Jerome Soltani, Sr. VP of U.S. Services and Alex Gershman, Director of Strategy, Services and Solutions both at Schneider Electric join Sarah to discuss the inflection point service is at, the excitement that holds, and the challenges organizations face in bringing outcomes-based service potential to fruition.
Welcome to The Future of Field Service podcast. I'm your host, Sarah Nicastro. I'm excited to have today on the podcast a couple folks from Schneider Electric, talking about the company's move to delivering outcomes. If we look back over the podcast we've recorded this year, I think it's safe to say a majority of them have been about the path to outcomes based service and to organization. And there is some really good reason for that.
Sarah: I mean, first of all, I think it is the big evolution that companies are working on and toward. And hearing these stories I hope, for you, our listeners, gives you some light bulb moments that you're able to learn from and take back into your own businesses. I think these journeys are complex, as we're about to discuss, and I think sharing them with one another is fantastic because we all have something to learn from each other's stories.
Sarah: So, with that being said, I'm thrilled to welcome to the podcast today, Jerome Soltani, who is the senior vice president of US Services at Schneider Electric, as well as Alex Gershman, director of strategy, services and solutions at Schneider. Jerome and Alex, welcome to the podcast.
Jerome: Thank you. Thank you, Sarah.
Sarah: Thanks for being here. Before we dig in to the topic at hand, why don't you guys tell us a little bit more about yourselves? Jerome, can you start and do an introduction?
Jerome: Yeah. I'm Jerome Soltani. I'm the services leader for Schneider Electric in North America. I'm overseeing the field digital and consulting services for the biggest part of the Schneider Electric portfolio. Schneider, as we know, is the global specialist for NRG management and automation, and I oversee our entering services business, from building the strategy, develop the marketing plan, up to the execution and delivery. Alex, over to you.
Alex: Yeah, and I'm Alex Gershman, and I work on Jerome's team. And I've got the pleasure of working with him on the development of that strategy both over three-year period, as well as building our annual operational executional plans as well.
Sarah: Awesome. Well, thank you both, and excited to have you both here. We connected and I have a number of points I want to get to today, and I think we probably could've split this into three or four podcasts if we wanted to. But we'll do our best. With that being said, to sort of set the stage for the conversation today, I said at the beginning this path to outcomes based services is one that most companies are somewhere along today, right? And it's a journey. Can you share with me and the listeners for context, where would you describe Schneider being on this path, and how does that compare with what you have as the ultimate vision?
Jerome: Yeah, very good question, Sarah. Look, I think as you mentioned already, outcome based services is a journey. We are not yet there, but the good news is that we are strongly anchor the outcomes base value in our three-year strategy as mentioned by Alex. It's something that is completely in the core of our three-year strategy, and if you look back at what Schneider Electric has done, services and software and story and journey probably started probably five, six years ago in Schneider.
Jerome: If you look at this story, we have acquired different key players in the software domain in acquiring data, learning machine tools and so on and so forth, to really develop our capabilities and capacity in software. And services became very top priority for Schneider. If you look at that, this is really, for us, the prerequisite or the precondition to be able to move to outcome based services.
Jerome: So, with services and the digital piece, and now that we are able to have a much more unified approach in our services portfolio, we believe that we can accelerate very much our approach. And the good news as well is that we see the customer now. It was probably impossible a couple of months ago, a couple of years ago and now it's real. I mean, there were people who were asking for that, they are looking for that.
Jerome: To answer directly your question, I think we are at a inflection point where we are able, in some cases, some carrier, to redeliver the outcome based services, and be able to give this expectation or to provide this expectation to our end user.
Sarah: Excellent, excellent. So you're building momentum, which is really cool. So, I want to talk a little bit about we've set the stage for the fact that not only is Schneider on this journey, but a lot of companies are, right? Let's talk about why that is, and what I want to talk about really is what are you witnessing as a business from customers that is driving this demand, that's putting you on this path? So, happy to have you answer that question from a high level, and I know, Alex, you had made the comment that the conversations you have with customers today are far, far different than they were one or two years ago. Let's talk a little bit out what's changed. What's changed in terms of customer's needs, expectations, demands, and how is that really driving the need for Schneider to move this ball forward?
