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As AI Unlocks the Promise of IoT, It’s Time to Double Down on Service Innovation

From IoT to GenAI and Beyond: Advice for Building Intelligent Connected Solutions

What Does It Take to Thrive Vs. Merely Survive in the Experience Economy?

August 16, 2021 | 5 Mins Read

Breaking Up with Incremental Improvement

August 16, 2021 | 5 Mins Read

Breaking Up with Incremental Improvement

By Sarah Nicastro, Creator, Future of Field Service

Let’s be clear – no one is suggesting that continual improvement isn’t a good thing. However, what deserves some real exploring is whether incremental improvement is killing true innovation within your business. There are a number of reasons this can happen – incremental improvement can feel like “enough” if your business is achieving success; even as opportunity for true innovation abounds. Incremental improvement feels safe, whereas innovation can be scary. And, perhaps worst of all, you are focusing on incremental improvement under the guise of innovation – in other words, you don’t really see the difference.

In any of these instances, it is time to break up with the idea of incremental improvement and accept the fact that today’s market landscape demands true innovation. I recently had a conversation with Dan McClure, systems innovation choreographer at Innovation Ecosystem, which you’ll see soon on the podcast. It was clear in the first few minutes of our talk that Dan isn’t one to shy away from the challenges of true innovation, and he’s created a career from his inclination and passion for it in helping companies embrace real innovation.

“Most organizations are in the habit of working. They have built up a set of systems, they've built up a value proposition. They've built up a marketplace. That all work together to essentially deliver value to their customers and to their shareholders and to their employees. Everything works,” says Dan. “And for those types of organizations, simply making an incremental change to make things a bit better makes them more profitable, more competitive. Sustains their role in the marketplace. The challenge is, if they need to make a bigger change, let's say a competitor comes in and offers a radically better proposition, or the fundamental basis for their marketplace disappears, then they can't make small changes to the way things work, because those won't be enough.”

Disruption Can Be an Opportunity or a Threat

What Dan’s referring to is disruption as a threat, which is a very common viewpoint. What happens if a new competitor enters our market with a compelling offer? How do we pivot if the need for our core product declines drastically? What do we do when our value becomes commoditized? These are the type of disruptive circumstances that kick companies into gear when it comes to taking action – but of course, they have to hope it isn’t too late.

But it’s important to remember that disruption can also originate as an opportunity. Perhaps you see a gap in your customers’ needs that isn’t currently being met, but to jump in and address that need will be disruptive to your organization. Disruption as an opportunity can sometimes be more challenging in the sense that it is far easier to squander. Whereas disruption as a threat is obvious and forces action, disruption as an opportunity can be more subtle and easier to overlook – particularly when your current business is performing well. Weighing the decision of disruption when it is an opportunity versus a threat is an important skill to practice.

With disruption of both types rampant in a number of industries today, meeting these threats and opportunities with innovation is imperative. But companies commonly default to the comfort zone of incremental improvement. “An incremental project is going to be easier to sell, lower risk to execute, and easier to adopt. And that's a very attractive thing in an organization. Nobody wants to be the person who's spearheading a failed project,” explains Dan. “Now contrast that to a disruptive change, which requires an entire system to change. Here we're saying, ‘We're going to imagine a much bigger opportunity, we're going to have to hypothesize over what we think the opportunity is, we're going to have to change lots of different pieces and put in new things that nobody's thought about before really carefully and therefore the risks are going to be higher. And finally, we're going to have to get everybody else onto an entirely new page.’ If you compare selling those two projects, it's a heck of a lot easier to sell that small incremental project. And at the same time, it's the big disruptive system change project that really offers the hope of getting past these big threats that we were talking about earlier.”

The Art of Selling Innovative Change

With both the threat and opportunities of disruption high, it’s important for stakeholders across the business to become more comfortable with the unknowns and discomfort that embracing innovation brings. That said, as Dan points out, some of the discomfort can be alleviated with a more refined approach to suggesting innovation. If you recognize an opportunity or threat within your company, make sure you think about what innovation you think is needed before you articulate the need. “Let me give you a few examples of things that people do wrong when they go and talk to senior management about innovation. The first thing is they arrive and deliver a dead rat,” says Dan. “So, they walk through the door and they say, ‘The world is ending. Everything is going to go bad and we need to change something.’ And then they stop talking and they've delivered the dead rat, but they don't actually have a solution. As the innovator, the person who's proposing the change actually has to think through what it is they want to see.”

As you envision an innovative change to address disruption, be sure you don’t inch back into an incremental approach. “Come in with a solution that is complete and compelling. It's not enough to make one little foray into some change.,” warns Dan. “I think Servitization is a good example because companies think, ‘we'll simply add a bit more service onto our product, do what we've always done.’ What the system innovator needs to do is if they're going to go to management is come up with a big enough and powerful enough system change that it truly does create new, differentiated value.”

Finally, consider how to not eliminate but minimize risk. Risk is inherent in innovation and it needs to become more comfortable for companies looking to take market-leading positions, but that doesn’t mean it should be a free for all or that strategies shouldn’t be explored to minimize risk. “You're asking an organization to take big leaps in faith, plow into areas of uncertainty and so you need a strategy that allows you to evolve this new market opportunity over time,” says Dan. “And it can't be we're going to invest for four years, put millions of dollars into it and then see if it works at the end. There must be early points of feedback, all the way along the way to show that this is all working. I think if you do that well, we'll find that a lot of those senior leaders that seemed like they might be anti-change, are very appreciative of the fact that they don't want their company to fail either and they have a real opportunity here.”

