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January 22, 2021 | 2 Mins Read

Back to Basics: What is Servitization?

January 22, 2021 | 2 Mins Read

Back to Basics: What is Servitization?

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By Tom Paquin

This is part of an ongoing series on the state and standards of service management software in 2020. Here are the previous articles in the series:

So here’s the deal—we talk about servitization constantly on this site. To the point that we have a whole section devoted to our servitization stories and recommendations. For those of us in the world of service, servitization is simply entrenched knowledge. And its name does, to a point, allude to its definition. Nevertheless, the word isn’t even in my word processor’s dictionary.

There are a variety of reasons why one might not have encountered the word “servitization” before. One is the obvious—they’re new to service. Another, less obvious and arguably more prevalent, is that they’ve been raised on a different service orthodoxy. Perhaps they’ve referred to the concept as service transformation, or everything-as-a-service (the phrase I used much more frequently as an analyst). For those reasons, I wanted to take a minute and add to the record a formal definition of servitization. So…

What is servitization?

In short: Servitization is the act of restructuring traditionally product-oriented businesses towards service-oriented functions, including subscriptions, repair and maintenance contracts, and outcomes-oriented guarantees.

So within that, there’s obviously a lot of nuance, and a wide variety of topics that are worth breaking down. The primary consideration, and most important is to note that servitization is not merely the act of creating a warranty program. Servitization requires a forward-looking consideration of customer interactions, not reverting to the trappings of tradition.

Moreover, the delta between manufacturers, and, say, telecoms in adopting servitization is vast. Your business structure will naturally change—sometimes dramatically—how this definition is interpreted in practice. The good news is that we’re here to help you make the most out of servitization!

If you’re looking to see how businesses are employing servitization in practice, here are a few places that you can get started:

The Road to Servitization in Product-Oriented Businesses

COVID-19 Is Speeding Servitization Progress, But These 4 Barriers Will Hold You Back

What Aren’t You “Getting” About Servitization?

Overcoming the Barriers to Creating Servitization Revenue Streams

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January 18, 2021 | 4 Mins Read

Predictive Service: From Objective to Reality in 2021

January 18, 2021 | 4 Mins Read

Predictive Service: From Objective to Reality in 2021

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By Sarah Nicastro, Creator, Future of Field Service

Like most of the major service trends, predictive capabilities come up in almost every conversation I have. Some organizations have already achieved this nirvana, but many are still at the point of recognizing the potential but not yet translating it into their reality. I expect we’ll see significant evolution in this area in 2021 and that’s because while there are challenges to overcome, as with any change, the opportunities are simply too immense to delay in pursuing.

IFS conducted a global study with 3,000 participants in the Spring of 2020 to examine digital transformation priorities, and as Bob De Caux discusses in this article, found that intelligent technologies (AI, machine learning, predictive analytics and cognitive services) lead the charge with 64 percent identifying investment in this area as important. This aligns with what we see within service, because the role intelligent technologies play in enabling the shift from reactive to predictive service is a natural progression for organizations that have mastered the basics of service management.

This natural progression makes perfect sense. We know that customers are demanding far more from the service experience than for an issue to be resolved when it occurs, regardless of how efficiently. Customers want peace of mind, they want guarantees, they want uptime. Intelligent technologies and the move to predictive service are how you deliver upon these expectations. We know that predictive models eliminate or at least minimize downtime, reduce costs for both company and customers, improve customer satisfaction, and enable you to expertly orchestrate both your resources and assets because you’re gaining insights into what will happen instead of reacting to what already has. In many instances, the superior level of predictive service can be monetized to create additional revenue.

So, with all this potential, why haven’t we seen more companies master predictive service already? Well, there are a number of reasons. First, before the progression to more advanced intelligent technologies you must master some foundational aspects of optimizing service. This simply takes time – companies have been hard at work standardizing, optimizing, and automating service in order to reach a point where they can successfully move to predictive. I see that time as now for more and more organizations. Second, the shift can be a bit overwhelming. The potential is vast and opportunity significant, which means the stakes are high and the change is big. One point to consider if this rings true to you is the idea of thinking big but starting small. Just because the opportunity of intelligent technologies is vast doesn’t mean you have to realize the whole of the opportunity at once. Moreover, as De Caux discusses in the article linked earlier, these technologies build their learning upon data, so the sooner you start, the more sophisticated you can become – when you’re ready.