Alex: I think, Sarah, there are a couple of big, we call them mega trends, that we're seeing out in the marketplace that are driving the change in conversation. So first we see and certainly many of them accelerated through the last year, through COVID. Changes in investment shifts that our customers are making from big capital expenditures toward more operating annual kinds of expenditures. And again, through COVID we hear the needs to extend the life of assets, make sure that I don't have necessarily the capital to invest,
Alex: So that kind of CapEx to OpEx shift has certainly changed the nature of conversations that we're having. We're seeing from the customer perspective a couple things. One of my favorite terms of the last six months or so is the silver tsunami, hair color of the customers. We're seeing massive retirements on the part of the skilled labor inside of our customer organizations, meaning they're turning more and more to companies like ours to help them with the services needs that they had that they may have relied on internally previously.
Alex: We're also seeing a lot of pressure that our customers, especially a lot of our bigger strategic customers, that they're having to focus their efforts and attentions on their core business. Our candy makers want to make candy and they don't want to necessarily focus on their infrastructure. So, again, they're turning increasingly more and more to us to do that.
Alex: And then another one of the big ones, obviously the rise of data connected technology, the more that these things actually become real, the more customers are looking to us to help them with making sense of the data that they have, being able to get toward the outcomes that they're looking for with their customers.
Alex: So, all of those big trends have definitely changed the conversation, and I would say it really is in this last year, certainly in the few years previous. Jerome said that the journey started many years ago, concepts like IoT, customers were aware and cognizing and talking and early adapters had started to make investments. But it's really in this last twelve-month period and even in the last few months in particular, that we're really starting to see greater adaption, intense greater adaption.
Alex: I pulled some stats. We just wrapped a voice of customer survey a couple weeks ago, but more than a third of our customers say that they have or will be investing in connected software for their critical facility operations in the next year. Two thirds of them are investing in connectable hardware. So these things are happening, and they're real and very much it changes the dynamic, it changes the conversation that we're having with customers, because now they're looking to take advantage of these, they're looking for the ROI on these kinds of investments.
Alex: And quite frankly we're as well positioned as anybody to help them be able to take advantage to generate the ROI from those connected technology investments.
Sarah: Yeah. What's really interesting to me about what you just said, Alex, and, Jerome, I'm interested to get your take on this, is I actually think not only are you well positioned, but you are the reason that they are ready to take advantage of those things. And what I mean by that is, customers don't buy buzzwords, okay? That's why three, four, five years go you could talk about IoT until you're blue in the face and in most applications nobody cared, and that's because why should they, right?
Sarah: I mean, the organization is trying to sell that solution or recognize that evolution had not yet built the ability to translate those buzzwords into a value proposition. That's the change we've seen within the industry over the last few years, is the capability is of businesses like Schneider to see how do we take these buzzwords, make sense of it all, turn it into a solution that meets pain points of our customers, then they're ready to adapt those things. Of course they want to, because you've done the hard work of making it all make sense and making it valuable to them. Jerome, what are your thoughts on that?
Jerome: I definitely agree with you. I think before COVID we had the feeling to be a little bit in advance. Not being arrogant, but you see when you're a little bit too ahead of the market, you feel a little bit alone to create demand and create this awareness. But, I mean, COVID and the pandemic and the situation, working from home, nobody in the campus, in the university and so on, we saw this awareness and this acknowledgement of coming from our user. It was a big relief for us, and it was great to see that finally the combination of our software portfolio connected product and services would make sense, and would bring a lot of value to our user.
Jerome: I mean, again, there are a lot of things to work on, but we see definitely this resonating much more with our end user now than the past. So definitely now it's become a reality, concrete, and the customer. As mentioned by Alex, we see this trend now completely part of the description with our end user, and really asking them, asking us how can we deliver much more value into our services, our digital services, how can we connect the asset, our service, our connected service of North America. We drive data remotely from the installation, and what is of value and insight that we can bring to them to be more efficient, be more sustainable and really at the end of the day help them to deliver their value to the end users.