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As AI Unlocks the Promise of IoT, It’s Time to Double Down on Service Innovation

From IoT to GenAI and Beyond: Advice for Building Intelligent Connected Solutions

What Does It Take to Thrive Vs. Merely Survive in the Experience Economy?

August 13, 2021 | 2 Mins Read

Back to Basics: Asset-Centric Service and IoT

August 13, 2021 | 2 Mins Read

Back to Basics: Asset-Centric Service and IoT

By Tom Paquin

This is part of an ongoing series on the state and standards of service management software. Here are the previous articles in the series:

For businesses working with large, complex assets, whether it be in manufacturing, utilities, telecommunications, or simply service operations, there’s a growing necessity to develop a sound strategy for how assets impact your service workflow. As we’ve discussed previously (and like any major business initiative), doing so is not as simple as switching on a lightbulb. There’s naturally a timeline of events that need to occur in a logical sequence in order to initiate or overhaul an asset-centric service practice.

This all starts with IoT.

It Starts with a Good Data Stream

I’ve said this before, but bad data begets bad data. That is why it’s important, within any data model, to have a strong process in place to collect, validate, and process data. Within the context of asset-centric service, this often means that we’re talking about IoT. As with anything that we talk about here, there are plenty of resources, use cases, and best practices that you can call on to support what that looks like in a variety of different contexts.

IoT, largely, functions as a vector through which you analyze things like work history, which will benchmark an asset’s condition against the needs for service previously in order to predict service needs. A frequently overlooked way that IoT can be used is considering an asset within the broader context of your organization, where it organizationally fits within an ecosystem that may not, in some cases, be under your direct control. There’s also, of course, the direct monitoring of data, which can be used to assess asset condition during remote repairs, or simply to identify outages, and understand where, downstream, those outages are happening.

This is, of course, the first step. Next is to consider the software you’re using to manage your assets, and what it’s offering your business. That’s what we’ll discuss next time.

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As AI Unlocks the Promise of IoT, It’s Time to Double Down on Service Innovation

From IoT to GenAI and Beyond: Advice for Building Intelligent Connected Solutions

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August 9, 2021 | 7 Mins Read

The Microcosm Approach to Realizing Your Company’s Service Potential

August 9, 2021 | 7 Mins Read

The Microcosm Approach to Realizing Your Company’s Service Potential

By Sarah Nicastro, Creator, Future of Field Service

I talk to leaders all the time who are frustrated with their company’s lack of progress when it comes to embracing the potential that Servitization and delivering outcomes holds. This frustration is understandable, but it isn’t surprising – there’s a lot of deep-rooted legacy that holds many companies back from the world of potential that service can bring. On last week’s podcast, I talked about this issue in detail with Scott Weller, partner at Mossrake Group.

Scott was formerly the global leader for the support services business at Hewlett Packard Enterprise, a role in which he helped build a multi-billion-dollar IT-as-a-Service business that is now known as GreenLake. In his current role with Mossrake Group, Scott helps companies achieve success in introducing As-A-Service offerings in their own businesses based on the lessons he learned in what works – and what’s doesn’t – during his time at HPE.

According to Scott, the history of most product-centric companies creates an identity that is hard to overcome, both culturally and operationally. “Identity in a company is really around the unwritten rules it gets codified into the business model, so that the value chain aligns to it, and really, the business is optimized for that identity, and even over time, as the business might evolve, identity is what survives,” he says. “And so, if you try to introduce a new business model into an existing business, what can happen is the entire value chain can work against you. The identity becomes a barrier to change.”

As such, creating a new identity – say, as a service versus product business – is a difficult, fundamental shift that, as my conversations with leaders reflect, many organizations are still struggling to come to grips with. “This is why you find a lot of mature product companies either haven’t started on the journey or are working through the journey even though there are clear demand signals from the market,” says Scott. “Just think about the impact – you think about sales, for example. Salespeople have to move from a transactional relationship to one that's continuous and collaborative. And of course, there's the never-ending questions about, how do they get paid? You will find people who strongly believe that anything that leads to a monthly payment must be in the purview of the financial services organization or an external financial partner. And consider product development. You have engineers and product management who identify with making the coolest thing, the fastest thing, the best, the highest quality thing, and now they're asked to be a supporting cast member in an ensemble trying to deliver unique experiences and outcomes.”

The Journey of a Thousand Miles Begins with a Single Step

While we’ve painted a daunting picture, though, it isn’t without hope. Bit by bit, organizations across industries and across the globe are recognizing the demands of the market and the value service holds in differentiation and growth. But the journey of a thousand miles begins with a single step, and this is why Mossrake Group so highly recommends the microcosm approach when it comes to making tangible progress in introducing As-A-Service and outcomes-based service offerings.

“Our view is, having done this in practice, is that the microcosm approach is really the best one. The internal incubator where you start small and take an agile approach is really the best way for us to see this evolution to succeed, because in the end, what this approach does is it allows the new business model to essentially gestate within the existing machine,” Scott explains. “This allows a company to knock down all of the value chain barriers one by one, which is not a small challenge. But when you do it in a microcosm, it's just much easier, and by the time the bigger machine realizes what's going on, the model is entirely proven. And then the question is not whether it works, the question is, how do you go faster?”

