Every quarter, The Service Council’s Sumair Dutta takes the pulse of field service by asking business leaders some key questions: What are they worried about? How have their priorities shifted? What business and technology investments are they making?
Below, Dutta walks us through a few highlights from his latest quarterly research. One big takeaway: Service leaders are keenly aware of the bottom line and are going all in to improve the profitability of their service organizations. Keep reading to learn how fellow service leaders are getting smarter about profit and their people — and what changes to expect leading into 2016.
On service leaders’ top priorities:
Dutta: The top priority among companies was improving the profitability of their service business, turning service into a profit center. We see that message gaining more traction, where profitability is tied more and more with revenue as opposed to just containing costs.
The second area was new services development — so finding new streams of revenue. Companies have talked about developing these new services for a while, but they’re still in the initial stages of figuring out how, exactly, to do that. The Internet of Things and big data phenomenons play a pretty big role here in terms of uncovering these new services, and prioritizing what to areas to focus on.
The third priority area is people development and talent management.
Top technology priorities?
We saw more technology focus in Q2 across field service, analytics and management — and how new technologies can support broader service objectives around profitability and developing new offerings.
How do you anticipate these priorities shifting heading into 2016?
There will be a focus on gathering insight from data. For example, as organizations focus on profitability, there’s a continued push for efficiency in the field, and in parts and contact centers. In terms of revenue, organizations are going to look at data to figure out what new offerings they can sell to customers, and also how better to collaborate across the organization to support a better customer value proposition.
A big focus on talent:
The talent discussion in field service will center around four areas. The first will be hiring, recruitment and finding the right talent in a dwindling pool of candidates.
Seventy percent of service organizations are going to have to deal with the consequences of a retiring workforce in the next 10 years. It will be vital to ensure tribal knowledge remains within the organization. — Sumair Dutta
The second will tie into the use of newer training tools and methodologies to get workers up to speed faster. We see a greater focus from organizations on specialized training programs, where new recruits aren’t made to sit through months and months of training. Instead, new hires are first trained on a few product models and then sent out in the field to practice their craft, often with a more experienced field engineer in tow. Afterwards, they are brought in for further training that can be customized to their strengths or weaknesses.
The third area is knowledge retention, especially from retirining workers. Seventy percent of service organizations are going to have to deal with the consequences of a retiring workforce in the next 10 years. It will be vital to ensure tribal knowledge remains within the organization.
The final area will be the use of third-party labor. I believe that we will see more and more organizations outsource non-critical field work to third-parties and focus their own field resources on critical assets and critical customers.
People are still the core value service organizations offer to customers:
On the whole, respondents still say that their value proposition is that they offer highly trained, skilled people. Eighty-one percent of respondents said that was the top value they offered to customers.
The second piece was service quality — finishing work on time, correctly, the first time. The third was quick on-site response.
Factors such as faster service response rates and better appointment windows are increasingly important, but companies are still pushing their people as the major value driver for their customers. If your people are your top value proposition, then talent will continue to be a big area of focus.
New services could strain staffing demands, but that wasn’t a top concern. Why?
Over the last three quarters, we consistently saw people talking about increasing service demand and the lack of resources to support demand. That was not a top challenge this quarter. I think there are three reasons why: Organizations have put more resources into supporting demand. Service leaders are also better are forecasting demand, so they aren’t constantly reacting to increases in service demand. Finally, there’s the cyclical nature of demand. There are certain industries where service demand tends to peak in certain quarters, and perhaps last quarter was a down quarter in terms of demand across the board.