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

By Sarah Nicastro, Creator, Future of Field Service

Nearly every business is amid some sort of transformation today. The two most common forms we discuss here are digital transformation and business transformation, in the sense of evolving the company’s go-to-market and customer value proposition. What I want to discuss today is the critical role that trust plays in the success of transformation and the importance of prioritizing the development of trust among your employees, your customers, and with the technology you invest in.

As this Deloitte article, Ethical Technology and Trust, states, “In what we recognize as an emerging trend, some companies are approaching trust not as a compliance or public relations issue but as a business-critical goal to be pursued—one that can differentiate them in an increasingly complex and overfilled market. Every aspect of a company that is disrupted by technology represents an opportunity to gain or lose trust with customers, employees, partners, investors, and/or regulators.”

Building a Culture of Trust

I believe the focus on trust must start internally. If your customers don’t trust the company vision, top-level company leadership, or their individual managers, building trust with customers becomes nearly impossible. A culture of top-down mandates and forcefulness is a thing of the past – you need to focus on how you build a culture of engagement and satisfaction, and trust is fundamental.

This Harvard Business Review article, The Neuroscience of Trust, reveals that “Compared with people at low-trust companies, people at high-trust companies report: 74% less stress, 106% more energy at work, 50% higher productivity, 13% fewer sick days, 76% more engagement, 29% more satisfaction with their lives, 40% less burnout.”

Looking at these statistics, you can imagine how a high-trust culture pays off in business-model or digital transformation. Employees who are engaged and satisfied and who trust their leadership buy into the vision being presented and work more energetically toward the desired outcome – versus trying to pull the weight of a low-trust culture along.

When it comes to digital transformation specifically, the Deloitte article references earlier suggests considering the emotions of your employees and handling their concerns transparently. The article says, “Give employees a reason to trust. Much of the anxiety over AI and other advanced technologies stems from the fear of the displacement of labor. From an ethical perspective, this presents business leaders with a challenge: balancing the best interests of the business, the employees, and the wider community and society. It’s a task made more complex by the fact that advanced technology systems are not self-sufficient. While AI can replace some jobs, for example, it creates others that often require specialized skills and training. Companies can build trust with employees by advising them how technology may affect their jobs in the future. This could include retraining workers whose roles may evolve and who will likely work with automated systems.”

Business Growth is Contingent Upon Trust

While an internal culture of trust should be priority number one, building trust with your customers is equally important – the company culture comes first only because it fuels the success of your external efforts. Today’s customers have options – and their expectations are high, with trust being the barrier to entry. Just to earn business, let alone evolve or expand it, customers expect you to keep your word good, meet your commitments, and get the job done.

According to PwC’s Trust in Business Survey, 49% of consumers started purchasing or purchased more from a company because of trust. So, for companies looking to transform their business models from product provider to As-a-Service, or from break-fix to outcomes-based, this evolution isn’t conceivable without a strong foundation of trust. For a customer to want to invest in a new, different, expanded relationship with your company, they must have a deep level of trust in your understanding of their needs, your commitment, and your abilities.

From a digital perspective, technology has the ability to strengthen trust with your customers – or break it. You need to ensure you are applying ample attention, and investment, to your digital initiatives to ensure you achieve the former.

Invest in Technology You Can Trust

While the emphasis on trust should be weighted toward your employees and customers, your technology investments are a through-line that – when executed well – can help you build that trust. Today’s digital landscape is exciting in the sense that it is more sophisticated and intelligent than ever, but also overwhelming in that it is more complex.

The key to building a digital ecosystem you can trust is to focus on minimizing that complexity. As the Deloitte article states, one important aspect is a strong foundation. The article says, “Build a strong data foundation. Without methodically and consistently tracking what data you have, where it lives, and who can access it, you cannot create an environment of trust. A strong data foundation unifies stakeholders around a single vision of data accountability and delivers on secure technology that supports effective data management.”

Consider business needs and don’t be distracted by what’s “cool” simply because it’s cool. Be cognizant of failure points – streamlining as much as you can into a single platform helps to keep the employee and customer experience smooth and data integrity high. Start with solid execution of core elements, and only then look for opportunities to add more sophistication and automation. And get feedback as you go! Asking your employees and your customers for their input is a great way to strengthen trust (as long as they see their insights put to use). You can find some more great advice from our recent podcast guest Dr. Haroon Abbu, VP of Digital, Data, and Analytics at Bell and Howell who, in 2021, co-authored the book TRUST: The Winning Formula for Digital Leaders – A Practical Guide for Companies Engaged in Digital Transformation.

What Drives Trust?

If you’re wondering what drives trust, I’d start with reflecting on what drives trust for you. What helps you to trust an organization – or even an individual? Are those concepts reflected in your company culture, your customer relationships, and your partnerships with technology providers?

For some external perspective, PwC reported in its Trust in Business Survey what respondents said were the top drivers of trust in company (asked of both employees and consumers). The top six responses were:

Accountable to customers and employees – 50%
Clear communications – 48%
Admits to mistakes – 40%
Delivers consistent customer experience – 39%
Appropriate employee compensation – 32%
Protects customer and employee data – 29%

Each of these characteristics sound simple at face value but have varying degrees of complexity when it comes to the realities of execution. No matter the effort it takes, though, prioritizing trust is key to accomplishing the objectives we have in digital and business transformation.

Dr. Haroon Abbu, Vice President of Digital, Data, and Analytics at Bell and Howell and co-author of the 2021 book Trust: The Winning Formula for Digital Leaders, a Practical Guide for Digital Transformation talks with Sarah about the differences between digitally mature and digitally developing organizations.

Sarah Nicastro: Welcome to the Future of Field Service podcast. I'm your host, Sarah Nicastro. Today, we're going to be talking about all things digital, data, and analytics. I'm excited to be joined today by Dr. Haroon Abbu, who is the Vice President of Digital, Data and Analytics at Bell and Howell, as well as co-author of the 2021 book, Trust: The Winning Formula for Digital Leaders, A Practical Guide for Digital Transformation. Haroon, welcome to the Future of Field Service podcast.

Haroon Abbu: Thank you. And great to be here, Sarah.

Sarah Nicastro: Yes. I'm excited to have you. Alright. So before we dig into some of the points we want to be sure to cover today, tell our listeners just a little bit more about yourself, your background, your role at Bell and Howell, that sort of thing.

Haroon Abbu: Glad to. My name is Haroon Abbu. I'm the Vice President of Digital, Data and Analytics at Bell and Howell, which is headquartered in Triangle Park in North Carolina. I've been with Bell and Howell for the last 12 years. If you don't know, Bell and Howell is a technology enabled services company with over 850 service engineers. Bell and Howell services industrial equipment from mail automation to robotics with a large install base in North America spanning multiple OEMs. The company also delivers comprehensive solution for retail click-and-collect grocery, pharmacy automation, and production mail industries. Currently I'm focusing on transforming the company through analytics and digital technologies, such as IOT, machine learning, artificial intelligence and field service automation. My team is building digital service offerings, such as remote monitoring by connecting both Legacy and new equipment through log file sensors, et cetera, and processing them in real-time in order to provide prescriptive insights and recommendation to our field service technicians.

Sarah Nicastro: Okay, excellent. So can you talk to me a little bit, Haroon, about what drew you to the field of digital transformation?

Haroon Abbu: Yeah, it's a great question. My undergraduate degree is in industrial engineering. I was always fascinated with operational improvements and efficiency gains, which my, which drove my choice of major. Then I did my MBA and M.S. in Engineering Management with intention of working in a managerial role in manufacturing. Right after my graduation, at that time, I worked in a company that was transitioning from print production to audio cassette manufacturing, and then to the manufacturing of compact discs and DVDs. So in that company, I saw firsthand how a company can be disrupted by rapid changes in technology and can eventually go under if it cannot keep up with the speed of innovation.

Haroon Abbu: When I started at Bell and Howell, I quickly witnessed the same challenge, which is transitioning from a Legacy Mail equipment manufacturing company, into state-of-the-art technology enabled services company, as well as a solution provider for cutting edge technologies in click-and-collect business. While working at Bell and Howell, I also pursued my Ph.D. on digital transformation, where I studied, how physical companies digitally transform themselves. I strongly believe that digital transformation, when done right, can add tremendous value to an organization in number of ways.

Sarah Nicastro: Yeah. No, it's a really exciting field. I actually recently wrote an article. I've had a few people in the last couple months ask me, "Do you think we should still be using the term digital transformation?" Right? And-

Haroon Abbu: Mm-hmm (affirmative).

Sarah Nicastro: ... So I sort of reflected on that in the article because I do get where they're coming from and there's a couple different points that have been made. One is some people perceive that they have already transformed in the instance of the initial migration to a digital ecosystem.

Haroon Abbu: Right.

Sarah Nicastro: And then, is transformation the appropriate word if we're really talking about something that's more of an ongoing continual effort? What are your thoughts on that?

Haroon Abbu: Definitely. It's not digital transformation because it's table stakes. All companies need to go through digital transformation. We nowadays effort to has just digital. It's companies, how companies can innovate their business models using digital technologies-

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: ... Because digital actually magnifies the traditional metrics. In the olden days, if you're getting one X return on something, once we have the backbone under digital systems, then the impact is multifold because-

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: ... The investment is already made, then it's basically scaling up from there.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So it's basically how companies can use digital in their strategy.

Sarah Nicastro: Right.

Haroon Abbu: There is no business strategy in digital strategy because digital is the strategy.

Sarah Nicastro: Right.

Haroon Abbu: Because if they don't have digital, then it's very difficult to manage your business going forward.

Sarah Nicastro: Yeah. So what I said was, "You could call it the digital journey. You could call it the digital..." What was the other term I used? Something like that. The problem is-

Haroon Abbu: Yeah.

Sarah Nicastro: ... People hate all of those words. Do you know what I mean? There's always someone that says, "Oh, I'm sick of journey" or "I'm sick of transformation" or whatever. And at the end of the day, it really isn't so much what we call it, but a common understanding within the business that digital is an imperative part of the business and the strategy. Right? And I kind of laid it out into a continuum just based on the stories that I've heard and helped tell over a number of years of how companies tend to progress through that.

Haroon Abbu: Yeah.

Sarah Nicastro: I think honestly the definition and that common understanding can be a challenge in and of itself for businesses. What are some of the other ways you see companies struggling to really succeed with digital?

Haroon Abbu: Yeah. So digital, the classic definition that I use is it's the process of using digital technologies to create or modify business processes, culture, and customer experiences to meet the changing business and market requirements, right? So it's basically a fundamental change in the organization's mindset, systems, data, and tools, all that need to be together, needed to reposition the entire company and company's business model. So we, when I say we, I basically, it's the research teams that I work with at innovation departments of two prestigious universities. One is Business Analytics Initiative of North Carolina State University, which is headquartered here, which is located in Raleigh. And Innovation Department at RWTH Aachen University in Germany. So we first studied the phenomenon of digital transformation through an extensive survey that we designed called Patterns of Digitization survey. So this survey examined every aspect of digital and how it is implemented.

Haroon Abbu: We looked at over 500 companies, their business strategies, how they allocate resources, their design practices, et cetera. In addition to that technology angle, we also analyzed the people side of things, what we call soft skills-

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: ... How their leaders communicate, how they build trust in their teams, et cetera. And what we realized, or what we saw was that companies fall into two distinct groups. One is digitally developing companies. The other one is digitally mature. Far majority of those 500 companies where digitally developing versus digitally mature companies. The companies that focus mainly on technology rather than cultural and mindset aspects of digital are really struggling to implement it.

Sarah Nicastro: Mm-hmm (affirmative). Yeah. That makes sense. Absolutely. And there's so many layers to this where you realize that it's also about incorporating new skill sets, right? So the role that you've taken on and in Bell and Howell is a really good example of dedicating more resource, energy, and effort to this practice. Right? And, sometimes I think companies struggle to figure out how they need to digitally advance without recognizing some of the new and different skill sets that are necessary within the organization to really go as far as they need to. Does that make sense?

Haroon Abbu: Absolutely. Absolutely.

Sarah Nicastro: Yeah.

Haroon Abbu: Yeah.

Sarah Nicastro: While also to your point, making sure that the incumbent people are understanding the evolution and bought into where the company is going and the introduction of different tools or different ways of measurement or different practices of making business decisions. All of the things that come from, not just the introduction of the digital tools, but as reflected in your title, the result of that is the data you didn't have access to before. And, the way that you can analyze the business in ways that you couldn't do prior. Right? So there's the idea of digital tools is really the beginning of this journey, not the finish line. Right?

Haroon Abbu: Absolutely. Absolutely.

Sarah Nicastro: Yeah.

Haroon Abbu: Yeah.

Sarah Nicastro: So if you look at a company that you consider digitally mature, who has done a really good job at this-

Haroon Abbu: Mm-hmm (affirmative).

Sarah Nicastro: ... Versus someone earlier on in the process maybe a bit of a laggard or someone that still has quite a bit of work to do to digitally transform, what would you say would be the key differences that would sort of surface between those businesses?

Haroon Abbu: Yes. So we statistically validated these results. So the major driver for the differences between digitally mature and digitally developing companies is the differences in human dimensions of digital leaders, right? Digital mature organizations are managed differently. Their leaders align the human and financial resources with a strategy. They create an innovative culture, even within a Legacy environment like Bell and Howell, you create a collaborative environment, innovative environment, kind of entrepreneurial culture, promote open and transparent communication that enduring human traits of these leaders far outweigh the proficiency in the technology evolving field of information technology. Yeah.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: The knowledge of the technology is important. But it's also how you exhibit, how you promote the, that culture.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: How do you make digital part of your strategic priorities? It's the ability to engender trust of their employees. It's more about people than it's about digital technology.

Sarah Nicastro: Right.

Haroon Abbu: So it actually requires organizational changes to the customer centric that's backed by leaders.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So that's pretty much what we found is that the leaders, they trust their teams. They put leadership in place. They hire the right skill sets. They build credibility. They tell stories of when they're successful or their failure, so that employees are properly aligned to the theme of digital.

Sarah Nicastro: Mm-hmm (affirmative). Okay. Now, would you say that there are some, I guess, common trends in terms of as a company moves from digitally developing to digitally mature, if you look at the people part, right?

Haroon Abbu: Mm-hmm (affirmative).

Sarah Nicastro: So, I understand what you're saying. The impact of leadership and how leadership views this transformation and understands its role in acting as a motivator and acting as a connector but not needing to act as a doer of all things. Right? And, really trusting the team. Would you say there's any commonalities, though, in the new skills or new roles that you see companies bringing in to help support and build this out?

Haroon Abbu: Yes. So, the key thing is when you hire new people, trying to have them understand the value about the data. So it's basically starting out with what is that you're trying to do with the digital.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: It's not a buzzword anymore.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So what is your business goal? What is that your company try trying to do with digital transformation or digital tools? For example, take Bell and Howell. We were transforming a company from a manufacturing based mail production based company that was in rapid decline 10 years ago, five years ago, and create new business models. We were transforming ourselves into a technology enabled people powered service organization. And in order to do that, in order to service other OEMs in the robotic space and in other adjacent markets that we never handled before we needed new business models, including remote monitoring.

Haroon Abbu: And, we are able to connect because our existing Break-Fix model no longer works when we are servicing retail, one of the largest retailer with 5,000 stores.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: We had to do more with remote monitoring. So how do we do remote monitoring? We had to obviously put the digital backbone with IOT machine learning algorithms where analytics data is the underpinning.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So we had to do that. And now, at this point at, we are remotely monitoring 98% of our service calls on this new click-and-collect, the retail focus product. And in order to do that, we need to win over our technicians. We need to start small and show them that, hey, there is value here.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: You're able to resolve an issue in 10 minutes. And the remote monitoring platform, the digital backbone we put together is going to tell you what the issue is.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: And then there is that contextual information. So you're able to fix a problem in 10 minutes, rather than having to roll the trucks and resolve, or take it for, three hours or four hours. We just cannot scale that model. Right?

Sarah Nicastro: Right.