In addition to “think big, act small,” here are a few points to consider as you chart your path to predictive service success:

  • Choose your intelligent technologies wisely. The idea here is to master complexity in order to delivery the ultimate simplicity to your customers – uptime. To do so, you need to choose technologies and technology providers that will streamline, simplify, and offer cohesiveness – not complicate matters. Doing as much as you can in one platform is helpful – which means finding a provider that can not only address your short-term objectives but build upon your success over time.
  • Be ready to feel uncomfortable. In a reactive service world, most everything is manual. In a predictive environment, you must begin to trust the technology. Using AI where you’ve previously used manpower can be an uncomfortable feeling, for you and for your employees. You have to remember why you’re introducing the technology and what it can do and fight the urge to step in and override out of habit.
  • This is because predictive tools learn over time, and if you don’t allow them the space to do that, they won’t achieve the optimal output they’re capable of. Give the tools time to learn and time to work and be ready to be in awe of what they can do.
  • Harness the wins. As you see success, shout it from the rooftops – internally to help manage change, and externally as you recreate the customer experience. Once you start down the path of leveraging intelligent technologies, you’ll be on a path of continual opportunity – once you achieve success, you can look for ways to build and expand. At first this may feel overwhelming, but once you experience those first wins, you’ll quickly transition from overwhelm to excitement at all the possibilities.

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January 15, 2021 | 4 Mins Read

How Retailers Like GameStop are Failing their Customers

January 15, 2021 | 4 Mins Read

How Retailers Like GameStop are Failing their Customers

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By Tom Paquin

As a college student, I had the decidedly unglamorous job of overseeing the launch of the Nintendo Wii as a shift manager at GameStop. Due to a variety of supply chain challenges at Nintendo, the Wii launch was notorious for a supply drought that lasted well past my tenure with the company. Several years at least. That first holiday season was brutal, as furious parents took every opportunity that they could to berate the twenty-year-old me behind the counter for not possessing the ability to generate a pile of Nintendo Wiis with the power of my mind.

This was not GameStop’s fault, but it represents the natural disadvantages that go along with being a third-party purveyor of in-demand consumer products, and one that is available to be verbally abused in the flesh. Now, nearly two decades later, on top of the natural challenges of retail, digital games downloads and online commerce has led GameStop to dramatically scale back its brick and mortar footprint.

This week, though, GameStop’s stock suddenly shot up on the news that they’d tapped Ryan Cohen of pet ecommerce site Chewy to help fortify their ecommerce business on the news that online sales had shot up by over 300% during the last holiday season.

I think this is a mistake.

Listen, digital sales are great, and the Chewy guy can certainly help GameStop increase digital sales, but there’s a reason why even Amazon is investing in brick and mortar operations. The infrastructure is there, it’s up to businesses like GameStop to use it appropriately.

GameStop is, at its heart, a boutique outfit for game sales (It should come as no surprise that their Canadian footprint still carries the name of one of their acquisitions, Electronic Boutique). While brute forcing a transition to ecommerce may seem like the most expedient way to generate funds, it ignores the fundamentals of its products.

When you buy something from GameStop (assuming you’re not buying a Mega Man keychain or something) you’re not buying a commodity, you’re buying an experience. You’re buying roughly 10-100 hours of entertainment in the form of a game, or a console. You are, ostensibly, purchasing a service. It’s tangible, it’s experiential, and it’s criminal that GameStop is not using its brick and mortar footprint to capitalize on that. Experience is just the tip of the iceberg, too! Here are some ways that GameStop could rebuild themselves as a service company:

Experience

So yes—in-store demo kiosks are not new to gaming stores. They’ve existed for years, typically installed by hardware reps that want to highlight a specific game or feature of their system. But in the land where the point of sale is so often online, a video game store should be about 70% kiosks—home-grown kiosks. Kids—being the primary consumers of games—should be compelled to come in, play around, and try before they buy. In a time of near-ubiquitous digital gaming, it’s easier than ever to have consoles ready to allow kids to play demos of whatever game they want. Smart companies (especially digitally-minded ones) would allow customers, once they reach the end of a demo, to purchase the game right from this interface.

There’s obviously a lot of back-end that would have to go in to building proprietary demo machines for a place like GameStop. You’d always want one employee manning the demo areas to keep an eye on kids, make recommendations, and answer questions. You’d likely want to tie playing to a GameStop membership, so kids wouldn’t be compelled to treat the store like an arcade. You’d also want to track plays and purchases (and services, which we’ll talk about in a minute) in a single place. With that in mind, you’ll need to consider a best-in-class customer experience tool. This, combined with some proprietary software, could completely reinvent how a company like Gamestop manages customers.

Subscription

When I was a Gamestop employee, we sold a card that got you 10% off of used games and a subscription to a magazine. Not very interesting. Today, that same card…gets you 10% off of used games and a subscription to a digital version of that magazine. Redefining the footprint of a Gamestop means redefining subscriptions, too. Perhaps the subscriptions allow extended play inside the store (Gamestop’s own pasta pass) or perhaps access to a digital library of games, similar to what Microsoft has built with its own Game Pass. This one will require careful thinking about value, but should ultimately focus on loyalty, experience, and retention.