The microcosm approach, which we discussed in detail with Schneider Electric who recently worked with Mossrake Group to introduce power-as-a-service, circumvents the often snails-paced acknowledgment of and alignment around an opportunity and enables a “dip your toes in” approach that minimizes the impact of failure should failure occur. But this self-starter approach isn’t without personal risk for the leader that decides to spearhead the effort, and it requires the right mix of some key ingredients:

A visionary leader. Someone needs to be willing to take control of building some momentum for this change to take hold. The visionary leader sees the potential of service for the business and is willing to take some personal risk in evaluating and evangelizing its worth for the company to pursue at scale. “Once you have someone who's visionary, by that I mean they can see how this plays out, they're getting the demand signals locally, and they really believe in the idea, then they're willing to put their neck out a bit and have the courage to see it through,” says Scott.
Initial pilot customers. To begin, you’re really testing the waters to determine what new value proposition will fit. “First of all, determine, are the demand signals that they are personally seeing representative of the broader market? If so, then what is the opportunity in the market?” says Scott. “And then get down to, okay, well, what do we want to offer here? Define that, build it out, again, using an agile approach, where you don't solve every problem at the beginning, you know that you don't know everything, and you start building.”
Enlisting adventurers. A visionary leader can’t go it alone, but in the early days of building this in the microcosm, resource is scarce – so they must enlist the adventurers around them to bring the vision to life. “It's harder than it looks,” says Scott. “You can find people who are really up for it, but they're just bored and aren’t the kind of people that you need at the moment. You look for people who seem to be high energy, always looking for how to do things in a better way. It's almost like you know it when you see it. And even then, not everybody can sustain the level of energy and output.”
Test and refinement of the go-to-market. This is where the agile aspect really comes into play. “The presumption is that you have a pretty good idea of the pins that you have to knock down along the way, but you certainly don't know everything. You have a pretty good idea about what will resonate with the market, but there are pieces that you can't know, and you might have to, maybe not do a hard left or right, but you have to be able to shift direction. And especially for the sponsor of a program like this, they have to have a rapport with their peers and management chain that allow them to come in and say, "Hey, listen, what we've learned is we need to shift a little bit to the left or right, and that's got to be okay. That's not going to kill this," right?” explains Scott.
Initial wins for internal evangelism. The goal is to be able to provide evidence-based insight that service is a viable future for your company. “In my experience, what happens is once senior management sees this, they're like, "Okay, this is really good, and why aren't you going faster?" At some point in time, after enough work has been done, there should be a hard go-no-go decision, not unlike the classic waterfall model, you do need to prepare for that moment in time where you're going to say, "Okay, we've learned enough. Is this what we really want to do?" Because the next phase will inevitably require more people, more resources, more investment. And especially, if you've built a local successful business, now you want to take it on the road, and take it to other locales and try to build the business in those places,” says Scott.
Documentation to expand success outside of the microcosm. If you find success, that success must be able to be replicated across the business. This means that every step you take should be well documented. “This has to be well documented, again, across the value chain, every aspect,” says Scott. “Every aspect is within what we call an operational blueprint, so that when we're no longer involved in the activity, the business is able to survive personnel changes and so on. It's essentially a matter of institutionalizing what you're doing to the point that it will survive personnel changes, and certainly, our involvement coming to an end.”

Now neither Scott nor I can tell you the microcosm approach makes this evolution from product to service easy, but it is a viable, proven method to consider if you feel progress needs to be made at a faster pace. Perhaps you are the next visionary leader? “In storytelling, it's thought that really there are only a few unique themes, like coming of age, or good versus evil. One of them is about courage and tenacity, perseverance. And I would say that that is the theme of moving to as a service and outcomes,” says Scott. “You have to have courage, or some small group of people have to have the courage to think differently, to put themselves out there a little bit, to champion the cause, to fight the good fight to stay with it through and through, and those kinds of people are hard to find. It's much easier to play it safe and let somebody at the top of the company make the big decisions.”

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August 6, 2021 | 3 Mins Read

The Service Stumbles of Willy Wonka

August 6, 2021 | 3 Mins Read

The Service Stumbles of Willy Wonka

By Tom Paquin

Willy Wonka and the Chocolate Factory, the 1971 classic film based on the children’s book by Roald Dahl, is still one of my favorite movies, boat scene and all. Gene Wilder’s ability to vacillate his performance between loving and deranged in a single moment is truly inspired. When it comes to how he manages his factory, though, he certainly trends towards the deranged.

Yes, on its face, having the entire world frantic with excitement over the opportunity to go visit a factory is a bizarre premise upon which to build an entire story, but think of the service implications! I certainly have, and let’s just say it: Willy Wonka is not managing his service opportunities effectively.

According to a strange tinker, elaborated upon by Grandpa Joe (who seems to implicate himself in the process) Wonka closed out the outside world from his factory’s comings and goings due to corporate espionage. This, in turn, created a closed system, which was run by Wonka’s subhuman labor indentured force known as the Oompa Loompas.

