Service organisations who have integrated field service and reverse/service logistics processes report a higher level of service performance than those who have not, reports Michael R. Blumberg, President and CEO, Blumberg Advisory Group, which has conducted a survey of 250 field service companies companies in the high-tech sector.
Much attention has been given in recent years to the need to automate field service and service parts logistics processes through the implementation of Enterprise Service Management (ESM) systems, . Although the benefits from improved automation are well documented, there is a segment of the market that faces challenges to achieving measurable gains in productivity and efficiency as it relates to key performance indicators (KPIs). This is especially true for KPIs associated with service parts logistics activities. We believe these shortcomings are due in part to lack of integration between field service and reverse/service Llogistics functions.
In order to validate this hypothesis, we conducted a survey among a cross representative sample of companies in the high technology service and support industry. Over 250 respondents participated in the survey, which was sponsored by IFS. The survey results reveal a number of very interesting trends:
- Greater reliance on remote support: The survey results support the growing trend toward resolving service requests remotely without the need to dispatch a field service engineer. 40% of companies can resolve more that 25% of service requests remotely by sending out a replacement spare part. Over one quarter of respondents expect this trend to continue to increase over the next 18-24 months.
- Best of breed solutions outperform integrated solutions: Despite the breadth of functionality found within integrated enterprise systems, our results indicated a higher level of satisfaction with Best of Breed solutions than with Integrated ESM platforms. Over one-third of respondents were extremely satisfied with their Best of Breed ESM solution compare to 14% with integrated ESM platforms. We believe this is because best of breed solutions are more focused on the detailed processes and transactions involved in managing a field service and/or reverse logistics operation.
- Perceived gaps in reverse logistics functionality: Many companies perceive their ESM solutions have gaps in the ability to deal with reverse/service logistics issues particularly when it comes to depot repair activities. For example, 27% of respondents claim that their ESM is not very effective in tracking the results of depot repair test and screening activities. Another one quarter indicated their systems are not very effective in automating the work flow or business rules associated with processing returned materials.
- Integrated automation is critical to success: The level of integrated automation between field service and reverse/service [ogistics functionality has a direct impact on ESM effectiveness. More importantly companies with a high level of integrated automation perform better on key service performance metrics than those who do not. Companies with some level of integrated automation experience a higher SLA compliance rate than those have no integrated automation (93.4% v 87.9%) as well as a lower no-fault-found rate (26.1% v 38.3%).
In summary, our research findings reveal that companies who have been able to successfully integrate field service and reverse/service logistics processes report a higher level of service performance than those who have not. The most effective integrated solutions are those that incorporate integrated, best of breed functionality for both field service and reverse/service logistics processes. More importantly, the data reveals that these integrated, best of breed solutions are not only highly effective in managing ongoing service requirements but essential to overcoming critical business challenges such as improving remote resolution rates and improving field service engineer productivity rates.
We’d like to thank IFS, a leading provider of ESM systems, for sponsoring our research study. IFS has made available the results of our study in a 14-page whitepaper that can be downloaded at Whitepaper Download. To better understand the implications of these findings to your organization or to define requirements for a best of breed, integrated solution, schedule a free strategy session with us today by clicking here.
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