Repair

An obviously large amount of product that accounts for GameStop’s sales would be video game consoles like the Xbox and PlayStation. These things break down periodically, as do all electronic devices. An in-store service that permitted repairs alongside the typical GameStop buy-back of used merchandise (one of the tenets of their business that we haven’t talked about). By taking that a step further and offering a service alongside the buy-back, you’re building in new revenue opportunities, and, crucially, getting people into the store. Is that difficult as a third-party retailer? Of course it is, but by hiring skilled laborers (the same ones that refurbish systems at depots, another thing that GameStop already does) the potential is there.

By doubling down on digital, GameStop might think that it’s solidifying its business position for the future, but cutting and running on brick and mortar is not the recipe to success, when you already have the infrastructure in place to build an industry-defining service business. Will it require institutional changes? Yes, absolutely, but getting it right might mean the difference between success and failure.

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January 11, 2021 | 4 Mins Read

4 Key Benefits of Additive Manufacturing in Servitization

January 11, 2021 | 4 Mins Read

4 Key Benefits of Additive Manufacturing in Servitization

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Dr. Ahmad Beltagui

We take it almost for granted now that devices, from mobile phones to industrial equipment, evolve through software updates long after they are released, in order to meet changing needs. Yet while the software can be customised and updated, the hardware stays the same. Manufacturers continue to sell the same products to all customers for many years. What if not only the software, but also the hardware could be updated, to keep products relevant long after they leave the factory? By combining Servitization with additive manufacturing, this could soon be in reach.

Servitization is the transformation of an organisation from transactional sales to long-term relationships with customers that deliver outcomes. These outcomes are achieved by aligning the incentives of customers, suppliers, and manufacturers around long term, sustainable value creation. Achieving Servitization requires a manufacturer to update its design capabilities and how it develops new products.

New products typically take years to reach market. Designers start by examining previous models, competing products, and alternative technologies to understand what works and what is missing. They listen to what customers say and try to figure out what customers don’t say. They feed technical and market data into design iterations, using drawings, computer models and physical prototypes, before preparing for manufacturing. And then they start to think about the service…

Compare this with software products, created using agile methods. Developers may start by understanding customers, examining how they interact with products, and often drawing on data from customer interactions with previous products. They create prototypes, or minimum viable products, to get continuous feedback. And they prioritise features, even after launch. For example companies as diverse as Microsoft  and Fitbit  ask customers to suggest new features and vote for which ones to launch next. In short, the product is never finished, the design does not have to be frozen, and the service can come first.

Here is where additive manufacturing (AM – also known as 3D printing, or rapid prototyping) comes in. This is a set of technologies that produce physical objects, in layers, directly from a digital design model. For large volumes of standard parts and products, AM is not useful. Yet the possibility to produce customised and high-value parts, in a few hours, anywhere in the world, with very little waste, means that updates can be launched during the lifetime of the product. Consider a long-term agreement that gives the manufacturer responsibility for maintaining performance and an incentive to improve the outcome delivered. The manufacturer monitors product performance, using data to allow preventive maintenance and, once a year, performs a full service on the product. Now consider using the data to design a new component that would optimise performance, based on this particular customer’s usage patterns, to be installed at the annual service. Since manufacturing typically depends on economies of scale, the cost would traditionally be prohibitive. With AM, however, the benefits could outweigh the costs. Variations in customer usage patterns can mean a customised design for critical components which might reduce energy consumption, prolong product life, or improve output. And if the manufacturer is paid for helping the customer improve output, or reduce downtime, then this could enable a new, more competitive value proposition to be created.

AM offers four key benefits, which can form the basis of an innovative value proposition.

  1. Designers benefit from the possibilities to make more complex shapes that are harder to make by traditional means. A part that would typically be assembled from components made by 10 to 15 suppliers, is now made in a single part by General Electric – making it 40% lighter and 60% cheaper.
  2. Since one-offs are possible, products can be made that better meet the individual requirements of customers. For example, Align Technology receives scans from dentists, and produces over 200,000 customised dental braces per day.
  3. AM can also help make product innovation and servicing faster. While refurbishing aeroplane cabins, Airbus found that printing plastic panels, although more expensive than injection moulding, saved a lot of time – an additional benefit is weight savings, which are critical for applications including aerospace.
  4. Finally, as COVID has shown, supply chain disruption is always a possibility – lockdowns closed factories, leaving customers waiting months for products. Across the world, AM was used to produce protective equipment for local use, rather than waiting for delayed deliveries. AM allows production to be nearer to the demand, helping to offer a better service.

While many have focused on the implications of AM for logistics, and spare parts in particular, evidence suggests that for spare parts, AM is more costly than storing inventory. The true value of AM comes in the ability to make product design flexible. Manufacturers can keep a step ahead of competitors by evolving their product designs even after production. For customers, this means products can be updated through physical design changes as well as software updates, as new requirements emerge. To make all this possible you need two things: Servitization, to create the incentives for continuous improvement of products in use – and AM, to offer the means.

