(Part 2). Bill Pollock is president of Strategies For Growth, a research analyst and consulting organization for service businesses, and chief research officer for The Service Council, a virtual trade organization for service executives. In a previous Q&A with The SmartVan, Pollock described why service businesses must consider new technologies, such as iPads and cloud software, to keep pace with rivals — both big and small. Here Pollock discusses how technology can help smaller service firms exploit their most apparent advantage in the marketplace — customer familiarity.
Service organizations that choose not to embrace technology risk being left behind by smaller competitors, not larger rivals?
Yes. There’s something else that ties into this, too. We talked about the technology and the devices. I see a number of trends out there that are impacting all businesses, including SMBs. One of them is that while some of the larger organizations have begun to transform themselves from being internally perceived and perceived by the marketplace as merely manufacturers and OEM service organizations, they’ve already made the transitions from being cost centers to at least thinking about running their service organizations as profit centers. They’ve made that leap. They’ve shifted their operational focuses from being company-centric to customer-centric. You see more and more larger service organizations talk to the marketplace about what they can do for the market, what they can do for their customers, moreso than just a few years ago when the main focus of conversation was, “We spend billions of dollars in R&D, we’re technological advanced. Here’s some of the new technology we’ve just implemented.”
The marketplace doesn’t want to know what you’re doing for you. They want to know what you’re doing for them. Small businesses, historically, have established their own niche, by telling the marketplace what they can do for you. They admit from the get-go that they’re not one of the big guys. “We’re a small company and because we’re small we know your first names. We know who you are. We understand your equipment. We don’t outsource things. We’re doing everything ourselves. We really know you. We get it. We get the customer. We get you.”
In many ways SMBs are still at a disadvantage compared to the larger companies. But in one area they do have an advantage, and that’s because they’re accustomed to dealing with their customers on a one-to-one basis. In many cases, they know their customer base better than some of the larger companies know theirs. Now, empowered with new technologies and more cost-effective devices, they’re not only able to provide the same level of customer service and support and field support that they’ve provided to customers over the years, they’re now able to provide orders of magnitude better field service because they’re more automated, they’ve got more mobile devices and they’re more in tune with what many of their customers are already used to getting from other, larger service organizations.
Now, what the SMBs are able to do is they’re able to show the marketplace that they’re closing the gap somewhat. There still is a large gap between what the larger organizations can do and what they can do. But the gap has been large for a long time, and they’re able to make some inroads now that they weren’t able to do before the cloud and the proliferation of some of these mobile devices.
Which SMBs are doing it right, using these new technologies to really compete?
There are a lot of Delaware Valley-area businesses focusing in HVAC, for example, which have been running their organizations for years on a non-automated basis. [Bill Pollock lives in Southeastern Pennsylvania.] They’ve grown from a point where they started with three or four HVAC technicians. They’ve expanded, in some cases to half a dozen, in other cases a dozen or more, and they’ve been taking advantage of some of the new technologies. And these are prime examples of SMBs that, for the first time, have the power, through the cloud and through some of the newer mobile devices, to automate themselves.
Internally, it convinces even the naysayers to think of themselves as being a professionally run and managed service organization. For the first time, they’ve got the tangible things behind them to prove it; that they’re now able to use the same types of systems that companies far larger than they are. They’re using the same kinds of solutions that they’re using. They’re carrying the same kinds of high-tech devices with them. Internally, it really is a refresher. It makes them feel as professional as they’ve always been, now empowered with the tools and technology, in their ability to take care of their customers.
The second half, the other side of the coin, is that the marketplace also sees much more professionalism being offered by them. They’ve been arriving on time, meeting their contractual obligations. But now they’re doing it with technology instead of doing it simply with good management. The combination of good management and good technology is really making them feel prouder of themselves and giving them a more professional reputation in the marketplace.
There are professional services organizations that are also benefitting from this. Over the last 25 years, lets say, if you were a medium- or large-sized service organization dealing in a white collar segment, you would dispatch your field techs and they would do their jobs without getting their fingernails dirty. That’s the old model. That’s the model from 25 years ago. Today, there are service organizations, whether they’re getting their fingernails dirty or not, that are able to do what those traditional medium- and large-sized service organizations were once able to do. The cloud and mobile devices are empowering some of these SMBs for the very first time to compete on as professional a basis as any other organization because now they’ve got the technology and the tools.