages reflect a further downtick from just one year earlier.”

Pollock believes that there are probably a number of reasons for why users are not particularly happy with their current WCM solution vendors: “In talking to a number of warranty chain managers over the past several months as part of our benchmarking program,” Pollock claims, “many have said they are unhappy with their current provider because their needs for this year and beyond are simply no longer being met by their existing warranty management solutions that may have been implemented a number of years earlier. Basically, their needs have raised the bar regarding what they now expect out of their solutions; but, in many cases, their vendors have not raised their own bars in terms of performance delivery.”

Madhu Kunam, director of software development at PTC for the iWarranty product, concurs with Pollock, but adds that, “Even with an implemented warranty management system, the “still manual” processes may make the overall system inefficient or unproductive.” He goes on to say, “Other reasons may include that the features and functions of the existing vendor-supplied solution do not work as advertised, due to a poorly implemented system, or one that has been constantly plagued with bugs.

“It may also be that the vendor-supplied solution simply doesn’t deliver the expected value, or that the vendor is either unable or unwilling to help with consulting or professional services support – or is not able to provide other types of customer-specific support. Then again, it might all just be about cost – although a solution structured for small and medium businesses and sold on a subscription pricing basis can certainly mitigate any problems in this area!”

However, these are only some of the potential problems that he believes PTC’s iWarranty solution can help its customers avoid. For example, Kunam explains that, “PTC’s warranty management approach defines, manages and analyzes all of the organization’s warranty processes from initial product registration through to the end of the standard or extended warranty period. This unique approach to warranty analytics and service lifecycle management focuses on a product-centric data model that allows users to manage warranty information and capture service history in the context of the product itself, thereby allowing this important data to provide feedback to the enterprise for continuous product and service improvement.

“In this way, no matter how high the customer raises the bar, or how customer-specific the solution needs to be, PTC stands ready to support its customers in all facets of their warranty operations. PTC believes that this is one of the key areas that can make a difference between a satisfied customer, and a dissatisfied one.”

On May 24, 2018, PTC will be hosting a complimentary hour-long webinar featuring the executive-level results of this survey, to be presented by Bill Pollock. It will also be making available the companion Analysts Take paper that provides further insights relating to the findings. To register for the Webcast, or to obtain a copy of the companion Analysts Take paper, simply click here: http://app.demand.ptc.com/e/es.aspx?s=2826&e=2100908&elqTrackId=c346145430f045a9a4a8ab0ad69df3d1&src=View_Online&elq=ec4b7ad031c5442e85dca16a47774a24&elqaid=29101&elqat=1.

The IoT Is Changing the Way in Which We Approach Field Service Management (FSM)

The impact of the Internet of Things (IoT) on Field Service Management (FSM) has already been significant – and will continue to grow in magnitude over time. This applies to all services organizations, of all types and sizes, covering all world geographies, and supporting all product-service lines. Yes – it’s that pervasive!

This is especially true for organizations supporting certain vertical industry segments (e.g., aviation/aerospace, energy, factory automation, medical devices, etc.), and is beginning to have a similar impact on all other segments, even going beyond the traditional field service B2B segments, to now include many of the emerging B2C services segments, such as consumer/home medical devices, home security systems, HVAC/electrical and plumbing services, among others.

In fact, the pervasive use of Cloud-based platforms, coupled with the integration of IoT-powered FSM solutions, has expanded the relevant market size to a near-ubiquitous universe encompassing all types and sizes of solution providers, as well.

However, as we sit here and read about IoT-powered FSM solutions, the means with which the IoT is supporting these systems is constantly growing and evolving as well. Even more, if a services organization has not yet embraced and incorporated the IoT into its services operations, they are already a step or two behind the market leaders. For example, for any one of the organizations that are still examining the potential value of incorporating Augmented Reality (AR) into their services operations, there are many others that are already looking to implement Artificial Intelligence (AI) and Machine Learning (ML) – and, increasingly, Blockchain!

