Increasingly, manufacturers are looking to deliver superior service offers to differentiate their brands, increase margins and secure customer loyalty. As the latest IDC MaturityScape report examines the maturity of Field Service Management entering 2022, Mark Brewer, VP Service Industries at IFS, considers the associated orchestration capabilities that make the difference between success and failure.
SERVICE: A DIFFERENTIATOR
It’s not easy being a manufacturer at present. Today’s markets are full of feature-saturated products, and there’s often little scope to outperform competitors or set a brand apart. In the face of aggressive pricing and often volatile supply chains, making money from product sales has never been more challenging. Increasingly, manufacturers are realizing there’s only one clear way forward. Investing in their service business presents an avenue to expand margins, grow customer loyalty and attract new prospects. Simply put, service is no longer an ‘aftersales’ activity: it’s a differentiator.
It’s no coincidence that the recent IDC MarketScape: Worldwide Manufacturing Field Service Management Applications 2021–2022 Vendor Assessment cites transformative digital technologies as key enablers for delivering service effectively. It highlights how “Digital capabilities and innovation accelerators such as augmented reality (AR)/mixed reality, the Internet of Things (IoT), and artificial intelligence (AI) are helping manufacturers and service organizations transform field support to be more proactive, predictive, and remote.”
By investing in service digital transformation, manufacturers can improve the customer experience (increase customer satisfaction and loyalty), raise technician productivity (decrease costs) plus create more innovative service offers to attract new customers (increase revenues).
LIFETIME REVENUES
As products have become increasingly commoditized, and sales margins have diminished, so manufacturers are realizing the value of monetizing service throughout the product lifecycle. Great service experiences reflect directly on the brand, providing much-needed differentiation in a crowded marketplace. It’s also highly profitable. Manufacturers of industrial equipment such as elevators and generators tell us that the lifetime revenue from service contracts is typically worth 12X the initial sale of the product.
Getting that seamless customer experience right when planning and delivering service is everything. IDC’s MaturityScape (Field Service Management in Manufacturing 1.0) reveals how reactive service models are being replaced by “smarter IoT enabled equipment which can inform service and maintenance to deliver resolution prior to failure”. The study identifies five ascending stages of field service management sophistication – ad-hoc, opportunistic, repeatable, managed and, finally, optimized. It is this optimized stage that provides the most dynamic service delivery landscape, effectively replacing the need for human intervention with predictive pre-emptive analytics, self-diagnosis of faults and, wherever possible, fully automated resolutions.
FULLY AUTONOMOUS SERVICE
An example of a company adopting optimized, fully autonomous service is Cubic Transportation Systems (CTS). The company operates and maintains the smart passenger gates used by Transport for London’s Oyster card passengers. The smart gates can automatically self-resolve many routine faults, for example by rebooting or updating BIOS firmware. The IFS Field Service Management (FSM) solution used by CTS includes Planning & Scheduling Optimization (PSO): real-time scheduling and optimization software that leverages Artificial Intelligence (AI) and advanced algorithms to deliver the optimum service schedule.
Up to 95% of faults are reported, triaged and allocated to a technician without any human involvement whatsoever. An appropriately skilled CTS engineer is automatically assigned and notified via mobile and, already on shift in the London Underground network, arrives within 45 minutes.
HUMAN-FREE REPORTING
In this scenario we can see the customer is no longer the sensor reporting an issue – the machine is. It also means, unlike human reporting, that the fault report is prescriptive and accurate, with no room for error. When a gate or elevator tells you the doors are stuck, it also tells you why – because it knows. The likelihood of a first-time fix is greatly increased because the usual areas of doubt or ambiguity are eliminated.
Despite this advantage, IDC reports that currently only 18.1% of manufacturers approach service operations in a prescriptive manner, with products providing autonomic capabilities to report problems/issues and request repair 1.
As you may know, IFS develops solutions that support a customer’s Moment of Service™. For customers seeking to deliver field service effectively, many things need to happen prior to the service request being executed if it is to be successful. First time resolution depends on careful orchestration of several different but critical checks, actions and events which often span multiple departments and use cases.
FROM JUST-IN-TIME TO JUST-IN CASE
Just as manufacturers are familiar with Just-In-Time supply for production, when it comes to managing or optimizing service they must also embrace ‘Just-In-Case’ planning. Are parts that are the most likely to fail locally held in stock? Is inventory burdened with a surfeit of costly, rarely required spares that are constantly becoming obsolete? If a new part isn’t available, can an alternative, replacement or re-conditioned part be substituted instead, saving cost and time? Are they over-provisioning costly resources across the network for situations that seldom arise?
Clearly the ability to model, plan and forecast scenarios based on accurate data and past learnings becomes critical as well as being able to consider known events such as planned maintenance, asset condition and usage-based data
HOLISTIC ORCHESTRATION
That’s why, unlike other field service management solution vendors who focus predominantly on execution of the service visit, IFS takes a holistic approach that includes the complex pre-emptive orchestration and triage needed to optimize First-Time-Fix rates. Using IFS, manufacturers can cite SLAs in contracts confident that appropriate Just-in-Case measures and logistics and resource planning are all in place.
Industry wide, 65% of the time parts availability is the reason cited for failure to achieve a successful first-time fix. But by using dynamic planning, scheduling and optimization capabilities in IFS, the solution considers both the person and the part to orchestrate synchronization. For example, if the necessary part is available in the network at a local part depot or PUDO location, the system can dispatch and route the engineer accordingly to encompass the part pickup event, minimizing down time.
As the IDC MaturityScape report observes, “a shift to proactive and predictive field service outcomes requires more than just automation, it depends on having a connected organization that ensures knowledge can be shared and data flows beyond the service team.”
MOVING TOWARDS OPTIMIZED SERVICE
So how specifically does IFS help manufacturers deliver streamlined, managed and optimized field service propositions? Well, in several ways. Firstly, for contracting and SLAs, IFS models the entire cost base for a contract, including all elements (spare parts, tools, transport, people and sub-contractors). The information can inform profitability across the contract lifecycle, allowing options (like type of engineer sent, in-house vs. subcontract resource, overtime utilization, SLA commitment) to be explored or changed.
Secondly, with multi-time horizon planning (MTHP), IFS can model the entire maintenance plan with a 365 day+ horizon, helping to ensure regulatory compliance commitments are met. Thirdly, sophisticated resource planning ensures the rota and shift matrix can support a dynamic demand profile, including forecasting and long-range capacity planning, determining the level of employee or subcontractor utilization appropriate for each task or location type, and modeling ‘what if’ scenarios for example when bidding for new contracts.
Fourthly, the system supports break/fix events, providing true intra-day dynamic scheduling, including route optimization for field engineers, and parts fulfilment (pick up drop off points and location), supported by comprehensive mobile technician enablement with complete asset as-maintained visibility. Lastly, performance analysis tools mine the granular data, informing future contracts and maintenance cycles for complete lifecycle profitability
What’s clear to me is that any truly optimized service model fundamentally depends on holistic orchestration of all processes. We call this Service Lifecycle Management (SLM), which requires automated, intelligent actions by the system, minimizing human touch-points, to succeed. The sooner manufacturers embrace intelligent and self-aware products, the sooner we can all enjoy predictive and pro-active service and ultimately the outcomes that these assets deliver for a superior customer experience.
Download the In the IDC MarketScape for Worldwide Manufacturing Field Service Management Applications Vendor Assessment 2021 – 2022 here: https://www.ifs.com/insights/idc-fsm-2021/
- IDC Manufacturing Insights’ 2021 Product and Service Innovation Survey
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