joanna.darby@ifsworld.com, Author at Future of Field Service

Sarah shares her personal reflections and highlights from last week’s IFS Unleashed customer event in Miami.

Sarah Nicastro: Welcome to the Future of Field Service Podcast. I'm your host, Sarah Nicastro. I am recording this episode here at the Miami Beach Convention Center in South Beach, Miami, Florida, where we are in the midst of wrapping up IFS Unleashed. It has been a very exciting, very energetic, very fulfilling, very informative, and very exhausting week here in Miami at the IFS Event. IFS traditionally has done what it has formerly called its World Conference Events every 18 months, but, obviously, with the pandemic, those didn't happen for a bit. So this is the first IFS Customer Event since the fall of 2019, and it's been rebranded to IFS Unleashed, focused around how IFS is helping customers unleash their potential, and it was just a wonderful, wonderful event. So I wanted to record a podcast and just talk about some of what I've experienced here this week. I myself have done a horrible job of being on social media, taking pictures.

I've been running from one thing to the next and really just focused on spending quality time with a lot of folks that I have not had the opportunity to see face to face in quite a while. So I have some notes that I'm going to glance at and they're in no particular order. I just wanted to go through some of the things that stood out to me personally this week. So when Darren Roos, the CEO, kicked off the event on Tuesday morning, he started with an image behind him on a huge stage of a tent. And if you've never heard the story of the tent at IFS, it's about how the company's owners early on in the days the company was created, actually put a tent outside of a customer location and camped there to deliver a project they had committed to. I've always loved that story. I think it really speaks to the customer centricity being at the heart of IFS all the way from its beginning. So I loved that, that image was up there from the beginning of the event and really reinforcing that story and what it stands for.

I also really enjoyed Marne Martin, who is the President of Service Management, Enterprise Asset Management, and Global Industries at IFS, did an all woman panel with two IFS customers, Susan Stevenson from NUCO2 and Martina Schoultz from Gilbarco, and it was a great conversation. I just also really admire the fact that anytime she can, Marne looks for ways to lift up and draw attention to the women in still a male dominated industry that are doing amazing, amazing things. So it was great to see Marne, Susan, and Martina chat about not only business transformation and digital transformation, but just what the landscape is like today for women who are in leadership roles.

Michael Ouissi, the COO of IFS, had a session yesterday morning, Wednesday morning, where he brought up a number of IFS customers to share a bit about their journeys, and one of those was Sasha Ilyukhin, who is the Senior Vice President for Customer Service Operations at Tetra Pak.

I myself have had the opportunity to interview Sasha before on this podcast a couple of times, But one of the things that Sasha said during their chat really stood out to me, which is in a business as complex as Tetra Pak's is they have to relentlessly drive towards simplicity. I really like that point because I think it's important and true in more than one way. Certainly, from a technological perspective, companies need to be looking for ways to reduce complexity, but also within the organization, within how you're communicating, within how you're managing and what those relationships look like. Are things clear? Is there ways to eliminate confusion, eliminate complexity? So I thought that was a very, very good point. We had the opportunity to be joined here yesterday by Michael Phelps. It was really, really cool to see him speak. I greatly admired his authenticity and his vulnerability.

He shared about his ADHD and his anxiety things I also have, and I just really appreciated him being vulnerable, being open talking about what has gone into him winning and succeeding as much as he had, but also what has gone into some of the challenges and some of the really hard parts of it. He was just very, very open and honest, and it was a really neat experience to have him here with us and sharing his story.

I led a number of sessions myself this week. I had a panel discussion with Sasha from Tetra Pak, that I mentioned earlier, Roel Rentmeesters, who is the Vice President of Digital Transformation at Munters, and Marc Ringwelski, who is the Head of Rema Tip Top's Smart Services Division, and we had a conversation about transforming service from the inside out and talking about some of the things that tend to happen when we don't focus on some of those internal components.

So not only setting a strong foundation with our technology and making sure that it's solid before we look for those ways to leverage it and really provide that external value, we also talked a lot about change management and how important it is to get that right. It was a really great conversation. I also had a session on the influencer track with Jorge Mejia, also from Tetra Pak. Jorge is leading Tetra Pak's next generation service management project, and the influencer track session at IFS Unleashed is a track of press and analysts. I personally always find it fun to present on that track because I used to sit in that audience before I was a part of Future of Field Service and IFS, and it just gives the press and analysts an opportunity to have some dedicated time with the speakers and be able to hear a bit more, ask them questions. Jorge gave them really an inside look at some of the details of Tetra Pak's service transformation or NextGen Service Initiative, and that was a lot of fun as well.

We had Tuesday night some beach parties. I may or may not have had too many tequila seltzers that evening. It was a lot of fun. And Wednesday night there was a big customer appreciation event at the Frost Center here in Miami. It was a beautiful place with a planetarium, a multi-level aquarium, a ton of entertainment. It was really fun, and most importantly for me I had an opportunity both in planned sessions and meetings and scheduled time, but also just at random in the hall at the parties and events to run into people that really mean a lot to me. A lot of friendly faces that I had an opportunity to reconnect with, some for 30 seconds and some for far longer, but really appreciated being able to see those faces and reconnect. I think that was really what the energy this week was a lot about. I think people just seemed so excited to be here, to be together, to be learning from one another, sharing stories of success and trials and tribulations, and hearing what IFS and IFS's customers are up to.

It was a wonderful week. I'll certainly plan to do some additional follow-up content stemming from the event and getting into a bit more detail on some of the topics. But while I'm here, I wanted to record this and report in with a bit of I guess a video diary of how the week has gone, because I haven't had my phone out much to be capturing a lot of the moments. I've been busy living them. I am actually taking some much needed time off next week to spend with my kiddos when I get home, so while you're watching this or listening to this, I will actually be in Disney World for my very first time and my kids very first time. Appreciate you tuning in and we'll look forward to presenting more soon. In the meantime, you can visit us always at futureoffieldservice.com. You can find us on LinkedIn as well as Twitter at The Future Of FS. The Future of Field Service Podcast is published in partnership with IFS. You can learn more at ifs.com. As always, thank you for listening.

Sarah welcomes Alec Anderson, Managing Director of Koolmill Systems, to talk about how his company is disrupting the rice milling industry – not only with its innovating rice milling machine, but with an As-a-Service go-to-market strategy.

Sarah Nicastro: Welcome to the Future of Field Service podcast. I'm your host, Sarah Nicastro. Today we are going to be hearing a very “cool” as-a-service story, which is the story of Koolmill. I'm excited to be joined by Alec Anderson, who's the managing director of Koolmill Systems. Alec, welcome to the Future of Field Service podcast.

Alec Anderson: Thanks, Sarah. Nice to be here.

Sarah Nicastro: Good. Thanks for being here. Okay, so I'm excited to share your story with our audience, because there are a couple of really interesting aspects to it, and we were introduced by James Galloway at BDR Thermea, who was on the podcast not too, too long ago, and I'm really glad that he suggested I connect with you, and that you agreed to join me here. So before we get into the Koolmill story, tell our listeners just a bit about yourself and your background.

Alec Anderson: So yeah. How did I end up in rice milling and doing machinery as a service? That's a good question. I started off as a marine engineer, when I left school. I was a qualified marine engineer, but that was a dying trade, so I went back to university as a mature student. During my vacation between second and third year, I went to work for a local company for summer vacation job for 12 weeks, became a final year project. I joined the company, and I bought the company, and here we are now. Rice got the hook into me there somehow.

Sarah Nicastro: Okay, yeah. So let's explain to our audience. So tell everyone what Koolmill is, and what industry you're in, because obviously our audience reaches across a variety of industries. So you're definitely going to have plenty of people here that are not familiar with the rice industry.

Alec Anderson: And that's not an unusual story. Rice is a huge global industry that feeds half the world every day, but it's not known for it's as a service opportunities. Koolmill is a small, family owned business based in the UK, and we've developed a novel disruptive technology, a paradigm shift if you like, in milling technology. And effectively, we are trying to transform a global food system, move it from a wasteful current position into a more sustainable future position. And that really depends on doing things differently, both in the physical sense, and then also in the business model sense.

Sarah Nicastro: Yeah. Okay. So we're going to talk a little bit more about some of the competitive differentiation that Koolmill has. Before we do that though, being that our audience won't necessarily understand of the market trends in the rice milling industry, just from very high level, explain what some of those pressures, challenges and opportunities are.

Alec Anderson: Yeah. So rice is a very conservative industry. So after 8,000 years of rice processing, we are the thumb generation in technology, and the current mechanized machines that are bound today, what introduced around about 160 years ago, and have evolved over that time, but effectively they're all based on those early machines.

So rice has saw a number of problems. There's enough rice to feed around about 600 million people, is lost each year from farm to fork, and that's due to poor storage, drying and processing, and we can help address the losses in processing, and the estimated loss is around $127 billion a year, or something like that. So these are massive numbers, and we need to do much better.

Sarah Nicastro: So there's an opportunity to improve the technology, which will reduce waste. Right? It is one big area of opportunity. And I think we'll get into this more later, but just to sort of set the stage for folks, when it comes to the organizations that are milling rice, and where that happens, and how it happens, there's some aspects of the industry that make it possible for huge corporations to do that, and leave a lot of people out of the realm of possibility. Right? So can you kind of explain the landscape, from that perspective?

Alec Anderson: Yeah, so the current state of the art in the industry, that's probably around about 50,000 large millers globally, and they're very highly capital intensive. Not necessarily digitalized, but quite automated in many instances. But to run that kind of operation, you need lots of money to buy it in the first place. You need lots of rice to keep it running, and you need a huge amount of infrastructure and power to support it.

Now, there are around one and a half million SME processors globally, if you don't have access to those three requirements. So they're kind of locked in to using antiquated and wasteful equipment. In fact, we were in Nigeria earlier this year, and they were running machines that were made in the 1870s, still driven by diesel. So they're kind of locked into what they have, or if they do replace, they replace like with like, because they don't have access to this high performance, state of the art, modern equipment, and we aim to try and change that.

Sarah Nicastro: Yeah. Okay, I did a horrible job of setting that up for you, but you did a wonderful job of explaining it. So there's opportunity in the sense of within the industry, there's a lot of waste.

Alec Anderson: Yes.

Sarah Nicastro: And so there's opportunity, both in the machines and in the process, to minimize that waste, which will of course help us feed more people in the world. Right?

Then, from a competitive landscape, you have these large corporations that can afford the most modern equipment, or if even a couple of generations more modern than the 1800's, right? But anyone that's at the small and medium size, that is attempting to play in this space, is kind of boxed out just based on the cost of the equipment itself. And so Koolmill is disrupting the industry, both in the sense of offering a machine that meets the needs of reducing waste, and then also offering a new business model that equalizes the ability for companies to compete and to produce. Okay? Did I explain that correctly?

Alec Anderson: Yeah, you've got it. So basically, I think maybe a better way to explain it is these large mills are large, and you can't scale them down and retain the level of performance. They're just not viable.

Now, one of our unique points is that we can scale down without loss of performance. So whether we're milling a ton an hour, or we're milling at 100kgs an hour, we have the same performance, and that's revolutionary in the industry. So basically I think probably three aspects to Koolmill. One is reduction in power, which is obviously very critical right now. So we're looking at upwards of 90% reduction in power.

We're looking at producing more food from the same input from the harvest, and increasing the value of that output, because more there's a higher quality. So we have a quantitative improvement in quantity, and we have a qualitative improvement in the quality of the output, which is higher value, and that all builds to better revenues for these smaller producers, and also for the growers.

Sarah Nicastro: Okay. So perfect. So the machine that Koolmill has developed improves those three areas. And when you talk about quality, we're talking about nutritional content of the ultimate output of the rice, right?

Alec Anderson: Because another aspect of Koolmill, we call it Koolmill, because we mill cold. We mill cold because we don't waste the power, which comes out as heat in a conventional machine. There is some evidence emerging that the cold milling retains more of the micronutrients, so that then produces potentially a more nutritious food product.

Also, our bran that we produce is very clean, very pure, and doesn't deteriorate after milling. So that enables that to be valorized into again, a human food ingredient, rather than as currently, mostly goes to food for animals, because it's basically gone rancid. So these are all things that increase the value creation.

Sarah Nicastro: Okay. And so those are how the machine itself is a competitive differentiator. Let's talk a bit about the decision to leverage the as a service business model, and how that is also a competitive differentiator, and a real change in the rice industry. So talk a little bit about that.

Alec Anderson: Yeah, it's a really interesting one, this, because I guess we hadn't heard the term Servitization before, and what we found when we did hear that term was they'd actually been doing it for many years, we just hadn't been charging for it. So we've been providing the machinery, providing the engineers, providing the consumables, and that was really necessary because of the development of the machine had to be in a rice mill, because of the quantities of rice that we needed to do that.

We spent a lot of time working with large customers, trying to sell them a machine that we didn't understand, that they didn't actually need, because they already had the best of what was already there. And then we started to look at the smaller users who had the need, but we find there's no point in having great technology if nobody can afford to buy it.

And we had two primary barriers. One was a perceived technology risk. We're a small company with a novel technology, nobody knows us, nobody knows our technology, and that creates some reluctance. And also we were perceived to be a high capital cost, which none of these are true, but the perception is harder to argue than the facts. So we became involved with the Advanced Services Group at Aston, and we started to work on this pay as you mill service, or the machinery as a service business model, very similar to world wise powered by the hour, where we've evolved to know we guarantee hours in exchange for a fixed fee.

So that offers these small operators cost certainty. We have the technical risk. They know what it's going to cost them, and it takes away the need for capital cost as well. So it's an enabler, an empowerment. It empowers these small producers now to compete on pricing and quality with the large producers.

Sarah Nicastro: Yeah. Okay. So we're going to talk a little bit more about that. Before we do, I want to talk about, you brought up to me three aspects that were key to making the as a service model work. So the first is connection to the machines. So talk a little bit about that.

Alec Anderson: Yeah. The whole service model is basically underpinned by connectivity, digitalization, and clearly if we are going to guarantee a certain number of hours per month, it's important that we understand what's actually happening on the machine, that we can work preemptively if things are going wrong, to mitigate any downtime, and to maximize value.

When you move to a service model, you're really moving away from the conventional transactional sales, which is a confrontational business model. I want lots of money, you don't want to pay me any money, and we try and meet somewhere in the middle, and you never see me again once I've got your money. Whereas the service model's really based on very much a strong collaborative, long term partnership, where both parties are aligned in the outcome, either successful or not successful. Hopefully successful.

Sarah Nicastro: Well, and to your point that you mentioned earlier and just now, there's risk sharing. Right?

Alec Anderson: Yeah.

Sarah Nicastro: So that helps you in terms of eliminating or negating that perception that's out there. What is this new innovative thing? Could be great, might not. I'm going to just stick with what I know. Right?

So when you say, "Yeah, but listen. We're not asking you to pay us this huge, upfront capital investment. Try it out and see if it works for you, and we'll share that risk." I mean, this is an area of moving to as a service that is really, I think, a huge opportunity. But it is an area that existing businesses that have a legacy, are very, very uncomfortable with. Right? Because it's just completely different. Right?

But there's no risk, no reward, I guess is what they say. Right? And so for you, it's been beneficial to share in that risk, to introduce something different to help these companies find a new way of working. So, sorry. I just wanted to point out the risk part, is a part of this that for a company that's moving to this model, there is no way around that. Right? If you're guaranteeing an outcome, there's no negating that risk. There's no way to do that without accepting some risk, and that's just part of this that we need to get past, as an industry, with companies that are going in this direction. Okay. So sorry, I interrupted.

Alec Anderson: No, but I think just picking up on the risk point, yes. The risk is there. There's always risk. Things will go wrong. The question is how do you deal with that risk? How do you write your contracts to deal? And again, if you have this strong collaborative partnership, so say for instance if we had a customer with five or six machines, we may put seven or eight machines in, so that any time, a given number of machines is working. Nobody knows your machinery or whatever you're making better than you do. But a lot of manufacturing right now is designed for manufacturer. How can we reduce the cost of manufacturer? How can we reduce the materials? How can we reduce everything, to make it as cheap as possible? We're trying to do a cost plus offer.

We take the opposite view, and moved to a value creation. So if I can look at the value I can generate from a machine over its life, rather than just selling it once, can I change the way I design that machine? So design for service. Can I design it in a modular way, so that anything that fails on a machine can easily be changed? As we already touched on, digitalization, the ability to remotely monitor, capture data, to pick up at an early stage things in data that a human being wouldn't be able to detect, and to make proactive management, rather than reactive management, which is where lots of companies are at the moment.

I think if you were in a traditional industry that's already selling equipment, it's probably a bigger change than it is for us, because we came in clean. We weren't selling anything. We are a new technology, so it's easier for us to start. But I think you have to think about the creation of value. How can you create that value? How can you capture a share of that value? And if that means redesigning the machine so that they can have a longer life with more service, and I think the world is moving away from the disposable, buy it, scrap it, get another one. If you can design machinery that has a longer life, and it can be upgraded through its life, I think there's great value there.

Sarah Nicastro: Well, there's great value in the sense of, like you said, you're moving into a relationship. Or for you, you've created a relationship. I understand it's different context here, because you're not moving away from a legacy, but a lot of our audience is, which is why I'm bringing up some of these points. You can imagine having done this from fresh, how hard that is. Right?

But when you create this partnership, and you are now moving away from, "How do we do it fastest, cheapest, and make the most money up front?" to, "How do we create the most mutually beneficial working relationship for the long term?" You build the machinery different, which helps you in servicing it, and guaranteeing the outcomes, which helps your customer. But there's also a huge environmental impact, because the additional investment that is required to create machinery that is intended to last longer is something that, in a traditional model, no one's willing to accept the cost of. Right?

And so this allows organizations to really transform the way that their operations are affecting the environment, without forcing themselves or their customers to accept that cost. I mean, they both are, but that's because you're moving into a model that makes that far more feasible. So I think that's really interesting part of the discussion too, is there's another benefit here, which is to the environment, and moving away from that consumable mindset, moving away from just turn and burn, create cheap, sell it, we don't care what happens after that. Right? So that's a really interesting aspect of this, as well.

Alec Anderson: So I think our machines are designed not to be scrapped, but they're designed to come back and be re-manufactured. So there is no end of life cost, because theoretically there should be no end of life. But it's minimal in that re-manufacture, you want to minimize the amount of materials that have to be recycled.

I think just to pick up on your cost point, it's really interesting, wasn't it? Because it comes back to the focus on cost reduction, rather than value creation. If I'm going to build something at a cost, and then I'm going to put a mark up on and sell it to you, it's an issue because the higher the cost, the more difficult it's for you to buy. If I, on the other hand, I'm not selling you that. Then the cost of the initial machinery is less of an issue. It becomes an asset finance question now.