The time is now for ramping up on all things IoT, reading IoT thought leadership articles, attending IoT conferences, viewing vendor demos, establishing “long lists” and reducing them to “short lists” for vendor consideration, etc. Gaining management buy-in is also a must – in fact, it is basically a must for all things services management anyway – but, especially with respect to the IoT and the “new” technology it brings to the table.

The most progressive – and aggressive – solution providers have already embarked on the road to an IoT-powered FSM or Service Lifecycle Management (SLM) solution scenario. As such, now is also the time for all other FSM solution providers to do so. Many of your competitors have already done so, and many of your customers (and prospects) are already at least somewhat familiar with what the IoT can ultimately do for them. When the global services management marketplace is more fully transformed (i.e., when the IoT is a ubiquitous factor in every organization’s services operations), your organization will also need to have made the transformation. If the market leaders are already several steps ahead of you, you cannot afford to fall further behind.

Proliferation in the use of Cloud-based and IoT-powered FSM solutions have also led to a major consolidation of the global competitive landscape. The “new” competitive landscape is now comprised of a combination of all types, sizes and categories of solution providers. Most (if not all) of the enterprise services providers are already offering FSM (or SLM) solutions (or, at the very least, “enhanced” Field Service Management solutions). They “get it”, and they’re doing something about it.

Over the past several years, we have also seen many of the large Enterprise Resource Planning (ERP) companies (e.g., SAP, Oracle, etc.) acquire their FSM solution capabilities. For example, Oracle acquired TOA Technologies, IFS acquired Metrix, Microsoft acquired FieldOne, and so on. Some larger companies have also elected to go more organically, such as Salesforce by introducing its Field Service Lightning solution based on ClickSoftware technology. ClickSoftware went private again, but still is a strong competitor in the global FSM marketplace, while also licensing some of its software apps to other organizations.

For the most part, the mid-sized services organization market is only a step or two behind the enterprise services providers in terms of embracing and incorporating the IoT into their FSM and SLM solution offerings. Some are already on an equal footing with their larger competitors. However, where the most “confusion” and uncertainty lies is in the landscape populated by start-ups – and what, in some cases, I refer to as “upstarts”!

In addition to the ongoing spate of mergers, acquisitions and alliances, and organic development, there has also been a significant increase in the numbers of “new” entries into the FSM solution marketplace. In fact, probably more of this type of activity has occurred in this segment recently than in the past many years – or decades!

These “new” start-ups can essentially be divided into two main categories: (1) FSM Start-ups, that are trying earnestly to find a way to enter – and successfully penetrate – the FSM market, by leveraging new technologies, experienced leadership, deep (enough) pockets, investment capital and a bit of luck into a services growth segment where they believe they can actually make a difference.

However, it is the FSM Upstarts, that are basically trying to ride the Cloud-based, or SaaS, solution wave into a “new” market opportunity (for them), in order to make a quick buck when all they ultimately plan to do is to be acquired by a larger organization in another year or two. As such, it is truly a “buyer beware” market, as there are a great number of “new” upstart FSM solution providers that will not be around for very long.

Yes – the IoT is definitely changing the FSM marketplace – both rapidly and pervasively. You can blame it on the IoT for this rapid evolution (and disruption); however, you will also need to share some of the blame yourself if your organization is not keeping up with the advances in services management technology!

Companion Piece to Bill Pollock’s July, 2017 Guest Blog Post on Behalf of Sprint Business (Part 1 of 2)

[This companion piece to my two-part guest Blog published in July on the Sprint Business Blogsite focuses on the impact of the Internet of Things (IoT) on the Field Services industry. As is the case in most analyst interview-based guest Blogs, much of my responses will not be included in the final posts. As such, please consider this Blog as a more detailed companion piece for the first five of 10 questions posed by Sprint Business. Hopefully, this will provide you with additional “between the lines” thoughts and opinions.]

Q1:   In what ways is IoT transforming the field service industry, and at what pace?