About the author:

Dr. Ahmad Beltagui is a lecturer at Aston Business School and a member of its research centre The Advanced Services Group. His current research interests include design, innovation and supply chain management, with a particular emphasis on Additive Manufacturing (also known as 3D Printing) and its innovation potential. In this blog he looks at how product manufacturers can adopt the principles of updating and innovating in-use products, that we see much more commonly with software, and how Additive Manufacturing can achieve this, in order to better serve customer needs and support Servitization.

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Mobile Service Considerations for Manufacturers

January 8, 2021 | 3 Mins Read

Mobile Service Considerations for Manufacturers

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By Tom Paquin

Service businesses and mobile devices are not in any way strangers—I’ve written many articles about the relative maturity of the mobile service market, across a variety of industries. I’ve also spent quite a bit of time recently discussing the various business changes impacting manufacturers, whether they be industrial, medical, or high-tech (and yes, I know that these three groups don’t represent all manufacturers). So let’s smoosh those two things together and think about the unique case of mobile service for manufacturers!

There are two main things that set mobile apart for manufacturers. The first is the fact that for businesses that are just now embracing servitization, mobile service might not be very mature for them at all. In fact, the utilization of mobile devices for any business process might be a completely new process. The other element at play is the gigantic scope of what manufacturers might be servicing. A company servicing an exercise bike is beholden to different physical requirements than industrial kitchen equipment. So let’s outline some of the major considerations:

Interface
I’ve been a broken record on this for many years now, but any sort of mobile device that is used for service activities needs to have full 1:1 parity with its desktop counterpart. This is especially important for businesses embracing servitization. If service managers are accessing, say, inventory systems that reach outside of service departments, it’s important to ensure that while on a job site, they can access everything in real-time. Not having that information either increases the time from ticket to invoice as the tech shuffles back to a computer, or, more troublingly, creates inconsistencies between systems. Best-in-class service software will have that complete parity right out of the box, and it’s incredibly important.

Knowledge Management

Mobile devices have already gobbled up some of the physical libraries of our lives, whether it be our CD collection, or movies, or books. They should obviously, then, be able to do the same for the reams of reference materials that technicians often need access to. Mobility also offers an opportunity to approach and access knowledge management in ways that take fuller advantage of the form-factor. Simplistically, this can mean things like universal search. Forward-thinking companies use cameras and other mobile-specific goodies to enhance the experience through remote assistance, AR-powered step-by-step instructions, and other similar utilities. To that point…

Wearables

Please excuse me for this: Be wary of wearables. Does that mean don’t use them? No! But they’re often heavy and take up space. If a technician is only going to pull them out once a week, then what is the value? With any technology, whether it be hardware, software, or wetware, there’s no excuse for not properly vetting solutions for practicality, usability, and return-on-investment. For industrial manufacturers, wearables (especially when paired with remote assistance) may be an invaluable asset. For other types of manufacturers, the cons may end up outweighing the pros (and maybe by only a small margin!). I love a good wearable, but unless it’s deliberately deployed, it’s hard to recommend. The bottom line is this: Don’t grab every shiny object that is dangled in front of you. Not unless you can make the case for your business.

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Setting Intentions to Turn 2020’s Trials Into 2021 Triumphs

January 4, 2021 | 4 Mins Read

Setting Intentions to Turn 2020’s Trials Into 2021 Triumphs

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By Sarah Nicastro, Creator, Future of Field Service

Fresh starts always feel good but kicking off 2021 brings a new level of relief. Now obviously challenges haven’t miraculously dissipated, but there is a sense of hope for what’s on the horizon. Let’s build from that and consider how we can use the trials of 2020 to set intentions for 2021 that will lead us to triumph. I do believe that there’s an opportunity for service businesses to come out on the other side of COVID stronger, more innovative, and more resilient than before. On the business side, here are three intentions for 2020 that I think are imperative to making that happen:

