Why shifting from manual reactive service to proactive and predictive is good for business.

Type ‘service with a smile’ into Google and it returns a set of results that cover a mix of stories about how excellent customer service should start with a smile or how the enforced toothy grin should in fact be banned. One company, Cambridge Consultants, has even come up with an app to determine which checkout queue shoppers should head for in a busy store.

The friendly face of service though has serious connotations. The proactive attitude to service should be embraced and businesses need to rethink, if they haven’t already, how service can be turned from a cost to a profit centre.

Cambridge University recently released a report, The Future of Servitization: Technologies that will make a difference that claims service providers gain “increased revenues and better margins, over a longer time span,” and that “customers can maximize equipment performance and lower the total cost of ownership,” while consumers can get “better products and services that meet their needs more precisely.”

That’s the sort of return from service that would make any business smile, so why aren’t all businesses doing this?

Three years ago a report from the Aston Business School claimed that servitization offers an “alternative way” for industrial strategies. It outlined potential cost savings (25-30 percent) and that leading adopters were seeing sustained business growth and increased customer loyalty. That was three years ago, so why the slow burn?

The Cambridge University report identified five key technologies – predictive analysis, remote communications, mobile platforms, consumption monitoring and dash-boarding – as being integral to servitization. The problem most businesses have in adopting these technologies revolves around perceived costs, legacy technology and culture, but also awareness.

That’s the sort of return from service that would make any business smile, so why aren’t all businesses doing this?

Not every company has a Chief Services Officer with the knowledge to sell the concept at board level but the idea that service departments can be transformed from cost centers to profit centers has to be attractive to any C-level exec. More revenue, up-selling, customer insight, increased loyalty, less churn, better cash management and improved stock management are all worthy positives to capture the imagination of any manager.Blog_IoT-Service-Insights-Are-Re-shaping-Product-Design_1200x600

Certainly there are skills issues that would need addressing. While businesses must help create a shift in culture and contracting structures, identifying key staff, retraining and implementing technology change will take time. The advice of course would be to start small. Identify easy wins (the low hanging fruit) and trial with small teams. Focus on one product for example and build up over time.

Where to start though? If predictive analysis has been identified as a key enabler of servitization then sensors on products and the Internet of Things (IoT) can help deliver the data feeds needed to offer proactive analysis. At the very least, this would enable service teams to identify issues early and order relevant parts before visiting customers – reducing service time and costs and importantly minimizing customer downtime. This on its own should lead to making happy customers.

It’s also about getting the platform right from the start. Understanding the importance of mobile to a service team should be obvious but if you have the functionality for future growth, such as a field service management platform, it takes away the fear of investments going out of date. Future proofing is a big part of how service teams need to develop their tech infrastructure. Technology will move fast and as we are seeing with IoT and data automation, relationships with customers can change through increased expectation.

We will hit a point at which businesses will be expected to offer live monitoring and predictive analysis for products. It will become the norm not the exception, like the friendly waiter or white teeth receptionist, offering service with a smile and customers expecting nothing less.

ABOUT Dave Hart

Avatar photoDave Hart is the former executive vice president of corporate development at ServiceMax. Previously, he was vice president of global customer transformation at ServiceMax, where he worked with prospects and existing customers to understand and unlock the true value their field service organizations. Having started his career as a field service engineer, Hart has decades of field service management and customer transformation experience, most recently leading Pitney Bowes' entire European service organization. During his more than a decade at Pitney Bowes, Hart also managed the international DMT (Document Messaging Technologies) service group, UK GMS (Global Mailing Solutions) group, and national operations of Pitney Bowes Management Services.