“Never waste a good crisis.”
I know…I could feel you wince just ever so slightly when you read that line – and believe me, I know it is a bit crass. I have to admit, as much as I would like to take credit for an offensive yet brilliant line; it wasn’t me. As far I can tell, the credit is generally given to Sir Winston Churchill, near the end of World War II. He supposedly said “never let a good crisis go to waste” during a meeting with Roosevelt and Stalin where some of the first discussions occurred regarding the formation of the United Nations.
That line was recently repeated to me during a recent discussion with several service leaders, where we were comparing notes on the changes to their service organizations that came about as a result of COVID-19. When presented with unforeseen challenges, a business can do one of two things: stay the course and refuse to change (generally a bad idea); or adapt by embracing innovation. Thankfully, I like to surround myself with really smart people, so in this case, the participants in the conversation had a plethora of good ideas on how to maintain and grow in the face of unexpected changes to their operations.
The best thing about the outcome achieved through innovation is that it is rarely worse than the method you were utilizing in the past. Innovation in service can usually be measured in four areas: top-line growth, bottom-line savings, intrinsic benefits seen within the workforce, and external impacts that improve the customer experience. If there isn’t a benefit tied to one of those areas, then it probably is not something that is worth investing your time in.
In my attempt to sum up all of the goodness that was espoused by the service leaders, I have placed the changes in three areas, which will be detailed below:
- Changes for the business
- Changes for the employees
- Things Service Leaders SHOULD be focused on
1. Changes for the Business
One of the first things that came up was the increased efficiencies they have seen via the accelerated adoption of digital transformation technologies. One might think it strange to try to shift and use a different technology while just trying to maintain their business, but the enhanced reliance on digital technology allowed the service team to complete their work and communicate with the customer while minimizing the amount of in-person contact necessary.
One added benefit of that is the speed at which work orders are processed and closed. Imagine a paper process where you have to capture the customer signature, fill out all the related forms, head into the office to turn it in, have it transcribed into the system of record (fingers-crossed they didn’t change or miss anything), double-check it all, then bill the customer and wait for payment.
Based on my experience it’s not crazy for that to take 60+ days. Now imagine a process where the data is automatically input and updated in the system via a mobile solution, and the bill is sent to the customer immediately. Not only is that a huge improvement for the business, but due to COVID-19, customers no longer wanted technicians to hand them documents for signature, and the back office didn’t want to manually process all the paperwork either. The reduction in Days Sales Outstanding also results in better forecasting and cash flow for investment expenses.
The next area of benefit is a focus on the flexibility of service resources, which I will detail below in the changes for the employees. Related to that though is the new ways of delivering service (self-service, remote, in-person). Equipping your customers with the ability to diagnose the problem and resolve it with minimal assistance can result in happier customers, and longer-term annuity streams as those customers continue to value a relationship with your organization. You also have the added benefit of creating and offering additional services like training and analytics. These revenue models are net new and don’t lead to the cannibalization of product revenue or from outcome-based models.
2. Changes for the Employees
As I mentioned above, the ability to bring flexibility to your service resources can be a huge boon to the service team. For years, we all have heard about the impending exodus of skilled, long-term service engineers…but what if there were some ways to retain that knowledge, and pass it on to the next generation of service talent?
In the past year, there has been increased adoption of remote technical support, and the tools necessary to deliver remote support, such as augmented reality and video communication. Service engineers are walking customers and less experienced technicians through the service process from a remote location. This fits with the increased desire to lighten the amount of travel and unpredictability for experienced service engineers typically seen across industries and allows them to scale and support many more engineers and customers.
In addition to the remote support, there has been an increased demand for on-demand, online, and personalized training. I am of the mindset that nothing can replace the experience that is derived from turning a wrench on a piece of equipment, but with live remote support, video-based content and 3d imaging, enough content can be made available online to support any on the job training. Even better, when that exists on a tablet, the service engineer can now bring it into the field with them to help analyze and fix the issue for the customer.
These days, one constant for many businesses is that service engineers continue to have higher levels of access to customers than the sales team. Moving forward, there will be a continued push for the service organization to support sales and renewal opportunities.
“There’s no reality in which I want my service team selling,” I hear you say. Sure, but the truth is that there is no one better to identify what the customer needs to maintain their uptime goals; that could be through new service contracts, new parts, or new equipment. The service technician is also one of the few people that the customer fully trusts because they are not a salesperson. So, any lead captured by your engineers is about as close to a sure thing sales opportunity as it gets.
3. Things Service Leaders Should Be Focused On
While a majority of leaders are looking at ways to keep their employees safe (and safety should absolutely be their top priority) while maintaining high levels of service, there are other areas of abundant opportunity for the business, should they choose to take advantage. Three common areas that I’ve seen are data, metrics, and profitability:
Data: The cleanup of their installed base information and the formalization of a data share plan with product and engineering. The time to repair difference on a system that was designed for service vs one that was not can be astronomical.
Metrics: Understanding things like leakage and how much it affects your bottom line can make a huge difference between operating as a cost center versus a profit center. In speaking with one service leader that wasn’t currently measuring their leakage, he estimated it to be as high as 25-30% in some areas!
Profitability: Analyzing your contracts and accounts to determine how profitable each of them is, and then properly quoting your service contracts moving forward.
I will be speaking and hosting a number of sessions during our Maximize conference in a few short weeks on March 16-18, 2021. If you would like to join and continue the conversation, you can read more and register here.
In the meantime, check out the fantastic blog “2021 Predictions for Chief Service Officers” by Sumair Dutta and Kieran Notter, and be on the lookout for our soon-to-be-released 2021 CSO Report (2020 version available here).