Sarah: Right, right. I want to come back to that increased acceptance and that increased awareness in a moment. But before we do, let's go back to the Schneider perspective for just a minute. So this is a path you've been on for a few years, right? It's not brand new because of COVID. But you did mention, Jerome, when we spoke, that there has been an increased recognition even within the business this year, of how service serves as a form of business resilience. Talk a little bit about that.
Jerome: You know, again, services journey has started couple of years ago, but I think it was still at the operation level, at the country level, kind of second thought and not really a top priority. Now it's a good thing that our CEO and our board members were strong believers and have been really promoting the services business for years and have made very structural and transformational investment into this different teams at country level.
Jerome: What we saw this year is that COVID-19 has been really a catalyst to prove that services was highly resilient, and the models that allow us to continue to deliver our very strong ordering tech and profitability to our overall P&L. I mean, when I compare our traditional transactional equipment type of business versus services today, depending on the country, depending on the portfolio, you have a discrepancy between five to 10 points of growth between a services business and a traditional core CapEx driven business.
Jerome: Very outstanding performance and at the end of the day we’re delivering strong profitability, and then contrastingly good. We talk about pandemic, but even the economy. In some area we saw some business struggling because of the situation. But as well oil and gas business beyond COVID was already in trouble. But this business still need to operate. They need to deliver, they need to drill, they need to extract oil, gas. And to do that they still need to maintain the equipment, they still need to be safe and reliable. And this business I'm passionate about. I love this business.
Jerome: But it shows that this business is one of the most strong and reliable business, and resilient business in the economy, in the market.
Sarah: Mm-hmm (affirmative). Yeah, and I think going back to what you said before, Alex, the changing conversations with customers, there's kind of a snowball effect in play to a point, right? Because as businesses become better able to translate the buzzwords into value propositions and to start to articulate those in a way that customers resonate with, then there's kind of a point where customers realize, "Boy, maybe we can rely on this company for more than just X product or X service," right?
Sarah: And I had a the exact same conversation with someone a few weeks ago who's in a different industry but similar situation in the sense of companies that have employed these highly skilled workers to run this equipment for a very long time, these folks are aging out and they're finding it impossible to replace that talent. So how can they turn then to folks like you guys, to help them bare the weight of that burden? What type of automation can you provide or insights can you provide that eases that and helps them maintain their business, right?
Sarah: And then you see how it can build. You bring something to the table, they have this moment of realizing you're bringing more to the table and it can build, you know? We've had a lot of conversations this in particular about COVID being a catalyst for service companies, manufacturing organizations that I'm speaking with, how they're far closer relationships with their customers in terms of really more intimately understanding not just how their customers use their products or services, but how they operate on a bigger scale, and letting that influence the journey forward, right?
Sarah: So, it's pretty cool stuff. And, Jerome, I know when we talked the other day we talked about the openness to change and acknowledgement of this evolution on both sides. On the company side and on the customer side. And I think we shared a bit of a moment where we both realized how passionate we are about the inflection point, as you said, that we're at.
Sarah: So, I do think that while this year has been immensely challenging and certainly wish things were different, one of the very positive impacts is going to be how it drives this evolution forward. You know, what are your thoughts on... How would you describe the impact this year has had and how you think that'll influence what's to come?
Jerome: I believe that we talk about this outcome based services and the value prep that we want to create for our end user, but it's urging a lot of senior as well on our coverage model, on our sales model and on our execution model. There is lot of consequences, implications on the way we want to now connect with our end user, discuss with our end user, which is much more remote. It's not the past model where you need to face to face, facing your customer, have this relationship intimacy and so on and so forth has completely changed.
Jerome: We have a shift in our sales model that we need to manage. Not only the tool that we are using and the capabilities we are using, but as well the DNA, the culture is different. You have to shift that. So yeah. Some people would be able to manage this shift and accompany you on the shift. The rest we will need partly to recruit different people. You need to change that. It cannot work the same way that it was working before.