Haroon Abbu: So they see that as sucks. So when they see that, okay, now I see the value of data. These guys are really modeling it, algorithm, using algorithms to minimize the attention needed to these machines.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So when those machines are calling home, meaning our home office, creating a service call, alerting them, and then if they cannot fix it in the same field service management system, dispatching a technician based on geolocation, based on skill sets, et cetera.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: That's really a win. So they see that. And when they see that as successful, then the culture slowly starts to change.

Sarah Nicastro: Sure.

Haroon Abbu: So that, okay, there is innovation happening. There is value in data that I see, and then they are on your side. Right?

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So yeah, technology played a key role, but do they need to know how we solve this using algorithms, machine learning, artificial intelligence? No, they don't need to know that.

Sarah Nicastro: No. Right.

Haroon Abbu: Yeah. They don't need to know the technology details. But just focusing on technology details is not going to win them over.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So right from the top management, we need to make this strategically intentional-

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: ... Analytics and digital is strategically intentional. It's not because everybody else is doing.

Sarah Nicastro: Right.

Haroon Abbu: No it's part of our strategy. We need to make sure this happens. And then we talk about it. We talk more about it. We share the success stories.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: And then the whole organization becomes part of it.

Sarah Nicastro: Yeah.

Haroon Abbu: We are not there quite yet, but I think we are making progress.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: Same thing, we implemented KPIs, field service performance metrics. This is how we measure our success. This is how our OEMs measure our success.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: That's defined throughout the company. And we measure it in real time using the digital platform that we put together.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So we see how those then cause improvements in our operational efficiencies, et cetera.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So that's, it takes, it's a journey, as you said. It takes time.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: But digital for me is a lot more than technology. Technology is important. You need the right people to get to understand the technology.

Sarah Nicastro: Right.

Haroon Abbu: But it's bringing that, bringing people on board.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: It's changing their mindset.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: It's very critical for our success.

Sarah Nicastro: I think it's also, I agree a hundred percent, but I also think there's this kind of stumbling block. And so I mentioned that continuum, right?

Haroon Abbu: Yeah.

Sarah Nicastro: And there seems to be this stumbling block where, like you said, digital today is table stakes, right? So we're not talking about, should we and all of that stuff, right? It's a given.

Haroon Abbu: Right.

Sarah Nicastro: But I think you have some leaders who understand it's important and advocate for it. But where they get stuck is all of a sudden they have this wealth of data that they don't know what to do with. Right? So then it becomes, they've gotten a certain ways to the end game, right, which is really being able to not have digital tools for the sake of digital tools, but have digital tools for the sake of extracting the relevant insights and stories from the data to make better decisions or to solve more issues remotely or to create a new customer value proposition. Right?

Haroon Abbu: Yep. Yep.

Sarah Nicastro: And so from the analytics and the storytelling perspective, what is the best advice you have there for making sure that you are not just going down this path because you know you need to, but going down this path with the right outcomes in mind?

Haroon Abbu: Yeah, exactly. It's starting with the right outcome.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: What is the business objective, right?

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: What is the business objective? What are the business questions you're trying to answer with data and what digital tools you need to do that?

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: For example, in Bell and Howell case, if our goal is to provide or invent or innovate new business models to grow our service business because we are no longer servicing our own equipment, we are servicing 50 plus other OEM equipment. So we needed a new business model, which is remote monitoring, remote collaboration tools, et cetera. So, that's our business model. We needed to innovate the business model from traditional Break-Fix to more on the predictive, prescriptive side, right? So, that was our business model innovation. So in order to do that, what did we need? We needed a digital backbone, right?

Haroon Abbu: Which takes these machine log information in real-time from these machines. And then we put together IOT based platform that built a model on, okay, if this and this, the error logs happen, this is your likely action. Basically, intelligent with algorithms and then connect that to our field service management system.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So, that service call gets created. And then it's visualized service call can be closed. It can visualize using Tableau platform, et cetera, et cetera. So, that was our business need. And that's how we solved using digital tools.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: The second thing is we needed to improve our operational efficiency, which is one of the main starting block in any continuum. For example, that you're talking about focus on your operational efficiencies. In order to do that, we need to come up with some KPIs. We are out of this organization, but we did not really have a commonly communicated, commonly defined performance metrics.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: And so we defined that based on some of the best practices. And then we developed a method to measure those metrics in real time for each OEM. And also for every technician, what's his tech utilization? What his first time fixed rate? What is his call, close rate? All that kind of stuff, so we can provide a scorecard with the idea that if we improve that we'll obviously achieve some operational efficiencies and then we'll also be able to present that to our OEMs. So they can also see how we are improving towards the whole.

Sarah Nicastro: Yeah.

Haroon Abbu: So yeah. So all in all it comes down to, what's your main objective?

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: Which is tied to a strategy.

Sarah Nicastro: Yeah.

Haroon Abbu: You have to tie that to the strategy and then go get the data. You may not have all the data. Or whatever data we think we have been collecting may be useless.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: Right? So define the problem and then see if you have data. If you don't have data, put systems in place where we can collect the data and then improve, refine the data, so that will ultimately lead us to operational improvement or in the case of remote monitoring, et cetera, new business models.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: That should be some of the analytics driven path towards digital. But analytics driven path for improvement are new business models using digital technologies and tools.

Sarah Nicastro: Okay. Alright. So speaking of data, in the book, you did this research and so you had this analysis of digital based on the statistics that you found.

Haroon Abbu: Yeah.

Sarah Nicastro: But you also incorporated interviews. So tell me a little bit about the importance and the value you found in talking directly with other digital leaders to put the content for the book together.

Haroon Abbu: Yeah. So as you said, we had compelling statistics based on the studies that we have done. But we wanted to go and talk to successful digital leaders.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So we interviewed 15 digital leaders in the U.S., as well as, in Germany. We know they're successful based on their track record. These are proven companies with proven successes in digital transformation. So they included CEOs and Chief Data Officers, business unit leaders from automobiles, medical equipment, IT services, and lot of different fields. So, these interviews showed us that the strength of their leadership based on what they told us comes as much from their personal character, as it does from their competencies to deploy digital technologies. So most of these leaders actually model human dimensions to build trust in their organization.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: Most of the Chief Data Officers, what we have found is the average tenure is two to three years. So they need to make sure, and CDO roles are pretty much recent, so they're basically have to work together with a lot of other Cs, a lot of other business here leaders, we call them their boundary spans boundary, spanning capabilities.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So they need to be able to work with multiple departments and multiple people. So they need to have growth mindset. They need to have storytelling capabilities, et cetera. And after talking to these 15 digital leaders, we methodically, using content analysis, actually developed a scale to measure human dimensions of digital leaders.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So there are 15 human dimensions that came out of these studies as well as interviews. And actually there is a self-assessment tool on our website patternsofdigitization.com, where digital leaders can actually go and take that survey. And it actually shows them how they are doing on various dimensions like storytelling or ethical use of AI or growth mindset or humility, integrity, et cetera.

Haroon Abbu: It shows them where they are lacking so that they can measure themselves or they can have their team measure them. So that's part of our research, continuing research. They're also, we are also in the process of developing some tools that will help them improve their skills that are in deficit.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: Sometimes these are, these seem to be trivial, but they're not really trivial. It matters a lot when you are implementing a major company wide initiative. How do you really make sure that they're successful? And as you know, most of the times technology, yeah. Implementation of technology is one thing.

Sarah Nicastro: Right.

Haroon Abbu: Even field service management system, for example. But it's after that, what happens? How is it internalized by the people, by the employees in the organization?

Sarah Nicastro: Yeah. Yeah. That makes sense. What would you say, Haroon, has been the hardest? Personally, Larry Blue, the CEO of Bell and Howell has been on the podcast before as well. And I think the company has a really cool story of how you really reshape the identity of the business. It is a really compelling story. That being said, I'm sure it wasn't easy. So, looking back on that journey, what would you say was the hardest part of digitally transforming the Legacy Bell and Howell business?

Haroon Abbu: Yeah. Again, I've been here for 12 years. The hardest part is getting people on board. Right?

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: That's the hardest part because in a company that has a history dating back to, I guess, 1906, there have been several iterations. There are a lot of employees here with long, long tenure. So they've seen everything, right?

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: The thing is, why is this different? The same as anything else, so we have to show the value in what we are doing. That's more important. Plus, the support and direction from leaders like Larry Blue makes a big difference. Right?

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So one of the thing that we have learned is, as I said, when we are successful in making a change to the business model, remote monitoring is a perfect example, people automatically buy in. So next time they ask, okay, can we get this?

Haroon Abbu: So that becomes part of the culture. The other thing is, when we work with multiple machines, even our engineering department, they would write a machine log like a log file in for a machine, before until we started this initiative, they would just write it, thinking that nobody's going to look at it.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: Now they understand that analytics actually is taking that piece of error log that they're writing on the machine to drive remote monitoring, to drive when to dispatch a technician. After a couple of years now, engineers are fully on board with that.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: When they design a new system, like the one we recently did, it's a grocery pickup machine. When they did it, it's completely designed for serviceability with machine logs, knowing that, analyst actually worked very well together on that initiative so that we can, they will write a machine log, et cetera, and even machine log, et cetera, write it in a way that we can use it for predictive and prescriptive maintenance.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So that took time. It didn't happen overnight.

Sarah Nicastro: Right.

Haroon Abbu: So as people see how you're successful or how analytics can be used in multiple ways to help the company, to help the service organization, to eventually help technicians and employees, that will make it different. So, we had some obstacles, but I think we are at a point where we have slowly started to change the mindset and we are seeing some of their successes.

Sarah Nicastro: Yeah. Yeah. That's really cool. And I think, in your role and you mentioned the role of the Chief Data Officer, the idea of someone who's harmonizing things is very important, right? Because one of the biggest barriers to success we see with digital transformation is it, companies attempting to do it in a very siloed way right? Which is kind of the opposite of what needs to be. Right? And so, I think that's an important point as well is to really think about not just how imperative it is to overall strategy, but how important it is to have that consistency and that collaborative view on how it can happen.

Haroon Abbu: Yeah.

Sarah Nicastro: Okay. Last question for today, Haroon. If you were to summarize, some key takeaways for folks listening on this digital journey, what would you leave folks with?

Haroon Abbu: Yeah, I would say that people are the key to digital transformation. Yes, bring in the right technologies. But you know, if you embrace Cloud, you can actually scale up or scale down technology elasticity of the Cloud gives you that opportunity to adopt these new technologies as you, as business conditions change.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: And secondly, start small and get some early success and always try to build trust in the organization that way the benefits of digital can be felt across the organization. Lastly, as far as the industry is concerned, I know your audience is field service organizations. My take is that the data landscape, it's probably not as mature or as some other industries. So there is a lot more potential to innovate faster beyond remote monitoring. There's a lot more opportunity to use AI and ML. So, for example, most of the field people who are in the field service organization, Field Service USA conference that you and I attended, we mostly the operations side.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So I strongly believe that there should be more analytics representation, so analytics folks don't just work in isolation.

Sarah Nicastro: Right.

Haroon Abbu: They need to hear the real-time problems.

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: They need to hear it from the people who are running these service operations, right?

Sarah Nicastro: Mm-hmm (affirmative).

Haroon Abbu: So it's always good idea to have that kind of balance so analytics can become main ingredient of success for field service organizations.

Sarah Nicastro: Mm-hmm (affirmative). For sure. Yeah. That makes sense. And, and I agree and I appreciate you coming and sharing your insights. I think it's a huge topic. There's probably a lot of different areas we could dig into in terms of the storytelling and all of that stuff. But, I like the point that it's just as much about people as it is about technology. I think it's a really important point. So thank you for coming on and sharing and, Haroon, if folks want to check out the book Trust, where can they find that?

Haroon Abbu: The website is patternssofdigitization.com.

Sarah Nicastro: Okay.

Haroon Abbu: There's a link to the book from that website. Also, there's more research in that website and also self- assessment tool where you can measure the human dimensions of digital leaders.

Sarah Nicastro: Excellent. Okay. So patternssofdigitization.com is where you can find the book. Haroon, thank you so much for being here. I really appreciate it.

Haroon Abbu: Thank you, Sarah, for doing this and your thought leadership in this space. Thank you.

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 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

The timing of this article *might* be related to my own burnout – my family had Covid around the New Year, and with the kids just back to school and my husband’s recovery moving slowly, it’s been an incredibly taxing few weeks. Of course, I am grateful my kids had very few symptoms and recovered well – and I know that while my husband is having a hard time feeling like himself, we are so fortunate none of us had any critical symptoms. Gratitude can coexist with stress, exhaustion, and anxiety, though – and the last few weeks have been a mix of it all.

However, I’m not writing this solely as a cathartic expression of my own struggles. This topic was already on my mind after having a conversation at the end of last year with a business leader who confided in me about his own burnout. We had an open discussion around how the stress of leading a company through the challenges of the last two years has begun boiling over into his own mental health.

This leader is responsible for setting standards that impact an entire company’s health and well-being. He’s bearing the weight of supporting his team’s mental health while also trying to preserve his own. He’s finding himself facing some complex emotions about significant differences in belief systems, including his own, and how to continue to keep peace among not only the employees of the company but with the customers they serve.

Burnout Impacts Everyone, From Leadership to The Frontline

Then you think about those on the frontlines. We read a lot in headlines about the doctors and nurses experiencing unimaginable stress in persisting through immense risk to their own safety and wellbeing to care for the masses. Teachers and childcare providers who, already underpaid, have now been shouldered with the responsibility of navigating angry parents, disrupted children, and a choice between putting themselves at risk or losing their livelihood.

But, as we know, healthcare and education aren’t our only frontline workers. Those providing services share many of the same burdens, often without the same levels of recognition. They must continue to show up for work, even if they fear for their or their families’ lives. They may find themselves in situations with customers where they feel unsafe or confronted by opposing beliefs. They may be in the impossible position of having children who are unable to attend school or childcare without a support system to offer help.

As I was thinking about writing this, I took to social media to see what others were saying.

On Twitter, Shep Hyken (@Hyken) said, “It is important for every employee who has any contact with a customer to realize that at any given time, they represent the company. They are the brand, the image – they are everything about the company.” This is a lot of pressure given the circumstances of the last two years.

Ron Ruggiero (@RonRuggiero105) says, “This is NOT a pandemic of the unvaccinated. It’s a pandemic of the working class. Had to: work with no PPE, laid off or hours cut, can’t work from the safety of home, get sick without paid sick time, burnout, called “heroes” without being treated like one, yelled at, and then deaths.” Reading these words, I feel so much compassion for what those in the service industries have faced while I’ve remained in my home office.

Women Are at Increased Risk of Burnout

We must also acknowledge the momentous impact Covid has had on women, especially working mothers. According to McKinsey & Company: “The pandemic had a near-immediate effect on women’s employment. One in four women are considering leaving the workforce or downshifting their careers versus one in five men. While all women have been impacted, three major groups have experienced some of the largest challenges: working mothers, women in senior management positions, and Black women. This disparity came across as particularly stark with parents of kids under ten: the rate at which women in this group were considering leaving was ten percentage points higher than for men. And women in heterosexual dual-career couples who have children also reported larger increases in their time spent on household responsibilities since the pandemic began.”

I can tell you as a working mom myself, the juggling act has often felt nearly impossible – and I am fortunate to be working from home, employed by a very supportive company, and have help.

Even pre-pandemic, the World Health Organization had classified burnout as an “occupational phenomenon,” characterized by three factors:

feelings of energy depletion or exhaustion;
increased mental distance from one’s job, or feelings of negativism or cynicism related to one’s job;
and reduced professional efficacy.

At the time of this article, it was stated that “The WHO plans to develop “evidence-based” guidelines for mental well-being in the workplace. Its member nations are set to implement the revisions to the International Classification of Diseases by 2022.” I don’t envy that task with the impact the weight of the pandemic has had.

How Do We Address the Burnout Bubble?

So, what do we do? A loaded question, for sure. And there’s both an individual and organizational responsibility here. As individuals, we have to prioritize and advocate for our needs and what will protect our mental health. While this looks different for everyone, commonly helpful practices like therapy, meditation, and exercise are certainly worth evaluating.

