We are seeing a growing interest in IoT adoption in the market today – from both customers and service providers – along with a move from reactive to proactive service. It’s certainly reflected in many of the companies I am working with that have a keen interest in this area.
But why is this?
Reactive service, as we all know, can be very expensive. In my view, it doesn’t really deliver what it should do in terms of the quality and value.
If you consider downtime and lost output, from a customer’s point of view, reactive service costs really are quite significant.
Also from a supplier’s perspective, it’s always been expensive to send engineers out with an average figure of around £180 for a B2B environment. Even in a consumer context, engineer call out costs can be expensive.
In fact, in some of the organisations that we work with – such as those maintaining gas plants or very expensive equipment such as security scanners – it can cost anything up to £1500 for an engineer to be sent on a job.
IoT offers us some potential solutions to address this issue. The recent research we undertook with Field Service News and PTC really helped solidify some of the thinking around how these benefits can play out in the real world.
In parallel, we are also seeing the shift to connected services begin to accelerate with a growing trend towards servitization.
I’ve sat on quite a few round-tables recently in this area.
Customers are looking for a guarantee that you are going to provide a particular service, deliver a particular outcome, and a certain level of performance…
Servitization has been around for a while, having come out of lean manufacturing and Six Sigma.
But with the on-going drive towards globalisation and digitalisation, alongside the emergence of IoT, we’re now seeing added market momentum.
We are seeing a large number of companies of all sizes, that view IoT as an enabling technology to allow them to move towards preventative planned maintenance within their service organisations, as well as a shift in focus for their businesses that puts the emphasis on outcome based solutions.
My personal view is that we will soon see outcome based service models becoming more and more common. The industry as a whole needs to sit back and rethink its service models.
I know that there are already a few high profile case studies, such as Cannon, providing document services rather than selling printers, for example, or one of the most famous examples of Rolls Royce providing flight hours not jet engines (coined ‘power-by-the –hour’).
But these examples are no longer examples of companies operating outside of the norm.
We often see customers looking for a guarantee that their provider is going to provide a particular service, deliver a particular outcome, and a certain pre-agreed level of performance.
And this shift in thinking is leading to a change within industry that is very much ‘we are in it together’.
Providers are becoming accountable for their customers’ success, and as a result will reap the rewards of being an integral part of their customers’ businesses – including longer-term contracts, which of course adds stability and a platform for further development and growth.
Our recent partnership with PTC has been well documented, and the reason for coming together is very much a result of this emerging need for a platform to fulfil this demand. A platform to enable field service companies to evolve in keeping with these trends and to support this new service economy.
Providers are becoming accountable for their customers’ success, and as a result will reap the rewards of being an integral part of their customers’ businesses
At the core of the partnership is a desire to allow manufacturers and service partners to connect products – a key building block in maximising IoT within an outcome based solutions strategy.
And whilst I know I’m biased, I must say that I’m really excited by our recent launch of Connected Field Service, which is the complete Internet of Things solution for the field service industry.
By leveraging PTC’s ThingWorx platform, ServiceMax’s Connected Field Service can let you know immediately when something is about to fail, and automatically dispatch the necessary technician with the right knowledge and the right parts to repair the machine and eliminate unplanned downtime.
Given the potential we discussed above for IoT to change the way field service companies focus their businesses, and its role as an enabler for companies moving towards a servitized model, I genuinely believe that Connected Field Service is a first glimpse of the future of things to come in our industry.
Exciting times indeed.