Jerome: I see as well very strong impact on the execution, and the way you crowdsource, the way you have a much more diffuse market, you need to be able to sell your customer everywhere at every moment of the day and night. Now the connectivity and the remote approach and the data that you have allow you to be much more predictive, but also give you the duty that you need to intervene before anything occur or before anything create trouble on the process of your end user.
Jerome: So, there is definitely a way for execution and the way you manage your population of technician that will oblige you to rethink your setup and to rethink how you drive and you organize your team. Big changes as well on the back end, behind the scene, to deliver that. And we were talking with Alex we are looking this inflection point on the sellers, you cannot do the same thing than you are doing previously. So, you need to cross examine and have this kind of already the adapter or champion that will allow you to embark this new approach and be much more constructive and really... Because for me I believe that the outcomes based is linked to the understanding of, the pinpoint and the expectation of the end user.
Jerome: You are not anymore just troubleshooting or maintaining something, you are anticipating and complying to needs for the customer to continue optimizing his operation or her operation, and the maintenance of his infrastructure or her infrastructure. So you're going to have different people that understand this need and this expectation to deliver the right outcome to our end user.
Sarah: Right.
Alex: I think we're going to look back on 2020 for lots of reasons. But if we think about what's happened in the years before, there have been incremental changes that have happened, connectivity customer demand, our own workforces. But given the intersection of external forces and acceleration of technology from the customer demand perspective from the sales perspective, as Jerome mentioned, from the delivery perspective, we're going to look back at 2020 as a massive inflection point across the industry in the in which services are consumed, delivered as a whole and the value that a services organization is going to bring to customers.
Alex: I fully believe we'll look back when the white papers are being written a few years from now, 2020 is going to be that inflection point.
Sarah: I agree. And so that's the exciting part. But, Jerome, you just did a great job of articulating some of the layers of complexity, right? So while I wholeheartedly agree and I'm equally excited about the fact that I think 2020 is and will be an inflection point, and it's kind of minimized some of the barriers and it's sped some of the understanding and awareness. The reality is the reason that these journeys are journeys is because there's so many layers of things that need to change to really be successful in involving from a provider of X to a facilitator of success really.
Sarah: So, Jerome, to your point, that's what I see the new role as, right? And it's a big difference, right? There's a lot of work that goes into getting from A to Z. So let's dig in to a couple of those things. The first... and I think you've eluded, Jerome, to most of these, so let's just talk in specific about a few.
Sarah: The first is the cultural and mindset shift, and to me this is one of the areas of biggest impact of this year. Because I think it's really forced people to get out of their comfort zone. I think it's really then the push that a lot of companies needed to realize, okay, it's time to do something different here. But it is a big change.
Sarah: I think the deeper, the richer the history. Often times the harder it is to really get everybody on board with this services mindset and all of these things. When we spoke the other day, Alex, you mentioned specifically that Schneider has done a very good job of creating a language around service. How? Because I think that this is an area where a lot of people struggle, right? Because there is pockets or recognition within the organization of why this journey is so important and how it can benefit the company. But to be able to persist that understanding all the way through a business and really change the culture is tough.
Jerome: Yeah.
Sarah: So, having that language and being able to get everyone speaking a common language is a really important step. So what are some of the aspects of that for you guys? How would you summarize the progress and success there?
Alex: I'll go first and let Jerome add. And it's hard, and again, like everything else, it's a journey and by no means what I declare victory. But I think, again, the position that we're in now is markedly better and different than it was 12 months ago. It starts for sure at the top down. Our CEO deserves a lot of credit. Jerome mentioned he's been using this kind of language for the past several years. There was a conversation, I don't know, maybe six months ago where we basically said there are six priorities for the company, services and software, services and software, services and software. That helps, right? When you get that message from the CEO, people start to listen.
Alex: But it's been a very deliberate push from Jerome, myself, our team, out to the rest of the organization, taking advantage of the door being opened for us and making sure that we're doing our best to kick it in. It is repetition on the language that we're using. It's reinforcing the concept that we're talking about. It's painting the vision about why we are where we are, and what, quite frankly, some of the implications are if we don't make some of these changes now.