The Internet of Things (IoT) is transforming the field service industry in ways that most analysts –  and practitioners – could not have foreseen just a few years ago. While most of us were focusing on machine-to-machine (i.e., m2m) communications and the prospects for utilizing Augmented Reality (AR), the IoT was already beginning to be leveraged into smart systems and Connected Field Service (CFS) solutions among the more progressive services organizations in the global marketspace.

Even as we speak, while some companies are just beginning to evaluate the benefits of integrating Augmented Reality into their services operations, AR is already morphing into Mixed, or Merged, Reality (MR) through the combined deployment along with Virtual Reality (VR) applications. And this advanced trend is not only not going to stop; it is much more likely to accelerate right before our eyes.

The growing recognition that Artificial Intelligence (AI) and Machine Learning (ML) applications are ultimately poised to make the difference between those services organizations that are destined to be the market leaders versus everyone else (i.e., the followers, and laggards) is also picking up steam, and will likely join the mainstream of market adoption shortly (albeit, the inner working of AI and ML are both much more complicated than the IoT – especially with respect to AI).

The IoT is not just for m2m anymore. It is the tool that can make any services (or other) process “smart”, if applied effectively. It can (and will) take services organizations to places they never dreamed possible just a short time ago – and it will be responsible for cutting the costs of delivering services along the way.

At what pace? Basically, if you merely blink, you may find yourself quickly falling behind your more progressive competitors! Many of them are already there!

Q2:   What are the highest-impact factors in this transformation?

The highest-impact factors in field service transformation will be the normalization of the playing field across all industry segments, by vertical market, size, type, geographic coverage and any other “demographic” segments you can think of. Field Service Management (FSM) is not only for the large enterprise organizations, but for services organizations of all types, regardless of size or market coverage.

The proliferation of Cloud-based FSM solutions has also moved many organizations from the historical perpetual license pricing model to a much more manageable subscription basis pricing model. This also is having a significant impact on facilitating the entry of smaller and medium-sized organizations into the world of the IoT and smart solutions.

The integration of AR, VR and/or MR platforms into services operations will also normalize the playing field even more, thereby empowering services organizations of all types and sizes, etc., to compete head-to-head against each other (as well as the market leaders) with essentially the same levels of system capabilities. It will also lead to quicker customer equipment “fixes”, at reduced costs (to the services organization), and with far fewer visits required to the customer site to perform the repair.

Q3:   What do you see as the top three or four benefits to field service organizations?

The top benefits to field service organizations, as cited in Strategies For Growth℠’s (SFG℠’s) 2017 Field Service Management Benchmark Survey, are (1) the ability to run a more efficient field service operation by eliminating silos, etc. (cited by 44% of respondents as one of the top three benefits); (2) improved customer satisfaction (cited by 39%); (3) the ability to provide customers with an end-to-end engagement relationship (cited by 35%); (4) the ability to establish a competitive advantage (cited by 30%); and (5) improved field technician utilization and productivity (cited by 26%).

Other top benefits include (6) reduced Total Cost of Operations (TCO) (cited by 25%); (7) reduced ongoing/recurring costs of operations (cited by 19%); (8) improved service delivery time (cited by 16%); (9) fostering enhanced inter-departmental collaboration (cited by 15%); and (10) ability to complete the automation of all field service operations (cited by 12%).

However, as more and more services organizations ramp up with respect to IoT-powered technologies and applications, there will likely be even more potential benefits identified within the global services organization community.

Q4:   How can organizations best leverage all the IoT data they gather?

Many reports have been written about services organizations (and businesses of all types) “drowning in data lakes”. However, the key to success is to establish early on what data is needed to effectively run the services operations, and hone in on specifically those types of data when collecting and processing the reams and reams of data generated from your IoT-based systems. Too much data is … well, too much data, if you don’t have a plan to harvest it effectively.

Services organizations also need to be able to identify which data is “need to know” vs. which data is only “nice-to-know”. Nice-to-know data is ultimately way too expensive to collect, process, analyze, monitor and distribute; however, need-to-know data is not only invaluable – but critical to ensuring the well-being of the services organization.