But an individual, particularly one who has the professional weight of an essential worker and/or a lack of support system, cannot be singularly responsible for alleviating burnout. There is a responsibility among employers to get a better handle on the reality, severity, and criticality of this issue. And you can’t afford not to – we are at a point where companies across roles, across industries, and across geographies are struggling to hire and retain talent – to the point in some scenarios that businesses are forced to reduce operating hours and even close. This is telling us it is time to look at the topic of burnout and mental health differently.

Arianna Huffington (@ariannahuff) says, “The Great Resignation is really a Great Re-evaluation. What people are resigning from is a culture of burnout and a broken definition of success. In quitting their jobs, people are affirming their longing for a different way of working and living.”

I continued my search to see what recommendations I could find for how to give this issue the attention it deserves and take real steps to change our current reality (rather than simply paying it lip service). Here’s some of what I found:

Numerous comments expressing the benefit of a simple start with a genuine willingness to address burnout and transparent communication with your employees about the topic, their current mental state, and what they need from you
A move away from the “productivity-at-all-cost” mentality to one that honors the need for downtime. Some comments on social pointed out that asking employees to prioritize more time off yet only allowing two weeks of vacation is not only laughable but resentment-inducing. It’s time to consider allowing more personal time – while unlimited time off may not be possible for workers in frontline roles, sorting out what higher degrees of rest is possible is essential
Don’t insult your workforce’s intelligence. As F. Jordan Carnice (@thebullgrog_) says, “Still puzzled that most companies’ responses to employee anxiety, burnout, and fatigue is another webinar on anxiety, burnout, and fatigue.”
Determine how you’ll measure burnout and whether the actions you take to improve it are working. STAT (@statnews) shared an opinion column on Twitter by Jan Muir, PhD, RN that suggest “Hospitals must track nurse burnout the same way they keep tabs on infections, errors, and falls, and give nurses higher pay and greater agency to make them feel seen, valued, and invested in.” Considering how we track this issue to ensure it gets the attention it deserves and the improvement it needs is a worthy goal for those outside of nursing, too.
Consider the concept of “cultivating endurance.” I can’t take credit for this term, which I love. This article from Entrepreneur discusses the idea of “cultivating endurance,” and emphasizes the impact on productivity when you balance intent output with periods of regeneration. Read the full piece for five steps to take.
Prioritize Inspiration and Empowerment. In this article, author Celia Willis talks about the idea of coming back from burnout by breaking out of a constant state of reflecting on the past two years and focusing on reigniting the energy of her team. She shares her tactical steps to address burnout, which are worth the read.

While I don’t have all of the answers and can’t any offer quick fix for breaking out of burnout, I do know this topic demands more of our attention. I would like to see the burnout bubble slowly deflate rather than burst, and that will require some real effort. If you have any advice you’d like to share on how you’re battling burnout yourself or addressing this issue within your organization, I’d love to hear from you!

Sarah facilitates a discussion with Cedrick Rochet, BU Operations Manager at Intel Corporation; Newland McKelvey, Core Delivery Director at Fujitsu; Krish Venkataraman, Head of Global Operations, Transformation & Customer Success Asia Pacific, India & Japan at Hewlett Packard Enterprise; and Kshitiz Agarwal, and independent consultant about the unique and creative approaches their organizations are taking to improve recruiting, hiring, onboarding, engagement, and retention.

Sarah Nicastro: Thank you, James. Hello, everyone. Happy to be here with you all today with a wonderful panel. We're going to have a discussion on this panel about the skills gap, the labor shortage, the talent gap, you hear it referred to in many of these ways. And talking about some of the actions companies can take, both on the people side and on the technology side, to address this challenge. So, as James said, my name is Sarah Nicastro, I am a part of IFS and I actually run a thought leadership resource called Future of Field Service. So I interview folks regularly about their business transformation journeys and am thrilled to be here with four great guests today. So I'm going to ask you all to introduce yourselves briefly. Cedrick, do you mind going first?

Cedrick: Yeah, sure, Sarah. So hello, everyone. My name is Cedrick, I'm currently working at Intel Corporation, so it's a processor company. And specifically in the branch of Intel called Internet of Things Group for Autonomous Driving Cars. So all the latest fancy stuff there. And so a little bit about me, so I have basically 10 years in engineering in the last 10 years, much more on the business side where currently I am running the operations of the business units.

Sarah Nicastro: Okay.

Cedrick Rochet: So that's it.

Sarah Nicastro: Thanks for being here. Newland?

Newland McKelvey: Hello. Hello everyone, my name's Newland McKelvey. I'm core delivery director of Fujitsu, so responsible for day-to-day delivery of the managed services that are provided to a big, major public sector body. And actually prior to that, was responsible for the setup of trader support service, which is the customs intermediary supporting organizations dealing with the sort of outcomes of Brexit need for those things to be handled in a new way. And I've been with the company a few years, actually, James, we've just been speaking, we were talking last week and I realized I joined Fujitsu before James was born. So one of those quirks of life, but yeah, so glad to be here.

Sarah Nicastro: Excellent. Krish?

Krish Venkataraman: Hello everyone. My name is Krish Venkataraman. I'm part of Hewlett Packard Enterprise, which you know needs no introduction, those in the IT industry. And I'm looking after the Asia Pacific and Japan customer operations, global operations, and the customer experience. Part of that, that's my area of focus. I'm based in Singapore, like what Newland said, maybe I joined this company before James was born as well. So that was back in 1988, so it's a long time. Thank you, very happy to be here. I look forward to a great session. Thank you.

Sarah Nicastro: Thank you. All right. Kshitiz?

Kshitiz Agarwal: Thanks Sarah. So hello everyone. My name is Kshitiz Agarwal and I'm currently working as a self-employed consultant where I'm helping small businesses with their clean energy transition. I'm a former site service director with Mitsubishi Power. And one part of my role is to develop the teams for these energy transition and prepare our training strategy. So I'm really looking forward to learning from all of you and sharing some insight. Thank you.

Sarah Nicastro: Okay, great. All right, so as James said in the introduction, this recording is going to live on for eternity, so we're going to make sure we make it a good talk. So I want to start off just by everyone weighing in a bit on how is the labor shortage or skills gap impacting each of your businesses. Okay, so let's just kind of level set with what is this issue meaning to you in your organization. So we can just go around again, if that's okay? Cedrick, if you could start?

Cedrick Rochet: So yeah, so currently labor shortage is quite an interesting topic at Intel because every world area has actually different dynamics. So for what, Intel being based in the West Coast, we have tremendous talent pressure on the West Coast of the US. And also in quite specific spots where you have other IT or technology companies, such as Ireland or Munich area or Singapore also, I mean, quite a few spots, Malaysia, for example, where we have competitors that are present also because we build the ecosystem around as we grow, there are also factories around ours over time. And so essentially right now, it is a little bit of a challenge for skills, specifically experienced individuals. And at every levels, from the engineer that is starting until the senior vice president that are being taken from one competitor to the other. So it's touching us at every level.

Sarah Nicastro: Okay. All right. And Newland, what about you?

Newland McKelvey: Again, with Fujitsu, and sort of echoing Cedrick, it's a global issue for a company like ourselves as well, where we've got global delivery centers as well as regional centers. And the experience and skills shortage is impacting across the board. And that can be in deep technical specialism or even in more generic skills, like experienced project managers in development or service setup and transitions, equally down to simple things like, or more simple things, like actually even standing up a support center now. There's just such a huge demand across the base and a lot of competition out there. And it's getting the right people in, but equally retaining and actually encouraging people from years ago instead of going to IT, I find ourselves doing other things that we'll probably talk about later.

Sarah Nicastro: Sure. Yep. Okay, Krish?

Krish Venkataraman: Yep. This is great question. And good input also from Cedrick and Newland. The way I look at it is also I used to wonder at times on the one side, we will take any countries' numbers. They'll say there is X number of people unemployed, at the same time, there are Y number of openings, roles that are there that they can't find the people. So be it in any industry, be it in manufacturing, technology, customer service industries, anywhere, the gap more I see that as the fit between what we need and what we have. And whether the people are building to see themselves as a different person. For example, there's a one quote I wanted to share with the team. It was predicted in 2012, hey, you're going to have two sets of jobs, the jobs that somebody will tell the computer what to do, and then the jobs that the computer will tell them what to do.

Krish Venkataraman: Okay. So these two divides, however, we all know in our whole day, different times, we act in different roles. There is one task I do what my computer tells me to do, and 10 minutes later, I'm doing a task that I tell the computer what to do. So it's not always this one side or the other. Now but the challenge here is how do we accept that? How do we internalize that? And how do we help the people recognize that and play that correctly? That's where I generally see some gaps as well, because I may have good set of candidates, good set of pool of people, but they are not having that right skill set and right training to do the right thing. So how do we bridge that gap is definitely a thing we'll be talking further, but that's how I see as the gap.

Sarah Nicastro: Okay. All right. And Kshitiz?

Kshitiz Agarwal: So basically, I'm from energy industry. So I had a little bit different perspective and different set of a challenge. So right now, because the energy industry is going through the massive transition. So it is a kind of an imbalance between the skilled workforce, as well as adaptation to the required or new skills due to digitalization. And this is happening, from my experience, this is happening because of two reason. One is specifically because of aging workforce. And secondly, it's because they are not enough new or young people coming into the industry, especially to the blue collar job that had created massive gap between the industry. So as Krish said, it's the right matching the skills as well as matching what is available in the market is right. But at the same time, I think the perception of the industry or perception of the job taken toward the market or toward globally basically, is also important in this, play a key role in the skill gap.

Sarah Nicastro: Yeah. So I'm looking, as we're talking, I'm looking at my long list of questions and realizing there's no way we're going to get through all of them. There's a lot to dig into related to this topic and it's one of my favorite topics to discuss. So instead I'm going to try and make sure we get to four questions at least. And then if we have time, we'll come back to some of the others. So the first thing that I think is interesting is really having a conversation around what we're calling this issue. So you hear it referred to as the labor shortage, the talent gap, the skills gap, the experience gap. And those are all really different things. And so I think one of the first questions we have to ask ourselves, for each of our individual businesses, is what is this problem to us? Which of those is it?

Sarah Nicastro: So what I mean by that is, I think historically... Now we're on a panel with people from different industries, different geographies, so we have to kind of look at things from a high level. But I think historically, most organizations, for most roles, are accustomed to hiring based on experience. And so I think one of the biggest issues with this topic is that I don't know that I believe we have a skills gap or a talent gap. I think there are people with skills and there are people with talents, they just may not have the experience that we, as organizations, are accustomed to be able to hire based on. And so I did a presentation on this topic a few weeks ago and it was around controlling the controllables. Because the labor shortage, the actual statistics around how many people are available to hire in any given location, isn't something you can necessarily control, but your perspective on this as an experience gap versus a talent gap versus a skills gap, those are things you can control.

Sarah Nicastro: And I think the first thing we need to do is take a look at our historical recruiting and hiring practices and ask ourselves: Do we need to adjust to today? So if we're always looking for people with X number of years experience, is there a way to achieve the same outcome by looking for different criteria in the folks that we're looking to hire? So the first thing I wanted to talk about is just your thoughts on that and any you've made within the business, or have thought about making within the business, to sort of shift from looking for experience, to looking for the skills, traits, characteristics, abilities you need, and finding ways to provide some of that experience. So that's the first point. Does anyone want to volunteer to go first?

Kshitiz Agarwal: So yeah, I can start. First of all, the thing is we cannot generalize the skill experience and the talent. It depends on the geographies, it depends on the industry. In some industry, it is required to have more experience than other, because it might be life in that situation. So we cannot generalize that. But I think from the industry where I am right now, traditionally and currently as well, the priority is always given to experience than young members. But because of this gap that we are facing between the aging and the young people right now, companies have started looking at the different perspective. One of the perspectives is as simple as looking at the talent or new workforce from the global perspective, rather than geography location. That is the one way they're tackling it. Another way they're tackling it is engaging to the indirect recruitment process, which is more they get engaged with the new graduates right from the time in their university, and then recruit them and train them.

Kshitiz Agarwal: Apart from that, from my experience, there's... We all heard about the apprenticeship program, especially in Germany. Those programs actually, over the period in history, they prove themselves very, very effective way, especially in mechanical industry or electrical industry. And I believe more and more organization right now are coming up with these program, apprenticeship program and the graduate programs, to bridge that gap so that they can train the people or train the new employee right from the base foundation level to the place where they need them to be at to bridge this gap.

Sarah Nicastro: Yeah, that's a really good point. And I certainly was not suggesting we just put people that are not capable of a certain job in role. It was exactly what you're saying. How do we become more creative about ways to sort of farm talent instead of just looking for it ready-made. So things like what you're saying are exactly my point, which is it really comes down to, as organizations, we may need to do more work than we've done historically because we just don't have a wealth of people to bring into the business that have 5, 10 years’ experience. So we have to look at how do we give them the training, the experience, the time they need to be capable, but take some more responsibility for doing that. Yeah, go ahead Newland.

Newland McKelvey: Yeah. So I was going to actually just going to build on what's has been said, because I think, in terms of apprentice programs, grad programs, et cetera, those have all proved, across many industries, including IT, whatever, really, really beneficial. But one thing that we've been doing over the last few years, and not just ourselves but I've seen it elsewhere, is when we look to recruit or appoint new roles, we don't just look within, I'll call it, the professional communities for want of better description, but actually look even internally outside that. For instance, so when you're bringing somebody, and I've seen examples where someone from a finance background has become a manager of a development team over time. And the reason for that is that the good thing is that they know the company, they maybe got a few years to understand, if you like, the mechanics of the organization. So they don't have that as a learning curve.

Newland McKelvey: Then supporting those people from sort of those diverse non-technical backgrounds, who have good management skills, to actually become managers in an area where we desperately need someone come along and really help build teams, et cetera. Where they've got the skills, it's just bringing the technical level up as well to support that. And I think that's helped us several times in the past where we've had gaps.

Sarah Nicastro: And a lot of the conversations that I've had on this topic, Newland, kind of echo that approach, which is if you find the right, whatever you want to call them, core skills, soft skills, you can provide the technical knowledge needed in many cases to compliment that. So that kind of opens up doors for you to look in different industries, different areas, things like that. Also, I recorded a podcast on this topic at an event I was at last week and one of the things, I think Cedrick you said, this isn't a challenge for just entry level workforce, it's a challenge all the way up. But one of the points that came up in that conversation is that a lot of younger workers, they don't come into a role and plan to stay there for 20 years. They want progression. So if you can kind of restructure the way you look at your recruiting and hiring practices and figure out how to map them up within the business, it gives them the progression and growth that they want, but also helps you when comes to filling roles above just the entry level.

Sarah Nicastro: So Cedrick, what have you seen in terms of ways that that Intel has adapted here?

Cedrick Rochet: So Intel is a very interesting company. Before being at Intel, I was working at Emerson Electric, which was a very industrial company. And now being at Intel, I see a very culture shift, mostly, maybe because Intel is West Coast based where also ecosystem and the startups is over there. But actually as much as an industrial company, you have people that were staying 5, 10 years on a job, when I was a younger professional, I was seeing that. Nowadays, when I am at Intel, actually, you see, well, the person is expected to stay maybe three, maximum five years on the role before moving up. Now what's happening is that also, I have to be honest, Intel has a huge competitive advantage is that we have a huge skills and talent pool within our employees. I mean, we are a rich company.

Cedrick Rochet: And to give you an idea, the quality department of Intel is about a thousand people, 800 of them have PhDs. So just when we speak about talent pool, that's what we need. To have people with PhD and MBAs, standard. You cross them everywhere almost. So when you take these people, you can almost have them going from one job to the other with too much problematic. Now that said, you still have to retain these talents. And it's not because you have great foundations, as I was saying, but you need also to close the talent or the gap that is a problem that you have to solve on that moment. And compared to other companies, at Intel, we have an internal volunteering program. So how does it work?

