As vice president of technology and social research at the Technology Services Industry Association (TSIA), it’s John Ragsdale’s job to stay on top of the tech trends in field service. And that means keeping tabs on industry insiders such as Tina Lux-Boim, president and CEO of Managed Maintenance (MMI).
Lux-Boim, who joined the TSIA’s Advisory Board this month, recently spoke with Ragsdale about some of the biggest issues affecting the field service industry, from marketing challenges and the impact of Big Data to the importance of recurring service revenue models. Below is an excerpt of Ragsdale’s complete interview:
John Ragsdale: I used to joke that “services marketing” was an oxymoron, and honestly the same can be said for “service sales” at many tech companies. Our data shows that product sales people are not very effective at selling services, and services people traditionally don’t have the best sales skills. Three years ago I noticed a trend that some very large tech firms were doing an honest assessment of their service sales and renewal operation and realizing they needed to look to a third party for help. Unfortunately, there aren’t many service providers with expertise in B2B service sales. Could you talk about some of the common problems you see with tech companies trying to manage service selling and renewals themselves, and how you are able to improve their renewal rates and revenue numbers?
Lux-Boim: There are many challenges that MMI sees facing tech companies choosing to pursue annuity-based sales through traditional sales team. Let me just touch on a handful.
- Many renewals are high-volume, low-value transactions at face value. This makes them unappealing for the sales representative to want to invest in. A view that can compile the data so all renewals across each customer can be seen and pursued offers an opportunity for the sales teams to view the renewal sales by customer as a more lucrative sale.
- For most renewals it requires data from 5-7 systems to prepare one (1) renewal opportunity. The time investment for sales team to prepare a quote suitable for presentation is often perceived to be too significant to justify the end sales.
- Tech companies often have a large “bag of tricks” they are selling. The messaging, presentation and sales of annuity type businesses is often a departure from their core offerings and something many sales teams are not comfortable in positioning or familiar with. With sales teams “coin-operated,” they are more likely to gravitate to the solutions and products in their comfort zone and procrastinate or ignore the potential annuity sale.
- Annuity sales often involve on-going management once the sale is completed. if the sale is remain in good standing and be positioned well at renewal time, this kind of sale requires specialists or customer success managers who are comfortable and adept at managing long term ongoing client relationships and managing details. They can’t be left to a sales hunter with low patience and interested in the “kill” or final sale as measure of success.
Ragsdale: Big Data is a big topic with our members, who love the concept of analytics but aren’t always sure how to get started. And, few of them have the resources of a data scientist available to build custom dashboards. Can you speak to how analytics can inform and empower renewal teams?
Lux-Boim: Managing enterprise assets is a complex, confusing endeavor — even for the teams dedicated to doing so. Asset and part data, warranties, and service agreements are often tracked in Excel spreadsheets or in proprietary systems that may not scale or flex with business needs. Staff members spend a good portion of their time performing lower-level tasks such as entering, cleansing, and maintaining detailed data and cannot always guarantee the accuracy of this information. Acquiring accurate, real-time information on enterprise assets is a necessary first step to driving effective asset decision-making and performance.
SaaS applications provide transparency into the corporate asset base by opening the door to big data access and leverage. IT managers can choose to pair high-value assets with RFID and Wi-Fi technology and receive a continuous stream of information on asset location and usage. VARs can harness systems to analyze sales, services, and maintenance data, identifying opportunities to save money for the customer and build their own services revenues.
In the new model of doing business, the entry point can be anywhere, but data is the common thread for designing and delivering customer-centric services. IT resellers can also use their own SaaS portals to identify customers’ emerging needs, manage customers’ global asset portfolios, and build their own maintenance businesses.
Read the full interview on Ragsdale’s Eye on Service blog.