You don’t go to work wearing 12 watches; you don’t buy 48 oz. of steaks, per person, to put on the grill for a summer barbecue; so, why would you pay for more data than you will ever need when you can harvest just what you need for now (plus whatever else looks like you may need in the future)?

Think of your data repository as a storage space for all of the data you will need today, tomorrow and in the future. If large enough, put it in a data lake – but make sure you don’t use Lake Superior for what a smaller data lake can do for you more efficiently.

Q5:   What barriers do organizations face in taking full advantage of IoT, and how can they overcome those barriers?

The greatest barrier in taking full advantage of the IoT is typically senior management resistance at the top of the organization structure. Coupled with a general lack of understanding of exactly what the IoT is, and exactly what it can do for the organization, these two factors can too often become “momentum-killers” within the organization.

This is why making sure that all participants comprising services management are kept up-to-date with (1) advances in IoT-based technologies, (2) the introduction of new applications and mobile tools to support field technicians (and to transfer some of their historical on-site responsibilities to more remote-based scenarios), and (3) evolutions in FSM solution capabilities, etc., is so important.

With subscription-based pricing, cost should no longer be as critical an issue to the prospects for moving forward with the desired FSM solution – however, do your CFO and Purchasing teams understand that? Or are they still entrenched in the traditional perpetual license mindset?

Attending field services trade shows and IoT-focused conferences should “shake off the cobwebs” for most of the non-believers or nay-sayers in the organization. Collect as much information as you can, schedule some demos, and invite management to witness the benefits (i.e., the outcomes) of an IoT-powered FSM solution first-hand. This will definitely sway most of the non-believers!

Hopefully, my responses have helped you to better understand the ways in which the services management market is changing – both rapidly and pervasively. Blame it on the IoT for this rapid evolution; however, blame yourself if you’re not keeping up with the advances in services management technology!

[To access the published Blogs, please visit the Sprint Blogsite at https://business.sprint.com/blog/field-services-iot-makeover/. Or, if you prefer, you may access the complete SFG℠ Analysts Take paper simply by clicking on the following Weblink: How the IoT Is Transforming the FS Industry (Draft-17-07-21-01)]

How the Right Warranty Management Solution Can Help Improve Your Organization’s Bottom Line!

[This Blog presents an excerpted portion of the White Paper written by Strategies For GrowthSM (SFGSM) and distributed by Tavant Technologies, a global leader in providing Cloud-based Warranty Management systems and solutions.To access the complete White Paper, or to download an archived copy of the companion Webcast, please use the Weblink provided at the end of the Blog.]

Each year, SFGSM conducts a series of Benchmark Surveys among its outreach community of more than 39,000 global services professionals. Total responses for the 2017 Warranty Chain Management Benchmark Survey, conducted in January/February 2017, are 215. As such, we believe the survey results to represent a realistic reflection of the global warranty chain management community in which we all serve.

Putting Things in Perspective

Overall, survey respondents identify the following as the top factors that are currently driving their desire – and ability – to optimize warranty management performance:

  • 47% Post-sale customer satisfaction issues
  • 43% Desire to improve customer retention
  • 36% Customer demand for improved warranty management services

In order to effectively address these challenges – and strive to attain best practices – respondents then cite the following as the most needed strategic actions to be taken:

  • 43% Develop / improve metrics, or KPIs, for advanced warranty chain analytics
  • 28% Foster a closer working collaboration between product design & service
  • 28% Institute/enforce process workflow improvements for supplier cost recovery

The survey results also reveal that roughly two-thirds (66%) of respondent organizations currently operate service as an independent profit center (or as a pure, third-party service company), compared with only 34% that operate as cost centers. At these percentages, the warranty management respondent base represented in the survey reflects a consistency over the past few years, and mirrors the overall composition of the global services marketplace.