And where I would argue is, forget the cost of the machine. What is the value that machine's going to create over its next 5, 10, 15 years of life? And when you look at it from that perspective, the cost of the actual, physical build is generally insignificant. So one of our machines may cost 10, 15, 20,000 pounds to make, but over its life, it's going to make process 50, 60 million pounds worth of rice. So the cost versus the value is really the key driver, and it's really changing that focus, because right now everybody's focused on, "Let's get the cost down."

Sarah Nicastro: Yeah. No, it's a really good point, and here's what I want to ask you. So you know, you brought this up when we chatted the first time, which is you have to educate people in this context, customers, that productivity is not only about reducing cost, but increasing value. Right? So we're programmed to think increased productivity means reduced cost, but in increased productivity can also mean increased value. Now, you're not battling an internal legacy that you have to overcome with what Koolmill is doing, but you are still battling a legacy mindset, in the companies that you're selling to. So how have you shifted that narrative?

Alec Anderson: Slowly. As I said, we work in a very, very conservative industry, and I would say our challenge right now is not a technical challenge. It's really a culture or mindset. It's changing the perceptions and how people think about. And if you think about it from their perspective, here's this small company from England coming and telling us we've been doing it wrong for a hundred years. You know?

So it is a lot to take in, and there is another problem I think, in that your sort of intermediate management level, their power base is based on their knowledge of the existing technologies. And when you come with a new technology that's very disruptive, it's highly digitalized, I think there's a fear there that the younger generation will pick up that new technology, and more quickly, and that will devalue their power base, if you like. So you have to work very constructively with these people. They could be the blockers, the saboteurs, to try and make them the hero of the story rather than the villain of the story. But it can be very challenging, and I guess if you are already got an established supplier-customer relationship, then changing that barrier, or getting through that barrier is going to be probably harder than it is for us.

Sarah Nicastro: Yeah. That's a really good point. I mean you're able to come in as a fresh take. Right? "Hey listen, we don't work together, but let me tell you about this." I'm not saying that's not hard, but one of the biggest objections or roadblocks that I hear from organizations, that maybe recognize the potential of as a service but are struggling to understand how they could get there is, "Well, our customers aren't going to be willing to pay for that. Our customers aren't going to be willing to allow us to connect and implement remote service, because they pay us for hours on site. Our customers are..." you know? And it's because they haven't figured out how to change that dialogue, and what goes into having that conversation constructively. And it isn't just about figuring out what goes into it.

I mean, there's a lot of factors here. I said, "How have you handled it?" You said, "Slowly." So there's a lot of patience that has to be at play here, and I think it's really interesting that you bring that up. I've been in this space for, I don't know, 14-ish years, and I get asked all the time, "What's new? What's cutting edge? What's the next big technology?" Right? And I think like you said, the technology is there. Okay? There is capability in technology, accessible to organizations today, far beyond what they are prepared to use. So we should not be focusing so much on AI, and what's next, and we should be talking about the cultural, and people, and mindset shifts that are preventing companies from making use of what exists today.

So when I think about, "Where are we going over the next five to 10 years?" I'm always asked for predictions. I hate predictions, but that is where the change comes in. And the reason that we're as media, or as thought leaders, still talking about the same concepts that we started talking about 10 years ago is because you're talking about foundational business transformation, that takes a lot of time because there's so many layers to it.

So I think it's a really good point that you are not tied to that legacy, as the owner of Koolmill, and that makes your remit maybe a teeny bit easier than companies that are. But overall, we all need to understand this isn't just a vision and a strategy that you put in place and boom, you go execute, and in six months or 12 months, you are an as a service business. This, it takes time, and we can't allow ourselves to become discouraged, or not believe in the power of the business model, just because it's not easy to get there. Right? So what do you think about that? That was a lot of words. I'm sorry.

Alec Anderson: No. Look, we live in a very fast world. Fail fast, move on. I don't have a problem with that, just define fast. So for us, a hundred years is fast in rice milling, but it does take time. And also I think if you're in a transactional sales model, where I make a product, I want my profit, I want to sell it to you, often that's where the story ends.

What do you do with my product? How much value does my product create for you? How can I enhance that value? How can I capture my share of that value? And so one of my customers said to me, "Look, I like your machine, but the price has to be fair." And I said, "Yes, fair to who? Fair to you, or fair to me, or fair to us both?" He said, "Well, just charge me what it's worth." And I said, "Well it costs you about $750,000, then borrow a machine. How many do you want?" And he wasn't so keen then.

So you have to understand, or maybe think about things from a different perspective. If you are delivering something to a customer, what value are you creating for that customer? Do the skills and knowledge that you have, and perhaps by adapting your product, by adding extra features to that product, can that create more value for them? If you don't understand your customer and how they use the product, and how they create value with your product, then it's very difficult to justify a service model. But if you have that knowledge, and you have that cooperation. So I guess the key aspect, you're just finding that initial customer to work with, who you can be very close, very transparent. We are very open with our customers. We'll show them what it costs to make a machine.

Everybody asks me, "What's a machine cost?" It doesn't matter. It's not relevant. It's, "How much will it earn you?" is a much better question.

Sarah Nicastro: Right.

Alec Anderson: So there's the challenge. Now again, I think going back to what we said earlier, much easier for us because we're starting from scratch. Much more difficult where you have established practices, and if it isn't broke, don't fix it. That's a saying here in the UK, and people like to just do what they've always done. There's no thought required.

Sarah Nicastro: Right. For sure.

Alec Anderson: But the margins, or the additional revenue potential is significant. And again, it comes back to that capture of the value. Capturing your fair share of the value.

Sarah Nicastro: I think the point about transparency is a really good one too, because if you were having those conversations, and your answer stopped with, "It doesn't matter what the cost of the machine is. What matters is this," you're not resolving that objection as successfully as if you say, "Well, I can tell you the cost of the machine doesn't matter. What you can earn with it does, but it costs X," because you're not hiding anything. You're not trying to get one over on them. Right?

And so that's another part that I think is a big mindset shift in how this is sold though, is that value creation conversation, and the shared risk, but it's also the honesty. Right? We're very accustomed to these negotiations, and, "Don't show your hand." And this is just, it's different. And if you can be upfront about, "Yeah, the machine only costs this and we're charging you this, but what you can do with it is this," and believe in that value proposition, then you know you can start a real conversation, versus trying to seem that you're hiding something or whatever.

Alec Anderson: That's key, but I think trust is the word there. You have to build that trust, and that, again, takes time.

Sarah Nicastro: Yeah.

Alec Anderson: And so we are lucky that we've been doing this a number of years now, and we've developed very strong relationships, both in a supplier. So we don't have customers and suppliers, we have partners. Our supply chain and partners, and our end users. So it is really that commitment to that partnership.

And I think again, we are a small company, so it's easier for us. Everybody's on board with the whole concept, and that's all they've ever known in the company. So if you were in a conventional existing company, with a conventional product, it's really important that this is driven from the top down. You can't push it from the bottom up. It's got to be a commitment, and it's got to be a genuine commitment, not just a dressing.

Sarah Nicastro: Yeah. For sure. So one of the things that I really, really like about your story, Alec, is when we chatted the first time, you referred to this as your ability to create a more virtuous cycle. Okay?

And so talk to us about how you see the as a service business model, and what Koolmill is doing with it, as a way to equalize competition among the really, really large rice milling companies, and the small and medium size. Tell us a little bit about what you're doing there and the way you view that.

Alec Anderson: So in terms of the virtuous circle, there's a number of things. So we have three pillars. There's economic, there's a social, and there's an environmental. So right now, rice is one of the largest polluters in the world. It's equivalent to aviation. About two and a half percent of all greenhouse gases, and 10% of all methane emissions come from rice.

So one of our is about valorization of these waste products. So the bran, already we talked about, can be made into a human food ingredient. Straw can be used to make power, which can power a mill, which can provide a 24/7 power to a local community, from a waste material. And the rice mill produces high value employment, which means that people can now actually buy the electric that's now available to them, unlike solar, many grids where they don't have a job. They can see people with light, but they don't have money to buy that light and power.

So that's the one aspect. In terms of the environmental aspect, obviously by not wasting rice, that avoids the waste of the resources going into growing that rice. By reducing the power demand, that's a massive benefit. And also the bonding of the straw, the methane from the degradation of the straw.

But perhaps in terms of building the social capabilities, we call it rural industrialization, where we can use that rice mill as a focal point, as a employment generator, as a means of creating and retaining value at a local community. So rather than a rice farmer right now maybe getting 25 cents a kilo for their rice, if they could turn that into a viable mill product, they're worth a dollar a kilo. So we could transform their livelihoods. So I think at the SDGs, we would say we address 16 out the 17. If we can put one on a submarine, we might get 17 out of 17.

So this is really a transformative technology. It can transform this global food system, and that's really critical because by 2050, it won't be three and a half billion people rice is feeding. It'll be 6 billion. Asia has a lot of issues right now, in terms of land stress and water, and weather events, and contamination. So we don't have enough rice. I think the FAO said we have to increase rice production by 70% to meet the demand by 2050. So it's really fundamentally important that we don't waste what we are already growing.

Sarah Nicastro: Right.

Alec Anderson: We've got to get the best use that we can from that. And if we can use that as an empowerment tool to give these local communities a means to create a wealth or value, and redistribute, rebalance that value chain, reduce the food miles, reduce the power per ton, these are all growers. And then also at the added valorization of using these extra waste materials to create for those adds value. That's kind of how we see our virtuous circle.

Sarah Nicastro: Yeah, and just to dig into that a little bit, so we talked earlier, at the beginning about historically, these large rice mills can afford the latest technology, they're doing a ton of output. Now they might not be doing it in a cost conscious way, or an environmentally conscious way, but they're just focused on in and out, in and out production, high volume. Right? And the small and medium size rice mills have struggled, because they cannot afford that technology. They struggle to create that output, et cetera.

So by leveraging the as a service model, you're equalizing that competition a bit. You're making it possible for those small and medium sized businesses to invest in the latest and greatest technology, in the same way that the large companies could. And then that gives them the opportunity to improve their output, improve their value creation, without that challenge of not being able to afford that capital expenditure.

I don't know if you're willing to share this example, but I know you told me, when we spoke, that you have had folks ask you to buy the equipment outright, and you have not allowed that to happen. Can you talk about that, and why that is?

Alec Anderson: Rice industry is very large, but it's also very small. So I think my feeling is we believe and are committed to our business model. The easy option for us right now would be perhaps to sell some machines to big companies, and just bank some money. But I think once we do that, we kind of shoot ourselves in the foot, and then trying to introduce the model will become significantly harder.

So it's tough, and you have to have a persistence, and belief, belligerence maybe. But we have a unique technology. It's patented, and so you can only get it from us, and we want to make it available to those that, perhaps the best impact is going to be with the smaller consumers. If you think about a lot, if we're looking at Africa in particular, or even rural India, you've got infrastructure problems. These big mills require lots of rice. So that means you've got to truck that rice for miles and miles.

Now in the states, they've got good road systems, great trucks, it's not a problem. In Africa, it's a major problem. They don't have the road infrastructure to haul that rice. So many of these large mills that have being built are not running at anything near their capacity, because they physically can't get enough rice to them, to keep them going. Now again, if you look at the macroeconomics, Africa should be self-sufficient in rice, yet imports enormous quantities of rice to replace rice they already have, because they don't have the physical capability to process that rice to an acceptable standard for the consumer. Therefore the consumer would rather pay a price premium to buy imported rice, rather than local rice.

So if we can increase the capability of these rural millers and bear in mind, going back to the macro, sorry to jump about, but of 750 million tons of rice that's grown each year, maybe 40 million tons will be traded as an export commodity. So most of the rice is grown and consumed in a very tight locality. So by improving that capability, in a distributed local sense, at a high performance level, then you don't need to be trucking that rice.

'Cause bear in mind, if you truck that rice out to process it, you got to truck it back in to the people who grew it in the first place, so they can buy it back their own rice at an inflated price, or they have to live with the very poor quality rice that the current capability can deliver.

So that's the sort of transformative impact we can have in those rural communities. And the large mills have a place, they have a good performance levels, but we can put those smaller mills into a position where they can actually exceed the performance capabilities of the large mills. And of course, the way energy prices are going right now, the reduction of power is significant, even for the big customers now, it's going to become really significant.

Sarah Nicastro: Yeah. Yeah, I think there's so many interesting aspects of the story, and I think you will see those large companies have more interest. It just maybe isn't the first line of opportunity, but I think it will definitely come. Right?

I think your commitment to the business model though is commendable, not only because you believe strongly in it, but also the way you perceive it as an ability to democratize innovation, so that those small and medium size businesses have it, just as accessible to them as it would be to the large companies, and because you believe in and understand its impact on the environment. So it's a really cool story, and a really commendable remit that you are committed to, focused on, being patient in seeing come to fruition. So I just think there's a lot to learn from this, both in a lot of ways you are a really good example of the disruption that's coming. Right?

So, people need to be aware of that and be thinking about it. Those big companies that are struggling to get away from, "If it ain't broke, don't fix it," well, maybe not.

Alec Anderson: It is broke.

Sarah Nicastro: Or somebody's going to come up with a different idea that is going to change the game. So we talked a little bit about the impact on the environment, and I just want to kind of recap there. So there's the less power consumption of the machines themselves, less waste.

Alec Anderson: Yes.

Sarah Nicastro: We talked about building the machines for serviceability, versus upfront cost. We talked about the impact of being able to get this equipment into some of these rural communities and minimize travel, maximize the opportunity for the local workforce, et cetera. Am I missing anything, from an environmental standpoint, that we should touch on?

Alec Anderson: No. I think the environment, obviously the way the world's going at the moment with the increase in temperature, I mean, one of the interesting stats is that for every one degree increase in overnight temperature reduces field yields by 10% for rice. So everything is a perfect storm at the moment.

There's more demand, and there's more problems about producing. So one of the things that we work with a partner company, they can take a husk, and they use pyrolysis to make a power or heating power. And one of the aspects of that is bio-char, and if we mix that bio-char with manure, and then reincorporate it in the ground as a natural ground improver, so it displaces chemical fertilizers. Again, with the Ukraine situation, there's a massive price hike in chemical fertilizers right now. But one customer we were talking to in Nigeria had done a sort of build out home bio-char unit, and had some really impressive results.

So he'd increased his field yield from two and a half tons to four tons, per hectare. But more importantly, when the drought hit, his rice didn't die because the carbon and the ground actually holds the water better. So we can mitigate carbon released by reducing the power, but you can also carbon capture that bio-char, re-enter in the ground becomes effectively a carbon capture process. So that opens up potential of carbon credits, trading credits in carbon. So these are all additional things that go into that value generation pot, and I think that's the key.

Now, just picking up on one of your earlier points, I think we are a family business. We're driven by our visions and value, so that gives us a lot of freedom to do things that perhaps bigger companies can't do. But we are a for profit company. We're not trying to save the world. Our intentions are to make a highly profitable, high growth, global business. But from a company that makes, we call it profitable purpose, we have a positive impact socially, economically, and environmentally. So why not make money from doing something good, rather than making money from something that's destroying our environment? So that's kind of our drivers.

Sarah Nicastro: Yeah. And it's a great point, because I think that there's increasing recognition that you can do both. I mean, doing good for your customers, and the world, and these local communities, and the environment does not have to mean that you sacrifice being a profitable business. It's the same way we talked about the difference in how you sell this. It's building partnerships, right?

Alec Anderson: Correct.

Sarah Nicastro: So it is creating mutually beneficial relationships, with an eye toward, "What's the social impact? What's the environmental impact?" and working to achieve that, with the partners that you have, that choose to work with you. Right? So I think that is a really good point, because I wouldn't want someone to hear your story and think that you're just a philanthropic organization. I mean, it has the potential to do good, and to make Koolmill money. So it's not either/or. It's and, both. Right? And so I think that's a good distinction.

Alec Anderson: So we would say we are not in this driven by money. We are in this driven by our technology has impact to make, and if we do a semi-reasonable job, the money will come. But that's the way around. So we are certainly not in the Bill Gates league, so we are not philanthropic investors. Let's put it that way.

But I think it's the old adage. If you give a man a fish, you feed him for a day. If you teach him to fish, he's fed for life. So it's really about this empowerment, and that release of that human capital that's frustrated right now. 'Cause if you look at Africa or India, or any of the Asian rural communities, it's all about human capital. Agriculture is such a massive part of their GDP, but they don't have any way of adding value, and that tends to be done sometimes out of country. So we are exporting all that value. How can we try and retain that value, and drive up that standard of living in that country? That's our key.

Sarah Nicastro: Yeah, that makes sense. So Alec, in closing, for anyone that is looking at the as a service model, and considering its potential, whether they're a new venture or an existing entity, any other lessons learned or words of wisdom that you would share?

Alec Anderson: Yeah. I've got lots of lessons. I'm not sure about the words of wisdom. I think you have to understand your end user, your customer, if you want to use that word. So you have to understand their business, and what's the business case for them. How do you explain? If you can't explain the business case, you're not going to get anywhere.

And I think when we look at the potential customers that we could have worked with, it's really important that you pick the visionary one. Some people have that visionary capability. They can see where they want to go, and some people are just trying to get through today, and we're not really worrying about tomorrow. So I think that initial choice, and who you're going to partner with to develop the model, because it is a development process. You can't just get one off the shelf and say, "Well, that worked for Rolls-Royce, and we'll just copy that in Koolmill, and then some days come along. Well, it worked in Koolmill. We can just copy that and do the same." You can follow the principles, but you need to adapt and deploy it to suit your particular product or industry, or what have you.

Sarah Nicastro: Right.

Alec Anderson: One size certainly doesn't fit all. But really, if you don't understand that value you're creating for the end user, then you're on a loser. And if you can't shift your mindset away from what you were doing, don't look at the past, look at what's possible now. Look at all the instrumentation that's available. Can I deploy that to create value?

If you can't create value, what's the point? Big data. What's the point of big data? It's just a lot of data. Is there any gold nuggets in there, that you can pull out and monetize? Because if you can't, then it's just nice to have, but it's not valuable. So these are the key aspects, I think. And be patient, and if you're not the senior management, you need to get that senior management buy in. There has to be a fundamental commitment in the company. This is where we are going, because this will create substantial revenue beyond where we are now, and that protects the future of the company.

Sarah Nicastro: Yeah, really good. Great stuff. I love the story. I appreciate you coming and spending some time with me, and sharing it with me and with our audience, and would definitely love to stay in touch and have you back some time, to hear how it's going.