Cedrick Rochet: And also this is also coming from the West Coast, it's basically you have for over five years, you accumulate vacation days and at some point you go on sabbatical. Meaning that for five weeks, in a batch, you go out and when you come back, you still have a job. Now what's happening is during these five weeks, somebody needs to take care of the job. And so we create what we call GIGS where somebody that has nothing to do or is interested maybe in this role, can apply so as a temporary gap filler, if you want, and test the job itself. And maybe as a person moves on to the next job, basically somebody is kind of seeing what's going on in that role and has to be experienced. I mean, five week is not tremendous experience, he's not going to break anything really. But still you get a look and feel about what it means or are you feeling ready for taking on this job, maybe in another organization.

Cedrick Rochet: I mean, Intel, we have the, the advantage of the size. So we have a huge internal job market that address many, many people. And so in order to fill these gaps of talents gaps that we might have, this is one of the way, by doing this so-called GIGS, temporary work that is outside of your standard job that can help on filling that gap. Something that I've never seen in any other companies that I've been into before Intel.

Sarah Nicastro: Yeah. And you bring up really good points, Cedrick, which is you mentioned the approach at Intel is far different than that of Emerson. And so I think you have that a lot with companies that are more on the modern, innovative type of culture versus something that has more legacy. And I think that's where these type of conversations become very important, because that doesn't mean that someone with a completely different culture can just mimic what Intel is doing. But I think this is an area where companies need to look at what others are doing and maybe just have some thoughts. So it doesn't need to be a blueprint for how they go back and do it, but just some different, new, fresh ideas to bring in and to try some different things.

Sarah Nicastro: Because I think we can all agree that this problem demands more creativity than perhaps we've leveraged before. So Krish, I want to come to you and ask certainly if you have any insight on kind of where you're finding new candidates, that's fine. But the other part of sort of the recruiting side is for new places to find folks and maybe changing the criteria upon which you use to hire a bit, but also making sure that you are speaking the language of the people you're trying to hire and making sure that the roles are appealing to the candidates that you are addressing today. So I'm wondering if you could talk a little bit about any changes that have been made or any work that's been done to make sure that as you're recruiting, you're offering an appealing opportunity for people that you're looking to bring into the business.

Krish Venkataraman: Great. Thanks Sarah. So let me start off answering that in a couple of parts. First one, the way we look at things is, as you know, Hewlett Packard Enterprise operates in 190 countries. So there's no one size fits all for us. The challenges are different in different geographies. So what we are doing as a starting point is see a need to rebrand the way we sell a role to the candidates. What appeals in different geographies, we need to be cognizant of. For example, in some geographies, the people want to know how am I contributing to the vision of the company, how am I part of the success story, how am I part of the community contribution that we are making. So that's very important for them. We also want to take the value properly. It's not just a job, it's not just a role.

Krish Venkataraman: We take the total value proposition of being part of Hewlett Packard Enterprise in different dimensions. So it's beyond just compensation and benefits. Looking at the career advancement, work environment, culture of the organization, and also the ability for an individual to shape the way they want to take their career development, personal development, forward in any direction they want. So that culture of the organization promotes that very well. People could walk across and do a shadow assignment in another part of the organization, no barrier. People could ask for a stretch assignment. Somebody could be maybe in finance, but they want to go and do a stretch assignment in marketing, vice versa, or some other areas, even in geographic stretch assignment. So all those facilities are there for the people to take advantage of that. And it also helps them to shape, determine, take control of their own career path and career direction.

Krish Venkataraman: And nobody's telling them what to do, but the options are there. So that's the real important cultural shift and the framework that we have in place to support that. Now in terms of how we look for also candidates or also, we need a good diverse set of candidates. So we we talk about the diversity equity and inclusion. So we want to make sure that that is practiced at all levels of the company. And actually, it's also part of my key focus area. Every year I measured on how many of those mix I am managing and continuously nurturing those mix of different things. It's not just the gender diversity, cultural diversity, and various other forms that we do want differentiate between how people want to express themselves or how they want to identify themselves, but how they can be part of the team and complement each other.

Krish Venkataraman: And we have a thing called Employee Resource Group, which is an internal community that's really, really supported right from the CEO level, to grow this further. At the same time, we also shifted our focus a little bit, we're using automation, for example. Quite often, this, what you call, unconscious biased comes in in the way we are writing something, on the way we are expressing something. So using a lot of automation to identify them very early, filter them out. For example, the way a job description is written should be very, very neutral, location neutral and agenda neutral, all sorts of neutrality being brought in consciously into that. Even the employee value proposition, all the external internal communication, there is a lot of effort and focus also drives that. And people feel that, hey, I'm part of this organization that do not differentiate this and values diversity. So we see this definitely helping both.

Sarah Nicastro: Yeah. So you brought up a couple really good points. And I did a podcast a while back with the woman who runs talent globally at Tetra Pak. And it was all about the move to outcomes-based recruiting and hiring. So I think it's a great episode for anyone to go and look up, but it's this idea of, well, there's more to it than just job descriptions. But what you just said about job descriptions, there's this idea of are we putting words or things in here that are going to have people leave themselves out that may be a really good fit? So are we limiting ourselves? How do we kind of get to the root of what is the outcome of this role and leave it with strictly things related to that so that you get a good broad pool of diverse candidates to apply?

Sarah Nicastro: The other thing is this idea of, and this probably sounds obvious, but you would be shocked how many companies aren't doing it, which is when is the last time you updated or revisited your employee value proposition. Do you know what is important to candidates that are coming into the workforce right now? It's not just about money, it's not just about collecting a paycheck. They want to feel heard, they will want to be empowered, they want to feel they're making a difference, they want to feel a part of something bigger than themselves, they want opportunities for career development, they want flexibility. So starting to look at are we providing those things and are we articulating that we're providing those things. Because what matters to candidates today is different than it was 5, 10 years ago.

Sarah Nicastro: So this kind of segues us into the next topic I want to talk about, which is retention. So Cedrick, if you can kind of start off and just share. This is kind of a natural segue because you bring people in with sort of this value proposition. And then it becomes a game of making sure that they are engaged, empowered, that they're having a fulfilling employee experience so that they want to stay. So what's your take, Cedrick, on retention?

Cedrick Rochet: So retention is quite, I mean, it's quite a vast topic. And over the years, essentially, to keep employees, companies are, I mean, at least at Intel, we are trying many different areas and trying to tailor, actually, to where even to the person is in his life cycle. From the young engineer that comes into Intel, that wants to revolutionize a world, that has plenty of energy and coding and things like this that wants to do this, to the younger adult that, I mean, later adult that wants to start a family. And so we have programs such as parental leaves, where basically I want to take care of my kids, they are bored and so on and so, but without the fear of losing your job at the same time. Then for later, when you are more experienced, then basically it might be going into an expert track or into a leadership track.

Cedrick Rochet: So you have, for example at Intel, for that, your salary... I mean, many times, and if I go back to my Emerson Electric experience, many times if you want grow, it was just go up the ladder, more people you manage, the bigger you are, da, da, da, da, da, da. At Intel, actually, there's a difference between a leadership track, which is exactly it's the traditional, the more people you manage, the better, da, da, da, da, da, da, and you get the salary increase. But there is also the engineering track, so basically you become a specialist from the young engineer to a principal engineer to a fellow who is on standards committee that is influence standards directions at the national level. And the great thing is actually the same thing as a leadership. It doesn't have the same name, but essentially you have the same grade, we call that grade internally, but you can be a senior vice president and just be a simple engineer, but because you are basically helping on steering committees for international standards, you are at the same level or considered at the same level of grade as maybe a senior vice president.

Cedrick Rochet: So by creating these two possibilities for more experienced people to grow into what they aspire, basically you get much more retention and you adapt to basically the different stages that a person might be. And of course, I mean, and you have plenty of internal trainings, that is quite standard in every company. You have another thing that actually, and a little bit provocative, that we are doing also at Intel that I've never seen before, is what we call returnship. So basically when a person left the job because they want to raise their kids and come back 10 or 15 years later saying, well, now my kids are grown up, they don't need me anymore, so I would like to go back to the workforce. Well, you still need the period of adaptation and we call that returnship where we allow people that have been potentially 10 or 15 years out of the workforce to get started again. And this is something that I've not seen in many other companies that have been to.

Sarah Nicastro: I love that idea, Cedrick, especially because when you look at the impact that COVID had on women in the workforce, and I mean just how we need to look for ways to help and to build bridges for them back in and all of those things. I'm conscious that we are going to run out of time and James is going to get mad at me because we haven't gotten to questions. Newland, so here's what we're going to do. James is going to bear with us for just a moment. Newland, if you can answer the same question about retention and then for Krish and for Kshitiz, I have one other question and then we'll get to the audience questions. So Newland, what are your thoughts on retention?

Newland McKelvey: So for people coming into the company new, we've set a strategy that retention starts from onboarding, and that onboarding starts right at the first interview, your first of the recruiting engagements, and continues throughout. So by the time somebody lands in the company, they've already experienced both interface with their management, they'll have a body, they'll have had different events, and that's the external recruitment. Equally, going back to Cedrick's analogy of moving people about internally, we do have sort of something similar, it's called career pathways. If someone's keen then wants to move into a role from that, moving role internally can be quite a step change. And again, it's a similar principles, because you don't want someone coming into a team and finding it's the wrong role.

Newland McKelvey: So the first thing is, is what Cedrick's outlined, equally as well is then making sure that onboarding process and induction and everything else really works for people. And then the final thing is also the concept of career, which Krish and others have outlined, it is broader than the vertical. It's very much a you're looking for cone-shaped people where they've got a number of areas of expertise and more general knowledge, but rewarding that as well and recognizing that, so it's not just a vertical hierarchical pay and reward, but actually rewarding and what they bring and the outcomes that we talked about earlier, trying on build that.

Sarah Nicastro: And this is where the complexity comes in. Because you can understand what's important to your talent pool that you're looking to hire, and you can tell them that you're doing all of those things, but if they come in and that is not the reality, then you have no chance of keeping them. So you have to be marrying the work on the recruiting side with really making sure that you're evolving the employee experience and offering people a rewarding place to be so that they do want to stay. Okay, all right, we're going to try and do this in two minutes. You guys each get one minute and I want to ask... Krish, we'll start with you and then we'll move right over. I want to ask what role has technology played in alleviating, assist, helping with this challenge?

Krish Venkataraman: Okay. So in terms of technology, the basic thing, for example, let me give an example of automation. When we use automation to redesign the workflow and the operating model becomes so elegant makes the flow much more agile, collaborative, and also nonhierarchical, and it empowers the people at the right point to make the right decision so that there is no need to go back and forth. So clearly the technology has played such a big role here and it can be leveraged for many other areas in a similar way. And we find that to match that... So what does that mean is we need education people with different set of background, with a different set of knowledge and skills, to take the full advantage of that. One of the challenge we always find is even though the technology is there, the people are not really ready to go on and take full advantage of that. So if we have that cultural shift and the technology enablement with the right people at the right the skillset, I think we can the best out of that.

Sarah Nicastro: Yeah. Okay. And Kshitiz, your thoughts on technology?

Kshitiz Agarwal: So technology is playing a wider role right now, especially in mitigating this skill gap, what we're talking since the beginning. So for example, I was involved in developing a training program using AR and VR, augmented reality and virtual reality, to train the people on the health and safety side while working on the site. And similarly, there's also in energy industry specifically, there's an increased use of robotics, whether it's a remote control or autonomous robotics to do those job which are not required a human interaction. And not only it bridges the gap, but it also makes a safe working environment, which is more important at this moment. And from the point of view of the retention, again, technology is again making a huge difference as Krish rightly said. It bridges the gap, that hierarchical gap between the different people. And it enables different people from one role to easily shift from one role to another role and one job to another role, which they consider as a progression in their career path. So, yeah.

Sarah Nicastro: Yeah. So I always look at technology on the tactical side, the strategic side. So tactically, what are the ways we can leverage technology to help alleviate areas of this challenge? So is our current workforce optimized and fully utilized. So when you look at scheduling and things of that nature, are we appropriately using the people we do have? And then automation, are there aspects of work that are not value-add that we can automate to allow more capacity for our workforce to do really important things? I think a lot about knowledge capture and knowledge management. You have such a volume of expertise leaving the workforce, are you capturing that knowledge so it can continue to be leveraged? And then the point got brought up about augmented reality and different training tools to get people able faster to get into the workforce and to be impactful.

Sarah Nicastro: On the strategic side, Krish, I completely agree and it's obviously a completely different conversation. But the idea of what new roles need to exist? What reskilling and upskilling do we need to do to make sure that we're leveraging technology strategically as a part of our value proposition? Okay, so James, come on in and yell at me for going over. And I'm sorry, but it's such a good conversation, we should have allotted more time.

James: Yeah, no, don't worry. I'm not one to get mad. I'm not going to shout anyone. Let you guys do your thing. That was great. Yeah, I'm just conscious of our next speaker who's probably waiting in the little pre-check and worried that I'm not there. So we've got time for one question I think. We'll give hard stop after five minutes, just so I don't panic her. So question here from Christine: There are any recommendations as to the split you should have between retained employees versus outsourced contractors resourced to deliver digital innovation?

Cedrick Rochet: I will take this one if I may, because this is, actually, I think I would say it's a hot topic, not in every areas of the company, but in this. And most of the time what we are doing is that we are looking at whatever we are doing is the position a long-term. And what we mean by long-term is three years. So will be there jobs to be done for the next three years for a person to come on board. If yes, we open a job. If not, then we look at a contractor, contingency worker. And some areas of Intel, we have very few contingency workers. In others, which is much more customer project based with very short time turnarounds, then basically we use much more because we cannot predict really what is the next skills set the customers will ask us to support them.

Cedrick Rochet: And so it's very much becomes very customer oriented adaptation. But it doesn't mean that at a strategic level, we see... I mean, contingency workers or outsource workers cost a lot more. So there is also other times, strategic reviews internally to try to find the right balance. To be honest, we haven't found it yet. We look for it, but all the time trying to balance between the business objectives on one side, but also having a much more stable head count or strategic gaps that we might need. And it's always a balance between the two. And for that one, yeah, we try to do our best, but sometimes it's not that easy with business and our expenses.

James: Anyone have anything they want to add there just quickly?

Newland McKelvey: The one thing I would add is that odd enough to sort of let the lens that Cedrick applied slightly different in our type of organization, where we're actually looking at whether it's an area where we're growing, expanding, versus one where if we have a gap, but reality it's a legacy area. And if it's wherever we're growing and expanding, we want to bring in very specialist skills to help recruit, retain, and actually develop our own internal workforce. But the ultimate aim will be that. Whereas if it's legacy, we'll focus more on moving some of those people on and using contractor, external staff to sort of supplement. So we've got that sort of moving wheel of people internally as well. Krish, I'll let you speak.

Krish Venkataraman: Thank you. Quickly, one area we look at it, James, is transformation. Organizational transformation. Organizations go through continuous transformation. It's not always that the organization may have the right skills, knowledge internally to do the transformation. They need that external help to do the transformation, and then the internal core organization can continue to move onto the new platform and operate, but the need to shift them to move that. That's where I think the external sourcing would be very helpful.

James: Brilliant. Thank you guys. I would love to let everyone else chat for another few minutes, but I'm afraid we have to call it day there. All I'd say is when we overrun a bit like this, it's always suggestive of a great conversation. So thanks so much guys. I'm sure you'll all stay in contact and likewise. Sorry to anyone who didn't get their question answered. If you are going to the agenda tab, you can find each of us speakers there. You can message them directly. Or you can put them in the event feed, or just email them to me and I'll pass them on, you'll definitely get your questions answered. So for now, just go ahead and exit this stream. We're back in 10 minutes for our final session of the day, with Rainy from Nokia. I'll see you all then. And thanks to our panelists.

Sarah Nicastro: Thank you everyone.

By Sarah Nicastro, Creator, Future of Field Service

To reframe my headline into a more positive statement: I believe 2022 will be the year we master first-time fix. Why? It simply has to be! Those of you who follow my content know that change management is a topic I will rant about. Well, first-time fix is coming in at a close second.