Some businesses have no trouble handling a closed system. Apple is the obvious example, as they own the product, diagnostics, and depots for their devices. But even big bad Apple can’t do that all in a closed system without the proper oversight. That oversight comes from smart, forward-thinking technologies that are not just reflective on the specific industries in which they are found, but are proven through a strong network of references and use cases. Here are a couple of technologies that really could have improved

Capacity Planning

In the film, Wonka announces his Golden Ticket giveaway of a trip to the factory and a lifetime supply of chocolate (It’s not specified whether the lifetime supply is delivered annually or in a lump sum). This creates an immediate strain on the supply chain, leading to shortages so severe that Queen Elizabeth herself is forced to bid on what is apparently the last box of Wonka bars in the United Kingdom.

While these issues make for entertaining scenes, they could easily have been mitigated if Wonka had taken the time to run scenario forecasting. With such a tool, the factory could have routed supply chains appropriately, make the necessary arrangements, and avoided a lot of headaches.

Depot Repair

I’m sure Oompa Loompas are great for rolling around giant mushrooms in your candy terrarium, but do they know how to replace the parts of your meat-and-potatoes chocolate manufacturing equipment, as featured in the (still incredible) opening credits? Surely, building a system that routes parts, materials, and assets through external systems, even if they’re owned internally, would be necessary to avoid bottlenecks like a complete UK chocolate shortage.

Logistics

Fun fact: Quaker Oats financed Willy Wonka and the Chocolate Factory as an excuse to produce and sell their own Wonka bars. The bars shipped to stores about a month before the film’s release, but they were taken off store shelves because they melted at room temperature. So, the movie was released, but there was no tie-in chocolate bar.

Sure, it was the early 70s, and computers were the size of a Buick at the time, but smart logistics planning in real life could have gotten them back on track. Heck, that same logistics management could have allowed Wonka to distribute the golden tickets equitably, and over the course of a prolonged period of time, in order to ensure maximum sales. This is why simple factory service management is great, but truly next-level service management ties all the areas of your business together seamlessly.

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4 Signs It is Time for A Digital Rebirth

August 2, 2021 | 6 Mins Read

4 Signs It is Time for A Digital Rebirth

By Sarah Nicastro, Creator, Future of Field Service

I’ve had a handful of excellent conversations in the past few weeks about digital transformation – what it really means, the distance between recognizing its importance and knowing how to take action, and the biggest barriers that stand in the way of success even once you have a clear idea of your digital objectives. Based on what I’ve heard, it seems that for many organizations it is time for a digital rebirth.

There are a handful of reasons why I believe this, the first of which is that it is undoubtedly a critical aspect of your company’s success or failure in what is our digital present and our digital future. So, it’s incredibly important to get this right, and similar to our conversations around Servitization and business model shifts, doing so is trickier than it sounds because it is a matter of making some foundational changes. Digital transformation isn’t about a never-ending quest of technology investments, it’s about reshaping your business to compete in the digital era. My recent conversations have illustrated that there’s in many instances a missing of the urgency that is very real, and/or a lack of clarity on what it takes to make the changes needed.

In a recent conversation I hosted with Philip Carter of IDC, he spoke about a company’s digital identity and digital destiny. I’m curious – do you know your digital identity? Have you considered your digital destiny? My bet is many do not and have not, and that’s because we haven’t properly defined what digital transformation means for our business. The first step in your digital rebirth needs to be defining these terms, for your business, in a way that only you can do. Only then you can determine what your digital transformation needs to look like and take meaningful steps toward achieving success. If when you think about digital transformation and what it really means your head just spins, here are four surefire signs you need to consider a digital rebirth.

#1: You Haven’t Yet Realized/Admitted Your Company is a Technology Company

Every company today is a technology company, and this truth will only be multiplied as we step into the future. Out-and-out resistance is futile, and even hesitancy is putting you significantly behind. At one point we looked at digital transformation from the perspective of using technology to automate manual processes, but at this point the definition of digital transformation has broadened to becoming a digital company.

This can mean digitizing internally in a way that optimizes your use of resources, automates tasks to maximize output, streamlining the customer journey to create a seamless customer experience, and enabling the level of fast-paced, data-driven decision making that is needed today. But it can also mean using digital tools to create outcomes-based service offerings and even digital services for your customers. The options are limitless and unique to your needs and goals, but the truth is universal.

In Accenture’s Technology Vision 2021 report, the firm states, “Amid the challenges of 2020, two truths became evident. More companies than ever have embraced the axiom that every business is a technology business, and they’ve ignited a new era of exponential transformation as technology continuously reshapes industries and the human experience.” The report goes on to highlight the difference in performance between companies who embrace and take action on this reality versus those who lag, stating that digital leaders (the top 10 percent of companies leading technology innovation) achieve 2–3x revenue growth as compared to their competitors. Accenture refers to this widening divide as the “Digital Achievement Gap.”

#2: You Lack Technology-Adept Leadership

Who then is leading us into this new world of digital potential? That’s a very important question. I see all too often leadership within organizations that holds its company back from success for a variety of reasons. Sometimes it is overall resistance to change – the, “we’ve always done it this way and it works just fine” mentality. Other times it is overwhelm – not knowing where to start. And sometimes it is ego standing in the way of admitting the need of more digital expertise. It can be many different things, but to keep pace in the way you need to in the digital era, you must have technology adept-leadership.

As Accenture’s report states, “During the pandemic, it became starkly clear that there is no leadership without technology leadership. Rapid digital acceleration during the pandemic has cemented technology as the cornerstone of global leadership.”