Alec Anderson: That'd be great. Thanks for the opportunity. It's been great chatting.

Sarah Nicastro: Absolutely. You can learn more about servitization, and the path to as a service, by visiting us at 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 at IFS.com. As always, thank you for listening.

By Sarah Nicastro, Creator, Future of Field Service

Coming up on this week’s podcast, I talk with the Managing Director of Koolmill Systems, Alec Anderson. Now, I learned a lot from Alec during our discussion – and I don’t want to give that all away here because, well, then you won’t go listen for yourself when the episode comes out on Wednesday. But I do want to share some thoughts on one of the pieces of our conversation that stuck out to me, which is thinking about how Servitization allows for the democratization of innovation.

To give a little background with minimal spoilers, it is important for you to know that Koolmill Systems is a company that has created a disruptive machine for milling rice. I will admit to you that when I first heard what Koolmill does, I had a preconception that hearing the ins and outs of rice milling from Alec may be a little boring – and I couldn’t have been more wrong. It’s actually very fascinating!

Learning a bit about the rice industry wasn’t the only aspect of the conversation that was fascinating. What’s also interesting is Koolmill’s decision to go to market with an As-a-Service business model, which is also disruptive for its industry. There were a number of angles for Alec and I to discuss there, too, such as exploring the similarities and differences of a new market entrant selling As-a-Service versus the transition of a legacy business to the model. Understanding how the decision impacts Koolmill, its customers, and the environment certainly had my attention – but then Alec brought up how he views the decision to go to market As-a-Service as a way to level the playing field between huge players and the small businesses, as well as what he refers to as create a “virtuous cycle,” and I was intrigued.

The Competitive Landscape Shifts with Move from CapEx to OpEx

In rice milling, the significant capital expense of modern machinery is prohibitive to many businesses. “The current state of the art in the industry, that's probably around about 50,000 large millers globally, and they're very highly capital intensive. Not necessarily digitalized, but quite automated in many instances. But to run that kind of operation, you need a lot of money to buy the equipment in the first place. You need a lot of rice to keep it running, and you need a huge amount of infrastructure and power to support it,” Alec explains. “Now, there are around one and a half million SME processors globally who don't have access to those three requirements. So, they're kind of locked in to using antiquated and wasteful equipment. In fact, we were in Nigeria earlier this year, and they were running machines that were made in the 1870s, still driven by diesel. They're locked into what they have, or if they do replace, they replace like with like, because they don't have access to this high performance, state of the art, modern equipment, and we aim to try and change that.”

With pay-as-you-mill, Koolmill’s cutting-edge machinery becomes attainable for each of those SMEs. “Offering these small operators cost certainty is an enabler, an empowerment,” says Alec. “It empowers these small producers now to compete on pricing and quality with the large producers.”

With modern milling technology now within the grasp of SMEs within their grasp thanks to Servitization, significant opportunity is created. “We see the opportunity for a virtuous cycle in three pillars: economic, social, and environmental,” says Alec. “In terms of building the social capabilities, we call it rural industrialization. This is where we can use that small rice mill, now equipped with cutting-edge machinery, as a focal point, as an employment generator, as a means of creating and retaining value at a local community. With pay-as-you-mill, we have the opportunity to transform their livelihoods.”

This angle on the impact of Servitization hasn’t come up in my previous conversations, and I admire Alec for wanting to make sure that as he creates a successful business, he is also helping others along the way. It isn’t uncommon for companies to get so narrowed in on their financial viability that they overlook the ways in which they can perhaps achieve monetary success and have an impact – it doesn’t always have to be either/or. This conversation with Alec about how Koolmill’s decision to go to market with their innovative technology in an As-a-Service approach is leveling the playing field in the rice milling industry has had me thinking about all of the other areas that Servitization could democratize innovation as well. I think this angle is one that is intriguing to explore. What do you think? I’d love to hear!

Kevin Starr, North American Service Development Manager at ABB, joins Sarah for a conversation around Industrial Automation and how the education of today’s workforce must evolve while maintaining the core principles.

Sarah Nicastro: Welcome to the Future of Field Service podcast. I'm your host, Sarah Nicastro. Today we are going to be revisiting the core concepts of industrial automation. I will be honest, I have a lot of conversations on this podcast that I feel I know a lot about and I'm very comfortable with, this is not one of them. So this is good though because the reason this podcast exists is to learn and grow and expand. And so I'm excited for today's discussion. So today I'm welcoming back Kevin Starr, who is the North American service development manager at ABB. Kevin was interviewed for episode 59, so it's been a while, Kevin. Welcome back.

Kevin Starr: Thank you. Thank you. Well, I've got a great book for you to help with your understanding.

Sarah Nicastro: Yes. Yeah, and that's what we're going to be talking. By the end of the episode I should be an expert, so.

Kevin Starr: That's right.

Sarah Nicastro: Okay. So before we dig into the topic, tell everyone just a bit about yourself, your role, et cetera, and then we'll get into it.

Kevin Starr: Sure. My name's Kevin Starr. I've been with ABB for a while. I'd say it's 35 years. I tell people I started when I was five. It's been an amazing journey of automation troubleshooting and seeing the evolution of automation. And I've had the opportunity to work all over the world in all kinds of industries. And along the way I was able to learn process control and industrial automation and loop tuning. And I've been able to present the material, develop training classes, develop tools and software and solutions. And a book that I wrote, that was close to 30 years ago, has really resonated with the community and it's sort of having a resurgence as we're going into this kind of industrial revolution. So I get to work in the service space. I get to help customers improve production quality and reduce the cost to produce and help grab onto and hold onto our tribal knowledge.

Sarah Nicastro: Yeah. Okay, cool. So you recently re-released this book that you wrote for the first time, I think you said close to 30 years ago, right?

Kevin Starr: Yeah.

Sarah Nicastro: So, tell us a little bit about your journey writing the book. What was sort of the catalyst for the first round of writing it and how does that compare with the version that was recently rereleased?

Kevin Starr: Well, it's been amazing. When we started this journey, it's been, well a long time ago, 37 years ago, I was what they call a systems engineer where we do process control and startup of a paper machine. And we had a control system that you would have to configure. And I go into college and had a background in electrical engineering and a minor in process control where we had learned about root locus and Bode plots and poles and zeros and a lot of mathematical rigor, but the application of the real world just wasn't really there. And I went to this paper mill down in Vicksburg, Mississippi and the process control manager said, "You can't touch my machine unless you tell me how these numbers work." And I was like, "Oh, well here's my binder." I was given this binder, and we call it the golden binder. "Plug these numbers in, everything will work." And he says, "No, you can't touch my machine."

And I knew I wanted to go home eventually. So, I went and started cramming and studying and trying to figure out how to answer, what's a proportional gain, what's an integral gain, what's dead time? And so I was able to tell him that I knew what I was talking about. He let me set up his machine and it ran good and I could go home. And that was the spark really is like, "I wonder if anybody else is struggling with this?" And then as I was happened to move into instructing and teaching and people started asking questions about tuning, that's when we were going from pneumatic and four to 20 milliamp current loops into the distributed control system. And so the controllers were no longer operating once a minute, they were operating every five seconds or every second.

So some of the maybe sloppy techniques that we had grown up with weren't working. And those, I started teaching classes and then the students would say, "Hey Kevin, could you write this stuff down because we're taking too many notes?" So each class I would write it down. And then Jim Flading once said, "Kevin, if you would just write this as a book, we would buy it. And then I had a boss at the time that let me take several months to compile the information and the Single Loop Control Methods, loop tuning book was born. It is kind of funny, is the first book we sent it to a wordsmith to have them edit it and it came back with so many corrections. Their question was, is English your native language? I still find that funny, because I can't spell, I'm terrible at English. And yet I wrote a book. And that was 30 years ago and now this is the fourth edition that's coming out.

And I would say I was fortunate, I had some extremely talented mentors that kind of took me by the hand and showed me some of the tuning and to tune by feel. And I was able to write that down and then help other people understand tuning from a much more practical perspective. The theory's great, but it has to make sense. So I was able to work with hundreds if not thousands of people. And then as the controls took off and things grew, people sort just used auto tuners and oh, we don't need tuning. And they moved to advanced process control and now people are coming back and saying, "Hey Kevin, all of our advanced controls sit on this thing called a control loop. Can you help us again?" And that was really, we said, "Well, let's dust this thing off." And it's amazing once you hit the resonant of the theory of control tuning, it's applied to every application, every industrial controller. It's non platform dependent, it's vendor agnostic. And that's what's helped me stay relevant and have such a long career.

Sarah Nicastro: Okay. So how would you describe the current sort of state of the industry?

Kevin Starr: I still work at ABB, and we're constantly working with our customers. And I would say after we've all gone through this pandemic and hopefully are coming out of it, but what I would say we've seen beyond our wildest imagination was the remote work. Doors have just opened up for remote capability, remote access, being able to apply application of technology remotely. Loop tuning is one of those things that years ago customers were like, "You have to be sitting in front of my machine. If you're going to do an evaluation or a step test, you have to be here." That stigma has been removed and we're doing remote tuning and commissioning from anywhere in the world.

And you couple that with the other change that the industrial revolution 4.0 has introduced is one person used to be able to know everything about the technology they were working on, that has passed. They say 2015 was about the point where the industrial revolution really started, and if you look at the amount of knowledge that a person has to have from loop tuning is one thing, but so is cyber security, so is IT and OT and alarm management. And the list goes on and on. And so what's happening is people are only getting smaller and smaller pieces in an academic setting. So no one's really an expert, but everybody's supposed to know everything. So what we're seeing is the state of the industry is our clients are saying, "Can we have a sliver of all these expertise? And we can't have just one person, how do we do that?" And that's where we've introduced the concept of the right person at the right time with the right solution drives the right value.

It's kind of another spark along the way here is my son, who's now, five or six years out of college. He took a class at a Ohio University on loop tuning. And he goes, "Dad, I can now talk to you." And I said, "Okay, let me see what you're doing." And I'm like, "Oh my goodness, that's all you're learning?" And they showed me their videos and I said, "Well, your dad used to do this stuff." And he goes, "Really?" So we got a videographer. And I said, "Get your camera, let's go." And we recorded every chapter as a YouTube video and primarily showed him how to pass his class. And that has exploded.

And people, your listeners can go to Kevin Starr ABB PID, search that in your YouTube and you'll see, ABB allowed us to make those available to the industry for free. And one of them has over 400,000 views, which is kind of crazy is to see that that has really prompted part of the state of the industry is we're a Google... If you can't learn it through Google, it doesn't matter. And so now people are finding this technology and finding how to do things and we've made it available. And then almost always people will read us, well I'd like to have a reference book. So they'll send us a note and then they can get the book now through ABB.

Sarah Nicastro: Very cool. Okay. So let's walk through some of the components that are covered in the book. So the first one is around process identification and modeling.

Kevin Starr: Yeah, it's challenging. A lot of people get into loop tuning, they want to talk about Ziegler-Nichols or lambda control or direct synthesis or pole-zero placement and that goes kind of over people's head. And then you say, Well, I have an ABB or an Allen Bradley or a Fisher or a Yokagawa or a controller. And then there're different types. So people get kind of caught up in the math really, really quick. And I take it back to we start off with processes. Every input output, relationship, like if you go to steer your car and you turn a steering wheel and the car doesn't turn, you don't speed up, you stop.

And that's the way it is with actuation devices. You have to inject energy or figure out some way of looking at historical data to find the causality between that input and how's the process going to respond? Is it going to move really, really slow? You think of a like fire hose or a garden hose. You can't adjust those the same. So there are techniques and methods that we cover for identifying process types and how you come up with numerical numbers to represent how much did it move and how long did it take to get there? So we really try to boil things down. This all goes into calculus and differential equations, but not in this first book. We just say, okay, these six or so different types of processes. Was yours self-regulating or non-self-regulating, and here's how you would do an identification using current lump test techniques or historical data. And if you can't identify what's going to happen when you move the actuator, you're not ready to go into the next levels of tuning.

Sarah Nicastro: And then you talk about the technology that's being used.

Kevin Starr: Yeah, the technology is, we'd like to think that everybody has an ABB controller out there, but industry's been out there for 35 years or longer than that. And so you have to be able to adapt the language to the type of control that's being used. There's actually three main branches. There's parallel, classical, and standard. Those are the three classes of the mathematical formula, which is interesting. If you go clear back to the pneumatic controllers with sniffers and baffles, they literally developed software around physical components that they took into the digital world and there was three versions.

So, there's the MOD systems, the Taylor MOD, the ABB, the Allen. Different companies have different embodiments, but if you understand that you can map your tuning into their language. That's where a lot of people get messed up with tuning is they may have two different controllers and one is set up with a particular equation, one is step with another, and they put the same numbers in both. One explodes, one doesn't. And there's this stigma of process control that it's black magic and you can't understand it. We really try to demystify that with the book.

Sarah Nicastro: And so how are you helping people take the process identification and the modeling, understanding the language of the technology they're using and then getting to the desired outcome?

Kevin Starr: Well, that's great. It's tuning a lot of people it's a guess and check. Well, I'll just throw some numbers in. And see that's how I was brought up, just throw these numbers in, it'll work. Well, no, that tune by feel, in the old days you could actually feel the knob and you could feel the system calm down. In today's world electronics, you don't have that feel so you have to rely on the numbers and the response. And the response is, do you want the response when you change the reference to happen fast or slow? Imagine when you get in your car, if it's cold out and you want it to get hot, well you kind of have an idea of how the heater works. So normally you turn the heat way, way up and you're trying to speed up how fast a car can heat up.

So you don't just put the valve where it ends up, you go really fast and then you come back into it. The reason you can do that in your car is you understand the dynamics and you understand you're doing it by hand. We can do the same thing with automation. We can make a process respond fast or slow. We can give it a percent overshoot. We can actually tune out a particular frequency. I guess that's what I find fascinating about tuning. Once you understand that the control will respond to the way you tune it. Even if you don't know what you're doing, if you know what you're doing, you can do incredible things with process control.

Sarah Nicastro: So, you mentioned when we were talking about the catalyst for the book, you had gone to college and when you got into the act of actually doing the work, you know realized there was sort of a gap between what you were taught and what you were expected to do. And so the content was geared at not only closing that gap for you, but for other people as well. So then when you talk about present day, it seems like the gap still exists, it's just different than it was. So there's still this need to sort of close this gap between the textbook learnings and the real world. It's just the realities of that look a bit different. So you mentioned that in today's workforce we know that people are stretched to find talent. You mentioned that there's this desire for a little bit of all different types of expertise versus someone that's an expert in one thing. What does this kind of lead to in terms of how we need to educate the workforce and provide training and knowledge and enablement that fits what companies have to accomplish today?

Kevin Starr: That's great. That's a lot there and I keep coming back to spheres of influence. There's only so much one person can do. And you can chase rabbits if you're not careful. And so I always try to boil it down to what's the core value. I've had a chance to work in a lot of industries and so production quality, cost perdu, safety, transportation. You figure out what's core. What are the turns in their factory that makes money? And then how can you take your knowledge and help leverage that goal? Instead of getting caught up in, well let's use this dashboard or this tuning tool or this, whatever. Those change, but the cores don't. And so how do you link to that?

And that's what I found with this is that the tribal knowledge that we grew up with. A lot of people were fortunate enough to work in an industry for 20, 25 years. You kind of grew up with this. New people are coming in and they have a different paradigm. It's like, why are you doing? And which is great, we want that, but we have to be able to adapt to that, to be able to bring information to a heads up display so they can be taking data, convert it to information that they can take action on that creates value. If you can't do that link, then you just have a fancy dashboard or a treadmill that you hang your clothes on in your bedroom. It's not really any good.

Don't get sucked into technology for the sake of technology. How does it apply to taking action that creates value? And I know that's a lot there, but as we've transitioned and our industry has grown and the technology has grown and the demands of the people have grown, we call it work-life balance, that's been disrupted. It's people are like, "When that phone rings, what do I have to do?" And when I walk into the building, there's so much, how do I prioritize so that I can give the person the right things to do at the right time?

If, for example, loop tuning, when I first started to tune one, two loops, it'd take a couple days. And we figured out how to do 10 loops in a week and people paid us a lot of money for me to run around and tune 10 loops, 10 control loops like a flow or a pressure, a temperature, a level or machine speed or consistency, those types of things. And then all of a sudden technology kept growing and now we could do 100 loops. And then if you couldn't do a hundred loops in a week, they wouldn't buy it. And then now we're up to two, 3000 loops and you need to do it instantly.

So the theory of control hasn't changed, but it's a little bit like painting the Golden Gate Bridge. If you have a brush, you can do it, but by the time you get finished you got to start over again. And how do you know? That's the thing with control loops is there's so many now and if you don't figure out how to grab a hold of all of them to give you a heads up display, say, "Okay, these five are broke, go." And then I can distill and still apply, I don't want to take shortcuts on the theory and the tuning, but I can't spend so much time diagnosing 5,000 control loops. I need them come to me and then apply the knowledge to that and then get the desired outcome that is important for my client.

Sarah Nicastro: So, when you think about the challenge to provide employees that have bits of expertise across areas versus a lot of expertise in one area, how do you see that sort of playing out?

Kevin Starr: I think that's what the information age and the digital age and the industrial revolution that we're in is, what we're seeing is if you force everybody to know everything, then not everybody can know everything. And so then they always feel a little bit like, for example, we were sending a guy to go do a feed study and he was talking to the customer and said, "Okay, show me where this valve is." And the customer says, "You're sitting on it." And the guy was really smart, but he didn't know that particular item. And so then it made him look bad and he was embarrassed. And so it's like, well you can't know everything. I don't know about... There's a lot of stuff. So how do you get access? So that's where the distribution of the workforce and the regional and kind of think of the Uber of service. You need to go someplace, if you have that app, they come and get you. It totally disrupted the cab industry.

That's kind of where we're at in the service space is, you had to send one person to know everything. Well, it made sense to me in the oil and gas sector where when an offshore oil rig had a problem and they called in for help, you just didn't have 100,000 people that could go. You had a group of people and then the guy was like, "Well it could be this, this, or that. So let me grab a great big box of parts and hope that when I get to the site I've got the right one." Well, that's where I can still remember sitting with the customer saying, "This isn't okay." I need to be able to make sure that when that person comes to site, he's equipped with what he needs. Or better yet if I can fix it without them even flying on the... Because that's kind of a dangerous... Why put people in this danger when we can remotely bring them in.

So that's what we are seeing back to the state of the industry is technology and remote is changing so that we can kind of self-adjust so that maybe you only need one or two advanced process control experts in your company. But you need 20 or 30 control guys and you need 30 or 40 cybers, but you don't need them all in one place and you don't need them all at the same time. So learning how to dispatch them and orient them based on the need and getting their access and their scheduling, that's what we're seeing is the big change that's happening.