Alex: I think that repetition and that storytelling about customer successes that we've been having about the kinds of conversations, the things customers are asking for us about what we're trying to do. That repetition, that language, that resonates as you're trying to make change.
Alex: But again, I'd say we're still in the early stages of making that happen.
Sarah: Mm-hmm (affirmative). And this is where it gets tough for me without having a five-hour podcast. This is where we get into there's probably 20 questions I could ask you just one this topic, because yes, you still have a ways to go, I get that part, right? And I think that companies that are really innovating well realize that there is no finish line to this journey, right? You're not all of a sudden going to put your feet up and say, "Ooh, we Servitized. We reached the outcomes based nirvana, right?"
Sarah: It's going to be a continual process, so as such the language will continue to evolve, the culture will continue to evolve, but I may ask to have you back just specifically to talk about what does creating services language within a manufacturing organization look like? Because I think that, that's a cool topic. But we'll leave it there for now, I guess. Jerome, anything you wanted to add to that or can I ask you the next point?
Jerome: Yeah, I like to respond on what Alex said... a little bit. Definitely it's one of the biggest challenge to change this culture and this language. I think as leader you need to drive adoption. And we were discussing that with Alex a couple of weeks ago. I mean, it's a must and not nice to have. And you need to at one point explain and message to our organization and the shift to outcome or the shift services or the shift to digital may not be super beneficial today, but if you don't start to shift your boat or your organization right now, in two or three years you will be completely out of the market.
Jerome: So, this is a difficulty to manage this situation where, I mean, you need to start before it's happening, proactive anticipation. And really I was telling you the story adopters or this champion. You need to have people that get it. You need to have change agents that will allow you in terms of services to show you that, I mean, it makes sense, and successes bring successes. We saw that in some of our customers. They realize that as soon as we provide them with the digital connectivity and the services, they were operating much better than before. And we have some testimony that has been shared across our organization and people realize from bottom to top that, "Wow, yeah." It makes sense and it can deliver a very different shade of added value or value prop to our end user.
Jerome: It’s kind of chicken and egg. You know at one point you see the benefit and so the thing that you have kept messaging, kept communicating, starts to resonate outside and internally and then it's a way you can cross examine in your business. But it's not overnight, and it's a complex shift in the culture of our organization.
Alex: Nothing does a better job... something that Jerome said is nothing does a better job in amplifying and making that message sticky. Again, the CEO can push it, but when customers share that and when we can share that success with all of our people, with our colleagues when our customers come on and do it directly, those are the things that ultimately make the difference in resonating in people's minds.
Sarah: Right, right. That makes sense. Okay, I want to talk next a little bit about some of the operational change that has to take place as well. And again, this is a whole separate topic that we could really dive into. But I want to talk quickly about two things. The first is how do you convince people to evolve when business as usual is working quite well?
Jerome: Again, it's one of biggest difficulty, biggest challenge. I think-
Sarah: I'm only tackling the big, hard ones. I'm not going to ask you any easy questions, Jerome.
Jerome: I see it as being one of my pet peeves, my things that keep me awake at night. I mean, especially... again, as I said earlier, the services business in US was doing well. Your core business is growing, and generating the right level of, the expected level of profitability. Now you need to say to your team you start to shift your focus from 100% of this highly profitable growing into something that takes more time, is more practice, more consultative business.
Jerome: And so you need to educate, you need to convince, and as I said it's becoming mandatory. And we need to, as we discussed with Alex and with our financial partner, with our HR partner, we need to experiment things to see what could work to shift this behavior and this focus.
Jerome: We've changed ourselves. You need change, something different, because it's different quarter, different financial investments. So you need to change about that, because people will not be paying out as it were and you don't see the same return investments. So you need to work on changing your incentive plan and the way people are paid out.
Jerome: You need to change your model. You need to give more time to your sellers that used to phase customer and you need to give them more time to create this pipeline of activity to create opportunities. You need to find a way to manage transactional services business elsewhere, because they cannot anymore spend their time on spare parts business. That's not what we want to drive.
Sarah: Right.