To be clear, this doesn’t mean every leader has to be a technology guru. But it also doesn’t mean that every leader should go out and hire a digital leader just to shirk the responsibility of a foundational understanding, vision, and acumen. Technology-adept leadership also isn’t the be-all and end-all of digital success – we know that we know that people and processes are what most commonly foil these efforts. Today’s leaders need to combine keen technology awareness with agile and courageous decisions and ample amounts of emotional intelligence.

#3: Your Digital Transformation Efforts are Siloed

In the recent IDC conversation I mentioned earlier, Carter pointed out a statistic highlighting the fact that only 26 percent of organizations achieve ROI with their digital transformation efforts. The number one reason for this is the widespread existence of organizational siloes. There will be no true digital success if these siloes aren’t broken down to where the company is working toward an aligned vision for their digital destiny and working collectively on the digital transformation initiatives that will get them there.

You hear many conversations about how the business and IT are working closer on technology decisions. The Accenture report states that “83% of executives agree that their organization’s business and technology strategies are becoming inseparable—even indistinguishable.” The closer the communication and partnership across all functions of the business, the greater the impact your digital transformations efforts will have.

We discussed here the topic of building a digital dream team. The idea is that a team is formed that combines stakeholders from each function of the business with someone designated to “coach” – often a head of innovation-type title. This team approach helps to ensure that there are common, measured objectives; that duplicative investments and efforts aren’t taking place; that digital decisions are being made with the customer journey in mind; and that true progress is being made in prioritizing the efforts that will best help you reach your digital destiny.

#4: Your Tech Stack/Strategy Are Antiquated

This one may sound obvious – it might be time for a digital rebirth if your technology is aging. Well, yes. But you might be surprised just how many companies or leaders have outdated technology strategies or systems and simply don’t see them as such. It’s important to stay abreast of how digital has evolved, and continues to evolve, and evaluate how that evolution should impact your strategy.

We did an article recently with Cimcorp, discussing the five tenets of their modern approach to IT. We discuss the need to rethink the role of IT within your business, the benefit of relinquishing some control, the value of a platform approach, and more. The premise of Cimcorp’s thinking is to determine how to work smarter rather than harder so that the IT team has the bandwidth to focus more on the company’s digital strategy and digital future rather than its time being all-consumed by hands-on IT management. This thinking is incredibly smart, and what will set apart leaders from laggards.

In terms of the tech itself, Accenture states that “90% of business and IT executives in our survey agree that to be agile and resilient, their organizations need to fast forward their digital transformation with cloud at its core. Building a competitive technology stack starts with accumulating technical wealth—cloud strategies and microservices are the key. Enterprises need an adaptive technology foundation, and they can’t afford to be weighed down by legacy systems. As enterprises merge their technology and business strategies, they will start to play a bigger role facilitating people’s relationship with tech. This requires building trust—not just in products and services, but in the technologies behind them.”

I can imagine for someone reading this that is thinking a digital rebirth may be warranted, the idea likely seems very daunting. I won’t lie to you and say that it isn’t, but it is imperative. There is so much that rests on a company’s ability to be not just digitally competent but digitally competitive that it isn’t something you can ignore or delay. Daunting or not, mastering digital is simply a must.

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Build Service Processes that Work by Studying Customer Behavior, Not Customer Wants

July 30, 2021 | 3 Mins Read

Build Service Processes that Work by Studying Customer Behavior, Not Customer Wants

By Tom Paquin

Is the customer always right? Obviously not. If a customer comes into a store and says that they are deserving of a 60% discount on their order because they had a hard time finding a parking spot, it’s okay to say ‘no’ to them.

I’d argue that any utterance, complaint, or assertion of any kind from a customer be met with a proportional amount of scrutiny. Because people don’t necessarily know what they want. Sometimes you need to show them what they want.

I will use a video game example, so skip the next two paragraphs if you don’t want to reach about Nintendo. Every few years, wide-eyed analysts and fans make broad assertions that Nintendo is about to release some sort of “dream” console, or game collection, or localization of a beloved Japanese game. These things never happen, and instead Nintendo releases modest hardware upgrades or $60 re-releases of mediocre games.

Nintendo does this rather than capitulate to fan demands because it is cheaper, it specifically targets the young demographic that Nintendo has always targeted, and because it has proven to be incredibly successful. Podcaster and journalist Justin McElroy frequently says, of Nintendo, “They won’t sell what you want them to, but you’ll want what they sell you.”

This is a similar strategy to the one employed by Apple, who, rather than acquiesce to the demand that they build a $500 “Netbook” (remember netbooks?) in the late aughts, built the exact opposite—a nearly $2,000 computer called the MacBook Air, that had something called a “Solid State Hard Drive”. And what type of computer has endured for over a decade?

Doing that requires you to understand your customers better than they do, and to study your customers in a non-binary fashion. The Simpsons has shown what happens when you just ask people what they want:

There is no value in getting a list of customer wants, you need to understand their behavior. In service, there are a variety of ways that you can do this.

One key consideration is to consider not just asset and employee output when measuring service processes, but also customer output. If assets are IoT-enabled, what is the length of time between exception and customer contact? When given an array of service times, how far into the future does the customer, on average, book an appointment for a specific need?

Then, of course, you can begin to benchmark elements against one another. What is the correlation between NPS and time from ticket to invoice? What length of product ownership yields the most repairs, errors, and scraps?