Sarah Nicastro: Yeah. Now we talked a little bit about, you were mentioning when your son was taking that class and was showing you what he is up to and you're saying, "Well, that's it?" And just the need here of making sure we don't overlook the core principles. That's kind of what your book does in a way is make sure that people get the emphasis they need on what those core principles are. And you can update it so that it's reflective of present day, but the underlying principles stay the same. It just makes me think there's probably other areas of service and manufacturing and the things that we talk about here often where that's applicable. Are we trying to do all things and overlooking some of the core elements? I mean, can you think of any other areas where that idea is applicable?

Kevin Starr: Oh yeah. I mean, I've been fortunate as to apply the concepts of process control. Once I started putting the inputs and outputs and realizing that once you can compare those, then you can put a control loop. A control loop is simply a device that takes action based upon an input, That's what's special about a PID. It literally makes a decision and makes... Most everything is a diagnostic tool. Control loops convert it into action and that's why it's also scary for a lot of people. If you set up the wrong things and that actuator starts moving and your machine breaks down, then that's kind of scary. But I've been able to apply this.

One example is I was, in one of my positions, I was the software development manager for the global software development. And I started seeing the relationship between developers and throughput and I use the book here and the tuning for a tank to tune the backlog based on the capacity of my teams. And I was like, holy smokes, this stuff applies everywhere. You don't have to guess. So I was able to use these methods and apply them to the extended agile scrum team backlog and prioritization, which people are like, "Oh really?" Oh yeah, it worked. And I've seen that with even down to like this, this podcast. You'll see if you get a million views, you'll probably have me on sooner than later. If you get 10, this is probably my last view. But so we all take inputs and take action. That's a control function and that can be optimized. And that's what I find fascinating still is the optimization of all these processes.

Sarah Nicastro: Yeah. No, I agree. Now if you think about, you mentioned the YouTube videos you created and how much traction you've seen there. So, you started 30 years ago with writing this book, you had the opportunity to more recently create those videos and relay the content of the chapters there. It just makes me think people learn in different ways. So when we think about empowering our teams with knowledge, what are some of the things we need to have in mind about how best we do that today?

Kevin Starr: I suppose in summary is to assume that everyone learns the same way is the biggest mistake. Is to allow people to learn how they learn because the information and turning it into action is so important. And I guess that's where people need to recognize is, there are different ways, whether it's video or text or remote or in person or mentoring or apprenticeship. What we're doing in industrial and industrial control is important, and the safety of our people are at the utmost. But driving our clients to improve production quality, and cost produce, sits on the back of knowledge. And that knowledge is something that leaves when people leave. We need to figure out how to capture that, and training and capture is one of the ways we can do it.

Sarah Nicastro: Yeah, that makes sense. And I think, you spoke earlier Kevin, about how technology has allowed organizations to do so much of this work remotely. That also goes for sharing knowledge. You don't have to have access to experts that are in person, you can have access to them remotely. So, there's a lot of different ways teams can collaborate and have that over the shoulder reassurance that you mentioned without that needing to be a physical presence. So, I think that's a good point.

Okay. So, I've certainly learned a lot so far today. Any other insights, comments, or lessons learned that you would like to share with our listeners?

Kevin Starr: Oh, I suppose, one of the lessons learned, I suppose it's somewhat of a personal journey. In my quest to help solve industrial problems around the world, I had let the biggest industry kind of go on back burner, which was me and my health. And my doctor said, "Look, if you don't turn things around, you're going to have a stroke or a heart attack." And that was when I turned 50. And so, I was like, "Oh my."

And I said, "I go around using these techniques of troubleshooting and fixing industrial processes. I wonder if I can apply these skills to me?" And so, I did. I started recording the data, I found what inputs were outputs, I tracked everything down, and I went to my doctor and got physicals and asked for advice and applying it to myself, basically doing the bump test, identifying my process type.

And all of a sudden, I started losing weight and people started asking me questions. And then I started sharing the information. I said, "I've been on this journey before when I wrote the control book, so I wonder if I could take this experience and write a book?" And I did. I just released it called Tuned Fit an Engineer's Journey into Health and Fitness. I lost 50 pounds and became a master’s athlete, and I never would've dreamed these possible. And I credit it to this book and going back 30 years ago and putting that together. So, it's been amazing, is what you allow yourself to learn and then to put it into action. And that book's on Amazon if anyone's interested, you go to Amazon, and type Tuned Fit.

Sarah Nicastro: Well, congratulations, Kevin. That's awesome. I think it is interesting how sometimes what we can put to work in our professional lives, how it can be mirrored in our personal lives. I wrote an article not too long ago about everyone wants the transformation, but are you willing to change? And the idea of how that applies both to organizations, but also to us as individuals. I know I shared with you, so I turned 40 in March and at the beginning of this year I realized I had put on some Covid weight. And so, I've lost probably 35 or so pounds since the beginning of the year. And it is very much just, are you putting the focus in that you need to? Are you paying attention to what works and what doesn't, and making adjustments and all of that stuff? So yeah, there is definitely some parallels there. And I think it's really cool that you benefited from the hard work you've done and sharing your knowledge with others in a very personal way as well. So good for you.

Kevin Starr: And congratulations to you as well, that's a lot. But if your why isn't big enough to overcome your reasons, then you never change. And I think back to the industry stuff, I'm so fortunate to have written a book that has lasted this long, and people are asking for it again. But the pandemic, the growth of an industrial automation, people are recognizing the core values and the core components and knowledge and training and application, they're all kind of new again. And so, this continuum, I was fortunate to touch it at the beginning with some great mentors. I feel like the flag was carried and now we have stuff for the next generation to take with them. So, technology is exciting, and knowledge is something we should never stop trying to gain.

Sarah Nicastro: Yeah, for sure. All right, Kevin, well thank you so much for coming and sharing with me. I appreciate it. If anyone is interested in checking out Kevin's books, you can reach out to him on LinkedIn. So last name is Starr with two Rs. And you can look him up on LinkedIn, send him a message, and he'll point you in the right direction for either of the books. So, thanks so much for coming on again and spending some more time with me.

Kevin Starr: Oh, thanks for having me. It was a pleasure. Appreciate it.

Sarah Nicastro: All right. You can also find more by visiting us at future of field service.com. You can 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 at ifs.com. As always, thank you for listening.

By Sarah Nicastro, Creator, Future of Field Service

On Wednesday of last week, Amazon announced a new investment of nearly $1 billion over the next year in its frontline workforce. The company is increasing the average hourly rates of its fulfillment and transportation workers and has also introduced a new benefit that gives employees greater flexibility around when they collect their pay. The announcement also includes an expansion of career advancement and development opportunities for its frontline workforce.

The press release states that, “Amazon employees around the world team up to meet the needs of customers every day. Employees are the cornerstone of the company, facilitating the journey of an Amazon package … To ensure customer orders are picked, packed, and shipped on time every single day, Amazon continues to invest in our employees, technology, supply chain planning, transportation, and delivery teams in an effort to get customers what they want, when they want it, wherever they are.”

You may read of Amazon’s investment and think – well, sure, but not every company has Amazon money. Here’s what I want to emphasize – it isn’t as much about the money as it is about the recognition that the frontline workers are powering Amazon’s customer satisfaction. That’s the part of the announcement that stands out to me far beyond the dollars and cents.

Companies across industries and geographies are struggling with filling roles and finding talent. These challenges often take the conversation to how do we better attract, recruit, and hire – and those are all important things, but I want to urge you to think critically about what you are doing to invest in your current workforce. We’ve all heard the saying that it is far harder to find a new customer than it is to keep an existing one happy, and this is true for the workforce as well. We will exacerbate the talent problem by focusing so specifically on brining in the new that we overlook the need to nurture the existing.

Not Every Investment in Your Workforce Has to Be Dollars

The goal isn’t to replicate exactly what Amazon is doing, but to consider some of the points surfaced in the announcement and reflect upon whether you’re doing what you can to engage and retain your existing workforce while you seek that new talent. Here are a few points that come to mind:

Recognition costs nothing and goes far. Yes, Amazon is investing $1 billion – but as I said, while the number is significant, what stood out to me most when reading the news release was the respect and acknowledgement of the critical role the frontline workforce plays in the company’s success. Your employees want to feel that they matter, they want to hear their hard work acknowledged, and they want to be respected for the value they bring to the business. There are very simple (and free) ways to recognize your frontline workers for their contributions that will make a real difference.
Pay must be fair. With financial pressures top of mind, it can be difficult to prioritize investing in your resources. What you want to be careful of is making sure you are being fair to your existing workforce when you bring new talent on board. I’ve had people ask how to handle situations where new workers are demanding far more than existing workers are paid – and while there’s no easy answer, I think the right thing to do is to make sure your workers are all fairly paid.
Flexibility is hugely desired today. In Amazon’s example they are addressing flexibility by giving employees greater control over when they get paid. But the takeaway here, to me, is that flexibility in general is very important to today’s workers. In some frontline roles you are constricted in what ways you can offer flexibility, but you should be getting creative in how to do so.
Complacency is a thing of the past. Amazon’s commitment to upskilling its workers and offering ample career advancement and development opportunities is one to model. Many companies haven’t moved beyond the memories of being able to hire a frontline worker who was happy to show up and do the same job, every day, for 20 or 30 years. Those days have past and to not only attract new talent, but to retain the knowledgeable workers you already have, you must think of how to offer development and growth opportunities.
Purpose matters to people. In the press release it says, “Amazon workers around the world ‘team up’ to meet the needs of customers.” Now I recognize these are only words, but they are words that can get you thinking in the right direction – which is that a sense of purpose, and a sense of belonging, matter. Does your company have a “team” culture? Is there a camaraderie of working toward a common goal and celebrating wins together?

I’d love to hear how your company is investing in its workforce. If you have thoughts or a story to share, email me!

Sarah welcomes Norbert Schöfberger, Global Vice President of Infrastructure Services Sales at HPE, to discuss how the company is adapting to customer expectations and evolving its GTM.

Sarah Nicastro: Welcome to the Future of Field Service podcast. I'm your host, Sarah Nicastro. Today we're going to be getting an inside look into HPE's operational services strategy. I'm excited to be joined today by Norbert Schöfberger, who is the Global Vice President of Infrastructure Services Sales at HPE. Norbert, welcome to the Future of Field Service podcast.

Norbert Schöfberger: Thanks Sarah for having me. Welcome.

Sarah Nicastro: Yes, thanks for being here. Okay, so before we get into taking a look at where HPE is related to selling service and some of the things that are evolving and some of the things you're learning, just tell everyone a little bit about yourself, your role, and your background with HPE?

Norbert Schöfberger: Right, sure. So, I'm with the IT industry for more than 25 years. I'm located in the center of Europe in beautiful Vienna. And I'm now since five years with the services part of the organization within HPE. I've been running Austria as a managing director. I've been handling the services business for the DACH here, so Germany, Austria, and Switzerland. And now since close to 18 months I'm running the job on a global scale, which is a very nice experience. And I would not miss, would not like to miss the last 18 months.

Sarah Nicastro: Yeah, well, and five years represents a lot of change and growth for services. So very exciting timeframe to have moved to that part of the business. Excellent. And I have not had an opportunity myself to visit Vienna, but it is on my list and I hope to make that happen.

Norbert Schöfberger: Great.

Sarah Nicastro: Okay, so let's talk a little bit about some of the shifts that are happening in the industry that have prompted HPE to really reflect on and evolve its approach to service?

Norbert Schöfberger: Yeah, no, it's a very good starting point here, Sarah. So, I think the shifts in the industry that we see, and it starts with a personal experience that we have every single day. If you recall, for example, how you consume your preferred video today, you're just going to click on Netflix. It's here, you're going to, that's it. Or how do you operate? In the past you've taken a cab from A to B. Today you open map, you push on Uber, Arrived, or Lyft, or whatever is around. So a lot of these things happened in the last years and it is at the end of the day, everything is around customer experience. So what is your experience that you have with your whatever, your Uber, your Netflix, your Amazon stuff, whatever you do?

If you're happy with the experience and things work fine, you're going to revisit. You're going to do the same thing again. On the other hand side, if you're not happy, you're going to do something else. And this experience economy where we are going into is also so much related if you, again, compare it with a personal experience that you have on consuming your IT that you have at home. So in the past you bought whatever, a license, a CD or something that you put in your laptop or in your PC when you installed Microsoft.

Today everything is coming over the app. It's coming as a service, you're going to pay as you go. And this is getting into more and more details of your private life. And therefore the consumerization always shifts into professional life. And this is what we see going on in business environments, in enterprise environments, since a couple of years where the things are going to, and this also affected us as HPE obviously, how to adapt to this new type of environment, to the shifts in the industry? And how can we cope with a more than 75 years legacy as a company to adopt to the new situations?

Sarah Nicastro: Yeah, it's funny, when you brought up Netflix as an example, I was thinking, just this weekend my, so I have two sons. My older son is seven and my younger son is nearly six, so they're very close in age. And it was a rainy weekend, so we were just hanging out around the house. Of course, they were tearing it apart. And they found a DVD. It was Kung Fu Panda, coincidentally. And my son said, "Mommy, let's watch this." And I said, "Well, actually, buddy, we don't have a DVD player." And he pointed the TV and he said, "Yes, we do. It's right there." And I'm like, "No, this is a DVD." And he's like, "What are you talking about? Just put it on." And I'm like, so it's absolutely has permeated every part of our lives.

And you bring up a really good point, which is companies that have a 75 year legacy, even a 15 year, a 20 year legacy, they have to really urge themselves to make sure they're not staying tied to that, and that they're adapting. So it's a really good point. And I don't think there are a lot of companies that are not really accepting of where we are and where we're going, but there are some. There are some that want to keep the blinders on, just because they're comfortable with what they're doing.

But you mentioned consumerization of IT. And it made me think, not to date myself, but when I started in this space, that conversation was happening around hardware. And so when we talked about the mobile devices that field technicians would carry around, you were talking about big, big rugged devices. And I won't name a bunch of names, I could, but you don't hear about many of them anymore, unless you're talking about a situation that really demands that. And that's because when the iPhone came out and other smartphone devices, it just became the preference of first people, then employees and customers. So, it's the same thing here. The way that we consume is absolutely influenced by what goes on in our personal lives. So, when you think about, or if you can talk to us about that reality, that shift, what does that look like in terms of how HPE's customers, how their expectations have sort of shifted?

Norbert Schöfberger: Yeah, absolutely. And you touched a couple of very good points here, Sarah. If we look on the trends and how things move forward, there are a couple of facts that we need to consider, also as a customer situation. So for example, Gartner has stated more than 80% of customer service interactions will be self-serve already this year. Then you have Forbes who have a study that more than 95% of customers say that service is important to their choice. So, it is the end-to-end capability that you have everything that you need also from a service perspective at the tip of your fingers, which is digitized.

Then ideally with the most intelligent that you can provide to your customized environment that you have as a customer, so means digitized and personalized. And then you don't want to have lengthy discussions with people. And I remember some 10, 15 years ago, when you designed a services contract on a mission critical environment that you had to provide, it was lengthy discussions on details here or there. Today things are pretty easy and you can leverage knowledge from around the globe that is available on similar customer situations on possibilities when all the environments that you have and new sources of digital customer experience and self-service insights are brought together that you can benefit from this.

Sarah Nicastro: I think a couple of things here. Number one, when you think about those conversations related to mission critical relationships, contracts, historically, I think in many ways that has set the bar. It doesn't necessarily, I'm not minimizing the importance of mission critical situations or environments, but the reality is, today a customer doesn't care if their operation is mission critical or not, they just expect the performance. So, those conversations that used to happen about situations that necessitated some superior level of outcome, output, now every customer has a very similar expectation. So, the onus is put on the company providing the product and or service to figure out, "Okay, well, we're not just talking about creating this experience for this elite set of customers that have a specific need. We're talking about needing to create it for just about everyone who's willing to pay for it, right?"

Norbert Schöfberger: Yeah.

Sarah Nicastro: The other thing I wanted to point out that I think is such an important point in this conversation, and one that is very challenging is, you pointed out that ... So, if we talk about HPE specifically and we talk about customers that want to move more to as a service model. They want to pay for what they're receiving. They want what they're receiving to work when it needs to work. They want that peace of mind, et cetera. You're talking about a very well-orchestrated set of products and services. And I think one of the biggest challenges within organizations when it comes to providing that seamless, digitized, positive customer experience is internal silos, right? Because if you don't have this vision and strategy across the organization, you're not working toward that customer journey at large. If you're just in charge of this piece, and you may have it perfected, but if it isn't tied to the next piece and the next piece that ultimately gives them that experience, it's all for nothing.

And so I think breaking down those silos and making sure that you're not transforming internally to be the best at what your function in the business is, but you're transforming externally to have that customer impact is a really important point of clarification. So, that of course is something that HPE has had to grapple with. I mean, you're not just talking about, "Okay, I'm in charge of this piece. So here's what I've done to make it the best." You have to look at, our customers interact with all of these pieces and here's how we're working together to give them what they want. So, let's talk about what that means in terms of your role and your area, and then kind of the company at large? So, we'll just touch on a few things here that I have some notes on, and then if there's others, we can weave those in as well. The first thing is that customers are looking for new sources of value. So they're expecting more from you than they have historically. Tell us a little bit about what that means, what that looks like? Give us some examples?

Norbert Schöfberger: So, on the new sources of value, I would highlight three things that you should look at from a service perspective. The one and first thing, and maybe the most important thing, it needs to be truly customer-centric. So each customer has to be in front and center in a personalized way that you look at the specific environment is around. That's the one thing, and I'm going to elaborate a little further in detail in a minute. Second is, everything that you do from a new source of value should be digital and data driven. So what do I mean with this? I just touched on a minute ago on the global possibility that you can leverage from the knowledge in similar situations. So today you have the most intelligent products out in the market, and there is lots of very intelligent ingredients in these products, like info site, cloud physics, you name it.

So lots of staff sending telemetric data on the health and then the status of the equipment, what it is, to an intelligent data hub. Let's call it this way. And therefore, if you have a similar situation that someone in, I don't know, in APAC or in Europe or in Latin America or in the U.S., and there is a similar constellation coming up, there is an AI-driven intelligence. So an artificial intelligence associated to it. And this could bring up a popup and not even tell you that you could run into an issue in the next 48 or 72 hours, but could from a machine-to-machine connection automatically go into a self-healing mode and going to say, "Okay, I'm going to accept this." They're going to change this piece of configuration, et cetera, as long as it's software driven, when it's not a physical part that is going to be defect in there. And you don't even realize what is going on at the end of the scene and your system are seamless where.

