Field Service

The Service Contract as Revenue Stream: Q&A with Jim Saccone of GE Oil & Gas

When equipment breaks, companies expect their field service vendor to fix it — fast. But that’s not always possible when the equipment is extremely complex or located far away. The risk: significant lost revenue for an unhappy customer. The best option, says Jim Saccone, global field services leader, Americas, at GE Oil & Gas, is to never let the problem escalate that far. Here, Saccone talks about the value of service contracts for GE and its customers.

What types of customers and equipment do your technicians service?

I work in the global services division of GE Oil & Gas and am responsible for field services within the Americas. We provide aftermarket services, both planned and reactive maintenance, to oil and gas customers for their rotating equipment needs. In our terminology, rotating equipment is gas turbines, centrifugal and reciprocating compressors, and other rotating equipment such as steam turbines and turbo expanders. We also handle control systems that open up the valves within equipment, including gas-fuel mixture rates.

Are service contracts built-in when you sell the equipment?

Whenever we sell a new piece of equipment, the goal is to include a long-term service contract. It doesn’t always happen that way. It’s pretty expensive when a customer buys a gas turbine and tries to get it installed. The upfront cost is huge. A lot of companies have sticker shock when looking at an aftermarket service contract for the equipment. They’ll buy the equipment. They’ll have a warranty. And then they’ll make a decision on how to service it, whether with us or internally. In certain countries, we have in-house capabilities where we partner with the customer and help them along the way.

What types of service contracts do you offer customers?

We have several tiers. Our high-tier offering includes residence on-site. It includes remote monitoring and diagnostics from a central hub. It includes parts and all of the recommended maintenance. Whenever something happens with the equipment, it’s literally minutes until the engineer can get their hands on the equipment. That’s the best solution for somebody who has time sensitivity with equipment and can’t afford for it to be out. I have field service engineers across the globe who go to the customer site every day. They’re almost like a staff extension to company.

The lower-tier contracts are price agreements on field services, parts and repairs. The customer knows how much money they’re going to spend when they call us, but we’re not physically on-site. We still have to show up and do a site survey and plan and then get to work to fix the equipment.

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