Finally, you can begin to involve customers directly in the service process, and see what attrition rates are with utilities like appointment assistance, “where’s my tech”, and other such tools. Doing so allows you to see what customers really value, anticipate their needs, and build service solutions that meet the contour of your business without needlessly cutting into your bottom-line. Because you know your business best, and your customers should want what you are serving them.

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3 Barriers Preventing VoC From Driving Fruitful Innovation Within Service Businesses

July 26, 2021 | 5 Mins Read

3 Barriers Preventing VoC From Driving Fruitful Innovation Within Service Businesses

By Sarah Nicastro, Creator, Future of Field Service

While there are a few companies still struggling to grasp the concept that Voice of the Customer is the key driver of service innovation, evolution, and growth; the vast majority have accepted there’s no other path to success. This is important because it’s absolutely clear to everyone paying attention that gone are the days of “build it and they will come” or any reasonable chance of success in creating solutions or making technology investments based on hunches or good intentions.

Today, customer is king – period. In all industries, in all geographies, we are simply living in a time where differentiation and revenue growth depend on being able to deliver experiences and outcomes that your customers need, value, and desire. Attempting to do this without putting their direct input front and center of your strategy is foolish, and most companies I talk with recognize this truth. However, in many cases, that recognition has not yet been matched by an effective means for obtaining and reacting to the customer voice. This must quickly be addressed – the recognition of the criticality of VoC must be married to the proper measures for collecting, channeling, and closing the loop on customer insights. Based on the conversations I’ve had, there are three primary barriers that are preventing companies from making proper use of VoC.

#1: Customers Won’t Engage

“We’ve tried collecting input from our customers, but they don’t respond to our efforts.”

This is the most challenging of the three barriers, because it is most likely representative of a more systemic issue (or issues). If your customers aren’t interested in providing you with feedback or discussing with you their needs and challenges, you first need to examine the customer-centricity of your approach and where you may be falling short in building close customer relationships.

If you feel you have good customer relationships but aren’t having success with them engaging in VoC efforts, I would then move on to review both your method of collecting insights and your follow through on feedback. If your method of outreach is poorly timed, cumbersome to use, or entirely impersonal, it may be that they simply aren’t willing to participate due to those factors. Looking into the most effective forms of customer outreach is worthwhile, and keep in mind that you need to balance quantitative measures of collecting feedback with more in-depth, qualitative engagement particularly when you’re looking to better understand challenges and needs. Along these lines, make sure you think through the matching of input sought versus contact asked. So, for instance, feedback on current operations should clearly be sought from those experiencing your company’s services, whereas input on innovation or next-generation offerings may require someone other than your current day-to-day contact.

Then you move on to considering whether or not you are following through. If you are asking for customer input, quantitatively or qualitatively, and not providing a feedback loop for them to hear or see how their time and effort to engage had an impact, they won’t continue to provide that input. Why would they? A feedback loop is imperative for nurturing ongoing VoC efforts. This is a step many miss because it takes time and effort, but no customer will continue to weigh in – particularly on anything other than a negative experience – if they don’t see the impact their voice is having.

#2: VoC Data is Siloed

“We gather the data through a survey tool, but then it just sits in that tool and isn’t really digested in a timely or effective manner.”

VoC data collected or insight from customer conversations doesn’t do your company any good if it just sits somewhere, unused. But this happens, because oftentimes the measure used to gather the input is lacking in any sort of analytics functionality as well as siloed from the systems used for decision making or customer engagement. The siloed data is often compounded by a lack of clarity on who within the organizations owns VoC and is responsible for ensuring the insights are put to good use.

This type of scenario is particularly unfortunate because you have customers who are willing to engage and are actively doing so, only for their input to be wasted. This leads to the issue of no feedback loop, which means it is only a matter of time before those customers you have weighing in decide it isn’t worth their effort to do so. VoC insights need to be incorporated into your company-wide systems and decision-making processes so that you can ensure the invaluable perspective of those already investing in your company’s success are used to drive it forward.

#3: Action on VoC Input is Unclear

“We gather VoC data, but honestly struggle with knowing what to do with the input.”

I’ve had people tell me that they used to collect VoC input and simply stopped because the data wasn’t being used. This makes me break out in hives! The first step of taking action on VoC data is to choose a tool that helps you to avoid analysis paralysis – one that has functionality built in to help surface trends, decipher patterns, and sift through important points.

The other important aspect of taking proper action, however, is ensuring someone is accountable for making proper use of VoC. With the importance of the role it plays in innovation and company growth potential, this may very well be a specific resource dedicated to a formal VoC program and held accountable for ensuring the input doesn’t sit unused, the proper actions are taken, and a customer feedback loop put in place. Ultimately, VoC should be everyone’s responsibility in some form – whether in collecting it, evangelizing it, creating based on it, or being accountable to it – but without proper ownership, a lack of action is likely. If you aren’t at a point where you have dedicated VoC resources, you need to ensure duties of action are assigned and metrics put in place to measure how VoC is being used. It’s far too precious a resource to waste.

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Your Last Service Appointment

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Your Last Service Appointment

By Tom Paquin

Last week, I wrote about service appointments from the cradle, and what we can learn from them. Life being a series of contrasts, I figured I might as well take that full circle and talk about what goes into the last service appointment you’ll ever have: your funeral.