You’ve heard the saying, “In the age of information, ignorance is a choice.” I feel the same about first-time fix. In the age of information, failure of first-time fix is simply unacceptable. There are too many tools at your disposal to not dig in and seize the opportunity to succeed in an initial visit. Now I’m not suggesting any organization have a goal of 100 percent first-time fix; perfection is never a reasonable objective. However, I do believe that those who really struggle with first-time fix – at this point – have no excuse and are missing the mark of what service today means.

If you consider the far-reaching, negative impact of repeat visits, it is a service standard that demands more of our attention. You have the cost of not one, but two (or more) truck rolls. You have your technician’s time, which in the current climate of labor shortages and talent gaps is even more golden. And besides their time, how do you think failure to fix impacts employee experience? Put yourself in the shoes of a frontline worker who is on-site with a customer, often already frustrated, and must communicate their inability to get the job done.

And we haven’t even touched on customer satisfaction yet. In a time where outcomes are demanded, the frustration that surfaces when a repeat visit is needed is not only immense but can be reason alone for that customer to seek service elsewhere. Because accepting subpar service isn’t a luxury your customers are willing to afford you – not when many of your competitors have leveraged the tools at their disposal to not only master first-time fix, but to evolve service delivery and expand service offerings in ways those struggling with first-time fix likely haven’t even thought of.

As we continue down the path of As-a-Service and outcomes-based offerings, failure at first-time fix will not only impact you in the often-mentioned ways; it will erode your profits and diminish your reputation. To maintain competitive advantage, you must realize that something like first-time fix is table stakes in today’s service landscape.

Predict & Prevent

Quite frankly, on-site service shouldn’t be your first line of defense. Leading organizations are adopting technologies like IoT and augmented reality that allow them to predict and even prevent issues that would previously require on-site attention. When issues do occur, remote resolution is becoming more and more common – and expected among customers.

Prepare

When an issue does require on-site attention, you should have the ability to know in advance what your technician will encounter on-site so that you can prepare accordingly. This means matching technician skills and assessing urgency, ensuring the availability of parts that may be needed, and using modern communication methods so that customers have a reasonable service window and have validated their availability and confirmed the appointment.

Persist

Even with proper preparation, your technician may run into an issue he or she needs help with on-site. They should be properly equipped with customer history, access to a variety of documentation and assistance resources, and should be able to rely on technology like remote assistance if collaboration is necessary.

So, let’s make 2022 the year we resolve to master first-time fix and shift our attention to more strategic focus areas and innovation. Pretty please?

Sarah starts the New Year off with her recap of the highlights of 2021 and a look ahead at the topics she’s excited to dig into in 2022.

Sarah Nicastro: Welcome to the Future of Field Service Podcast. I'm your host, Sarah Nicastro.

Happy New Year! When this episode airs, it will be the first week of 2022. As you can tell by the bits of North Pole behind me, I'm recording this at the end of December. So, we're going to do an episode today just talking a bit about the highlights of 2021 and some of my thoughts around the headlines I'd like to see in 2022.

So, I'm often asked for predictions and I'm not a fan of predictions for a couple reasons. One is none of us can predict what's coming. I think COVID has been a case study in that, right? We never really know what's coming. The second is I think when you look at the topics that we cover here at Future of Field Service, we're really talking about a continuation of a lot of themes, a maturation of trends that is coming together and culminating to really bring immense opportunity to the industry.

So when I'm asked for predictions, I always feel this pressure to come up with something new or unexpected, when in reality I think a lot of the headlines that we'll see in 2022 are growth and progression on trends that we've been talking about for a bit.

So, those are the things we're going to dive into today. So, highlights of 2021. The first I would say is we survived. I don't know that any of us expected to still be in the situation we're in right now with the pandemic, but we're here and we're plugging along and we are getting things done. We've found a way to persist through all of this, and so that's what we're going to continue doing one day at a time.

We did have the opportunity to get back to some face-to-face events in 2021, and I myself thoroughly enjoyed that. I was able to attend the Service Council Symposium in Chicago in September, Field Service Palm Springs in November, and I was also able to take my first trip out of the country since COVID began to visit the Netherlands to attend IFS Connect, and provide a keynote there, which was a really wonderful experience. I had the opportunity to connect with some folks face-to-face that I had thus far only met through Zoom and Teams. So, that was certainly a highlight for me to be able to get back to engaging face-to-face.

We are up to, I believe at the end of 2021, 143 three episodes of this here podcast, which I just am so thankful for. The ability to have these conversations and share them with you all, the wonderful, wonderful guests that I've had on and gotten to know, really. It's just been a very fulfilling experience for me, and I hope you all have enjoyed being along for the ride.

The other thing that I really enjoyed about the podcast in 2021 is we had the opportunity to really diversify some of the guests. So, we had folks from really all over the world. We had folks from Malaysia and Singapore and Australia and Finland and Iceland, and so I just really, really have enjoyed that as well. Getting to see how the trends and conversations differ from region to region across the globe, and also just getting to know some of the wonderful people that I've gotten to know.

I have had the pleasure throughout 2021 of running a customer community group at IFS, and that has been a wonderful experience for me as well. I have a group of just about 40 folks that we have actually met very frequently in 2021 about twice a month, and we have focus groups of an hour at a time where we come together and talk about different business trends and challenges and opportunities. Really just in a situation where we all haven't been able to travel for quite some time, we started these to really have that sense of community and connection and to be able to build collective knowledge, and it's been just a wonderful experience.

So there's much, much more that happened in 2021 that was fantastic, and if I were to try and go through every highlight, we would be here for a very long time. But it was a good year and I appreciate you all being a part of this podcast. I'm incredibly thankful for the wonderful guests that joined me on Future of Field Service throughout the year, and there was a lot of great highlights.

So, if we shift gears and talk about 2022 headlines. I'm not going to say predictions, I'm going to say headlines. So, the way that I put this together was to think about some of the conversations I've had throughout the past year, throughout the past years really, and how I would like to see those progress in 2022. The conversations I'm very interested to continue and see evolve essentially is what I'm looking at here.

The first is a whole host of topics really around the employee experience and employee engagement. I think we all know that the great resignation is posing immense challenges for industry, after industry, after industry, region, after region, after region and business after business. It's an issue that I think has been a long time coming, but is becoming critical for folks to address. There's some different layers to this, right?

I think if you look at some of the content that we've done throughout 2021 as a platform to start the discussion this year, we've had some wonderful conversations. You look at the responsibility of organizations to become more creative in how they recruit and hire and what their employee experience looks like.

I actually have a podcast episode coming up that hasn't yet been released with Roy Dockery. He was one of my first guests on the podcast, I think it was episode two. We sort of had this conversation I think before folks were ready to hear it, and we recently revisited that conversation and that podcast will be coming to you soon. But his point is as businesses in this space, we need to take more responsibility for solving this problem, rather than just kind of dwelling in it. So, that'll be coming.

We took a look at how companies are doing that, right? So Tetra Pak, Bonnie from Tetra Pak joined, that was episode number 85. We had Bureau Veritas come on and talk about how they're building the future of work. That was episode 129. So, those are episodes that are great to go back to and sort of think about how we can continue this conversation in 2022.

I think the topic of mental health is going to be very important for us to address this year. I know that I talk about this quite a bit myself, because I like to normalize the conversation and share my own experiences, but I think collectively when we look at the impact this has had on all of us, this being the pandemic, it's just every everyone's tired, everyone is a bit worn and a bit burned out. I think that as employers and as businesses, we really need to elevate the way we are considering how we can help related to mental health.

I had a great episode with Jordan from QIAGEN, that's episode 105, and he was very open about how he has realized this is such an important issue with his team. He's in Australia and some of the things he's done, and so this is a conversation, I think, that's going to be imperative. Also just leadership, right? What are we doing to create a culture within our companies that employees want to be a part of, that they feel fulfilled and they are happy and they want to stay, right? We can't force people to stay in role, but we need to look at what we're doing to impact that.

A couple other episodes I'd point out. Just recently I had an episode with Karin Hamel from Schneider Electric. Episode 140, where we talked about five areas of focus she's considering when she looks at building the future of the frontline workforce. Also had an episode with Lauren Winans, who is the CEO of Next Level Benefits, she's a consultant in this space, about creating a strong employee value proposition. That's episode 132. So, all of those will be great things to check out if you have some time to go back and kind of set the stage for where we can take that conversation this year.

The next area is really around digital. Again, this is kind of an umbrella with a lot of different sublayers, right? But I think the idea here is I anticipate 2022 is going to be the year that it clicks for a lot of companies that they need to become far more strategic in their digital strategy, right? So, companies know that they need to be deploying digital tools and they need to be considering the digital experience and things like that, but it's still very disconnected. It's still in many cases, not in all cases, of course.

So I think there's a lot of sort of refinement, I also think this is an area where some businesses are going to realize ... I wrote an article last year called It is Time for A Digital Rebirth? So, I think it may also be a situation where folks realize that they need to go back and kind of start fresh in certain instances.

Some of the podcasts from 2021 that are kind of great lead-ups to continuing this conversation in 2022. One is a conversation I had with Pekka from Cimcorp, that's episode 110. His was a conversation really around modernizing our approach to IT, which again, I think is a very important subset or pillar of sort of becoming more adept at digital.

I had an episode with Russell who was formerly with Rolls-Royce, Russell Masters. That's episode 128, and we talked about the need for more digitally-adept leaders, which is super important. I had an episode with Eduardo Bonefont from BD, episode 139, who told a really interesting story about how related to their digital tools and digital investment specifically, they decided to press pause and take a chunk of time to kind of reflect on what was already in place and address some employee feedback.

Which the idea of what's your digital reputation among your employees, and are you making decisions with their best interests and their voice in mind are very, very important things. The elimination of silos as it relates to digital strategy, I think, will be an important conversation to continue, and evolving into how are we leveraging digital and data to tell stories, and how does that result in new and different employee value propositions? So, lots to discuss there.

The other big topic that I'm excited to continue exploring is the progression on As-a-Service and outcomes-based service offerings. Had some great episodes last year with Kaer. That's Dave Mackerness, episode 136, told the story of how they have evolved to a completely As-a-Service business, wonderful, wonderful insights.

Schneider Electric Australia shared their story in a two-part series, 113 and 114 of how they kind of tackled it in a microcosm approach and made a big impact in their region that will spread across the business. I did an episode with Kevin from TSIA on some of the myths around As-a-Service, so there's some great stuff to dig into there.

Towards the beginning of last year, I had an episode with Tim Baines from the Advanced Services Group talking about the blueprint for servitization. I also had a great episode last year, number 104, with Jennifer Deutsch from Park Place Technologies. She's their CMO and she came on talking specifically about the marketing of services and service businesses, and it was super interesting. I think that's another area that as we evolve the business models and the go-to-market strategy, there's a lot to consider around how are we communicating this evolution to our customers in a way that will resonate? So, lots of cool stuff to discuss.

Finally, I'm super excited to continue the conversation around sustainability. This is of growing concern and interest across the globe, that we had a few episodes in 2021 to sort of initiate this conversation. One was with Sasha Ilyukhin from Tetra Pak talking about the intersection of service and sustainability. It was episode 131. Similar conversation in terms of that intersection with Bureau Veritas, episode 133.

Had on Dr. Andreas Schroeder of the Advanced Services Group at Aston Business School. He was on a few times this year. He's a great person to talk with, but specifically 127 was about this topic. So, I think that's also an area that there's so much to dive into both related to how companies improve their own efforts around sustainability and how that also translates into new service offerings for customers.

So I've been doing this for a while, and I've been in this space for a while and I often get asked how do you keep writing about this stuff? Don't you get bored? It's all of these layers that exist in each of these topics. There's these sort of buzzwords or these categories of conversation that people know are important, or have heard, digital transformation or As-a-Service. It's really when you dig into those things and you start to talk to people that have done it or are doing it and understand all of the layers that go into that type of change and that type of transformation. That's what makes it interesting for me, that's what keeps it interesting, and I'm thrilled to be here sharing that all with you.

So I look forward to some great, insightful, fruitful, actionable conversations this year. Thank you so much for joining me here on the Future of Field Service Podcast. I know it's been around for three years now, which is hard to believe, and I'm looking forward to a wonderful 2022. So happy new year, thank you for being here, and I'll speak with you all again soon.

By Sarah Nicastro, Creator, Future of Field Service

Happy New Year, everyone! There’s something so inspiring about fresh starts. While 2021 didn’t bring us as much reprieve as we may have wished from Covid and its ripple effects, I’m entering 2022 cautiously optimistic that we’ll find a next normal this year that will give us at least some respite from the immense stress of the past two years. Whatever the year may bring, I’m thankful to be sharing it with you all – and we’ll work through what comes together, just like we always do.

With that said, I’m often asked at the end of a year/beginning of the next to offer my “predictions” for what’s to come. I have never been a fan of this practice. I understand why folks do it – the headlines draw a lot of clicks. But let’s be honest – none of us can predict the future, and I don’t enjoy the forcedness of trying. The other reality is that much of what will take place in 2022 is a continuation and maturation of some of the trends we’ve been “predicting” for a while – we’re at a level of sophistication with technology and innovation in service that the excitement isn’t in any one “next big thing,” but in the nuance of mastering the layers of change that come with ongoing evolution and transformation.

So, spoiler alert – no predictions here! But what I would like to share are some thoughts on the headlines I’d like to write in 2022. To me, these are the top-of-mind conversations leading into the New Year that I think deserve our attention and will benefit us all to have:

#1: Employee Experience Takes Priority

We’ve spent the last five or so talking at length about the customer experience, and while that’s no less important than it has been – in 2022, employee experience will take center stage. It simply must. The Great Resignation will force companies to reflect on everything from their company culture to the strength and quality of their leadership to the employee value proposition to how much (or how little) opportunity exists for career development, and much more.

Organizations will be forced to take responsibility to get more creative in how – and whom – they hire. Leaders will need to do and give more in the form of mentorship, encouragement, and recognition. We’re all realizing that the stellar customer experience we aim to deliver is impossible without engaged and satisfied employees, and in 2022 we must do what it takes to understand what our employees want and need to be happy and work tirelessly to deliver that.

If you’d like to review some excellent podcasts from which we’ll continue this conversation in 2022, here are some recommendations:

#2: Mental Health Gets the Attention It Deserves in the Workplace

You cannot dispute the depths of stress and worry and trauma that have been experienced over the last two years. Of course, there are varying degrees – some have lost loved ones, some have had to juggle working with children at home, and some are forced to show up to work with colleagues who have very different fundamental beliefs than they do. And that’s just the tip of the iceberg, really. Not to mention the fact that even pre-Covid, mental health deserved far more attention in the workplace than it was getting.

We’ve begun to take efforts to normalize the topic of mental health in the workplace, but we have a long way to go. There’s a lot of room for improvement when it comes to how these discussions are handled – and encouraged, what resources are available and how they’re used, how leaders lead by example, and how we deal with the realities of providing a safe place for those struggling to come when they do.

Again, if you’d like to check out some of the conversations we’ve had thus far on this topic, you can find those here:

#3: Companies Weave Digital into Their Identities

I just wrote an article at the end of 2021 about some of the confusion around Digital Transformation and in 2022 we need to gain more clarity around the digital continuum. Digital isn’t something we need “to do” but rather something that needs to become a part of our company’s identity. This means no more siloes, no more disjointed approaches and strategies, and moving beyond fragmented systems and tools.

Digital as a part of our identity means it is within the business’ DNA – it’s a part of every conversation, every function, every role. Digital leadership is strong and digital reputation is considered. Digital is being leveraged to streamline internal operations in a way that enables the best customer experience as well as efficiency, and it’s being used externally as a part of a company’s value proposition. As a company masters a foundational level of capability, they look for layers of sophistication and intelligence to layer on.