Further, the two-thirds ratio supports the supposition that it would strongly benefit services organizations that are attempting to keep their customers satisfied – and make an attractive profit by doing so – to put into place a well-structured, automated and Cloud-based warranty management solution designed both to satisfy customers, and contribute directly to the bottom line.

However, while the importance of effective warranty management is sufficiently validated by the responses to the survey, a majority of warranty management solution users are not as duly impressed with the vendors that render them these services. For example, only 42% of respondents are presently satisfied with the services and solutions provided by their respective primary warranty management solution vendors – including a stunningly low 12%, or only one-out-of-eight, who are “extremely satisfied”.

In fact, just under half of users (44%) rate their perceptions of the performance of their primary vendor as “neither satisfied nor dissatisfied” – or what we would normally describe as a “complacent” user base. While only 3% of users claim to be “not at all satisfied”, there are still a total of 15% that fall into the “dissatisfied” category.

Research shows that a majority (i.e., 50% or greater) of the dissatisfaction that users have with their current vendors apparently stems from the importance that the market places on key factors including cost of services (70%), followed by the industry reputation and warranty management experience of the vendor (i.e., at 47%, each). Other factors influencing performance perceptions include the vendor’s data/information reporting capabilities (41%) and specific geographic experience (38%).

Roughly half (49%) of the survey respondents’ organizations have either implemented a “new” warranty management solution, or upgraded their existing solution, within the past three years or less. Of this amount, about one-in-seven (15%) have implemented a “new” solution, while more than one-third (34%) have upgraded their existing solution. The remaining 51% are currently using warranty management solutions that are, at least, three years old, or older (Figure 1).

The survey research clearly shows that those organizations that have implemented “new” warranty management solutions have realized the greatest levels of performance improvement – certainly, much greater than for those that have merely upgraded their respective Warranty Management solutions. The Key Performance Indicators, or KPIs, that reflect the greatest improvements for each category of organization are as follows:

Warranty Claims Processing Time:

  • 14% Performance improvement for “New” Implementations
  •   6%  Performance improvement for Upgrades

Supplier/Vendor Recovery (as a percent of Total Warranty Expense):

  •   8%  Performance improvement for “New” Implementations
  •   5%  Performance improvement for Upgrades

Based on the results of SFG’s 2017 Warranty Chain Management Benchmark Survey, the key takeaways are:

  • Roughly half (49%) of the warranty management segment have either implemented or upgraded their warranty management solutions in the past three years or less
  • More than three-quarters (77%) of current warranty management processes are at least partially automated
  • Over the next 12 months, annual warranty management budgets are expected to increase, with more than twice as many organizations planning increases over decreases
  • Organizations with “new” warranty management implementations have realized significantly greater performance improvements than all other categories with respect to warranty claims processing time and supplier/vendor recovery (as a percent of total warranty expense)
  • Warranty management organizations are being driven, first, by Customer-focused factors; second, by Product Quality-focused factors; and third, by Cost/Revenue-focused factors
  • The most significant challenges currently faced by warranty services managers are identifying the root causes of product failures, followed by product quality issues and claims processing time and accuracy
  • Currently, as well as in the next 12 months, warranty services managers will be focusing primarily on developing and/or improving their KPIs and warranty analytic programs, fostering a closer working collaboration between product design and service, and instituting/enforcing process workflow improvements for supplier cost recovery
  • Nearly half (46%) of organizations are currently integrating warranty management with all other services functions, and just as many already have an end-to-end workflow process in place to handle claims and returns (46%); however, this means that more than half presently do not have these capabilities in place
  • The top uses of data/information collected from warranty events are basically to improve processes (i.e., field service, depot repair, parts returns, etc.) and effect changes (i.e., product design, manufacturing, etc.)
  • Customer satisfaction and warranty management-related costs are the top two categories of KPIs used by warranty services management organizations, followed by warranty costs, per product

[To access the complete White Paper, containing much more information and numerous supporting tables and charts, please visit the following Weblink, hosted by Tavant. An archived copy of the companion Webcast is also available for download at http://bit.ly/2lUppNZ.]