And that's also one part and portion of the thinking. If you move to a consumption environment, if you remember 20 years ago, 30 years ago, did you ever ask your telephone provider what the backend stuff is? What the thing, no, a dial tone was a God given right, and that's it. And it's the same, if you consume IT in there in the backend, what's going on and how this is working itself? This should not bother you. It is the service that you leverage and it's the highest interest of the provider that the service is up and running, because otherwise you can't use it. And then the vendor doesn't get money for it because you can't get a bill if it's not used in there. So, that's the element in there.

And on the third point I would like to make is, it's driving innovation by leveraging intelligence. So, the days are over when service was a static thing, did you say, "Okay, we're going to make a contract for three years, five years, whatever it is, and this is what we're going to do. And yeah, we're going to make sure that all your light bulbs are blinking green and not red. And this is all good." But if you not innovate on these investment cycles and innovation cycles that we have in industry on a regular base, on a customer-specific environment, then it will be very, very difficult. So this is how it phrase it from it. I mean, it's a digital customer experience. It's a self-service insight info and the expertise to leverage on driving new sources of value going forward.

Sarah Nicastro: Okay. I want to ask you two questions on that.

Norbert Schöfberger: Sure.

Sarah Nicastro: Number one is, I agree with the point about personalization, but how do you achieve a level of personalization at a scale that is feasible in terms of running a business?

Norbert Schöfberger: So, the personalization starts, and this is closely linked to self-service on the environment, so that you're going to have an automated tool that you're going to bring up on a single log-on portal. You're going to go there as a single source of tools for your existing environment, where you have all the health status of your equipment, where you can see if there is a problem. You can start an interaction with a technology specialist, if you want to. And this is a 100% customized to your specific environment. So this is not a one fit all. It's an environment that is made for you being the unique customer. Yes, it's a common platform that is used because of scaling effects, but this is exactly tailored to your environment. And then you have, depending on the service levels you're going to act and operate in, it could be a physical person that you could connect to at a push of a button, or you can go into a chat situation. And again, this is a 100% personalized and made tailored for you and your specific requirements, what you have.

Sarah Nicastro: Yeah. Now, we were chatting before we started recording about how roles related to service are evolving. And so I just want to also point out, there are folks within this audience that have businesses that differ from HPE's. And some of those are, we're talking about larger equipment, we're talking about different types of service, et cetera, but I just want to point out that personalization also depends a lot on ... This is where relationships and the human side of service becomes so important. Because if the goal is, or not even the goal, the reality is that we're going to leverage self-service and remote service more to provide that ultimate outcome that customers want, they will appreciate that. But when they need a response from a person or when you are engaging with customers to talk about their innovation cycles and to talk about the business relationship, those are your opportunities to personalize it in a human way. And I just think that's super important as well.

Norbert Schöfberger: Yeah, absolutely agree. And that's why we have with the largest engagements and is our enterprise customers where we're going to operate in, you have regular sure fixes where you have this physical touchpoint, at least once a quarter. And depending on your situation, if you're going to move or you're going to do an M&A and you're going to integrate something, et cetera, where you have these detailed analysis and going to plan ahead, what is the next phase you are going to approach in the next two, three, four months? And then from a service perspective, we should take care on how to wrap this in a cozy, nice feeling and going to take care about everything that the customer can move forward, make a mantle, tick in a box and we're going to manage the stuff. And that's the physical engagement that you're going to have, and less the standard service that you're going to keep the engine running.

Sarah Nicastro: Yeah, yeah, that makes sense. Okay, I'm going to save my other question for later because I think it's going to be applicable to some of the other things we're going to talk about. Okay, so let's talk about how the changing customer expectations and industry trends and the new sources of value that are becoming expected, how does that lend itself to HPE's focus on creating new revenue model? How is that sort of a natural transition, and why is that consumption model needed and desired among the customer base?

Norbert Schöfberger: Yeah, it's a very good point. And if you look on the consumption model you just mentioned, Sarah is that the compound average growth rate, the CAGR is projected at roughly 20%, 25% going forward. And therefore there is one key metric what you have on recurring revenues that you usually have if you have lengthy engagements, that's the ARR, so it's the annualized revenue run rate. And this ARR is a key metric if you're going to move into the consumption world. And the software companies are doing this since years. And now it's also, if you go into environments like hybrids cloud environments and stuff like this, where we're going to look into this on a much more detailed way.

And the beauty of this is that the transition that you mentioned, it's not a black or white issue that you push a button and the entire world is just consuming that way. You can have a mixed environment of CapEx and OPEX, and you can leverage and decide what is run on which environment, depending on how you want to do it. But the trending what we're going to see is definitely moving to the OPEX environment, and therefore reflecting in the ARR metric from a revenue streaming perspective, because that's the future. And also for us being a company and all for the other companies being in a consumption world, this is reflecting also the stickiness of your services, how your customers are happy and accepting what you're doing and how you move together forward a step.

Sarah Nicastro: Yeah, I mean, to me, when you talk about some of the things we talked about first, so moving toward more self-service, a digital experience, the appreciation or expectation of insights and expertise. These things lend themselves very well to and as a service model. I mean, it's really what I see is companies that start introducing some of the transformation, and they're doing so though on their existing business model and then running into some challenges. Well, we've introduced more self-service capabilities, but our customers don't want to pay for it. And that's because their customers are paying for them to be on site. They're compensated for hours of service, not for uptime or outcome. And this is where we get into to a little bit of challenges.

And I think ultimately your point is a good point, which is the trend is toward that consumption model, that as a service model. And so as we see that become more and more of a reality, it gives the organization providing the products and or services the capability to innovate more on service delivery and cost of service without it affecting the way they recognize revenue from their customer base. So, I think there's some areas of this transformation where we're almost getting ahead of ourselves in terms of wanting or achieving the capabilities without recognizing the impact on more of the business transformation, not the actual service transformation, if that makes sense? And so let's talk a little bit then, Norbert about how these trends change some of HPE's structure and route to market. So, your point also about, this isn't an all or nothing approach. It isn't all CapEx, it isn't all OPEX, it can be a hybrid. So, how does that impact the way that you structure the organization, the way you go to market with your customers, et cetera?

Norbert Schöfberger: Right, and that's exactly the point. It's nothing that you do depending on the size of your company. So we are still some 60,000 people in the field, and this is nothing that you do within one quarter, or not even within two quarters. It's a mental model shift that you need to do and that you need to facilitate how to discuss and talk about outcomes. So it's a multi-year sales transformation that you have to do. And this is one you decide to going to go there, not just for us, also for our customers and specifically for our business partners. Because together with our business partners on the go-to market, this is so important that we're going to stay aligned here and that we're going to have a detailed understanding and each and everyone's specialties and how to move forward that we're going to align this.

But I think the future sales force should be absolutely driving outcome-based discussions and selling. Because it is something, not a lot of customers in the future will just buy a product from you because it's the nice and fancy and the most features and specs and whatever you have around in there. The customers are interested in outcome, and this leads to how do you manage workloads? How can they manage workloads efficiently, cost effective, et cetera, going forward? And therefore it is something what you need to understand from a sales perspective and go-to market that services-led experience is a continuum across the entire IT environment. And it's regardless what your environment is in the data center today, you need to start at a point and say, "Take a decision, what do I keep as CapEx, where going to go to OPEX."

And then you're going to have this famous land and adopt, expand, and renew. And this entire process is something that customers are walking through the transformation the same like we do with our sales community and our structure as a company, because it's a different way than you just have R&D creating excellent high tech products, then you're going to build a perfect supply chain. Then you're going to do it and you're going to configure it, you're going to order it and you're going to deploy it and you're going to build it. That's a different approach.

Sarah Nicastro: And I mean, ultimately it requires completely different skills from a sales perspective, right?

Norbert Schöfberger: Absolutely. Absolutely. And that's the point when you say maybe 15, 20 years ago, the best sales folks have been the ones who had a very detailed, technical understanding on the equipment product, how a data center is built, how is the IT foundation working that you walk through the layers? What do you need to look in? And this is shifting more and more because the discussion between a customer and the vendor is less about bits and bites and specs and features. It gets more about, "Hey, what is the value add you provide to my business or to my customer's business and make my life easier with the solution that you are offering to me?" And that's a different discussion you have to facilitate with a different knowledge. You need to have more detailed knowledge on the specific industry the customer is working at to understand the market conditions and the customer's customer environment.

And then you can tackle the right discussion, how this leads to a solution that best fits the customer's needs. And it's by no means set that everything or for everything the right answer and best answer is consumption. It could be that a customer has an environment, they say, "Hey, I still, I'm still very happy on having a product that I buy with wrapped perfect services around it on a CapEx environment. And I'm going to leverage this, whatever four years, five years, I'm going to do it. And then I'm going to go into the next cycle." Or it is something that you're going to say, "Okay, I have my equipment that is aging. I'm going to do just a tech refresh and do the staffing services, or I'm going to just continue to leverage." But we have customers out there who are leveraging the products already since seven, eight years, because it is working.

The application is not demanding on me what is running there for whatever internal compliance reasons they need to have this, so they are just renewing the services contract that they make sure everything is wrapped in the right services level, that they can operate internally and with their customers. Or ultimately it's the third option then that the customer says, "Hey, I understand where the world is moving in here. I want to join this train. And we're going to move the certain environment to a consumption model." And therefore, so for us at HPE, it's the GreenLake offering that we have out, and with all the workloads that we're going to manage through this, I'm going to go to the GreenLake platform and can I move this forward?

Sarah Nicastro: Yeah, I just wanted to come back to two points. When we talk about what the changes are from a sales perspective. One other point is, and let me know if this is accurate for HPE, but for a lot of organizations it's not only a change in approach, required knowledge, and ability to communicate and build relationships. It's also often a change in who you're selling to within your customer base, right?

Norbert Schöfberger: Absolutely, absolutely.

Sarah Nicastro: So that's another thing to be aware of and to prepare for. Because if you go in with this great message of this outcomes approach and it's to the person that you've just had sign off on purchasing products, they may not be receptive. And that doesn't necessarily mean it isn't a business fit, it could just be that it's not the right person.

Norbert Schöfberger: Yeah. No, absolutely, agree a 100% with this, Sarah. So it's because if you come with a strong legacy in the data center, usually you've been talking to the data center manager, maybe to the CIO in there. By the way, the role of the CIO is also changing with the way forward that we're going to have here, but that's a different topic. And if you stick to go to your old context that you have since years, then you potentially have an issue be if you show up with a different, so you need to try to find the language of the business of the customer and this understanding, and then you can land the proposition that you're going to have in there.

Sarah Nicastro: The other point I wanted to bring up is that as those relationships evolve and change and you're having more of an outcomes-based conversation, you mentioned the fact that this isn't just about going in and having a look, a perspective, a knowledge on the HPE part of the ecosystem, it's really looking at it as a whole. And I just want to say, for a company that has a legacy, this is a really important point of when you go into those environments, those conversations, that is how you look at what value you can expand to delivering. And so don't get stuck in the, "Oh, well, we don't do that. That isn't part of our offering. We can't help with this." Listen to what it is they need at the highest level of what the outcomes are, and be willing to get creative on having conversations internally of, "Well, we keep hearing this need, we maybe don't solve that directly now, but what should we be thinking about?" That's where the innovation comes from is being willing to step outside of the role you've historically played and think about the role you can play going forward.

Norbert Schöfberger: Right, absolutely. And this is also, I don't think there is any company out there that can deliver everything that a customer needs. So this is where, from our perspective our partner ecosystem is so important that you have this as a company and the vendor, because this is complimentary. And regardless if you talk about the partner programs that are out there from a services perspective and how to tie things together, or to glue this together, that the customer really gets what they want. You need to have complimentary maybe services here, or a piece of a product there to make the end-to-end solution that best fits for the customer's needs. And I think this is very important also the way going forward.

Sarah Nicastro: Yeah, that makes sense. So, what is the focus at HPE on driving the go-to market acceleration going forward?

Norbert Schöfberger: So, I think the focus is that we clearly identify and see on the three options I mentioned in there. So is it you're going to keep what you have, you're going to just renew the service contract, install base? Classical selling in there. Is it a technology refresh when customer just wants to bring in fresh technology or going to move to consumption? And with this motion going forward in combination with our partners together, I think the go-to market push that we are going to leverage, first of all, on a very large installed base that is out there. Luckily with great market shares around the globe that we're going to have, this sets us up perfectly on the future and on the way going forward.

The trick here is on a go-to market like we touched that we're going to develop and evolve from a type of how we're going to sell and whom are we going to talk to with the customers? Where are the next sets of best partners for the future strategy this is going forward? How do we walk this story together with our existing, great partners that we're going to have in there? And how do we evolve with our own sales force that we're going to move into the workload outcome-based discussion and accompany the customers with their transformation, regardless on what level or maturity level they are currently on the way to digitalization?

Sarah Nicastro: So, is it fair to say that the go-to market is to meet any of those three needs-

Norbert Schöfberger: Yes.

Sarah Nicastro: But there is a focus, as we talked about the shift to outcomes takes years. So, while there's still those three paths, there is also a focus on shifting to the outcomes approach in terms of focus or prioritization, or just continuing that internal mindset shift, skill building, et cetera?

Norbert Schöfberger: Yes, absolutely. And this is so, when you ask on the go-to market and how to drive there, we already have, as of today, our CEO stated already couple of years ago that by '22 we will have all of our services that we're going to offer ready in a consumption model. So we are currently in a, I could call it a hybrid phase, is it CapEx or OPEX? And it's the best solution for the customer that we need to propose, also from a go to market perspective. And this hybrid model will, from my personal perspective, move towards a consumption model going forward. So the legacy and the CapEx, also my personal opinion, will never a 100% disappear. They will always be product business, but the portion of the consumption business going forward will increase.

Sarah Nicastro: Yeah, okay. That makes sense. All right, so we talked quite a bit about this, but if there's anything we didn't touch on, is there anything we didn't discuss when we think about what it takes to be successful selling service in today's landscape?

Norbert Schöfberger: Yeah, I think there is maybe one point to add this, that you need to look at it from a customer perspective that service is kind of a function that is very essential to an organization, that it engages with customers at every step of their journey. And if you're going to look at this from a vendor perspective, you would say, "Hey, it starts with pre-sales, during the sales position, past sales afterwards, this is sometime forgotten. Because in the past you showed up every three years, four years, and you're going to did some deal done tick in a box. And therefore the infrastructure sale at the beginning, if you're going to go this way, it's just the beginning and not the end. And then you need to elaborate particular during the sales process and with the post-sales environment that you're going to cover all the needs that are around the customers. This is just, and then the story gets complete then.

Sarah Nicastro: Yeah, that makes sense. So, we talked quite a bit about what has changed. If you were to try and give your predictions for what things will look like, if not at HPE specifically, in this sort of ecosystem 10 years from now? Where do you think we'll be?

Norbert Schöfberger: Well, if we would notice, we in the famous crystal ball, maybe in there, but it's a gut feeling, I would say. So everything in the future, I think it's proactive, preventive remediation. It will be kind of the gold standard of support that you can do. Leveraging all around machine-to-machine connectivity in combination with AI. And therefore meaning less physical interaction on the traditional service environments and moving close to a 100% to digitized and personalized, customized for the customers. That would be in a nutshell where I would see potentially in a couple of years, is it 10 years? I'm not exactly right in there, but this is where we're going to.

Sarah Nicastro: Yeah, and I think when we talked at the beginning about new sources of value and the digitalization, the personalization, that sort of seamlessness and peace of mind that customers want, those things sound very simple. They sound very simple, very straightforward, and they are things that everyone is talking about. And the problem with that is, they're not simple to execute. And this is why when I say, where are we headed? Five years, 10 years, whatever. We're not really talking about anything different, at least based on what we know right now. We're not talking about, "A meteor will hit and this will happen and the whole game will change."

It's really taking the time to execute on those mindset shifts, the skill building that needs to take place, the customer journey, all of those things that will inch this to where we see that increase in consumption, increase in as a service, because it will become, I think, the standard approach, because we will as an industry master the things that it takes. Right now some people would argue, "Oh, we've been talking about this for however long." Yes, but there are foundational business shifts that take time to see come to fruition. So, as someone that's been covering this space a long time, I hate it when people ask me for predictions. But I also say, "Look, don't spend your energy trying to think about what is the next big thing. Spend your energy getting good at the things we're talking about right now." Because there's still a lot of work to be done, right?

Norbert Schöfberger: And I'm a 100% with you, Sarah, and maybe some easy examples. So we've all been through difficult times the last two and a half years. And I remember at the very beginning we've not been able to enter onsite customer data center due to the regulations, and you've not been allowed to. So all the customers who have already been further advanced in this journey, they benefited from the digital and remote environment. Just as a simple example in there.

Or secondly, I remember customers that told us for years, "Things like remote access and home office is impossible. This will never happen in there." Hey, these guys called me a couple of days after this thing started two and a half years ago. "Hey, what can we do? I need this now." So maybe sometimes it needs, even if it's difficult, some events are going to reopen thinking and get unblindfolded to kind of move things forward. And this is why exactly what you say. It's so difficult to predict what will be around in 10 years or in five years, because we don't know what, and if we just master what is around today and what the visionaries today say, that will be good to do, I would really support and suggest that everyone takes a deep look in there, because things are moving pretty fast and quick. And at the end of the day, it just makes lives easier.

Sarah Nicastro: Yeah, for sure. Okay, Norbert. So, you came into sort of the service part of this world five years ago. And I'm curious if you can share, what has been your biggest lesson learned as someone leading service now for the last five years?

Norbert Schöfberger: Yeah, so I think one of the biggest things is that selling services requires a different mindset and skillset. It is, there are comparisons out there say, "Hey, if you sell a product, you sell a solution. If you sell a service you sell a vision." And this is something in the discussions with the customers and the changes we see, particularly in the services area as five years ago, I mean, consumption just started in the professional business environment, at least in there. And with the hockey stick we saw till today, this would be the biggest change that I see what we need to adopt to. And there is no end yet in line of sight when this will be over.

Sarah Nicastro: Yeah. Well, that's good because it makes things exciting, right?

Norbert Schöfberger: Absolutely.

Sarah Nicastro: There's a lot of work to do. There's a lot of change yet to be realized, and certainly a lot of potential. So, thank you, Norbert for coming and sharing, I appreciate it.

Norbert Schöfberger: Thank you very much for having me, Sarah.

Sarah Nicastro: Yeah, it was fun. You can find more by visiting us at 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 at ifs.com. As always, thank you for listening.