There’s a lot to discuss – and for many to do – to get to this point. We need better strategy, systems that streamline complexity, and insights that tell stories and allow for intelligent decision making. If you’d like to review some excellent conversations around digital, here are some top picks:

#4: The Service Value Proposition is No Longer Service

Here’s the punchline: customers don’t want service. They want uptime, outcomes, peace of mind. They want all of the complexity that goes into making “it” work to be invisible. They don’t want to buy “things” – they want knowledge and insights and perspective that helps them be and do better.

Whether we refer to this evolution as Servitization, the move to delivering outcomes, As-a-Service, or the subscription economy, it means that we need to re-evaluate how we’re doing business and how we’re talking about service (hint: it shouldn’t be an “offering”). Companies need to be equipping themselves with the technological underpinnings that allow for guaranteed outcomes and need to be reconsidering their identity – moving away from manufacturer of X or servicer of Y to provider of (insert your differentiation here). I wrote an article about the idea of storytelling here, and I would love to explore this more in 2022.

We had some great conversations about this topic in 2021 and featured some who are leading the charge. You can review those here:

#5: Sustainability Spurs Service Growth

With the growing realization of how much more effort we need to be putting into saving our environment, and new standards and regulations being introduced around the globe, there’s a lot to discuss around sustainability. Even more specifically, there’s an immense amount of opportunity here for the introduction of new services – as well as a natural fit in how a focus on sustainability lends itself to the changes that Servitization introduce in terms of longer-lasting products and a more circular approach.

I’m excited to see where this conversation goes in 2022. You can check out some of our previous discussions here:

What are you most interested to read or discuss in 2022? I’d love to hear! I’m always open to your feedback and input and look forward to continuing the conversations with you all this year.

Sarah welcomes special guest Enrique Ochoa Reza, an energy specialist, Ph.D. in Political Science and Master's degrees from Columbia University, Lawyer from UNAM and Economist from ITAM, professor and author who was a Federal Congressman in the Mexican Congress and before that, the CEO of the Federal Electricity Commission (CFE), Mexico’s state-owned, nationwide, power and natural gas company. He recently joined IFS to lead the company’s Energy and Utilities Business Unit and patiently enlightens Sarah on the top energy trends shaking up the status quo and forcing organizations across the globe to evolve and adapt.

Sarah: Welcome to the Future of Field Service podcast. I'm your host, Sarah Nicastro. We're here today to talk about the future of energy and utilities. Earlier this year, IFS welcomed a new member of the team to head the energy and utilities organization, which is Enrique Ochoa Reza. Enrique, welcome to the Future of Field Service podcast.

Enrique: Hi Sarah. This is great to be here. Thank you very much for the invitation.

Sarah: Thank you for being here. So Enrique's bio is impressive to say the least. So I'm going to read some of the highlights Enrique, and then you can fill in some gaps. So Enrique has been in the energy space for more than 20 years. He holds a PhD in political science and Master's degrees from Columbia, a lawyer from UNAM. Tell me what that is?

Enrique: Yes, the National Autonomous University of Mexico. I am Mexican.

Sarah: Okay. Yes.

Enrique: And I studied law in the National Autonomous University down there.

Sarah: Excellent. He's been a professor. He's a published author. He was a Federal Congressman in the Mexican Congress. Served as secretary of the Energy Commission and oh, what am I missing? There's a lot. He was awarded Person of the Year by the Oil and Gas Magazine in 2015. And as I mentioned, he has recently joined IFS to lead the energy and utilities business unit. So Enrique, go back through a couple of those points. It's a tough bio to read, because there's so much to it, but tell folks a little bit more about yourself and some of the background that you have in the energy space.

Enrique: Yeah. I've always been fascinated by energy. And Sarah, I think it's one of the most important things for human mankind. And so, that I always focus on my studies in economics, then law, and then political science, because I wanted to participate in public policy and energy in Mexico. And I had the opportunity to do just that some years ago when I was a deputy secretary of energy in Mexico for hydrocarbons. And back then, I participated in an overall energy reform in Mexico to open up to private participation, the oil, gas, and power sectors in Mexico. After Congress went to a constitutional reform and then some legal and regulatory amendments, I was appointed CEO of Mexico's nationwide power and gas utility, which I run for over three years. And that was a fantastic moment, because we had to transform the utility to allow for private sector competition, both national and international, but more importantly, to strengthen the national utility in order to move from fuel oil, which was a very strong fuel use for power.

Enrique: But as we all know, it was expensive and highly pollutant and we transit to natural gas and renewables. And it was at that moment in time when renewables were succeeding in becoming affordable, as you all know, when back in two decades ago, a decade and a half, we had to choose between producing energy with renewables that was more expensive than other fuels, but it was clean and comfortable with the climate change challenges that we were facing. But it was a choice, it was a trade-off. You'll have to accept that you will have to pay more for that power, not any longer. Now, as we have moved towards very important technological advances, humankind can have at the same time, clean energy, that it's good for the environment, but it is affordable as well. So now, that has created an enormous incentive for utilities worldwide to compete and to attract private and public investment into new technologies that allow us to substitute fuel oil or diesel from your portfolio to generate power and to include more clean energy that makes your portfolio of power generation more affordable and better for the environment.

Enrique: And that transition was one of the busiest that I had to oversee when I was CEO of Mexico's utility. The other big one was to bring more natural gas from the cheapest source of natural gas in the world, which is Texas. Mexico, as we all know, has a big border with the United States and part of the reform allowed for the public utility to be able to buy natural gas from its cheapest source. In the past, it was linked somehow to the supply of natural gas from its sister company Pemex, which is Mexico's oil and gas monopoly, but sometimes Pemex did not have enough natural gas for the industry, for the commerce, for public consumption and for the national utility. So when there were some shortages of natural gas in the country, CFE will have to go back and use more fuel oil or diesel, which were again, more costly and more pollutant.

Enrique: So then, the energy reform allowed for CFE the public utility to be able on the one hand to go towards renewables and on the other hand, to be able to build an extended natural gas pipeline that linked us to the natural gas coming down from Texas, and that allowed to reduce costs of energy production and on the other hand to decrease the amount of CO2 emissions, because natural gas is much more cleaner than fuel oil or diesel when you use it for combustion for power generation. So it was a win-win situation in both great transformations within the public utility. Natural gas and renewables was the answer that technologically was able to provide the public lower costs in energy and a better source of power with less pollutants than before. So for me, that was a fantastic transition and I see that happening worldwide. Most important utilities are going towards clean energy and they're also going away from coal, from fuel oil or diesel in order to use more balanced portfolio for power generation.

Sarah: Okay. And so, we're going to get into quite a few things that you see happening that are really, really changing the dynamics in energy. So you have 20-plus years of extensive experience in, as we kind of walk through a variety of different aspects of this space, which gives you a very insightful and unique view on what has in recent years and also what's coming. So that's what we want to talk a bit about today. So, the reality is that for quite a long time, this space was very stable and some would say maybe even a little bit boring, but just sort of, just very even, very consistent. And now all of a sudden, we're in a time where some of the factors you've mentioned and others are causing tremendous change and it's a real shake up. So talk a little bit about some of those different factors that are contributing to such a stable industry coming to a point of just quite a bit of disruption.

Enrique: Absolutely. As you will say, energy sectors tend to be long-lasting. They seem to be stable and sometimes for some, even boring. However, there's some moments in time when there's important amount of change, technological change, and also consumption change that drives for utilities to have transformations. And this is one of those moments in time Sarah, this a moment of profound change, it's driven by different factors. One of them obviously climate change has become a main concern. We have just come back from COP26 in Scotland that united the world leaders, trying to reach an agreement that will allow the world to focus on reducing pollutants. And on the other hand, you have a consumer that's always more aware of that challenges looking ahead and therefore, even important businesses or commerce, try to respond to that by producing its products with clean energy in order to make their consumers know that they are also concerned about the environment.

Enrique: So technology has been leading the way into making more affordable the fact that we can use the sun and the wind to create clean energy and make it available for the many. And that has led also for consumers, for household consumers, to be able to put solar roofs in their homes and to produce the energy that they will consume. And this is a very important moment in time when every time more households find that this is affordable. And although it requires a lump sum investment on the first year, it takes off in three to five years. And then, you have a long time to make economic sense of that investment. So more people have become producers of energy, and there's a terminology for this. Consumers have become producers, they're the consumers. And what you can see in the future and it's happening already in many important cities in the world is that a household would have a solar roof. It would have even a battery in the basement, and they will use the power that they generate through the day. They'll store it in a battery and they will use it through the night.

Enrique: In the past, that was not really necessary and it was a little bit expensive to have a battery. So in the past, what used to be the battery of everybody that had solar panels was the utility. The utility will take the energy that you were producing in your home through the day and with that bidirectional meter, we'll know exactly how much energy it was taking away from you. And when you came back on the evening and you turn on your TV and you need it for your refrigerator, and to do your house lighting. You will be using energy at night that you will be pulling back from the utility. And that bidirectional meter we'll make a balance of that. And at the end of the month or the period, they will let you know how much you generated, how much did you consume, and what was the balance too. That was the traditional way we were doing these things, not anymore.

Enrique: Now with household batteries of different brands and of different capabilities and different costs, it is becoming affordable for the citizen to be able to produce its own energy, store it in their battery, and use it again. More importantly, we can talk about that in more detail, electric vehicles are also appearing in the ecosystem to transform the way we transport ourselves. So if you want to see it in a way that it closes the cycle, somebody in their household can generate with a solar roof, store it in their battery or in their electric vehicle, recharge its transportation and be disconnected from the overall utility in the services that they are using to transport, to consume, and to entertain, or even to work. The world is becoming every single time more electric and people can be that original source of its power and the utility therefore has to adapt to this new reality and adaptation that's what they're doing right now.

Sarah: Right, okay. Yes. So the way you describe it, and we think about how that traditional model is evolving to this new model where really the consumer is in control and can do a lot of this themselves to be more independent. What does that mean for the organizations that have thrived off of that traditional model? And how do they need to, if you were to give us kind of a best case scenario, how do they adapt? So how do they evolve to meet the needs of today's reality instead of staying kind of on that historical model?

Enrique: I've seen two trends, and obviously there are wide variation in the world, but I'll say that I'll see two trends. One trend is some traditional utilities that will think that this is not going to be a game-changer and therefore, they're a bit on denial and they will say, "We do not need to change, because the overall industrial and commercial and big household consumption is not picking up on clean energy. The electric vehicle footprint is low and some countries are going to be slower than others to adopt change." So they can say, "We still have 5, 10, 15 years for that." So there's not much that they are doing right now. They think that it's business as usual.

Enrique: However, there are some other utilities who are embracing this change, who are not only embracing it, but leading it. And they're coming up to the household and say, "Guess what? We are here, where your traditional utility, we are embracing change, we're promoting it. And we can provide you with solar panels and services that will allow you to do this transition with us. And we're here and we're not going anywhere. We're up here to serve. And we're here to help." And therefore, they're embracing new business units that provide and help citizen with this change of technology to install solar roofs, to install batteries, to have long-term relationships with them to actually help and finance these installations and to advise them, how can they be even more efficient and more knowledgeable about the energy that they're producing and the consumption that they'll be going to go through in the following five years or 10 years as their investments payoff. And I think those utilities are doing the right thing.

Enrique: They're leading the way, and they're making every citizen have a trustful partner to have and drive through this transition. And I think that the key reason to go this way is because it's becoming every time more affordable to do it. So if you don't lead the way, the market is going to lead the way, and you are going to be sitting down in the sidelines. There is an industry that went through this type of transition with some variation obviously, 20 years ago. And you might remember this era when cellphones first arrived, when we were younger, cellphones were big instruments, they were heavy, they didn't last long, they were very expensive. And some people will say, "There is no need to worry if you're in the telecom industry, because cellphones are expensive. Okay, people are not going to like them. They will always like to go back home and call from home. Who will want to carry a phone with them in their pocket?"

Enrique: Some communication companies denied that change. And remember that in the past, your telephone company will charge you for every call that you make. And long-distance calls were just prohibited. I remember back home, my mother wouldn't let me call my cousin, because it was a long-distance call and it was just crazy, costly. So nowadays everybody has, cellphones are more numerous than hardline, phone lines. People have one or two devices. Even youngsters use it for their social life. It's not even a communication device. It is way more than that. It's even a working device.

Sarah: I was going to say that, you're not even charged for calls anymore. I mean, it's really just based the access or volume of data, but the idea of being charged for a long-distance call, that's completely obsolete at this point.

Enrique: So the communication companies, and you're right in the point, communication companies that before they had the revenue for every call that you were making, now that they changed the way they charge for services and they charge not for a call that you make, calls are unlimited, long distances are no more. And even you have some apps that allow you to make calls without even going through the communication company. So that has changed in a very important way. And the way that utilities think of the communication's sphere changed their business system to collect cash through the services that they provide changed as well. And I think that's the type of change that we will see with utilities. As every citizen will have the chance to generate its own power, utilities will have to be there to back up the system and to make sure that everything runs smoothly, but they will have to evolve in the way they collect their fees and they charge for services.

Enrique: And I think that those utilities that are thinking about those new ways will lead the way and those utilities that do not think that that's going to happen and stay on the sidelines, will maybe having some risk in their overall business. And they will miss opportunities that others will take in their place.

Sarah: But you made the point too, that the risk to the companies that maybe don't believe that this is a fundamental point of change. It's not just them versus the other utilities that want to lead the way. They also have the risk of third-parties entering the space to compete as well. So it's not just which utilities are going to get it and which aren't, but you may see other organizations come in to provide some of those needed services and support to the consumers, if these organizations don't want to step up and fulfill those needs.

Enrique: And there are areas within the industry that are changing faster than others. And I'm going to be stating the obvious, but utilities have at least four different services that they provide. First, they generate power. And back in the days, they generated power far away from the cities. They transform some fuel into power and they bring it into the cities for consumption. So one is power generation. The second big thing that they do is to dispatch and transmit energy from faraway places into all the regions and cities of a nation. So you see these big high towers that transmit power from high voltage, from one place to the next. So transmission and dispatch is another big, important activity. The third one is distribution. When low voltage energy comes down to your cities and you can see it in city posts and cables that take you down to your house or to your commerce. And that's that distribution activity.

Enrique: And finally, it's wholesale. To actually sell you the power and all the services that I have mentioned and you pay a bill for it. The two sectors that have been open for competition in many places now, in many parts of the world is power generation and wholesale. Now, transmission and distribution are what we call natural monopolies. It will not be efficient to transmit, to create an additional source of transmission or additional posts of distribution to have competition in that area. Those areas tend to be regulated. They're natural monopolies, and they work that way worldwide. But power generation and wholesale are open for competition in many countries and even more so, because now the citizen can generate and commerce with its own power. So you will see that change in those areas.

Enrique: The utilities used to be integrated and provide the four activities in a single bill. That's also changing. Now, in different cities and countries where power generation is a source of competition, you can choose your provider of power. Now you do have to pay a fixed rate for transmission and distribution, and then you can actually choose who's going to sell you the final product. So those are the areas of where utilities have to be participating, and regulators are making that participation happen as well. So this is a trend that's happening on the one hand, because of the choice of the people and on the other hand, it's also being imposed by the decision of energy regulators in different countries that are advancing into this direction.

Sarah: So the end result is these utilities have to work to become more competitive in nature than they have been historically. Particularly, when it comes to the consumers.

Enrique: Absolutely, because there's also some stranded assets of long-term investments that were done 5, 10, 15, 20, or 30 years ago that are essential for the overall power system to work. And those assets need to be recognized and paid for. In addition to that transmission and distribution grid also needs always to be modernized even more now so, that so much information is going to be transmitted and require from consumers and the utilities, so that we can include an ever longer list of electronic utilities, electronic appliances that we're using. So we need to have those transmission and distribution grids modernized and up for the challenge of having even more data going through them. So we definitely need to keep on investing in those things. And that's where the regulators come into play. And that's where utilities also need to inform properly regulators, what are the real costs of those systems that it's in the best interest of all that they remain to be very importantly, well-modernized and well-maintained.