Jerome: So, you need to change your sales model to give to your top guns, highly competent sales guys that understand this approach more time and you need to be probably at the beginning less stringent, less demanding on the return on cost than before, because it's not the same value. It's a different value that you are selling to the end user, and even if the market has changed and the expectation are different, you still need to convince. You have some challenge in terms of we talk about connectivity but you should've talked about cyber security.
Jerome: And so there's some additional complexities that need to be taken into account, and you need to give the right support to this team to be successful. So lot of changes in terms of incentive plan, changing term of sales model and sale setup and rules of engagement to you can really make sure that you can give room for your people to be successful in this new ecosystem.
Sarah: Mm-hmm (affirmative). That makes sense, and it kind of ties in with the second part that I wanted to talk about, is eliminating silos, right? And having a more cohesive strategy and cohesive approach. So what are the thoughts there? How have you made progress on breaking down some of those silos and working more for the greater good of the customer outcome?
Jerome: Yeah. I mean, look, Schneider Electric is a great a company and, as we said, making the right move at the right time for software services, and I think the direction and strategies is very key and relevant. Now it's a complex organization. You have many functions, you have hardware functions, software functions and most of them are working silos still, okay?
Sarah: Mm-hmm (affirmative).
Jerome: And now what the company has done is really try to shift from this profound performance measurement by BU and being much more agnostic in terms of performance tracking and performance monitoring. If the possibility of opportunity for our seller, for our people to be recognized not only on the silo, but be recognized on the overall accountability or responsibility that they have on a larger, wider portfolio.
Jerome: So, you need to break this, you can't still have this BU because you need R&D very specific to each BU, and you need to have some marketing very specific to each BU. But at the country level, you need to have a performance management and performance tool that allow you to break this silo. This is from the hardware and software point of view. On the service side I think it had been clear from the get-go, and we see that with Alex we have expanding our portfolio and we have a national unified approach.
Jerome: I mean, for us, I mean, we talk about digitization, we talk about services. Again, to move to the outcome based services, you need to move from an asset and BU point of view, to a much more system and solution point of view.
Sarah: Right.
Jerome: And you don't bring an outcome-based services if you just monitor the obsolescence of your title. You need to cover a system and a multi BU approach with this decision and with services will allow you to provide this outcome based services. So problem for us, every discussion that I'm having with the different BU leaders is that I will own the outcome based services, and I will generate the outcome based services if the customer or the market is expecting that. But then I will need to provide them the right performance, and allocate the performance that they own and they deserve. But truly as a services team to be able to integrate and blend the different BU to make sure that it's completely transparent for our end user and you manage the complexity behind the scene.
Sarah: Right, right. Yeah, I mean, this is another very common conversation that I end up having, right? Because, as you said, it's another very complex part of the change. So as a product manufacturer you're structured operationally for internal efficiency usually, and if you're trying to be structured instead for customer centricity what you need to be to your point to tie all the pieces together and deliver outcomes, it's a big difference.
Sarah: Okay, I'm stressed out because we're running out of time and I want to make sure we get to two more questions, so bear with me. I want to make sure we talk, again, when we're talking about the different layers to this journey about digitization. So I know this, again, could be an entire topic on its own, but for the sake of giving the Schneider Electric overview today, talk a bit about how digital transformation, the need to be able to collect and deliver data, things like that plays a role into this evolution.
Jerome: I will start and, Alex, you can go on. For me you transform your assets and your products into a smart connectable product and equipment. So digitization for me is going from this dumb equipment and gear to this smart and connectable products that you can connect on the cloud, and then completely leverage all the algorithms, all the abilities to deliver insights and actually insights to our customer, again, to deliver this outcome.
Jerome: So, digitization is key for us, for riding this layer of connectivity to your equipment, to your software to really be able to deliver this apps and this advisor for our customers. So, digitization for me is key as well on the execution. We made a huge transformation on how to schedule and dispatch our technicians who have access to our partners, because they are technicians as well and we are leveraging now our technicians.