  1. Capitalize on the acceptance and open-mindedness that 2020 created. We discussed in one of our last podcasts of 2020 with Schneider Electric that we’re at an inflection point with service – the idea that the challenges of 2020 have created a greater acceptance of the strategic importance of service and an increased willingness to put a focus on service culture and service strategy within the business. This openness seems to be shared from the frontline workforce all the way to the C-suite, and it’s something that shouldn’t be wasted. In 2021, we need to capitalize on this openness and this inclination toward service by being ready to showcase all the ways service can be innovated and matured to improve the customer experience and add revenue. Being able to build upon the acceptance 2020 brought has the potential to catapult progress at a pace that seemed impossible a year ago.
  2. Evolve service offerings and service delivery. What ways did 2020 force you to get creative in serving your customers? Did you introduce or expand remote service? Did you learn how to make far more rapid decisions and become more agile? Did you create new service offerings? Don’t let the creativity and agility that 2020 forced upon your business be for naught. If remote service worked well for you in navigating COVID, work toward developing a remote-first service strategy as your standard. If you built confidence in making faster decisions and moving more quickly to innovate last year, continue that momentum. Did your customers respond well to service spend over capital investments or new service offerings? That shows you they too are open to bringing the future of service into the present.
  3. Modernize your technology stack. 2020 proved to those who’d invested in digital transformation just how imperative those investments are and illustrated for those lagging just how critical it is to catch up. A very important step in turning 2020’s trials into triumphs is making the effort to determine what is needed to truly modernize your technology stack. Do you have a cohesive platform in place or a piece-meal approach? Are you leveraging the benefits of cloud? Have you mastered the foundational elements of digital transformation so that you can begin to reap the benefits of the next generation of functionality? Each company’s starting point is different but putting focus in 2021 into determining what your technology stack is lacking and how it needs to be modernized is imperative.

Business lessons weren’t the only 2020 taught – service leaders as individuals learned a lot too and, as individuals, you should be setting your intentions for this year as well. Here are three suggestions to get you thinking:

  1. Create white space for long-term thinking. 2020 was a whirlwind and we all did a wonderful job just by surviving. We learned on the fly how to be more flexible, more creative, and more innovative. In 2021, we should try to take back some control of our time and create some white space for longer-term thinking. We know that service leadership is a delicate balancing act of solving immediate challenges while strategizing on how to build the future. What we don’t want is for the day-to-day to overshadow our time and attention on the future and creating white space that is dedicated to innovation is important.
  2. Practice vulnerability. We all became more connected as humans in 2020 and I think continuing and building upon that in 2021 will be a triumph. Being authentic and vulnerable as a leader will help you to create personal connections that not only help you in achieving your business outcomes but fulfill you as a human being.
  3. Prioritize self-care. 2020 was hard and we’re not out of the woods yet. To lead effectively, you must take care of yourself. Burnout is real and to avoid it, you need to be cognizant and respectful of your own needs. This looks different for everyone but take some time to tune in to what it is that makes you feel energize and rested and recharged and make sure you’re doing that.

Here’s to a triumphant 2021! I’m excited to be on the journey with you and look forward to telling many stories this year of how we’ve channeled the challenges of 2020 for good.

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What Did I Write About This Year?

January 1, 2021 | 4 Mins Read

What Did I Write About This Year?

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By Tom Paquin

I’ll spare everyone the cliched overtures about what a year we’ve had. We’ve all been enduring it, but there’s the potential of hope on the horizon. Given that 2020, on the whole, was mired by disruption of business-as-usual, with this wretched year now in the rearview, I wanted to take stock of exactly what it was that I, personally, spilled digital ink over this last year. Sarah wrote a lovely article in which she discusses many of her feelings on the last year, as well as some of her favorite pieces that she produced, and I encourage you to read that, if you haven’t. Here, on New Year’s Day, is my own.

The COVID Stuff

Perhaps unsurprisingly, beginning in mid-March, our year was inundated with content and stories about COVID—what businesses should do, what they are and will be doing, and how we, as a community, are working to make the best of a set of challenges and restrictions that few were adequately prepared for. We have a whole section of the website dedicated to this content, but here are some of the pieces that I think speak to the gravity of the situation, and where we go from here:

  • Our First Articles on the Subject (Here and Here): Sarah and I both took different perspectives when first tackling COVID-19, and while they’re now somewhat peculiar time capsules considering the immense speed of change that propelled us through the year, there are constants that run through both into today. At the end of my piece, I promise our readers that Sarah and I will see them at the next in-person service event. That has yet to happen, but I have high hopes we’ll be able to meet again in 2021.
  • The Story of Munters: Munters was a topic of frequent conversation for us during the early months of the crisis, as they were the first COVID success story, leveraging Remote Assistance from IFS to quickly keep operations afloat in spite of the pandemic’s restrictions. Even now that we’ve seen other businesses find success, Munters stands out with the speed and forward-thinking they employed to stay on top of things, and use a crisis to differentiate their business for the better (Also listen to Munters on the Podcast).
  • The Service Buyer’s Guide: COVID-19 Edition: Typically, when we write about business decisions, all roads lead to software, and that’s naturally adjusted our evaluations when planning for service software implementation. I think that the calculus of what makes service software has been permanently changed by COVID, and I tried to reflect that in this article.