Enrique: So I think that's where the overall challenges lies. We need to find a middle ground between the advancement of technology and the right of the citizen to generate, consume and sell its own clean energy. And on the other hand, the fact that we need all those assets from utilities, for transmission and for distribution, and in some sense for generation to create a stable system to be there. And it is a common good that we all have to chip in and pay.

Sarah: Okay. And then, you have the idea that when you talk about the move to consumers doing more of this themselves and utilities needing to respond by introducing new services and kind of thinking about how they evolved their revenue models, it seems like those would be tasks that they really haven't had to think about much, or at least in quite a long while, is that accurate? So sort of when you just think about sort of what's the new value proposition? And what's the go-to-market strategy? And how do we market this? And how do we differentiate ourselves? Those seem like things that under the traditional model, most of these utilities probably haven't had to flex a lot of those muscles. Is that-

Enrique: Absolutely. And let me give you examples of them. I've seen utilities that in order to deny the fact that a citizen can put a solar roof in their home. They just denied the fact that you can buy or install bidirectional meter that will allow you to send back power to the system, where you're producing it and bring in electricity when you require it. In the absence of that bidirectional meter, you can just not have the success of a solar panel working. So a utility will have a gate-keeping power by saying, "There's no more bidirectional utilities available, and therefore I cannot connect it to you, and therefore, it's not a wise investment for you to put solar roofs." In the opposite extreme of that, there are utilities that will facilitate you that bidirectional panel that will allow you to buy it or rent it in payments along a year or two. And therefore, it makes it easier for you to do that transition.

Enrique: Moreover, they can even say, "I'll give you the whole system integrated and I'll give you support to maintain your solar panels, your batteries and your bidirectional meter a long time." So those are two ways that utilities varying their approach to this. And the same thing will happen with batteries or electric vehicles. Electric vehicles and the first time I drove an electric vehicle, it only could run ultimately, 70 kilometers for every recharge. So, you will always be worried that if you will be far away from your recharger, that you will be stuck in the middle of nowhere. And that's a main fear that most people still have today. So the way to go away from that is that as much as you have gas stations in every corner, in the big city, you need to have available electronic fast rechargers so that you will never feel that you are going to be left with no rechargeable nearby with your car.

Enrique: So now, there's ways to go about this. Now, electric vehicles can run over 300 kilometers or more without a recharge. So that technology has improved. And on the other hand, it could be very wise that cities continue to establish public recharging stations that become frequent, and that can be nearby your home, your place of work, or the school of your children, or you can recharge while you're receiving coffee. And therefore, you feel that there, you do not need to fear that your car is going to leave this stranded someplace. In addition to that, some electric vehicles are also suggesting that you can have an electric recharger at home. So it is like when you recharge your phone or your iPad, you ride home, you connect your recharger to your car and the app allows you to choose at what time are you going to be recharging?

Enrique: So maybe you are going to recharge your car every third day at the middle of the night, when the cost of power is the lowest. And therefore, you will be even saving more money in comparison to the gas pump, or maybe you can just do it in your office and when you arrive to your office, you connect it, and in 20 minutes, your supercharger allows you to have a car recharged for the rest of the week or 15 days. Some car makers are even suggesting that they will have a battery for 2024 that will allow you a 1,000 kilometers of autonomy. So maybe you'll have to recharge your car only once a month. So that cost of recharge for electric vehicles is going to be so much lower in comparison to charging for gas at your usual station. That's going to be a game-changer.

Enrique: Now, some people that I talk to in a recent conference in Milan, some will be saying, "Well, that happen maybe in five years in 10 years, and it will never happen in my country." Well, that's exactly the denial that I was telling you about. Others are saying, "Here's the technology it's affordable, you can put it in your home, in your office or in the public space, and it's going to be happening as soon as next year in the following year," and so on. And some countries are seeing the rate of new cars being electric vehicles increase in a formidable way. Most Scandinavian countries, they sell more new cars that are electric than any other type of hybrid or gas or diesel. So there's variation in how countries will adapt to change. But I think that change is happening and there's no way around it.

Sarah: Yeah. I definitely agree. And I think it Enrique, it's interesting, on this podcast, we haven't discussed energy super-specifically many times. It's more just sort of service and more horizontal trends, but what's interesting to me is this idea of disruption and the idea of how these utilities need to a, acknowledge that disruption. I mean, that resistance to change is the first barrier to overcome. That denial is futile, I think. And so, the first thing is you really have to see the reality for what it is. But I think a lot of that resistance comes from fear and the uncertainty in how an organization is going to pivot to meet the new needs. And so, I think in a lot of ways, it's a very natural response, because you want to protect the way in which you've operated and been successful.

Sarah: And so, one way to protect that is to deny that there's a new reality upon us or coming. But I think one of the points that I was thinking about when you were sort of talking about the two ends of the spectrum, like the company that's in full denial, that just refuses to think that this is happening, and then the company who is proactively going out and saying, "Oh, you want to install solar panels. Great, we can get those for you. We can support you. We can help you," and getting ahead of that disruption. The reality is it doesn't have to be, there's a lot of gray area in between those two realities that is the transition time. You have early adopters that maybe already are self-sufficient in their energy, but you have a lot of residential areas that will take quite a bit of time to get there. And so, I think one of the points that seems important to make is that these organizations, you can both accept the reality and start planning for the future while continuing to deliver your current business model.

Sarah: You saying, "Yes, this is coming," doesn't mean that cut, you can no longer make money doing what you're doing. There's a chunk of time here that this transition is going to happen under. And so, we see that when we talk with organizations in manufacturing that are on the journey to Servitization. That whole journey is about moving from someone who manufactures and sells a product to being an organization that delivers an outcome, okay? And that's a whole continuum of steps. And oftentimes, you don't just jump from one end to the other. And so, this seems like a similar situation where part of what these utilities need to be thinking through is how do we embrace this new reality and what's coming even in the future and start preparing for that while continuing to support our current business. And just understanding that you can do both simultaneously for a bit while you get to the point in the future where things are transitioned. Does that make sense?

Enrique: Absolutely. Let me give you an example of that. Now that I have been traveling to Europe and to the U.S., what I have seen in airports and what I have seen in the conference that I've attended, is that an industry that is being adapting quite quickly to these changes are the sisters and cousins of utilities which are oil companies. You can see that oil companies have moved from being their traditional business model of extracting oil and gas from the ground or the sea, and now to become an energy company in a way that they're also buying and building wind farms and solar farms. So they're evolving from hydrocarbons to clean energy. Not only that, in their gas stations, they're installing electric vehicle superchargers, because gas stations have two source of business. One, I'm saying the obvious, they sell gas, but second, they have a convenience store that is a source of income, sometimes even more important than the gas pump.

So they do not want to lose that flow of income. I saw in a conference that they estimate of that gas, gasoline, diesel, and car industry is over $1 trillion annually. That's the size of their business. And they don't want that business to be taken away by electric rechargers that go and take the consumer elsewhere, away from their gas stations. So they're putting the electric vehicle rechargers, where you used to go and charge gas. So they're transforming their product into adapting to this change. Now utilities were the natural beneficials of this change of electrification, of transport and electrification of the world. So for utilities, you should be easier to transit to be the paramount of clean energy and the promoters of electric vehicle recharging. But if they do not move fast enough, some of those who do not move fast enough, guess what? Your cousin, the oil company is doing it for you.

Enrique: So they are now, they have a big advertisements in airports, what they say? "We got it. We've heard you and we're transitioning, and we are not anymore an oil company. We are now an energy company and we have solar winds, electric vehicles, and they're going to move into that direction." So that change is happening. How fast you adopt it and how fast you lead the way, that's really up for the utilities to embrace. But there it's a change that benefits utilities, because it brings transportation, batteries and solar panels that it's something that they know of to their front yard. So some other companies are going to come there too, if you don't lead the way.

Sarah: Right. Yeah. It's just interesting, like you said, it should be easier for them, but in my years of doing this, it's not easy, because it's a change in identity of who they are. And it's a change in the identity of how they serve their customers, how they make their money. And that is just, it can be very, very challenging for people to embrace that need to become something different. At the end of the day though, this doesn't sound any different than a lot of the other industries we discuss, which is, what do the customers want? What do the consumers want? If there are going to be more and more electric cars, then yes, you need more charging stations. That doesn't mean that today you need all charging stations and no gas pumps, but you need to start planning for the future now and figuring out how that transition is going to take place and what that's going to look like. And it just comes back to being open to meeting the needs of the consumers you make your money from.

Sarah: So if it's ultimately driven by what do they want and where are they heading, which in this case is incredibly compounded by the environmental impact of these things. So, super, super-interesting.

Enrique: Thank you, Sarah. Absolutely, because at the same time, you do see utilities leading the way. You do see utilities taking all this information right on and actually investing billions of dollars into promoting the citizen to use this clean energy to adapt technology that allows for batteries at homes, at buildings, at commerces. And on the other hand, to collect all this information in a way that allows the utility to plan ahead all the investments they need to do in transmission and distribution to guarantee a normal and high level of quality service, because all this change in way we produce, consume, and commerce power also requires an adaptation of the traditional models of when was the usual way of consuming and producing power in the past. These changes also require investment and also require long-term thinking. And in an industry where five years and 10 years is short-term, because energy industry have investments that when you decide your first investment for a power plant to be built, you know that it's going to be a five-year buildup project and then a 30-year asset that's going to be working very hard for you.

Enrique: So we're taking decisions now for a 35, at least 35 year-period. So five years go by fast in the utility sector that the economic cycle is a long economic cycle. So some of those utilities knowing all this, they're leading the way, and they're doing what's right for the environment, but what's also right for the pocket book. And that's why this moment is very important. Right now, you can really have your major, your cake and eat it too. You can have a win-win situation when technology allows you to make a decision that's good for the environment and good for the pocket book.

Sarah: Yeah. Yeah. It's really interesting. I want to talk with you a bit after. I'd be interested in relying on your network and maybe having someone on that is leading one of those utilities that is really stepping up and taking the reins in this transformation, because it'd be interesting to just talk about why and how they see things. I mean, to your point, with any disruption there's companies that just are more adaptable and more willing to innovate, and there's those that are just more resistant to change and like you said, more in denial. And it's really interesting to kind of examine the differences there and try and help those who are resisting a bit, understand what the flip-side of that can look like and the opportunity it presents. So really interesting stuff.

Enrique: Well, there's one comment that I want to show you. When you go back to power generation and you see that the cost of solar generation has gone down by almost 85% in the last 15 years. The technological advances of that is tremendous. And one way that countries have been achieving that technology change to benefit their consumers, to benefit their citizens, is that they have auctions every year that will allow for different technologies to bid, to offer the lowest possible price of power generation for wind and for solar. Mexico did that back in 2016 and 2017, and 2018, with very important outcomes of reaching the lowest price for solar panels and wind farms in the world. Other countries that continue doing those type of standard processes, public, international, transparent, open have led the way into having even access to lower cost technology in their own processes in 2019, 2020, 2021.

Enrique: So what I see is that as years go by and countries offer an important atmosphere for technology to come compete and therefore show the way, and you get the benefits that will impact the citizens for years to come. Those solar farms and wind farms take two to three years to be built. And their service life spans from 25 years to 35 years’ time. So, it's very beneficial. And of course, we can suggest names of different companies that have led the way in this technology. The U.S. has just announced that they are going to have their first offshore wind farms established in the east coast, something that has happened in Europe for a long time now, but that technology increasing the size of the basis or the length of the rotators have allowed to even generate more energy with the same wind offshore.

Enrique: So that allows for more efficiency, lower costs and so forth. And obviously, there was always be some criticism to every technology power generation, and there's also always to be open to hear how can we improve technology and improve many things, but the bottom line is that in comparison to hydrocarbons, the possibility to use sun and wind to produce power is just a very important asset within an overall portfolio of power generation. And it's not going to be the only one as we can continue conversing, there's also a hydrogen, there's a conversation about additional nuclear, hydropower is also always very important. So there's always a source of clean energy that has to be part of an overall conversation. But as of today, clean energy, batteries and electric vehicles seem to be leading the way. And in the conference that I was just recently in Milan, everybody was just talking about it.

Sarah: Yeah. Okay. Well, I think we'll have some additional conversations we can have in the new year to kind of dig into some more of this, because there's a lot of interesting aspects to this and I really admire your wisdom and your passion. One other question I wanted to ask you today Enrique is, obviously you're incredibly experienced and have played many different roles in this space, and you're obviously very passionate about this industry and this topic. So I love that. And with your experience and your passion now you're at IFS, you're heading the energy and utilities business. What makes you excited about coming onboard a software organization to bring your expertise in and take it from a new perspective?

Enrique: Absolutely. Software makes all these changes possible. Behind all these decisions in the long run is software that allows you to make services more efficient for the benefit of the people. And software is a live subject. It changes, it evolves. It requires a lot of feedback, a lot of knowledge, but it grows. So one thing that it attract me to join now this effort, is to be able to have conversations with utilities and to understand what are the problems of these changes? How can software allow them to have the information they require to run the assets that utility has to provide services? How to empower the citizen with software so that they know how much power they're generating, how much they're going to be consuming, what they can sell and where, and how to, at what price? On the other hand, you need software to understand how are you going to include the electric vehicles within the ecosystem of a city, a neighborhood or a household?

Enrique: In addition to that, you need software to understand how are you going to transmit all this information that's going to be produced by the consumption of even more electric appliances in the family household, in industry, in commerce? So all these need software and software that allows you to face change in a more secure way, in a more knowledgeable way. And the conversations that I had in the U.S. with many utilities that are leading the way in these changes is that without software, they would be blind going into this change process. So they need their software with them. They also understand that software is something that needs to be improved and included and brought on up. So I think it's just fascinating to be out now on the other side of the equation and understand how a service provider of good software helps utilities lead way.

Sarah: Yeah. I mean, when you talk about big of a foundational change, as we're talking about today. You can't lead through that without a lot of insight. And that's the power of the software, the power of the technology is having the information at your fingertips that you need to know how best to meet the needs of the consumers and businesses you serve. So I think it's really cool. It gives you a chance to be a part of this transformation and in a new and different way than you have thus far.

Enrique: Absolutely. And let me tell you, utilities, although obviously infrastructure is relevant. Utilities is about people. Utilities is about the workers and engineers within a utility that make all this happen. And when I was in the utility in Mexico, I remember to say that a utility is like a referee in a soccer match. If the referee's good work is for him not to be noticeable, you see the game plays, and there's no controversy if the referee called a good shot or a bad shot. So then the referee has to be mostly invisible when it does a good job. Utility is the same way. If you arrive home and you turn on your power and you keep on about your business, everything is fine. So the utilities are quite doing a great job when you don't even think about it, when you can go around in your life.

Enrique: And for that, for the utility to be invisible, is that thousands and millions worldwide of women and men, talented women and men are doing their job right. And what software that helps that is Workforce Management. Workforce Management allows a utility to take care of their workers and allows the workers to take care of the utility, because it allows the job to be done properly, safely and economically for the benefit of all. So that's an additional way that a software company allows for the world to continue doing their business without anybody noticing that it's there. And that is the key of it. You have to do your job. And everybody continues to do, to have their own life and power is on when you need it. And that's the belief of it. Power is on, everybody happy. When the power is not on, it's like the bad referee, everybody's talking about the bad referee and nobody wants to talk about the bad thing he did. So I'm glad to be now in a software company that helps utilities and helps the women and men in utilities do their job properly.

Sarah: Yeah. Well, I think it's great that you're here. I absolutely loved hearing some of your thoughts and some of your experiences, as I mentioned, this is a space that I have not dove a lot into. So I appreciate you educating me as well as some of our listeners. And I'd love to have you back again and dig into some of the other areas of this and just keep learning from your wisdom and your experiences. So thank you Enrique.

Enrique: Oh, thanks so much, Sarah. And I wish you the best. And to all of you for this end of the year. Have a nice holidays with your family and best wishes for 2022. Let's make it a very strong year.