By Sarah Nicastro, Creator, Future of Field Service

At last week’s Service Council Symposium in Chicago, much of the conversation centered around people. Whether discussing how to better attract and empower talent, how to address and alleviate burnout, or how to give customers the connection they’re seeking, the Service Council’s Service is Humanity focus took center stage.

This isn’t to say there weren’t ample informative conversations on digital transformation and opportunities to engage with those providing the industry’s modern solutions, but simply that the conversation broadened into some of the very important but often less clearcut topics companies are grappling with. I think this is important because, as I’ve often said, technological sophistication isn’t what is holding companies back from achieving their objectives around innovation – the layers of change and complexity involved are. And while no one attendee at events like this has all the answers, collectively as a community we can inspire, inform, and uplift one another to go back to the day-to-day reinvigorated to solve challenges and keep the ball moving forward.

With that said, and in no particular order, I wanted to share some of the moments and insights that stood out to me at the event:

Elizabeth Dixon, former Principal Lead of Strategy, Hospitality and Service Design at Chic-Fil-A delivered a keynote based on her new book, The Power of Customer Experience: 5 Elements to Make an Impact. Elizabeth said during her session, “We have to remember that Customer Experience is nothing more than the overflow of our Employee Experience.” This is a reality I think many in our industry are reconciling currently. After many years of being very focused on cutting costs, we began to see the potential of service as a profit center – which shifted our focus to the customer. Now we’re realizing that we can’t deliver the customer outcomes we want, to drive the profits that are possible, without a frontline workforce that is engaged and satisfied. When you couple this with the shifts we’ve seen in the workforce and the challenges organizations have recruiting and retaining talent, it is clear that getting employee experience right is absolutely critical for service success in the coming years.

Customer Centricity Can Require Organizational Change

Bob Feiner, SVP of Global Services and Jason MacIver, VP of Services Procurement at DELL Technologies delivered a great presentation on what happened at DELL when the company began focusing on Customer Experience. They learned that their siloed approach, where support, field service, and parts management all worked toward individual objectives and measurements of success, although effective historically, didn’t stand up to the needs of a customer-centric business. They shared how DELL worked through the complexities of organizational change and invested in technology to ensure that each function of the business is unified in strategic vision, approach, and measurement of success.

Recognizing how imperative the employee experience is – and sharing stories of how disruptive change can be – leads us to the conversations around humanity. How are company cultures shifting to fit the needs of today’s workforce? In what ways do both organizations and leaders need to evolve to embrace the need to nurture and empower versus drive and demand?

Stefano Folli, EVP and Head of Global Services & Solutions at Philips shared some of the ways Philips is working toward a human-centric company culture, but he also shared how he as an individual leader has had to self-reflect and grow. I really appreciated the way he surfaced the importance of individual leaders not only being willing to “change with the times,” but putting in the work to do so. He drove his points home with some specific examples of issues within his team where he realized he needed to shift his thinking or augment his skills. He also discussed how he practices reverse mentoring, because he realizes he has as much to learn from those he mentors as they do from him.

The Role of Leadership in Human Centricity

I would argue that the role of leadership in human centricity is even more important than a company’s commitment to any sort of programmatic approach. This point surfaced in the workshop I moderated on Monday afternoon on Workplace Mental Health & Wellness. I was joined by Emma Jellen, Interim Director of the Center for Workplace Mental Health; Chris Westlake, Director - Service Process and Digital Transformation at Generac Power Systems; and Sasha Ilyukhin, SVP of Customer Service Operations at Tetra Pak. We had an outline of prepared points to center the discussion around, but as soon as we introduced ourselves, questions from the audience started flooding in:

How do we make this more than a check-box exercise?
What is a leader supposed to do when they notice an employee is struggling – how do you handle those conversations?
What if a leader is “old school” and feels that being personal has no place at work?

The questions were excellent and prompted a very lively discussion around the fact that while a company focus on this is needed, and most evidenced in its culture, the role of the individual leaders is most important. Emma shared some excellent advice on what goes in to building programs, training managers to handle tough conversations, and alleviating burnout. All of the free resources she referenced in our session are available at www.workplacementalhealth.org.

We know that one important facet of employee engagement is for employees to feel valued, appreciated, and heard. Karin Hamel, VP of Services, US Digital Buildings at Schneider Electric, demonstrated her commitment to improving employee engagement among the company’s frontline workforce at least year’s event by sharing about her creation of the Service Hero award. At last week’s event, Karin shared how she’s continued looking for ways to not only keep the field workforce engaged, but also to create an outlet for their valuable insight, and this past year has created a Field Service Advisory Committee to ensure the field service teams at Schneider can share their input, ideas, and feedback.

Another element of employee engagement that was discussed repeatedly at the event is having a sense of purpose. Sasha Ilyukhin of Tetra Pak, who won this years’ Service Council Humanity in Service Award, gave a presentation that tied in another very important area of focus in service: Sustainability. Sustainability gives companies, employees, and customers a sense of purpose and, as Sasha expressed, has become a license to operate. For Tetra Pak, this is a significant area of focus both in how the company itself continues to focus on its environmental impact, but also how it helps its customers do the same. As such, Sasha spoke to how sustainability is such an area of opportunity in service.

Technology Streamlines Complexity to Allow People Focus

These are just a few of the excellent points that were surfaced during last week’s event. At the close of day three, the Advisory Board answered a few questions around lessons learned, what they’re excited about, and what their top areas of concern are. Many of the members responded that their biggest concerns surround talent. Laura Mather, VP and GM, Global Services at STERIS Corporation made such a good point – she said, “Service is becoming ever more complex. If we want to have the capacity to focus on humanity, we must embrace the technology available to us.”

I could not agree with her more – the sophisticated technology at our disposal today can simplify some of that complexity. If you can leverage it in a way that gives you clear insights, automates menial tasks, and increases efficiency, it augments your ability to pour more time and effort into your people – which is a clear imperative for the industry.

Sarah welcomes Darcy Gruttadaro, Director of the Center for Workplace Mental Health, part of the APA Foundation, for a discussion around the tie between burnout and mental health and for tangible tips on how to address employee burnout.

Sarah Nicastro: Welcome to the Future of Field Service Podcast. I'm your host, Sarah Nicastro. Today we're going to be talking about a very, very important topic, avoiding and addressing employee burnout. I'm thrilled to be joined today by Darcy Gruttadaro, who is the director at the Center for Workplace Mental Health, which is part of the APA Foundation. Darcy, welcome to the Future of Field Service Podcast.

Darcy Gruttadaro: Thank you Sarah. It's a pleasure to be here.

Sarah Nicastro: I'm so happy to have you. So before we get into today's topic, why don't you tell folks a little bit about yourself, what the Center for Workplace Mental Health is all about and also what the APA Foundation is. So for anyone that isn't familiar, tell them a bit about the organizations and then your expertise.

Darcy Gruttadaro: Sure. Happy to do that. So the APA Foundation is a foundation that has a philanthropic and programmatic focus. And what we like to say is we are creating a mentally healthy nation where you live, learn, work, worship and play.

So we have workplace mental health initiatives, school-based initiatives, criminal justice reform initiatives, a faith-based community initiative. We focus on schools and really broad community anti-stigma work.

As far as my background, so I've been at the Center for Workplace Mental Health for five years. Before that, I spent 17 years at NAMI, the National Alliance on Mental Illness, and I worked primarily on policy and programmatic issues there.

I also have a family connection to mental health issues, which is really what led me into this field. I was a lawyer practicing litigator and I got very interested in policy work when it came to mental health and wellbeing, so here I am.

Sarah Nicastro: And you made a big change. That's awesome. Good. So I'm happy to have you. I shared with you when we were planning for this episode, Darcy, that I try to weave mental health conversations into our content quite regularly.

So I myself have my own challenges when it comes to anxiety and things like that and so I have a personal connection to the content, but I also see in the audience we have, the industries that we reach, this isn't a topic that has been widely discussed for very long and in some pockets still isn't, right?

But you have people that are struggling and need this to be a more regular conversation in the workplace and they need better support and they need that destigmatization that you mentioned. So that's why it's really important for me to make sure that mental health is a through line of the conversations we have here.

So today we're going to talk specifically about some advice you have around burnout, but before we do that, let's talk a little bit just about mental health in general. So how did you see the impact of the pandemic? So how would you say things related to this conversation have changed over the last two or three years?

Darcy Gruttadaro: Yeah, great question. I mean, let's face it, we really have been through a really challenging time, but let's just start with the idea that we all have mental health and mental health exists along a continuum. So our mental health may be in a really solid healthy place even if we live with a mental health condition like anxiety, depression or another one.

Or it may be slipping and it may be that it's really not doing well at all. So mental health exists along a continuum. We have what I like to describe as a trifecta. So we had the global pandemic which disrupted our lives tremendously, at work, in the community, if we have children at school, caring for loved ones.

It was a really difficult change and came very quickly and sort of got dropped into our lives. We also have had a lot of political and racial tension over the last couple of years. A lot of political change, a lot of political winds blowing. And then finally we have an economy that's really uncertain.

We're hearing inflation, recession, we're solid, we're good, we're stable. So this can all lead to a tremendous amount of uncertainty in our lives. We as human beings don't do great with uncertainty. We like certainty, we like things to go well. So we've been under a lot of stress, a lot of strain and it's taken its toll.

And we know the Centers for Disease Control and Prevention has been collecting data since March, 2020 in a weekly pulse data, a pulse survey rather. And what we know is that we've had a tripling and quadrupling of people experiencing anxiety and symptoms of those conditions across industries.

So whether you're in a service industry, you're a frontline healthcare clinician, you work in a restaurant, we are all experiencing symptoms of anxiety and depression at very high rates.

Sarah Nicastro: Yeah. So do you feel like... There's been a huge strain, right, on humanity as a result of everything you mentioned that we've encountered over the last few years. And that's kind of the challenge that we need to grapple with. If you maybe try and look for a bright side, okay.

Do you think that the collective stress we've all had to deal with over the last few years, has it opened eyes to the need to talk more about mental health in the workplace? Have you seen a change in people's openness to having dialogue, people's willingness to make changes in the workplace to be more accommodating?

Darcy Gruttadaro: 100%, yes. We are seeing mental health taking center stage. There is a recognition that we've been through a lot and our mental health has taken a hit as a result of that. And so the silver lining is mental health has existed in the shadows for too long.

And really there are myths and stereotypes that persist around mental health, that it's this dark scary condition that makes people act in ways that any of us would be sort of ashamed of in a sense, but that's all changing because more and more people are being upfront about the fact that they're feeling anxious, depressed, they're struggling with the substance use issue.

The more people talk about it, the more others are willing to come out and say, you're not alone. I'm experiencing this too. We know from surveys that younger generations are more comfortable talking about this. They have an expectation that the workplace will address these issues.

They're looking for it when they're making decisions about careers and where they want to work. So it is a positive development that mental health is coming out of the shadows and into the light. It needs to, because what we know is when you get treatment and connected with support and services, you can do quite well.

Sarah Nicastro: Yeah. Now how would you describe, based on where we are today, how would you describe the criticality of companies becoming more adept at managing mental health and providing employees support?

So there's been maybe less hesitant or resistant or reluctance, right, to do so, but I'm sure you also see a continuum, and that could be based on a variety of factors, location or industry of companies that are really advanced and doing wonderful things and companies that are lagging.

So what would you say overall in why and how it's so, so important for companies all around location, in a variety of industries to really grasp the need to put in work here?

Darcy Gruttadaro: Yes. So what we know is that people living with mental health conditions exist along the continuum from frontline healthcare workers to the C-suite. So having a mental health condition does not limit your ability to perform at an exceptionally high level.

And right now employers are really looking for high performing individuals in the service industry, in the tech industry, in the finance industry. And they know that people who are high performers may have mental health conditions. So they recognize... And the other thing is we have very low unemployment.

There's a real focus within organizations on retaining their high performers. So they want to make sure, given that we know high performers can live with mental health conditions, they want to make sure we have the right services and supports.

People have been through a lot, and even if we hadn't been through a lot, the expectations are growing that organizations will provide mental health services and supports. That it will be visible, that it will be talked about. They are really looking for that. So it's a retention issue. The other thing is it's an engagement issue.

If you're an employee in an organization that shows they care about you, not just your physical health, but your mental health too, you're going to walk into that business every day, or get ready to go wherever you're going in the field and you will feel much better about the fact that your organization cares about you. And in turn, you will be a high performer whether you live with a condition or not.

Sarah Nicastro: Right. Yeah. I think the points you brought up about engagement and retention are very, very important points for our audience, especially because I talk a lot about the fact that I think a lot of folks within our audience are amid a bit of a reckoning with employee engagement, because we as an industry have been so incredibly focused on customer experience that we've maybe overlooked a bit the experience of our employees and how engaged are they and how supported are they in all areas, right.

And then when you layer on the impact of the pandemic and all of that stress, there's a real recognition, I think right now to your point of, okay, this is real. We need to do something different. We need to make sure that our employees are supported and engaged so that they don't burn out, so that we can retain them because there is a shortage of talent.

And then as we bring new talent on, what is their expectation of what we can offer in this area? So I think those things are all incredibly valid. I wanted to ask, before we talk about the six ways to deal with burnout, I wanted to ask about if you think about service and some of the industries that we reach, what do you think are the biggest stigmas or misunderstandings that kind of persist?

Darcy Gruttadaro: Well, certainly stigma is associated with mental health conditions in many industries. I think industries that tend to be male dominated, that tend to have people who work out in the field, there can be perceptions that you should be tough. Just stick it out, suck it up.

Male dominated industries tend to have this tendency to really want to send the message that they're strong and they're tough and that somehow mental health can be linked with weakness. And when in fact we know, I mean, look at the professional athletes who have now come out and been very open about the fact that they experience anxiety, depression, substance use.

So we know some of the toughest athletes in this country at the highest levels are experiencing these conditions. So it's not a matter of toughness, but we still all have to work at breaking down some of those stereotypes and breaking down the stigma. And the best way to break down stigma is for people to share a personal connection.

So there's a real opportunity, but we have to chip away. It's not like we're going to wake up one day in stigma will be gone. We all have some responsibility, like we're doing here, to have conversations about it and to say it's not a matter of weakness. It could be really a matter of strength to seek help when you need it.

Sarah Nicastro: Yeah. And it's a really good point. I don't have any statistics off the top of my head, but I know that you hear stories of rates of real challenges and even suicide among men because they feel that elevated need to keep it in and struggle in silence.

And so this is an industry that's working hard to bring more women and all sorts of folks in and improve diversity, but it is still male dominated.

So that's a really good point to bring up that we need to be particularly sensitive to the fact that we don't want to reinforce, even subconsciously, that narrative of toughen up and suck it up. We want to make sure our teams know it's okay to say that they're having a hard time in whatever way that might be. Okay.

Darcy Gruttadaro: Yeah, I mean, I have to say I'm very impressed with construction and the field service industry, and really you all are doing important work around breaking down these stereotypes and that is what it takes.

Sarah Nicastro: Yeah, yeah. And to your point, there's no magic wand to make it go away, it's about having conversations like this, having conversations one-on-one.

This conversation blends over a lot into conversations about leadership because there's also this outdated or this misperception among leaders that feel they can't share or be vulnerable because it detracts from their position of authority, right.

And so we know throughout the last few years that I think leaders are moving toward a different model where they are more vulnerable and they see that as a strength, not a weakness.

And so when you can learn how to share appropriately and be open to the conversation, that encourages your employees to be willing to talk. So lead by example, right?

Darcy Gruttadaro: Yes.

Sarah Nicastro: Okay. So let's dig into the six ways that organizations can address burnout.

Darcy Gruttadaro: Sure. And let me just say, I think when people think of burnout they think individuals should just get over it. More exercise, more sleep, better diet, don't take stress so seriously, when in reality what the research shows is that, yes, we have individual responsibility when it comes to burnout, but there's a huge amount of responsibility that comes from organizational change, operational change.

There's been excellent research done on this by Dr. Christina Maslach and what she has shown is there are six factors, as you said. One is workload. Now workload can be difficult when we have people leaving the workplace because other people have to pick up the slack.

But what we want to do as leaders is make sure we're keeping track of whether people have a reasonable workload. Sometimes it'll be a little higher than usual, but then other times, make sure you're bringing it down to about where it should be. That's really important.

Two is autonomy and control. Do people have the chance to make some decisions about their day, about their work? And again, we all have key performance indicators. We all have goals that we need to reach. So it can be a small decision that people feel like they can make, but people want to have some control over their work day.

So autonomy and control is important. Three is sense of community. Let's face that we spend most of our waking hours at work. Do people feel that sense of community at work so that when they go to work in the morning, they feel like, oh, I really feel like I belong to this organization? Now that can be true in the field too.

You have to create with field work some opportunities for people to feel like they have that sense of a group, of a community. And the way you do that is you plan social activities, you find ways for people to form groups around topics they care about, to share information, employee resource groups.

The fourth thing is reward and recognition. And this is not per se huge awards and big monetary awards. This is just managers recognizing people want to be told, job well done, thank you for your work, it means a lot.

Really just taking those moments in our busy day when we're all doing more than we should be at work to say, I appreciate you and I see you and I want to recognize you, either in front of your peers or not, but you're being recognized for your good work. Four is that sense of, five rather is the sense of fairness.

So are people being treated fairly? If there are favorites, that's not going to sit well with others, really. And we're human beings. I mean, managers may have a slight favorite, but it's recognizing that has an impact. So try to create a situation in which everyone feels fairness somewhat evenly.

And then six is valued. People want to feel purpose and value in their work. So for leaders and managers, remember to share with people when they're out in the field how important their work is to the bottom line of the organization.

Because if people feel valued and feel like there's a purpose in them going out into the field and they're going out into the field every day, that they're making a difference for the bottom line of the organization and they're bringing value to what the organization can achieve, if they feel that sense of purpose and value, they're going to be much more likely to say, I can do this.

Even when it's hard, even when workload goes high, I understand that I'm important to this organization because I've been reminded of that by my manager, by my leader and others. So those are the six areas, and it's not rocket science, Sarah.

And it's not a massive investment. This is recognizing human nature and not feeling like, oh brother, I have to pat people on the back. You do need to remind them they're appreciated and reward them when the time is right.

And because we know 4 million people left their jobs during the pandemic, we are in a very competitive work environment and people have choice. So you want to be the place people want to go to and be part of every day.

Sarah Nicastro: And when you're in a service business, right, you're relying often on those people to be the face of your brand. Right. So you need to have them be in a place where they are engaged and feel valued and are committed to that experience. Otherwise, you're not only facing the realities of the talent situation, but you're also risking that customer experience that is really important.

Those are really good points. And I think it's funny that you say it's not rocket science. I feel like so many of the things that we talk about here fall into that category in the sense of it isn't some mysterious or incredibly challenging thing that gets overlooked, it's the simple things.