Bill Pollock to Conduct Workshop at the 13th Annual Warranty Chain Management Conference in Tucson AZ, Tuesday, March 7, 2017

Bill Pollock, president & principal consulting analyst at Strategies For Growth℠, to conduct Workshop on the topic of “Transforming Warranty Management Into Improved Customer Satisfaction and Revenue Generation”, Tuesday, March 6, at the 2017 WCM Conference in Tucson, AZ

[Reprinted/Edited from the February 16, 2017 issue of Warranty Week]

From March 7 – 9, 2017, warranty professionals will gather in Tucson, Arizona, for the 13th annual Warranty Chain Management Conference. And as always, the opening day is taken up by a series of pre-conference workshops.

Many times, at past conferences, people arrive too late to attend any of the workshops, but wish they had. So while there’s still time for attendees to switch to an earlier flight, we wanted to provide some detail about what’s on offer.

This year, there will be six workshops — three in the morning and three in the afternoon on Tuesday, March 7. They’ll be followed by a welcome reception in the evening, and then the main conference proceeds on Wednesday and Thursday.

What these workshops provide is a deep dive into a single topic, such as transforming effective warranty management into improved customer satisfaction and the bottom line. They’re run by experts in the field, but the attendees are from all levels. And what they all know is the fundamental value of conferences like these: none of this material can be learned from books.

Bill Pollock‘s workshop is one of the three workshops scheduled for 9 AM to 12 noon, MST.

 

Raising Customer Satisfaction Levels

Pollock’s workshop is entitled, “Transforming Warranty Management Into Improved Customer Satisfaction and Revenue Generation“.

Pollock, who is a repeat presenter of WCM workshops, said he’s aiming this year’s presentation at managers and executives who need to improve customer satisfaction, drive revenues, and gain competitive advantage through improved warranty management.

“The perfect attendee would be anyone who deals both internally and externally with customer satisfaction, revenue generation, revenue management, or sales and marketing,” he said. “They’re the people who have the mandate — all their merit increases, their bonuses, are going to be dependent on how efficiently they run their part of the warranty management organization.”

Pollock said companies want to see both a contribution to the bottom line and an improvement in customer satisfaction levels. “But they’re almost diametrically opposed to one another,” he said. Deny more claims and satisfaction drops. Approve more claims and profits drop. So there has to be another way: increase revenue.

“One of the best things you can do to improve your revenue stream and to satisfy customers is to focus on warranty management, contract renewals, and attachment rates,” Pollock said. “You’re going to have increased revenues, and they’re going to be more predictable.”

Once the revenue increases, the money can be invested in automating and improving processes, which will ultimately raise customer satisfaction levels, Pollock explained. The goal is to turn a warranty claim into a more pleasant encounter for the customer, rather than adding insult on top of the injury.

“If you can’t make them feel better virtually immediately, then you’re going to allow a bad situation to get even worse,” he said. “What you need to do is build a warranty management program that can generate increased revenue, then take that revenue and spend it on improving the processes.”

Pollock said his advice is backed up by surveys he’s conducted both recently and in years past. “The first part of the workshop is going to be me presenting what best practices organizations are doing that are different from what the average organization is doing. But we also introduced some new questions into the survey this year,” he said, such as whether your organization has recently upgraded its warranty management solution. “What we’re finding is that there’s a big difference,” he said, in metrics such as claims processing time, service profitability, and supplier recovery rates.

More basically, Pollock said, the companies that recently upgraded their warranty management solutions are better not only at measuring themselves, but also at reporting the improved metrics. “Now, through more automated processes, through the cloud, powered by the Internet of things, you can build algorithms that allow you to more quickly identify than ever before, what’s really making a difference,” he said.

For more information on this workshop, or to register for the 2017 WCM Conference, please visit the conference website at: http://www.warrantyconference.com

Looking forward to seeing you in Tucson!

Bill