Because we have the luxury of living in a society that doesn’t have to think about death constantly (something that’s only been true for about 100 years) it’s easy for us to mentally and logistically avoid the topic. But as a wise man once told me, human beings are guaranteed to always need to do three things: eat, go to the bathroom (he used a slightly different phrase), and die. And it’s important that we’re candid about all three. So let’s think about funeral services, and what we can learn about them, through a service lens.

Planning Ahead

My paternal grandparents, may they rest in peace, each began paying into a “funeral account” in their mid-fifties. This is not the same thing as life insurance: They paid ten dollars a month each over the course of a decade, at which point their accounts were fully financed, meaning that the funeral, coffin, and grave plot were all paid for. With this, they were furthermore able to choose their coffin, the readings at their funeral, the flowers, and the cards handed out to friends and family. We would never in a million years have put my grandmother in a baby blue coffin, but that’s what she wanted, and that’s what I carried on the day we buried her.

Offering services like this is good business, but much more than that, it takes the onus off of the customer. Sure—funerals are not exactly brimming with repeat customers, but service appointments are, and, as much as we don’t want to admit it, having an end-of-life plan for customer assets is as useful as having an end-of-life plan for our corporeal bodies. This, in some truly bizarre way, is a backdoor into servitization, as, perhaps with a monthly fee, customers are able to a pay for service and can build up collateral to a replacement when their current asset reaches end-of-life. This obviously wouldn’t work for every industry, but for a set as diverse as cars to industrial machinery, there’s certainly application.

Customer Experience

Listen, losing someone is not fun. They’re gone, which can be a huge bummer, and on top of that, you have the grapple with a rolodex of existential questions that otherwise just wake you up in an abrupt panic at 3AM. It’s for that reason that it’s imperative to have a good bedside manner, easy and responsive booking, and a clear, well-communicated plan of follow-up actions.

This is no different that service, where broken assets can mean money right out the door. That’s why a cogent, logical, and well-articulated customer experience plan is key. From chatbots, to remote assistance, to an uber-like view and communication network for technicians, there’s a lot that customers expect to get right when they need support.

Logistics Management

Funeral homes have to manage an overwhelming network of connections—from churches, to graveyards, they need to be well-connected to the surrounding areas and have embedded relationships with the appropriate people to make the process of burying a loved one as seamless as possible.

This is no different than managing a network of depots, warehouses, and dispatched for service reps. As we always, always, always say, these disparate functions have to be housed under a single view to be effective. This is how you manage seamless handoffs between dispatch, service, and repair—the hallmark of an effectively-run service business.

Obviously, the objectives of a funeral home and that of a service business differ slightly—You can’t repair uncle Morty, I’m sorry to say. But the fundamentals—delivering seamless, well-run service is the same. And when it’s your loved one’s memory we’re talking about, there’s no second chances. A philosophy that the best service companies also take to heart.

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Closing the Digital Transformation ROI Gap: How to Overcome the #1 Issue that Hinders Success

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Closing the Digital Transformation ROI Gap: How to Overcome the #1 Issue that Hinders Success

By Sarah Nicastro, Creator, Future of Field Service

The term ‘digital transformation’ easily rolls off the tongue of every business leader in the world today. But what does a modern definition of digital transformation entail? Certainly, we’re far past the point of actually digitizing paper-based information and processes. Digital transformation in today’s terms is representative of a company’s shift to excelling in the digital era – the mastery of digital tools, the cohesiveness of customer experience, and the introduction of digital products and services.

While the criticality of digital is widely understood, many companies are still grappling with how to articulate their digital identity and make tangible progress in their digital evolution. This is largely since organizational structure, culture, and company workflow aren’t historically set up in a way that is conducive to the collaboration and agility that today’s digital imperative demands.

In a recent session with Phillip Carter, Chief Analyst for IDC in Europe, Fredrik Tukk, Head of Innovation Scouting at Maersk Drilling, and Marne Martin, President of the Service Management Global Business Unit at IFS, we dove into a detailed conversation on what it takes to achieve digital transformation ROI in today’s landscape. There were many important points discussed and you can stay tuned to the podcast for a replay of the full session coming soon, but what stood out to me that I want to cover in this article is the number one issue that stands in the way of digital transformation ROI and how you can move past that barrier.

Organizational Silos Kill Digital Progress

“2020 was an inflection point for IT spend and digital transformation efforts more specifically because it was the first time ever we saw a lack of correlation between GDP trends and IT spend. Normally with a significant drop in GDP, IT spend follows that very closely,” says Carter. “If you look at 2020, the biggest drop in GDP since World War II, IT spend held up remarkably well, and that was driven primarily by investments in digital transformation. Our research shows that we will hit $1.5 trillion investments in digital transformation globally this year, growing at about 15%. So, we are literally hurtling towards our digital destiny.”

This digital destiny is being recognized in both our personal lives and in the business world. But as businesses look to keep pace with digital innovation, there exists a significant disconnect between the investment in digital and achieving ROI. “We're moving towards a digital first mindset, not just at a business level, but also at a personal level, a societal level. I think we can feel that we can see that,” explains Carter. “But the problem is that our pre-pandemic research showcases that only 26% of organizations are really delivering an ROI from all of those investments. That's the digital ROI gap, as we call it. And we need to close that gap to drive the next phase as we move to reignite business, across the board.”