The Weird Stuff

Perhaps as an antidote to the intense anxiety that this year caused me (on top of my, you know, regular anxiety), I had a little fun with my articles every few weeks. I think it’s useful, even with “serious” topics like complex business decisions, to inject a little levity wherever possible. I also like to take things that I’m passionate about outside of work and make them a component of what I’m passionate about at work. That’s what I’ve tried to do, and here are a few of the weirdest ones:

Back to Basics

The SEO-minded cynic in me knows that the most searched-for topic on service management is “What is Service Management?” and yes—that did initially inspire this lengthy series of articles. Moreover, though, I remembered what it was like to not know anything about service management software. Sarah and I both have shared stories about starting out in this field with little to no experience with the technology, and having to build a knowledge base from scratch. More than anything, I hope this series of articles saves someone the headaches that she and I went through a decade ago.

In spite of so many challenges, anxieties, lost sleep, and frustration throughout 2020, there’s still plenty of joy, hope, and thanks that this year has been able to offer. Much of it comes from being able to share thoughts, ideas, and stories here with all of you. In spite of the challenges, being part of the Future of Field Service Community through 2020 has been immeasurably special. Thanks for being part of this journey with us, and here’s to 2021.

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A Love Letter to the Service Community for Surviving 2020

December 28, 2020 | 3 Mins Read

A Love Letter to the Service Community for Surviving 2020

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By Sarah Nicastro, Creator, Future of Field Service

I came across creative evangelist Debbie Millman’s “Love letters to what we hold dear” a few weeks ago and immediately had the thought to write this piece. I then went on to second guess myself, wondering is “love letter” too much? But I’m going with my gut because, no – I don’t think it is. First, I do love this community. I never thought I’d say that when I entered into it in 2008 not knowing what field service even was. But nearly thirteen years later it’s become something I, indeed, hold very dear.

Second, you deserve the love. This year has been intense and as I’ve talked with service leaders about how they’re doing, strategies for navigating the complexity, lessons learned, and everything in between, I’ve been in awe of the fortitude demonstrated in conversation after conversation. Here are some of the amazing characteristics that have stood out to me from those conversations this year:

  • Resilience – You’ve likely had days this year where you felt like you just couldn’t anymore; where you felt like running away. I have too. But you’ve shown up anyway. Day after day, challenge after challenge. You’ve stood up to the seemingly impossible tasks and fought through one step at a time.
  • Selflessness – A very common theme among the conversations this year is how you’ve put people first. Customers, but even more importantly, employees. You’ve taken great care to take great care of your people – to prioritize their safety above all else, to check in with them on a personal level, and to make sure they feel seen and supported.
  • Grit – Unfortunately, there were many hard conversations to be had this year. Conversations around pay cuts, layoffs, job reductions and even harder ones around illness and loss. You’ve faced these conversations with grit and bravery and it’s something to be admired.
  • Creativity – I don’t think there’s such a thing as a comfort zone after 2020! But rather than fight the fact, you’ve let comfort zones go and have embraced your need and ability to get creative. Whether in how you serve customers, how you lead a team virtually, or how you use digital tools, seeing creativity brought to life this year was a really cool thing.
  • Vulnerability – I’ve seen you all open up, as individuals and as a community. Having the courage to be vulnerable with your teams and your peers and to share when you’re struggling and ask for help when you need it. And calling on the community with the realization that there’s power in numbers and peace in knowing we’re all in this together.

A few of my favorite conversations of the year that touch on these characteristics, and more, are:

I do love this community, and I love how Future of Field Service has been able to serve as a platform for sharing and connecting in a year where those things have been so very critical. Thank you to each and every one of you that opened up to me this year, whether on record for an article or podcast or just because. I have deep respect for the work you’ve had to do this year – as people and as leaders – and immense gratitude to you for trusting me with your stories. Here’s to hoping that 2021 brings ample opportunity to share stories of how you’ve turned this year’s trials into triumphs.

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December 25, 2020 | 5 Mins Read

Finding Opportunities for Servitization in my Christmas Village

December 25, 2020 | 5 Mins Read

Finding Opportunities for Servitization in my Christmas Village

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By Tom Paquin

Today is Christmas, folks. So Merry Christmas, if that’s your thing. I’ve never been particularly fond of this holiday myself. With a currently-pregnant wife, I have a feeling that I’ll be singing a different tune in 354 days as I’m laying out presents from Santa, but for now bah humbug. I have always preferred January 3rd or so, when everyone else on the planet is just as miserable, cold, and depressed as I am all the time. There is but one Christmas tradition, self-imposed, for which I fully, extensively, and wholeheartedly commit, though, and that is my Christmas Village. Here it is, under construction:

Some background: I’ve been collecting Department 56 buildings and figurines since the early 90’s to assemble this village, having been inspired by my grandfather (about whom I have written before) who still painstakingly assembles an epic, pristine recreation of a semi-fictionalized 19th century London every year, which tells the story of Charles Dickens’ A Christmas Carol.