Sarah: Absolutely. Thank you. All right. You can learn more by visiting us at futureoffieldservice.com. 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

Some of you regular readers may not know about another role I have and love, which is running a customer community group for service at IFS. Over the course of 2021, the group has met twice a month for an hour to share insights, discuss challenges, and provide feedback. The power of community is an amazing thing, and it’s been an honor for me to get to know these folks better and to see them helping one another in so many ways. Moreover, in a second year of Covid strain, being able to come together with peers has provided a sense of camaraderie I think we’ve all benefited from.

We recently held our last session of the year, where we discussed lessons learned in 2021. I thought it would be interesting to share some of those lessons with you. Maybe you, too, can find a bit of solidarity.

“I’ve learned that remote software implementation is really hard. Employee engagement plays such a huge role and trying to ensure enough of that virtually is challenging.”
“I’ve learned that some leaders are very comfortable with excuses. They turn a blind eye to the need for or opportunity of change because they don’t want to have to make the effort to do things differently.”
“I’ve learned I need to spend more time on the business, and less time in the business. I need to prioritize conserving time for more strategic thinking and initiatives instead of always getting pulled in to the day-to-day.”
“I’ve been reminded how valuable face-to-face meetings with customers are. Zoom and Teams can be exhausting, and you simply cannot ignore the power of human interaction.”
“2021 was a good reminder that the strength of the organization is in its people. In a remote environment, it became clear which managers were succeeding and which were struggling by how their teams performed.”
“I was reminded that you can’t assume the way you do something is the right way. You have to be prepared to shake up your thinking and throw out processes, tools, anything that isn’t serving you. It can be tough to do, but it’s so worth it.”
“My lesson in 2021 was to find the right balance of speed and stability.”
“I’ve learned that collaboration at the strategic level is very hard in a remote environment. From scheduling to dropped connections and so much more, gathering the right people to make decisions virtually is cumbersome.”
“Despite technology, service will always be a people business.”
“2021 brought the opportunity – and need – to try new things, which helped us learn that we can change faster and farther than we may have thought.”

What was your biggest lesson learned in 2021? I’d love to hear from you. Thank you for being a part of the Future of Field Service community this year. I’m wishing you all a wonderful holiday season and looking forward to 2022!

Sarah talks with Andrea Pelizzaro, Connected Services Manager, BU Decanters at Alfa Laval about the company’s multi-faceted approach to digital transformation. From the role of digital tools internally to optimize the customer experience to how to leverage digital to build next-generation services to meet customer needs, Andrea discusses the evolution, lessons learned, and what comes next.

Sarah Nicastro: Hello, everyone. Happy to be here with you today and excited to have Andrea with me. So just to, for a quick introduction of myself, and then I'll ask Andrea to tell you a little bit more about him. So I am with IFS. I actually I'm the creator of a thought leadership platform called Future of Field Service, where I write content as well as host a weekly podcast. So I had the good fortune over my career, which at this point is about 14 years to interview companies almost on a daily basis about their journeys in transforming their businesses, seizing new business opportunities, leveraging technology, et cetera. So it is a very, very great job that I'm happy to do and excited to have this conversation with you all today and with Andrea. Andrea, do you mind telling the audience just a bit more about yourself and your role at Alfa Laval?

Andrea Pelizzaro: Yes, of course. So first of all, hello everyone. And thanks for joining this session together with me and Sarah this afternoon. My name is Andrea Pelizzaro and I'm responsible for Connected Services within BU Decanter. I started actually introduce Business Unit since may this year, but previously I was working as responsible for Business Development within the other business unit boiler still in Alfa Laval. I would say that I have several years of experience when it comes to business model innovation and IoT and I've been working in different industries, but now I'm fully attached to Alfa Laval, of course, and I will do my best to explain you actually a bit more about what we are doing today.

Sarah Nicastro: Awesome. Thank you, Andrea. So we are here today to talk about two sides of the digital coin. So what we're going to be exploring in this session is the role digital plays both internally when it comes to helping you optimize and improve the customer experience, and externally as it relates to leveraging digital as a part of your customer value proposition. So two super important ways that digital tools are being leveraged by leading organizations today. A lot to consider, a lot of areas where you can go astray, and some lessons learned coming out of those, and some thoughts on where things are heading in both areas. So Andrea, with that being said, to start can you share a bit about, from the internal side, looking for Alfa Laval has leveraged digital to streamline and optimize its customer experience. So can you talk maybe about any major milestones and, or next areas of opportunity for that internal use?

Andrea Pelizzaro: Absolutely. So first of all, when it comes to, I believe our focus, especially when it comes to my job on the service business, I think one of the major milestones that we have seen or that we have been able to introduce within the customer experience nowadays is related to the user job remote guidance that is basically a software that enable us to be closer to our customer when they need to have support from remote and have the opportunity to be connected with an expert from our central headquarter. I think this is definitely a quite important advantage that we have been able to create, especially with regards to the challenges that we have seen during the COVID period. But of course this will be used more and more in the future, and that is actually our expectation.

Sarah Nicastro: Mm-hmm (affirmative). So Andrea, I have the benefit of having a little bit of insight on Alfa Laval's use of IFS Remote Assistance. And one of the things that's interesting, not just with Alfa Laval, but with some other customers who deployed that solution during the pandemic is how it was used initially as a response to enable business continuity. But the way that it can evolve as the COVID circumstances diminish or change to be a part of the overall service delivery mix. So in a COVID situation, particularly in the early days, you had situations where travel was restricted, technicians couldn't get on site in a lot of scenarios and you really needed to act fast and figure out how you could still support your customers. Even as those circumstances change, it becomes a valuable tool to help you just have options for service delivery.

Sarah Nicastro: So to look at perhaps a remote first scenario, or to your point to even leverage it from internal Alfa Laval expertise to frontline workforce, or a number of different ways. And so I think one of the key themes when it comes to digital is being a bit more agile, not in the sense of software development but in the sense of mindset. Right? And thinking about what does the customer need? How can we meet it? If that changes or circumstances change, how can we quickly adapt as best we can using some of these tools? I think the pandemic was a really good lesson for folks that were lagging a bit with their digital investments that it is very important to have these tools in place. Do you have any other thoughts or comments around looking at ways Alfa Laval is helping optimize the customer experience?

Andrea Pelizzaro: Yes, of course. Then if we focus on, let's say the capital sales side, so for new projects, I would say that the way that we are leveraging digital in general, it's through lead generation. So we tend to work more and more through an online customer journey instead of having physical meetings or looking for the right person to talk with over a meeting into an office. Now we leverage a lot on digital campaign and the opportunity to target directly the right decision maker in order to of course, enable more businesses. So I think that is definitely something that many companies are working on, but especially into the industrial business is another important emerging trend I would say.

Sarah Nicastro: Yeah, I think you mentioned a critical term, which is customer journey. And one of the biggest issues that we see right now with digital is the siloed approach. Okay? And I think what that really comes from is looking at digital and doing so in a way of how to solve a particular problem, which is important. We just talked about remote assistance and how that was incredibly useful in a specific issue. But it also plays a bigger role in the company going forward. And we can't just look at digital investments to solve a point specific problem without reflecting on their impact on the customer journey. So I think that one of the keys to digital success is really breaking down these internal silos and looking at that overall customer journey and making sure that it's seamless.

Sarah Nicastro: I mean, customers want simplicity, they want ease, they want peace of mind. And digital can either be an incredible enabler of that, or it can be detrimental to that type of experience if it's not done well. And so I think that term customer journey is really the key to looking at your internal use of digital and looking at it from the perspective of how your customers will experience that and reflecting on what's that experience like. Is it as simple as it needs to be? Is it as streamlined as it can be? And use that to guide your investments and your strategic initiatives.

Andrea Pelizzaro: Yeah, absolutely.

Sarah Nicastro: So good. All right. Let's shift gears a little bit, Andrea, and talk about the use of digital in creating new and differentiated customer value propositions. So tell us a bit about what this looks like for you in your role at Alfa Laval in the Decanter's Business Unit.

Andrea Pelizzaro: Yeah. So when it comes to what we are currently trying to shape as a new portfolio of, let's say services based on big data or IoT, we have different product families at the moment that we can leverage. And actually we start from something that could be very simple, that is a remote support and monitoring solution that is slightly different compared to remote guidance, because in that case, our customer will have the opportunity to remotely monitor their asset from everywhere and get support in case of troubleshooting. To the journey that we are basically working at the moment that is related to the predictive maintenance. That is another extremely important aspect that we want to tackle in the near future because we can clearly see the advantage of having this solution when it comes to support the customer in optimizing maintenance interval, for example. And so we would drive to cost savings.

Andrea Pelizzaro: So these are basically the key solutions that we offer. I can tell you as well that according to my previous experience when I was working in the marine industry, we were leveraging actually the knowhow that we have as a company when it comes to create specific support to our customer in order to operate in a proper manner the equipment that we provide. And I think it's key and where we have still a clear differentiator compared to IT companies, for example, that pop up in the market presenting their digital tool that are based purely on algorithm. I think the knowhow that OEM can provide in this case is still quite extensive. So yeah, that is basically what we are, I would say, bringing into the market at the moment. But of course, there's a lot of ongoing development for future innovation.

Sarah Nicastro: Mm-hmm (affirmative). Yeah, so the point here is you're absolutely right. So you as the OEM, you hold a ton of expertise and knowledge and wisdom, and digital is really what helps you depart that upon your customer base. So I think more and more of what we see is customers are not buying products. They're not interested in buying a product or a service. They're interested in buying an outcome, an experience, a form of assistance, something that will remove a burden from their daily lives. Right? And so by leveraging digital, by obtaining this data, by making this data useful, by using that to help your customers with their problems, you're delivering the type of value proposition that people are interested in today. And so I think that that is super interesting.

Sarah Nicastro: Now, what are some of the key drivers of this that you hear from within your customer base? So you mentioned cost reduction, you mentioned the need to leverage Alfa Laval's knowledge to help train and ensure proper use of the equipment. Are there any other customer needs that are really driving the development of these digital services?

Andrea Pelizzaro: Yeah. I think one of the key drivers that of course is always top of mind from our end is the opportunity to provide, first of all uptime, because in most of the cases this is key for the customer. If you think about a plant in the food industry that you are running couple of decanters, and at some point one of those breakdown, you can have a customer that can potentially have, I don't know, an entire line stopped for a day and they have a huge loss. So we need to provide of course this uptime, it's definitely key for the customer. But I would say that as well performance is extremely important because in most of the cases what we have seen and here again, I relate to my former experience within the marine business. But of course, this is something that we see a clear trend within the food and water business as well is the fact that in some cases, the operator on site, they are not able to utilize the machine always in a proper manner.

Andrea Pelizzaro: So the opportunity from the OEM side is to provide recommendation in order to have actually the 100% performance from the asset that they are utilizing at that moment. So I think those are extremely important as a driver. And then I would say as well, that the fact that now we are in a connected world and especially we have asset located everywhere, it's extremely important to be capable in monitoring from remote your asset. We have companies that are getting more and more mature in the IoT side, and that means that they are basically creating organization responsible to keep track about the processes of machines that are maybe 1000 kilometer away. So that's another of course, driver that we need to take into consideration.

Sarah Nicastro: Yeah, that's a good point too Andrea is in different industries and the differences in the customers they serve, this varies greatly. Some customers actually have less and less internal expertise. And so they need to rely on their suppliers more and more, or their partners. In this case, you bring up another really good point which is, you can't allow the digital aptitude of your customers to outpace your own digital aptitude. So you need to ensure that you are staying ahead of their appetite for these things by prioritizing digital solutions, investing in innovation, et cetera. So that's a really good point as well. So looking ahead, Andrea, if you think about what the next 12 or 18 months will bring either within Alfa Laval specifically, or just in the use of digital in both of the ways we've discussed today. What are some of your thoughts on where this is going to head?

Andrea Pelizzaro: I think in general the trend that we are seeing more and more within our industry is the fact that we have customer that are getting more and more mature when it comes to let's say, the approach of as a service. So it means that they are starting to think more, as you said, as the output that they can get instead of the hardware that support them in order to get this output. So I would imagine that in the future, we will be able at some point, and I don't know exactly when, because of course I'm not able to predict it. But my expectation is that we will be able to sell our piece of steel tied to a service agreement that is based on the output that they need. So they will not think any more about the transactional business, but more as a subscription based model for example.

Andrea Pelizzaro: That could be definitely something that I'm already working or as a company we are taking into consideration in every indigenous industry that we are engaged on. And then I would say that a potential challenge that I see when it comes to OEM like us, is the fact that we need to be better maybe in conveying that even though we have been working for centuries, let's say within the piece of steel industry, we are trying to go beyond the steel. And in this case, we want to be recognized still as a solid company when it comes to provide a digital solution. So I think this is an important aspect that we need to take into consideration into our journey to be more capable in showing our capabilities when it comes to IoT.

Sarah Nicastro: Yeah. So, boy that brings about a lot of thoughts, and I know we only have a few minutes left. But just to comment quickly on those things, Andrea, I think the second part of what you said around what is the company known for, and what is the story you're telling to your customers and prospective customers, and what's the identity. That is such an important point. And it is an area where a lot of companies struggle because it is a change in what and who the company is. And it is a very big cultural shift in a lot of ways to doing business differently and introducing these new business lines and business models. And that part in and of itself can be very challenging. And I think it's a point to bring home for folks, which is, that area deserves a lot of attention. I think going back to my point earlier about silos.

Sarah Nicastro: I think one of the very important first steps is to ensure that you have alignment on what the company wants that identity to be. Because when you have different divisions, different business units, different functions, all sort of telling a different story, it doesn't add up for your customers. And so you need to decide cohesively what's the story we want to tell. Who do we want Alfa Laval to become. And then make sure that you start managing that change and getting people on board with that. So let me pause there and just say that if anyone has a question, please feel free to type it in. We have just a few minutes left. I'm going to keep talking with Andrea in the meantime, because I actually have a couple more questions for you, Andrea, that I'd like to get to. But if the audience would like to ask anything, please feel free to add that in.

Sarah Nicastro: I wanted to go back to the as a service point that you made as well. So I recorded a podcast yesterday that will publish in a few weeks’ time with Dave Mackerness from Kaer, and Kaer is in Singapore, K-A-E-R. And they provide cooling as a service. And he had some really good insights on just why they're passionate about the business model, why it works for their customers. Actually, how it ties to sustainability, and really helps the environment, and the benefits that it's brought to the company. So I think your premonition that you can't predict if and when Alfa Laval will get there, but overall things are moving in that direction. I think is absolutely, absolutely true. Andrea, with the couple of minutes we have left, are there any lessons learned you can share from your experiences in the company's digital journey?

Andrea Pelizzaro: Yeah. I think first of all, I have seen, and we still see actually some challenges when it comes to, think about the standard that different industries should put in place in order to make this journey a little bit easier. Because from time to time, you get caught into, I would say, a conundrum of different directives based on location or based on industries that will not give you the opportunity to standardize and have a similar approach compared to the competition. That in the end, of course, you can pretend that you would be able to provide that to your customer the entire package of the solution that you have into our portfolio. But we know exactly that the customer are not looking for, for example, 20 different platform. They want to have one single platform where they can access all the data and so on.

Andrea Pelizzaro: So this is definitely something that I'm always trying to think about when it comes to the journey that I'm in. But at the same time, I would say that an important lesson learned would've been the fact that partnership and collaboration in general is key into this journey. We cannot pretend to work as a company always trying to produce everything on our own because we need to get the expertise from other places. And especially sometimes we can complement each other. So I think it's key the fact that we can leverage on the expertise that we have in house, together with something that we don't have in house. Of course, in the future, we will get better in filling the gaps. But I would imagine that even the fact that we have used in remote guidance IFS is because we were not capable in producing something on our own. And I think it has been a success in the end. So I think it's definitely an important lesson learned that we always take into consideration.

Sarah Nicastro: That's a very good point. Well, Andrea, thank you so much. I know we are out of time. So Andrea, thanks for being here with me. Copperberg, thank you for having us. We have some additional content on Alfa Laval and others at futurefieldservice.com. So would love to have you visit us there. And I appreciate the chance to come and spend some time with you all today.

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