It's the simple things that have an incredible impact that are where companies make missteps that really take them off course. So I think it's great to have those six sort of tangible areas of focus. One of the things I wanted to ask about, Darcy, is what advice would you give around, I guess being programmatic versus being personal? Okay.

And the reason I say that is there's a gentleman named Jordan. He works for a company called QIAGEN, and he is in Australia. He was on the podcast quite a while ago and we talked about mental health and he's a field service leader and he was sharing specifically some of the things that he's done.

And his point was, the biggest impact he's seen is around just making the topic a very regular part of every conversation and how he's incorporated that into meetings, how he's incorporated into his one-on-one dialogue with his team, et cetera.

And so I think both ends of that spectrum, coming up with something programmatic, we know that what we measure gets attention. What we focus on as an organization in an organized way will get the focus it deserves and this is certainly something that deserves focus.

At the same time, sometimes with I guess topics like this that are a little bit more on the human side, right. So mental health or diversity, you run into people doing it to check a box instead of doing it because they have that personal connection or they authentically care.

So what advice can you give people on how to balance creating effective programs that will help you achieve results at scale, in progress related to mental health, but also balancing that with authenticity and genuine connection in a way that matters to individuals?

Darcy Gruttadaro: Yeah. I mean, people know when it's authentic. So the check-the-box approach does not work well. So if you do one training and say, we did a mental health training, we are good, that is not going to make a big change for your organization. And leadership sets the culture.

So the more leadership is visible in talking about mental health, the more it's happening at a leadership level and operational and managerial level. And I agree 100% with Jordan that people really appreciate when you make it a part of the culture because it's something that gets incorporated into conversations, into check-ins, into health fairs, into annual performance evaluations.

You really have to make it real and it's worth the investment to do that. And the other thing is, I think it's really important to recognize we all get busy and sometimes we forget. So creating as a leader within an organization or a manager or supervisor or an employee, just those simple reminders around I'm part of the culture, I need to be real about making it a mentally healthy culture.

I can do that by complimenting my colleagues, in giving we receive when it comes to kindness. And also recognizing the six factors and maybe keeping them posted somewhere where you won't forget that reward and recognition matter, that autonomy and control matter, just because we all forget, we get busy.

And let me say one thing about burnout. Burnout became an issue of major concern in 2019 when the World Health Organization announced a new definition. It is not a product of COVID-19. So it's important to know that because we were already heading into concerns with occupational burnout and that has obviously been intensified.

So all the more reason to make it programmatic, as Jordan said, to make it part of the culture, for it to be visible in multiple ways with authenticity because that's when people will believe it and feel psychologically safe getting the help they need when they need it.

Sarah Nicastro: I think too, that's a really good point, that this topic did not become important because of COVID, right. It simply maybe helped surface the criticality of getting a better handle on it, right. And so that also means that for anyone that thinks, well, COVID is over and we don't need to worry about that anymore.

Let's just go back to grinding it out and high pressure and we don't need to do X, Y or Z anymore. You couldn't be more wrong, right. This is something that needs to be part of the culture from this point forward.

I think going back to the point you made earlier too, almost every organization that I talk with is kind of grappling with what will their recruiting and hiring plans look like for the next 1, 3, 5 years, right.

And so to your point about the younger generations and their expectations around this topic, that's something else we need to be thinking about. Is there anything on that point specifically that you would point out that the younger folks in the workforce expect? Anything companies are doing that you think is particularly appealing or impactful for them?

Darcy Gruttadaro: Yeah. Again, it gets back to the simple notion of make sure mental health is visible in a programmatic way, in how you talk about your organization. I mean, in the recruiting process you can say mental health and wellbeing matter to this organization.

Here's how we are addressing it. Here's what we have to offer as an organization. And work is work, so let's be real. I mean, we all have work to get done, but it's how we do our work and it's how we treat each other and it's how our workday goes.

I mean, one simple piece of advice is for managers and leaders to ask themselves, is this an organization that I feel good about being part of on a daily basis?

And if it's not, what minor changes can we make to make it more so? And even think about surveying your employees because they have really good ideas. Believe it or not, it's often not about a lot of frivolity that'll cost a lot of money.

It's sometimes just simple policy changes that are very workable that can make all the difference in the world. And this all hits the bottom line when it comes to retention and recruitment and really meeting the organizational goals.

Sarah Nicastro: Yeah. Yeah, I think there's an era of leadership or culture where it was all around trying to ring every last ounce of productivity out of every employee. Right.

And I think just really genuinely understanding and believing that that model doesn't work as well as giving them more support, encouragement, recognition, making them feel connected and how that pays dividends in terms of not only retention but just output. Right.

I mean, people will work harder if they feel supported and can genuinely be invested in what they're doing than if you're just ruling with an iron fist, right. So I think that that's really important. Go ahead.

Darcy Gruttadaro: Yeah, I was just going to say, you made such a great point earlier that I just want to amplify and I will use again, that when people are in the field, they are representing the brand of the organization.

And the more they feel good about what they're doing because they're being treated well and they're in a culture that cares about them, the more they're going to project a positive image for the brand, which really matters at the end of the day with the competitive marketplaces we all work in.

Sarah Nicastro: For sure. And I also like the point you made about most of the time making really positive changes does not require a huge budget or investment, right. So I want those listening to understand that this isn't something you should procrastinate because finances are tough and we don't have budget for another program, right.

Some of the things we're talking about, I think some of the things that matter most are the personal aspects, the person to person aspects that don't cost anything. So I would urge everyone to go back to those six points and think about what is realistic for us to start doing today to improve because it doesn't have to cost a bunch of money.

I know there's a gentleman that's spent on the podcast, Gyner Ozgul, he's the CEO of SmartCare. And throughout the pandemic, he made it a point, he had a goal, I think it was 2, 3, 4, something like that, but he would call a field technician through FaceTime and he would do so many a week just to say, "Hey, how are you doing?"

And people just overlook the impact that has and it's just a commitment of a 10 minute phone call, right, and it can make a huge difference. All right. Darcy, any other thoughts, comments, words of wisdom for everyone?

Darcy Gruttadaro: No, I think it's just important to remember that the workplace is what we make it and that all of us have a contribution to make in creating a caring culture. Whether you are brand new to the organization and at an entry level or you are at a C-level, you can make a difference.

And it really is about caring for each other and asking, "Are you okay? You don't seem like yourself. I'm just checking in to make sure everything's good." And the more we do that, the more we create that caring culture that people want to be part of. So every little bit counts.

Sarah Nicastro: Yes, absolutely. Can you tell folks, so if they wanted to learn more about what the Center for Workplace Mental Health does, resources, et cetera, where can they find that information?

Darcy Gruttadaro: Yes. We make it easy, it's workplace mental health.org. And actually on our website under employer resources, we have a free fairly new infographic on burnout that has the six factors with an explanation of each and some strategies on how to incorporate them into your operational level of your organization. So I would say, take a look at that and we have lots of free resources on our website.

Sarah Nicastro: Excellent.

Darcy Gruttadaro: So that's the best way to reach out.

Sarah Nicastro: Okay. I'll make sure we link that infographic in the show notes for the podcast and give people a chance to come and check out some of the free resources you offer. Thank you so much, Darcy, for joining me today and having this conversation. I really appreciate it.

Darcy Gruttadaro: Such a pleasure. Thank you for having me, and thanks for your great work.Sarah Nicastro: Thank you. You can find more by visiting us at futureoffieldservice.com. You can also find us on LinkedIn as well as Twitter @TheFutureOfFS. The Future Field Service Podcast is published in partnership with IFS. You can learn more at ifs.com. As always, thank you for listening.

By Sarah Nicastro, Creator, Future of Field Service

If you’ve been following Future of Field Service for any amount of time, hopefully you know I am passionate about the discussion around mental health. It’s such an important topic, one that impacts me personally, and thankfully one that is beginning to get more attention – and action – in the workplace.

However, while I’m among the ranks that are thankful greater attention is being given to the need for better mental health support at work, there’s still much to be done. Many stigmas still exist, many organizations lag far behind what’s acceptable in accepting the need for more focus on mental health, and many individuals are still struggling without the resources and support they need and deserve. And therefore, the quest to talk about this topic in an actionable way continues!

To that end, this week, I am thrilled to welcome to the podcast Darcy Gruttadaro, Director of the Center for Workplace Mental Health, part of the APA Foundation. Our podcast episode is on six ways to address employee burnout and it’s a must-listen coming Wednesday. In the meantime, I wanted to share from my conversation with Darcy eight facts around mental health that I feel we all need to better understand and urge action on.

#1: We All Have Mental Health

This is such an important point to start with – that we all have mental health, and we all deserve for our mental health to be supported at work. “We all have mental health and mental health exists along a continuum,” explains Darcy. “So, our mental health may be in a really solid, healthy place even if we live with a mental health condition like anxiety, depression or another one. Or it may be slipping, and it may be that it's really not doing well at all. Mental health exists along a continuum.”

Whether you have an employee that is generally healthy but going through a hard time or has a mental health condition that is very well-managed, it’s important for them to feel supported in the workplace. It’s also important for employers and leaders to understand that many incredibly high performers achieve all they do while managing a mental health condition. “We know that people living with mental health conditions exist along the continuum from frontline healthcare workers to the C-suite,” says Darcy. “Having a mental health condition does not limit your ability to perform at an exceptionally high level.”

#2: We All Share Responsibility Around Mental Health at Work

Second, we all must accept that we have a personal responsibility around mental health at work. While companies should absolutely be prioritizing an investment in creating and expanding mental health programs, a lot of the foundational work begins with individuals. “There are myths and stereotypes that persist around mental health, that it's this dark scary condition that makes people act in ways that any of us would be sort of ashamed of in a sense, but that's all changing because more and more people are being upfront about the fact that they're feeling anxious, depressed, or they're struggling with the substance use issue,” explains Darcy. “The more people talk about it, the more others are willing to come out and say, you're not alone. I'm experiencing this too.”

Being open about struggles and needs is one way the conversation takes hold and reduces or eliminates those long-standing stigmas, but even if you have no current personal mental health challenges to speak of, you should be contributing to creating a supportive workplace for those who may. “It’s important to remember that the workplace is what we make it and that all of us have a contribution to make in creating a caring culture,” Darcy emphasizes. “Whether you are brand new to the organization and at an entry level or are at a C-level, you can make a difference. It really is about caring for each other and asking, ‘Are you okay? You don't seem like yourself. I'm just checking in to make sure everything's good.’ And the more we do that, the more we create that caring culture that people want to be part of. It’s important to remember every little bit counts.”

#3: Improving Mental Health at Work is Key to Your Talent Strategy

Are you aware there is a greater expectation among younger talent that companies have structured mental health programs and ample support in place? Putting effort into a mental health program will not only help you to ensure your existing talent is engaged, supported, and healthier, but it is becoming a facet of recruiting new talent as well.

“We know from surveys that younger generations are more comfortable talking about this. They have an expectation that the workplace will address these issues,” says Darcy. “They're looking for programs when they're making decisions about careers and where they want to work. The expectations are growing that organizations will provide mental health services and support. That it will be visible, that it will be talked about. They are really looking for that. And because we know 4 million people left their jobs during the pandemic, we are in a very competitive work environment and candidates have choice. So, you want to be the place people want to go to and be part of every day.”

It's understood that high performers can have mental health conditions, so for companies looking to attract and retain high performing talent, having support in place can help these employees stay ahead of any issues and take care of their needs. “Right now, employers are really looking for high performing individuals in the service industry, in the tech industry, in the finance industry. And we know that people who are high performers may have mental health conditions,” says Darcy. “So, companies recognize the increased need for services and support.”

Finally, employers should understand there is a connection between mental health support and employee engagement. “If you're an employee in an organization that shows they care about you, not just your physical health, but your mental health too, you're going to go to work every day and feel much better about the fact that your organization cares about you. In turn, you will be more likely to be a high performer, whether you live with a condition or not,” says Darcy. “Employees in the field, they are representing the brand of the organization. And the more they feel good about what they're doing because they're being treated well and they're in a culture that cares about them, the more they're going to project a positive image for the brand.”

#4: Male Dominated Industries Lag in Addressing Mental Health

When you consider that much of our audience is comprised of industries that are still male-dominated, it’s important to acknowledge the reality that these industries tend to lag in normalizing mental health and creating at-work support. “Stigma is associated with mental health conditions in many industries. I think industries that tend to be male dominated, like many that have people who work out in the field, there can be perceptions that you should be tough. Just stick it out, suck it up,” explains Darcy. “There’s this tendency to want to send the message that they're strong and they're tough and that somehow mental health can be linked with weakness. We still all must work at breaking down some of those stereotypes and breaking down the stigma.”

How do we do this? There’s no quick or easy way but recognizing the impact of opening up personally and being willing to engage in conversation is an important start. “There's a real opportunity, but we have to chip away. It's not like we're going to wake up one day and the stigma will be gone. We all have some responsibility, like we're doing here, to have conversations about it and to say it's not a matter of weakness. It could be really a matter of strength to seek help when you need it,” says Darcy.

#5: Mental Health Initiatives Don’t Need Require a Huge Investment

I find this point to be so very important, which is mental health initiatives do not need to be based on a big budget or huge investment. This could be a barrier for organizations in taking action, so I appreciated Darcy pointing out that companies of any size, scale, and financial status can take steps to have a positive impact.

“A focus on mental health is not a massive investment. This is recognizing human nature and reminding employees they're appreciated and rewarding them when the time is right,” explains Darcy. “I mean, one simple piece of advice is for managers and leaders to ask themselves, is this an organization that I feel good about being part of on a daily basis? And if it's not, what minor changes can we make to make it more so?”

Just starting there is starting – and that matters far more than feeling you must have a perfectly planned formal program to “begin.” Darcy also suggests asking your employees for their input. “Think about surveying your employees because they have really good ideas,” she says. “Believe it or not, it's often not about a lot of frivol that'll cost a lot of money. It's sometimes just simple policy changes that are very workable that can make all the difference in the world. And this all hits the bottom line when it comes to retention and recruitment and really meeting the organizational goals.”

#6: Leadership Sets the Tone on Mental Health at Work

While it is important to ensure your company is taking a programmatic approach to prioritizing mental health and providing employees support, it’s also important to remember that authenticity and a personal touch can be the difference in how that program feels to your employees. “A check-the-box approach does not work well. If you do one training and say, we did a mental health training, we are good, that is not going to make a big change for your organization. And leadership sets the culture,” cautions Darcy. “So, the more leadership is visible in talking about mental health, the more it's happening at a leadership level and operational and managerial level.”

We all get busy, and often leaders are juggling immense responsibility. But making a human connection with your team a priority is well worth the effort. “It's really important to recognize we all get busy and sometimes we forget,” says Darcy. “Create simple reminders around I'm part of the culture, I need to be real about making it a mentally healthy culture, and so on.”

#7: Burnout Isn’t an Individual Issue

As I mentioned, the podcast with Darcy that will publish on Wednesday is discussing six ways employers can alleviate burnout. I won’t give too many spoilers here, but I will say that Darcy expressed that we must recognize that burnout isn’t simply and individual issue – and that it was becoming a major issue even before the pandemic. “Burnout became an issue of major concern in 2019 when the World Health Organization announced a new definition. It is not a product of COVID-19,” explains Darcy. “It's important to know that because we were already heading into concerns with occupational burnout and that has obviously been intensified.”

While every individual has a responsibility to take care of themselves and speak up if they need support from their employer, Darcy stresses the fact that we cannot blame burnout solely on individuals or expect the issue to resolve without the shared ownership of employers. “I think when people think of burnout, they think individuals should just get over it. More exercise, more sleep, better diet, don't take stress so seriously,” she describes. “What the research shows is that, yes, we have individual responsibility when it comes to burnout, but there's a huge amount of responsibility that comes from organizational change, operational change.”

#8: There Are Ample Resources to Support Businesses Making Mental Health a Priority

Before I was introduced to Darcy for the podcast, I wasn’t familiar with the Center for Workplace Mental Health or the resources it provides – free of cost. So, if you are struggling with where or how to start or feel your employer is lacking in their efforts around mental health, know that there are resources to help increase awareness, provide information, and assist in creating impactful programs. Learn more at www.workplacementalhealth.org.

Sarah talks with Berit Hallgren, Program Director at Tetra Pak, about lessons learned in her 30+ year career with the company on what it takes to achieve the strategic alignment, prioritization, and change management that contribute to a successful service transformation. This conversation is from the Stockholm Live Tour event.

Sarah Nicastro: Let's go ahead and get started. So, I'm going to welcome next Berit Hallgren from Tetra Pak. Berit, come on up. Hi. Thank you for being here.

Berit Hallgren: Thank you for having me here.

Sarah Nicastro: Okay. All right. So, what we're going to do is take another look at service transformation, and so have another perspective on what it takes to achieve success. So, Berit, you have now the advantage of having heard some of the other speakers. So, you can build off, of some of the points that have been made, so that'll be great. So, go ahead and tell folks a bit about yourself, your role, and what service means to Tetra Pak.

Berit Hallgren: Yeah. Thank you, Sarah. So, hi everyone. I'm Berit Hallgren and I play many roles in life as all of you do and I think I've got the toughest part after lunch because that's the part when people tend to fall asleep, right?

Sarah Nicastro: No sleeping allowed. I will be monitoring. I'm going to be calling you out, so just stay awake.

Berit Hallgren: First of all, I'm happily married. I have three grown up kids, so that's one of the roles in life I play and then I'm also part of Tetra Pak. So, I'm employed by Tetra Pak since actually 30 years back so it's a long time. Always been based in Sweden and basically always been working internationally. Tetra Pak is an international company, doesn't mean that you work internationally, but I've always done and mainly within the service business.

So, I have approximately 10 years in administration. So, I'm not an engineer, maybe that's something good for Tetra Pak as well but we don't only have engineers. And then approximately 10 years in project management and five years in line management. So, I'm part of our service business and right now I'm driving a major transformation within services. So, we are transforming our way of working basically going digital.

So, it's a bit of digital transformation. That digital transformation has actually started some backwards, 2014, '15 with small steps. Thinking about what Dan said earlier this morning and now we started the real transformation in 2020, basically when we set our new strategy. So, I'm leading that initiative which actually consists of seven different projects. Where field service management is one of them.

Sarah Nicastro: And you just took a new role not long ago, right?

Berit Hallgren: Yeah.

Sarah Nicastro: So, leading the team that is overseeing the operational excellence of the transformation, am I understanding that correctly?