My village, by contrast, is not Dickens Village, but instead New England Village, modeled after a semi-fictionalized version of the region of the United States where I live. And I love it. I’ve been assembling houses, people, landscapes, and electric doodads of one type or another since I was seven years old. Having discovered estate sales and Ebay, the village has expanded, spawned neighborhoods and sub-villages, and developed a warm character of its own. That character has created interlocking systems and considerations, ones that my service-oriented brain cannot help but consider. So let’s have a little fun.

Yes—this village is loosely set in the mid 19th century, as New England, cultural melting pot of the northeast, helped to solidify many of the Christmas traditions from around the world that would come to represent the American identity. But it’s also in my fleshy, corporeal living room in 2020, so I will not hesitate to consider modern technology as a viable option for these small ceramic houses.

Most of the businesses in my village offer simple services like horseshoes or bell casting. A few could easily benefit from modern service technologies. Here’s some considerations.

Cape Keag Fish Cannery

A product of the Napoleonic wars, depending on which side of “Mid 19th century” you choose to land, canning could easily be seen as cutting-edge technology for this village. You’d imagine, given its proximity to the ocean, that this cannery focuses mainly on canning oysters and other provisions brought in by fishermen each day. Light load on a calm morning? The canning equipment sits, unused.

We often think about servitization as an opportunity to build maintenance contracts, but businesses have an opportunity as well to, where appropriate, offer their equipment in ways that benefit non-commercial activities. We’ve seen this in COVID times among restaurant suppliers. Creating canning subscriptions could be a way to offset the uncertainties of fishing.

There are obviously considerations of volume and scheduling, if a great deal of commercial product is, in fact, coming in. In modern times, thinking holistically about your business allows you to consider your internal infrastructure as it relates specifically to the confluence commerce volume plus service volume. Perhaps service volume meets a threshold where you invest in additional canning machines. It’s that degree of cross-functional resource planning that only best-in-class software offers.

Blue Star Ice Co.

I imagine that when the tools were developed to harvest, store, and utilize ice for preservation, the technology was seen as revolutionary. “People will always need ice,” some old executives certainly crowed, chomping off the ends of their cigars, “How else will they keep their food fresh?”

It might not come today, it might not come tomorrow, but it’s time to start thinking seriously about future-proofing what once seemed like a sure thing. While refrigeration might be a few generations away, in the previous section of this very article, we discussed a technology that makes food reliably shelf-stable for indefinite periods of time. In the ice industry, the cracks of obsolescence are already forming. And yes—pun very much intended.

Is service the answer? Of course it is! Blue Star Ice Co. could convert to a full-time ice house, which has a variety of different purposes. Chief among them is that it offers coolant without electricity, which, for businesses who require products be kept at a certain temperature regardless of the state of the electric grid, would be incredibly useful. Even in the world of home refrigeration, a large ice house would have practical applications for larger items. Perhaps create service contracts with the local butcher or morgue (I should note that my village does not have a morgue, because nobody dies in my idyllic Christmas village).

The Emily Louise

I’m not at the stage of my life where “pleasure boating” has entered the equation but I love the ocean, and I love spending time on a boat. For that reason, the Emily Louise, one of my newest additions, is one of my favorites. This ship represents the best that field operations of the mid-1800’s have to offer. Whether or not they provide any explicit service, or just transcontinental delivery, the ability to use service-oriented functionality to improve the experiences of those waiting for them at the next port would be a compelling selling point.

One technology that sticks out as particularly useful with respect are newly-minted location-tracking tools. The best show when you’re next, give you a map view, and let you connect directly with your service person. A few years ago, I mused that location tracking as a function has numerous caveats in practice. At the time, location tracking on its own actually lowered customer experience scored. What businesses have discovered since is that location tracking alone is not enough, and needs to be heavily curated into a tool for customer communication, and allow for that communication to run freely. With that sort of tech on the Emily Louise, ports can be prepared in advance of the ship’s arrival, so they can make the appropriate arrangements to prepare.

I don’t know about you, but all this talk about servitization and process optimization has really turned me around on Christmas. I feel downright jolly! Readers, in all sincereity, take care and stay safe. Merry Christmas and Happy New Year. We can’t wait to share another year of great service stories with you all.

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December 21, 2020 | 5 Mins Read

3 Reasons Schneider Electric is Excited for Service in 2021 – And You Should Be Too

December 21, 2020 | 5 Mins Read

3 Reasons Schneider Electric is Excited for Service in 2021 – And You Should Be Too

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By Sarah Nicastro, Creator, Future of Field Service

We published a podcast last week with Jerome Soltani, Sr. VP of U.S. Services and Alex Gershman, Director of Strategy, Services and Solutions both of Schneider Electric during which we discussed the company’s journey to outcomes-based service. Like many other organizations making their way to delivering outcomes, there are challenges to overcome as progress takes place. However, during our conversation, it was evident how some of the challenges particular to 2020 are really paving the way for accelerated success. Jerome and Alex are quite excited about what will happen next as it relates to service, and I think their reasons are points many others share excitement around too.

