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November 14, 2022 | 5 Mins Read

Reflecting on the State of Service in 2022 to Plan for 2023

November 14, 2022 | 5 Mins Read

Reflecting on the State of Service in 2022 to Plan for 2023


By Sarah Nicastro, Creator, Future of Field Service

IFS recently published its State of Service 2022 Global Report, which surveyed 400 CIOs, COOs, VPs, and Directors of Operations, Field Service, Digital Transformation, and Information Technology across Manufacturing, Service Provider, Telecommunications, and Utility Organizations in 24 countries. I had the opportunity last week to reflect on some of the State of Service 2022 report findings on a live webinar with WBR, but I also wanted to share with you here some of the points that stood out to me most. 

The first point is how respondents describe the top competitive differentiators in service. Companies across industries have recognized that service has a powerful impact not only on customer satisfaction but also competitive differentiation. What did respondents feel contributed most to their competitive differentiation, though? Companies reported that technological superiority has become a deciding factor (29%), followed by CX (26%) and operational excellence (18%). 

What’s perhaps most interesting here is that the last time this same question was asked, in 2018, technological superiority was ranked fourth – and it’s now first. We know that when well-embedded and adopted, today’s technologies help companies master both operational excellence and CX. It has an immense impact on both of those points, which is why I think its capabilities as a differentiator are ranked first in responses. 

These areas of technology superiority, operational excellence and CX are all intersected – and it would be highly unlikely for a company to be strong in one area without being strong in the others. Companies are learning that technology-enabled service delivery is key to meeting today’s customer expectations, which include the operational excellence that leads to on-time arrivals, first-time fix, and knowledgeable frontline workers. 

The Top 5 Issues Facing Service Organizations Today

So, what stands in the way of companies achieving competitive differentiation? According to survey respondents, here are the top five issues facing service organizations today:

  1. 46% struggle to meet customer SLAs
  2. 40% are struggling with a lack of skilled workers
  3. 37% struggle with change management
  4. 37% are dealing with outdated or insufficient service management technology
  5. 29% are grappling with how to create as-a-service offerings

How do you relate to this list? Maybe you feel some solidarity. 

There are a number of factors to consider in solving each of these challenges, but since this is an IFS study let’s stay on the technology topic for the moment. No, technology can’t singlehandedly solve each of those challenges, but it certainly plays an important role. If you take, for example, IFS’s Planning & Scheduling Optimization solution, it directly impacts three of these five top challenges – by maximizing efficiency, it helps combat the skills gap by maximizing utilization of the existing workforce. With its self-learning and dynamic scheduling capabilities, it considers a wealth of criteria to ensure you meet customer SLAs by eliminating unnecessary travel, increasing first-time fix, and leveraging automation. 

And for companies like Cubic Transportation Systems, tools like IFS Planning & Scheduling Optimization are setting the stage for the creation of new service offerings. You can read here about how Cubic has successfully migrated to delivering outcomes-based service. 

Upcoming Areas of Technology Investment 

The challenges companies are facing are reinforced when looking at the top areas of focus when it comes to technology investments across respondents: 

  1. Remote Assistance Using Augmented/Virtual/Merged Reality
  2. Wearables
  3. Knowledge Management
  4. Simulations
  5. Scheduling Automation & Optimization 

Personally, I’m really excited to explore more the potential that Remote Assistance/Augmented Reality brings when it comes to the challenge of recruiting talent. Not only can the technology have a significant impact on how companies train new employees and offer them expert support on the job to speed time to value, but I believe in the coming years we’ll see significant development in remote service as a first response, reducing the burden on the frontline and eliminating unnecessary on-site visits. 

Roel Rentmeesters, VP of Digital Transformation at Munters, describes the potential of remote service well, “When you want to reduce downtime, you cannot permit yourself to send a technician who goes on site, has to travel for two hours, does a diagnosis, comes back, orders a part, goes for a second time to fix it. You don’t have that luxury anymore,” he says. “Remote Assistance can help reduce downtime, because that technician that did one visit during the day, using remote technology can maybe serve 20 customers that day.” 

Top of Mind for 2023

So, based on where we are – where are we going? IFS asked survey respondents, ‘Over the next 12 months, which will be key areas of focus for your service business?’ and identified three clear top initiatives:

  1. Sustainability
  2. Updating Legacy Service Management Systems
  3. Leveraging Emerging Technology

I think numbers two and three are quite self-explanatory based on what we’ve already discussed – and the need is likely exacerbated by economic turbulence and a recognition of the improvements in efficiency and productivity that can come from a technology investment. 

In terms of sustainability, I am happy to see this was listed as number one. While there’s ample reason to put better emphasis on sustainability strictly for the sake of our environment, we’ve discussed on the podcast several other reasons companies need to be putting more thought into this area. There are regulatory pressures that are heightened already in some regions and will be ramping up in others, and there are also concerns around investment decisions – some investors are putting sustainability into their criteria. It’s also important to consider customer preferences and opinions – in many industries, customers are now demanding visibility into a company’s sustainability initiatives and choosing where to spend their money based – at least in part – on that insight. And finally, there does exist for some service organizations the ability to develop new offerings around sustainability to help your customers with their initiatives – creating a new potential revenue stream. 

There are plenty more interesting insights in the full State of Service 2022 report, which you can download here