Berit Hallgren: Yeah, absolutely. So, we are in a matrix organization when it comes to driving this transformation. So, we have clear business owners for the areas that we want to transform. So, I'm responsible for delivering the transformation business case basically because, of course, if the company invests, they want some payback and some return as well.

And also responsible for securing that we deliver the solutions in the end, but I'm working closely with my peers who are the business owners. So, they decide the what in the end and then together we deliver the transformation. So, I'm responsible for the business case and they are responsible for the what, and together we make sure the transformation happens.

Sarah Nicastro: Okay. So, can you describe the current transformation project at a high level? So, what are the primary objectives and where are you at in the process? So, you said a new strategy was set in 2020.

Berit Hallgren: So, new strategy was set in 2020 in the whole of the company. When we set a new strategy, we normally work with partners. So, together with the partners, they find the opportunity in services. We can really do things differently moving forward and we have been... As many of you guys as well, service was a call center, many years back and we started our service becoming a business around 2000. So, we've been on that road for 20 years, approximately. So, through the strategy work the high-level opportunity was defined. And at the same time, that was a VP in services assigned to actually own this transformation. And I was assigned to drive the transformation.

So, the first thing we did, we did an analysis. So, I actually brought together a team with finance, HR, market experience, service experience, and project management experience. I had myself. So, we did an analysis of a little bit of more detailed analysis to understand what are really the areas that we need to transform and how do we make that happen?

So, basically the objective, we came out through that analysis. We decided that we can, and we will enable more growth of the service business. We need to lower down the cost to serve our customers. And then we need to simplify and improve both the customer experience, but also the employee experience. And I think the employee experience is a really important part here, the others as well, of course, because our field service guys and women, not so many, but a few, they are actually the voice at our customer sites. So, they are the ambassador so it's really important to have them on the journey.

So, with these four objectives, we also identified, we have four levers basically. So, we are working in the remote services area and connecting our equipment so that's one lever. The second lever is field service management. So, how can we automate that as much as possible? And then we have the competence development of our customers and our people, and finally the future workforce, how does it look like and the employee experiences as well.

Sarah Nicastro: So, based on everything we've talked about already today, the fact that you're owning this transformation, I mean, that's a pretty tall task to sign up for.

Berit Hallgren: Yes, it is.

Sarah Nicastro: And what makes you excited about the role you can play in Tetra Pak's transformation journey?

Berit Hallgren: Yeah. What makes me excited is that we have a clear vision where we want to go, but we need to do that in a step wise journey. And thinking about the customer, always putting the customer first and putting the employees first as well. That's really what excites me and what we can bring to our customers and to our employees and also to the company with this whole transformation and the new opportunities it actually brings for the future.

So, I was reflecting quite a lot this morning when Dan was talking about the digital transformation versus the innovation. And I think as many others, we also went wrong little bit in 10 years back. So, it was all about HoloLens and all this cool stuff, the cool technology, but what will you do with the cool technology, if the backend isn't working and all the other things are not in place.

And that's exactly what happened with us as well. So, now it's really, I mean, the transformation we're doing now is really to put the backend in place and getting the foundation in place for the future and then we can build on that. And that's really, what's what excites me to be part of this journey because we've been on it for many years already and trying bits and pieces, here and there, and now it really happens so that really excites me.

Sarah Nicastro: Did anyone else notice how firmly Berit said, "We can, and we will increase service revenue." And I love that very firm commitment and that comes from having conviction in that opportunity. So, the question I'm wondering is, we talked a lot this morning about one of the barriers to transformation... I know I'm going off script. See, Berit, that's I do it.

Berit Hallgren: No, that's fine.

Sarah Nicastro: But one of the barriers being resistance to change. Okay. Now, you, yourself have been a part of Tetra Pak for 30 years. So, what do you think the key is for someone with that amount of tenure who was literally with the business in a different phase of its existence, how do you stay open to what the opportunity is today and into the future?

Berit Hallgren: Yeah, really good question. Sarah. I've been reflecting because sometimes when I tell people I've been with the company for 25 years, for 30 years, and I say, "Okay, why am I still here?" And I think it's really about, for me, I'm changing job every third year, approximately and Tetra Pak is a big employer in Lund, Sweden. So, I have the possibility to really going from one area to another, which also develops people in the end. So, I'm curious as a person and I need change. I mean, that's my mindset, that's what I eat and breathe, basically. I need regular change because I get super bored otherwise and I think that is... So, the biggest challenge I think for us is really... Or what you need is really the right mindset.

So, you need to find the right team from the beginning who can really help starting off the transformation because there will always be the detractors and there will always be the front runners and you need the front runners in the beginning, but then you need to attack the middle. All the middle mass, that Dan and many others talked about as well earlier today. Because if the middle mass isn't with you, it doesn't happen. So, mindset is one part and I think capability is the other part. And I have some capabilities, but I don't have them all right.

So, how do we also bring the outside in perspective? And that was important when we did the analysis too, that the benchmark piece is really important and the outside in perspective. So, how do we make sure that we bring the right capabilities that we need who can help us on the transformation? And I think the third one is time because it takes time to drive the transformation. So, at the same time, you need to show what are the benefits and the values with what you're doing, but you also need to deliver some early results. So, the company really believes in, "Okay, this can happen, and this will happen." Because if you don't have some proof in the pudding, why should we do a huge investment as Tetra Pack is doing right now in this big transformation.

Sarah Nicastro: Yeah. No, I think that's really good, and I always think it's a testament of a really good employer when you have people who have been able to evolve many roles in the same company. Because a lot of times people like you who need change and they want to challenge themselves, they end up doing that elsewhere.

So, it's three years with one company. Okay. So, when you can do that all within one organization, I mean, that typically is an indication of a good business to be a part of. So, we talked this morning a lot about the need to eliminate silos, create better alignment towards the objective to create more collaboration and how we work.

So, in a lot of ways, the team that you've built and the function you're serving now is to really make sure that alignment happens with this service transformation journey. So, what are some of the ways you're doing that?

Berit Hallgren: Yeah. I should also say that in actually we have right now ongoing a big, huge reorganization in the company. So, my manager, who is the VP owning the program, she realized that, and I realized as well, we are too few people. We need better business owners and all of that. And then came the company reorganization, so that helped. Otherwise we would have had to do something else, but with that reorganization, she had the opportunity to really put together a great team who can really lead this whole transformation.

So, that was part of her, putting the organization in place and selling the idea, both to top management so that she got the resources she needed and also to the people she employed in the end. So, how do we then work together? Well, I would say we are doing mainly three different things. One thing is that we are working on two levels in the organization when it comes to the stakeholder management, the communication, and getting people on board. So, my manager, she works on her level and upwards in the organization and then, me and the business owners, we work on our level and downwards in the organization. So that's how we manage the stakeholder management.

Sarah Nicastro: But you and her need to stay aligned...

Berit Hallgren: All the time.

Sarah Nicastro: Lock step on what is the message up, what is the message down, right?

Berit Hallgren: Exactly, and we do. The second thing we do, we decided quite early on that we want to work in an agile way. And the company is doing that already in different areas, bits and pieces, here and there. Succeeding better in some areas than in others, but we decided quite early on, we want to do it in an agile way, because if we do it in the traditional way. We will develop and then, X years later we will deploy, and we believe we are deploying the right thing. No, we are not.

So, we decided early on agile and that we are using this scrum methodology. And then we have implemented that in the projects step by step. So, not taking everything in a big chunk, but bits and pieces being rigid on the principles of agile and making sure at the same time that we learn by doing basically.

Sarah Nicastro: So, rigid on the principles, flexible on the approach.

Berit Hallgren: Exactly. And then when we do that, we also explain to the people who work in the project that, what is an MVP? What does it look like? So, what is the assets? Where do we want to be? And this is what we are going with right now. And making sure that people really understand the concept of agile, understand the concept of MVP.

So, we create the right expectations with the end users when we are coming. And I think the beauty of the agile is that we involve the end users from the beginning. So, since we are rigid on the principles, the end users are part of the development. Some of the development project it's projects itself or themselves, but also through the sprint reviews. So, they have an early say early on and they will bring perspectives that we haven't thought about, but in my market, it works like this.

Okay. Maybe this is something we need to investigate to understand. If there is something we need to adjust on the journey, which means when we come to the market, they're already prepared to some extent, and then we make sure to handhold them and we don't let them go until the project is finished, basically. And then we are evolving over time. So, working on two levels, stakeholder management, working agile, and then at the same time, there are more transformations ongoing in the company.

So, we stay close to one other big initiative, which is sales and marketing transformation. So, we work very closely to make sure that we have the same message to the market in the end, because the market is the sales companies, and they are working across there. So, they don't care about who is capital equipment, who is services, and who is what's really. So, those are really the three top things we are doing to make sure that we will succeed in the end.

Sarah Nicastro: What are the primary ways that you, as a team interact with the various stakeholders in the business? So, what are the forms of communication? What is the frequency for the transformation team, the excellence team to communicate with everyone?

Berit Hallgren: Yeah. From the project levels, we do the sprint reviews, that's the primary communication channel and that's happening every third, fourth week. So, it depends on project so that's how we stay close with them. Then from the program perspective, we are doing demos on a regular basis, retrospectives, and planning, and that we do on quarterly basis. So that's when we invite the more senior stakeholders to take part of the planning.

And you need some form governance, even if it's agile. So, you need to understand, are things going in the right direction. So, we are doing monthly steering team meetings, basically on the program level, if there is a need. If there is no need, then we skip it basically. And then my manager, she reports in her management team on the monthly basis, how things are going. I'm doing the same in our management team on a monthly basis and then we do what else is needed, when we feel that.

Clear communication plans in all the projects, of course, as well. So, change and communications work closely together. So, we have a change manager for the program. And I think that is something, it's fluffy for many, what does it really mean? But if you don't take that seriously, the whole change part, there is a huge risk for failure. So, so I said from the beginning, we need to change manager in the program. Otherwise, we will fail because there's so many things to keep together so that we do as well.

Sarah Nicastro: Yeah. I think that's really smart. I think that if anyone follows my content, I've written and have said many times that change management is a topic that I have issue with, because it is always the number one reason the projects fail, but it continually is deprioritized, de-emphasized, budget cut, et cetera. So, it's widely recognized as important. Yet, often not given the time, energy, and investment that it deserves. So, I think that's really smart. Rafael was saying this morning, some of the real emotional reactions to this type of thing and at the end of the day, I think, if not the most important, one of the most important aspects of getting out of that hard middle to something toward your vision.

I think that is something that keeps people stuck here, because if it's not done well, a lot of the other things you've done right, don't matter nearly as much so I think that's really good. You also mentioned the tie in with sales and marketing, which I find really interesting and think is very important and we probably don't have time to really dive into this, but I have done some content on how are we selling modern service and are we doing it justice, and are we speaking the language of the customer and are we taking sort of our internal journey and articulating it externally in a way that resonates and things like that. So, I think it's very interesting.

You mentioned that you're responsible for the ultimate return on investment of the transformation. And so, one of the questions that has come up at a lot of the events prior to this one is advice for business case for transformation. So, that's one part of my question is, do you have any advice for that? The second part is you mentioned, this middle phase. So, you sort of, Tetra Pak started this journey a while, figured out what it was going to look like, and then, 2020, it clarified. Now we're here before we get to here. And so, when you're in that middle phase and things, it requires patience, there's some costs, there's some hiccups. So, what are the ways you are finding to communicate successes, even amid some of the non-successes or some of the slowness toward the ultimate success?

Berit Hallgren: Yeah, good question. So, if I start with the business case one, we decided early on that we need to do the business case on program level, because all these four levers, they are intertwined in the end. So, it will be extremely difficult to say what benefits come exactly from where, from there or here or there, it doesn't really work. So, we were clear on that to the company already from the beginning that don't come and ask us to follow up on the details because that will just be non-valid-added work because someone wants to see it so that we were clear on from the beginning. Then of course, we do a business case for each of the projects because you need to justify the transformation, but all those business cases needs to add up to the full one in the end and then we follow up on the full one.

And, when we do the business case, there are certain hard numbers like productivity gains that we will get but we are talking about them as more as avoided cost. Because the business will grow, which means service is a people business. So, the number of people needs to grow as well. But not maybe in the same ratio as it has been doing before. So, we talk about it as cost avoidance, and we also talk about it as how can we utilize our technicians better. So, there is a benefit there as well, but we are also talking about lost sales.

So, if we don't do this transformation, how much of the growth opportunity will not happen because we are not modern any longer. And that's what we are not counting in the business case as such, but we openly talk about it. So, it's clear for the company, this will not happen if we don't do this. So, that's some advice from the business case perspective. And then your second question was-

Sarah Nicastro: While you're in process and things are... Yes.

Berit Hallgren: And how do we communicate? Yeah, exactly. So, we started early on, we did some trials, many projects here and there, and then it was decided, and here is the end goal. So right now, if I take a practical example, we were supposed to go live with FSM Solution this Monday, but we didn't. And even if we were in a troublesome state a couple of weeks ago. We were supposed to do a user acceptance test with our end users. We decided to go to Panama to start the user acceptance test and do it as much as we could. And in there was some really good wow moments for the people.

So, the commitment is there from the market. And that is what we are communicating now. So, we are communicating transparently, why are we not going live? What is the problem? How are we addressing that? How are we re-planning? But even we decided to do this, get these wow moments, and people are really committed, but now when we go live, we can't fail. So, it has to happen the second time otherwise we lose the trust. And I think this is the beauty of the agile way of working.

Then we are doing some other things when it comes to automation of our processes. So, we have some good success stories there with our customers as well, that we are communicating. So, being transparent, I think everyone here does policing and you all know what red, green, and yellow means. So, we are open with that. The program is currently yellow and has been for half a year, but we are open about that. This is our challenges, and this is what it is and if we need senior management support. Then this is what we say, "We need your support to remove these and these roadblocks."

So, transparency was mentioned earlier today as well, and I think that's key. You don't hide, you don't try to imagine something that is not going to happen, but there are some successes along practical things that you can really communicate about as well and show to the company.

Sarah Nicastro: I think transparency is an underutilized art. Okay. So, does anyone have questions for Berit before I drawn on. You're my favorite delegate, by the way. Not that I have favorites, but if I did, you would be it.

Audience: It's really inspiring, and the story relates a lot with my journey also and what we have done at Electrolux. But I have a question you mentioned about being very strict on change management and having a change manager. And then you also said about agile principles, but being flexible on the approach.

So, having a program and such a big transformation program where you have almost 200 or 250 or more than these people, or even in a project there are 50 plus people or something, then how do you make everyone work on agile principles? Because not everyone is super knowledgeable or super trained in that way of working. So, do you have some agile coach, or do you keep on doing every weekly, some trainings or coaching, and analysis, so how do you manage that?

Sarah Nicastro: That's a really good question.

Berit Hallgren: Good question.

Sarah Nicastro: I was thinking you're almost teaching agile as you're doing the project, right?

Berit Hallgren: Yes, we are. We have an agile coach, an external one because we didn't have that capability in the company. But this guy has been working with Tetra Pak for many years in other agile transformations. So, he knows the company. He knows many people in there so that helps a lot. So, and he's really guiding us step by step. So, we, early on created learning journeys so people could take them. And last year, second part of last year, we talked a lot about agile in the program and now three of the projects are really up running. So, he's coaching them a little bit, but we are managing quite good by ourselves and in the program as well.

Now we have some new projects coming up that will start because everything is not starting at the same time. So, then he will be there to support those projects. And I think in learning for us is that... This was with IFS specifically that we are changing now. We were working agile, the business team, the Tetra Pak IT Team, but not IFS. And there has been clashes, of course, which doesn't help anyone. So, now with phase two with IFS, we will go fully agile together and that will help. While in the other projects, we have been doing it agile all the way through.

So, that's how external coaching again, to help us on the journey because otherwise we wouldn't succeed. Change management, we actually hired an HR person in Tetra Pak who has a lot of change management experience who has been driving change management projects or change management within projects as well. So, she has the capability, she has the methods, she knows what to do and then she helps the projects to apply the methods. They are super annoyed in the project from time to time because, "Oh, why do we need to do this? And why do we need to do that?" But suddenly they realize, and they understand and comps and change management are working hand in hand because that's also a critical success. So, you need to have dedicated comps people with you on the journey who can help you.

Sarah Nicastro: And those points of annoyance are where if you were relying on those leaders alone to handle the change management, it would just get pushed aside.

Berit Hallgren: It wouldn't happen. So, I'm not driving any of the projects, our people doing that, but I'm very much engaged in all the projects. So, for sometimes I need to be step in and be the facilitator because the change management person have her perspective. The project team has their perspective, and they talk by each other. So, then I'm stepping in to say, "Guys, this is what you wanted." She is like, "Okay, fine." So that's, how I'm also actively working with the project.

Sarah Nicastro: There's a podcast I did a while back with a gentleman named Dan McClure and it was talking about incremental improvement versus innovation. But one of the things that came up in our conversation is the increased need for, there's a term he used for it, choreographers is what he referred to it as. People that are more orchestrating what needs to happen. And this is something that last week in Frankfurt, almost everyone that spoke, it came up that there was either an individual or a function within the business that now serves the role of not execution but orchestration.

And so, I think when we think about the silos that exist and how do we break out of that, these type of roles like you have now that are able to be a bit more objective, bring different viewpoints and opinions and strategies together and sort out, "Okay. I understand what everyone needs, how everyone feels. How are we going to work as a team toward what is the decided outcome?" I think it's super, super important so really interesting. Okay, Berit, last question for you. Based on your experience, either in this project or throughout your career, what's the best piece of advice you could offer our audience today?

Berit Hallgren: Yeah. If I would say a number of things, I would say five things to always think about and bring with you, be clear on why you are doing this. What are the problems you want to solve? Because if that is not clear, how can you communicate to your audiences? And then, what are the areas you want to transform in the end? It needs to also be very clear for people, so they understand we are not going everywhere. We are going in these specific areas.

The outside in perspective, I think is super important as well. That I also would also really advise, because if I think about Tetra Pak, we haven't maybe in the past been so much outside in perspective because it's been a successful company and you tend to focus more on yourself than on the customers and the outside in the end.

So, bringing that and also showing to the organization, "This is where we want to go. This is where we are." That becomes really, really powerful. And then, I mean, "What's in it for me?" You need to be able to explain that for the customer, for the employees, and for the company as well, because it's not the same message to all of these people. And finally, I will say, have courage because it takes... That's probably one of my stronger skills. I'm persistent, "So, okay. Didn't go this way. Let's try the other way." Because you need that when you drive a big transformation. You have to be persistent because it will take time. There will be challenges, but it will happen if you have decided it will happen, it will happen, but you need to be persistent.

Sarah Nicastro: I love it. Thank you so much.

Berit Hallgren: Thank you, guys.

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