Jerome: We’re giving as well to our partner when we connect the end user we are providing insight to our partner as well to connect to their end user. So the digitization for me it's key on the offer and value prop, but it's key as well on the execution piece for crowdsourcing and for making sure that you send the right technician with the right competency, with the right component to deliver the right services. So it's for me forming digitization on both sides.
Sarah: Mm-hmm (affirmative). Alex, anything to add to that?
Alex: Yeah, the only thing I clearly get is the currency that enables the customer value to be driven to enable the efficiency, and it's also that maybe a third layer is the customer experience as well. The bridge between what you're being able to deliver, what your people are doing, the ability to seamlessly on their own get in touch with you, schedule the appointment, whatever it may be.
Alex: I mean, the reality is it's critical to all facets of the transformation. Data is the currency on which all of this is built.
Sarah: Right. I always say making the decision to deliver outcomes is taking on the responsibility of mastering a lot of complexity and making that invisible to your customers. And to do that, obviously, these tools are critically essential.
Sarah: Okay, one last question for each of you, and it can be a quick one. If I were to ask you each to share your biggest lesson learned or your biggest piece of advice for a peer that is listening to this episode, what would it be?
Alex: I'll let Jerome think. I've actually been keeping a bit of a running list of the lessons that we've been learning as we've been going through this, because there are many. So, Sarah, if you'll forgive I'll share. There's four or five of them.
Alex: So, one is look, becoming more outcome based is a process, it's not a switch, right? Don't have any misgivings that this is going be a year's long process that ultimately has no destination, right? And you have to orient yourself that way. The second is that customer selection, especially at the outset really matters. Finding customers or partners who want to work with you, who are willing to accept that things aren't going to be perfect right away, who are going to serve as case studies for you as you make the case internally and externally is hugely, hugely important.
Alex: It also means that segmentation and specialization within vertical segments also matters. You’ve got to be an expert. The way that you handle a healthcare system and the way that you handle an automotive facility, the outcomes they're looking to drive are going to be different and you have to be able to understand that.
Alex: Two others, one is that designing for services is key. So we work in an equipment, historical equipment manufacturing company that makes the best products, and one of the big keys to being able to drive this type of change is having the services team, having a seat at the R&D table, at the offer generation, creation table very, very early on, making sure that services isn't an afterthought. And we've pushed really, really hard for that seat. And I think that, that's been critical for us being able to build the momentum.
Alex: And then the last one is that I will say that internal selling is as important, maybe even or more as external selling. Again, your customers are pulling you along. Customers want this. I mean, this is where they're going this year. And that repetition, that setting the picture, that storytelling I think has been equally, if not more important, for the success we've had so far and enabling us to maintain that momentum. That's in so many was at the heart of sale.
Sarah: Mm-hmm (affirmative). Okay. Jerome?
Jerome: Alex covered that. But for me probably... I mean, I would say that for sure the outcome based services potential is exciting in the coming year. And we look at what is your current portfolio, and as mentioned by Alex, based on what is your market or what is your customer landscape. What is relevant for your customers in terms of services based on this portfolio? Do you need to partner to expand your value prop, because you cannot deliver an outcome by yourself if your portfolio is not enough or do not bring enough coverage.
Sarah: Right. So expanding the value chain?
Jerome: You need to change your value chain or adapt your value chain depending on the outcomes that you want to deliver versus what you have in your portfolio currently. So think about that before moving into this journey. I think it's important strategically. And then you can find the right alliances or partnerships to enrich your portfolio and deliver this outcome. But there's partly some work to do in terms of marketing intel to look at this portfolio versus the outcome based that you want to get.
Sarah: Okay. Good. Jerome, Alex, thank you both so much for being here. Plenty of areas that we could dig into further, so we'd love to have you back at some point if you would be willing. But thank you for coming and sharing your story today.
Jerome: Thank you.
Alex: Thanks for having us, Sarah.
Sarah: Yes. You can learn more about the journey to outcomes based service by visiting us at www.futureoffieldservice.com. You can also find us on LinkedIn as well as Twitter @TheFutureOfFS. The Future of Field Service podcast is published in partnership with IFS. You can learn more about IFS service management by visiting www.IFS.com. As always, thank you for listening.