To close the gap, we need to examine what it is that is keeping organizations who know digital investment is important from achieving their desired outcomes. “The primary reason for the ROI gap is the inability to scale due to organizational silos. These silos create barriers across traditional organizational structures which are linked to the legacy technology architectures of the past,” says Carter. “We also hear feedback that IT and security leaders slow things down, so there is a sense that business and IT need to come together in a more cohesive fashion to drive scale. We call it the digital dream team, where every business function becomes a technology function. This requires a need to raise the tech IQ across all of those business functions, and IT needs to be at the table as well.”

Building Your Digital Dream Team

In building a digital dream team, you should consider that the goal is to – as Carter said – raise the tech IQ of every business function and create a more cohesive, collaborative approach to digital transformation. This forces elimination of silos and brings issues to the surface in order to identify, resolve, and move past them. “It used to be that the IT department was building the technological foundation for the company. But these days, many times you find new technologies or new vendors that come to you with a different perspective where you can execute. And sometimes, especially around COVID, it hasn't been focused on the ROI,” explains Tukk. “It's been focused on actually delivering a value to the customer that might not be measurable. One example I have from our industry, from when we couldn't travel. We needed to focus on utilizing new technology and doing remote maintenance. There isn’t a direct ROI on that. It’s not a business decision, it's a necessity to keep the rig going. So, you need to find the solution, where then technology played a major part, and that solution wouldn't come from IT, and you need to find someone who can deliver that to you today. And that's why you need to find other ways of working than the traditional way.”

It's time to work past the age-old IT and business divide and to create an environment where a team approach with shared goals is the norm. To do this, you need not only to identify who the team players will be but who will lead, or coach, the team. “If you think about Premier League, for example. So often the business feels they are the offense, and we need them to be the offense, but there's either a perception or sometimes reality that IT is playing defense and slows down the offense,” says Martin. “We need to be thinking about how we get a full team to be working together. We often don't have that coach or a leader that can bring the offensive and defensive elements together to work as a team and, specifically, a Premier League team. So that's where we have actions that we can continue to drive and be better at, as part of IFS as a vendor. But we're also looking to how we can enable the leaders and the coaches in an organization to be more effective. And, to the extent that there isn't that type of leader in the digital dream team, that we call that out and work with our customers to address that.”

Teamwork Builds Speed and Effectiveness

In the more traditional, IT-leads-all approach, there can often be a sense of control that creates friction and can cause a lack of flexibility. “When it comes to digital transformation, there is for some natural reasons a lack of flexibility and adaptability to take on new technologies and test them out on the side more or less to the legacy system,” explains Tukk. “For example, we’re working with a startup who suggest a technology that might be set in a different cloud setting. If I come to my IT department, they say, ‘No, we are Microsoft, no discussion.’ No flexibility. I understand they also can't just say yes to everything, but with increased speed in change in digital, go to market needs to be fast. When you work as a team and focus on solving your problem you can go to market much faster.”

And, yes, speed is critical. That’s not to say rush haphazardly, but the pace of change is continuing to increase and the pace of innovation – effective innovation – needs to match. “I talk quite a lot about this notion of four-wheel drive innovation, which is taking the speed and mindset from the digital innovation initiatives around the edge, into the core as well. And that's basically saying, ‘Okay, we need to evolve quickly so that there can't be two speeds of technology investment or technology adoption, or business direction.’ It needs to be one speed,” explains Carter. “And that speed is a lot faster than it currently is. But that requires people like Fredrik who drive digital innovation initiatives and push the agenda on the frontiers to also bring that mindset into the core, across all the different business units. And that's part of the digital dream team stepping up to this new level around digital investments and outcomes associated with that.”

This move to a digital dream team requires team members letting go of ego and focusing on problem resolution. The most effective way to accomplish this is to ensure the whole team is focused around a common goal. “What we see here as a way of driving that alignment across the teams is a focus on metrics that everyone signs up to,” notes Carter. “With the remote maintenance example that Fredrik highlighted, if you've got a metric around meantime to resolution and IT, and the business, and digital are working towards that, then suddenly there's a different level of alignment. And you bring that speed from the innovation areas into the core, as part of the fact that everyone is going to be measured on that outcome.”

So, if the digital dream team is how you overcome the havoc that organizational silos have on digital transformation success, it seems the coach you choose to lead that team would take some careful consideration. What makes a good digital dream team leader? “You need to look for people that can work through conflict,” says Martin. “Keep the team on track, be able to motivate and drive the courage and the curiosity to actually get it done. Don't just think of it from a functional perspective, think about it as who has the enablers to do the job well and that that person might come from finance, or might come from sales, or might come from operations, IT, you don't know necessarily where that person comes from.”

The coach role is far less about function or title, and far more about personality. “It's much less about the title, but more about the personality,” says Carter. “I think it's the classic T-shaped person, someone who's strong in key detail areas where it links to the project at hand. They need to understand at least the domain associated with the use case, but then have the emotional intelligence so to speak, in terms of courage, in terms of curiosity, in terms of engagement, bringing people along, dealing with the friction, picking up the ball and running with it.”

As we experience our digital destiny unfold, we’ll witness death to complacency and over-caution. Tukk shares some wise words, “I’ve come to realize that you’ve just got to try. Don't sit and plan for too long. Don't sit and think, oh, we should find someone else, we should do this or that, we should plan more. Give it a go, give it a try. The worst thing that can happen is you fail. But if you do it small and fast, no big harm done.”

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