#1: Customer Conversations are Changing

Jerome and Alex discussed the fact that Schneider Electric has been on the journey to delivering outcomes for a few years and has been making progress all along. But COVID has accelerated progress in some key areas, one of which is in what customers are asking for. “There are a couple of big mega trends that we’re seeing out in the marketplace driving the change in conversation,” says Alex. “Many of them have accelerated through the last year, through COVID. First is changes in investment shifts that our customers are making from big capital expenditures toward more operating, annual kinds of expenditures. And again, through COVID we hear the need to extend the life of assets.”

This point has been echoed by other manufacturing companies I’ve spoken with in the past few months that have seen significant increase in service and maintenance revenues. “That CapEx to OpEx shift has certainly changed the nature of conversations that we’re having,” says Alex. “We’re also seeing massive retirements on the part of the skilled labor inside of our customer organizations, meaning they’re turning more and more to companies like ours to help them with the services needs that they had that they may have relied on internally previously. Customers are feeling pressure to focus their efforts and attentions on their core business. Our candy makers want to make candy and they don’t want to necessarily focus on their infrastructure. So, again, they’re turning increasingly more and more to us to do that. Finally, with the rise of data connected technology, customers are looking to us to help them with making sense of the data that they have, being able to get toward the outcomes that they’re looking for with their customers.”

It almost feels to leaders like Jerome and Alex, who have been working hard to make progress on this journey for years, that customers have finally caught up with the vision of how outcomes-based service can deliver. This is exciting, because the conversation becomes mutually driven. “I think before COVID we had the feeling of being a little bit in advance. Not being arrogant, but you see when you’re a little bit too ahead of the market, you feel a little bit alone to create demand and create this awareness,” says Jerome. “But, I mean, COVID and the pandemic and the situation, working from home, nobody in the campus, in the university and so on, we saw this awareness and this acknowledgement coming from our user. It was a big relief for us, and it was great to see that finally the combination of our software portfolio connected product and services would make sense and would bring a lot of value to our user.”

#2: The Service Language is Catching On

Not only are customers now driving outcomes-based service conversations, the language has caught on internally as well. We’ve written a number of articles about the challenges in evolving from a product provider to service-based company. The cultural shift that must happen is immense and employing a service vernacular is a critical step. This is an area Jerome and Alex have focused a lot on and, again, have seen major strides in this year due in part to the real-world illustration of just how much service matters to the business. “The services journey started couple of years ago, but I think it was still at the operation level, at the country level, kind of second thought and not really a top priority. Now it’s a good thing that our CEO and our board members were strong believers and have been really promoting the services business for years and have made very structural and transformational investment into this different teams at country level,” says Jerome. “But what we saw this year is that COVID-19 has been a catalyst to prove that services is highly resilient, and the model that allows us to continue to deliver very strong profitability to our overall P&L. I mean, when I compare our traditional transactional equipment type of business versus services today, depending on the country, depending on the portfolio, you have a discrepancy between five to 10 points of growth between a services business and a traditional core CapEx driven business. It shows that this business is one of the most strong and reliable businesses, and resilient businesses in the economy.”

Witnessing that in real-time helped expand the understanding, acceptance, and language of service within the company. “Like everything else, it’s a journey and by no means what I declare victory. But I think, again, the position that we’re in now is markedly better and different than it was 12 months ago,” says Alex. “It starts for sure at the top down. There was a conversation maybe six months ago where it was basically said there are six priorities for the company: services and software, services and software, services and software. That helps, right? When you get that message from the CEO, people start to listen. Storytelling about customer successes are also impactful and resonate as you’re trying to make change.”

#3: We’re at an Inflection Point

While fraught with hard moments and complex challenges, for services COVID and the experiences of 2020 have left us at an inflection point. Companies have an opportunity here to build upon the increased awareness and acceptance, both internally and externally, to see significant progress in service success. “I think we’re going to look back on 2020 for a lot of reasons,” says Alex. “But if we think about what’s happened in the years before around service, there have been incremental changes that have happened – connectivity, customer demand, our own workforces. But given the intersection of external forces, acceleration of technology, from the customer demand perspective, from the sales perspective, from the delivery perspective, we’re going to look back at 2020 as a massive inflection point across the industry in how services are consumed and delivered as a whole and the value that a services organization is going to bring to customers.”

2020 has brought many changes that can be built upon in 2021 and I agree with Jerome that the opportunity is exciting. “I would say that for sure the outcomes-based services potential is exciting in the coming year,” Jerome says. “And we look at what is your current portfolio, based on what is your market or what is your customer landscape. What is relevant for your customers in terms of services based on this portfolio?” The possibilities are almost endless for those ready to make the most of this inflection point.

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