Service Management Buyers Guide 2010 - daruMath

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SERVICE MANAGEMENT Digital EDition 04 FIG 1: What do you expect to have the greatest impact/influence on your field service operation in the year ahead? 50 40 30 20 10 0 30.2% Company strategy 29.5% Financial performance 34.5% Customer requirements 12.2% 7.2% 10.1% 25.9% Market competition Regulation & legislation Workforce capabilities Implementation of new technology/solutions from existing customers. The answers to question 4 confirm that customers are continuing to be demanding and that their demands will not cease. Many suppliers are recognising that differentiation can be obtained through service level agreements, by working very closely with the customer they are able to tailor service explicitly to customer needs. The answers to question 5 underline that services offered are becoming critical to competitive differentiation, with nearly 70% of respondents of the opinion that service as a differentiator has become either much more important or somewhat more important than before. Reinforcing that even in an era of commoditisation, service is able to provide the necessary differentiation to attract and keep customers. Question 6 considered the issue of staffing levels. Some reduction in the overall numbers of field engineers was reported for 2009 – caused by cost FIG 2: What proportion of your organisation’s total revenues will be driven by services in the year ahead? 50 40 30 20 10 0 10.9% Reduced contribution 35.5% About the same as today 42.8% Somewhat more than today 13% Significantly more than today FIG 3: What do you anticipate the most important driver of services growth to be? 50 40 30 20 10 0 Serving new customers 40.6% 40.6% Delivering new service offerings 41.4% Generating more service revenues from existing customers pressure. However, the increased demands placed on service operations during a period when product lifetimes have been extended, has meant that field service numbers were maintained at the same level across the period to a large extent. There has also been a significant reduction in unforced attrition levels, as salaries remained fairly static and staff were not prepared to gamble with job security. Many more staff will be coming up to retirement age over the next five years, although many of these will continue to work until the economic situation becomes better. There is expected to be a ‘shift to the left’ (increased use of virtual tools) but this will only begin to be evident towards the end of 2010, as the investment in technology begins to be applied more effectively. Question 7 was targeted at understanding the level of investment to be anticipated. In line with question 6, the consensus is towards a slight increase in investment which will continue if the economic environment achieves greater stability. The main FIG 4: What do you expect your customer service level agreements (SLAs) to look like in the year ahead? 60 50 40 30 20 10 0 30.4% Much more demanding and/or complex 55.8% Somewhat more demanding and/or complex 14.5% Equally or less demanding and/or complex “Service is able to provide the necessary differentiation to attract and keep customers.” FIG 5: How important do you expect services to be to your organisation’s competitive differentiation? 50 40 30 20 10 0 40.6% 31.6% 27.1% A much more important source of differentiation A somewhat more important source of differentiation Of equal importance 2.3% Of less importance FIG 6: How do you expect your number of field service agents to alter in the year ahead? 50 40 30 20 10 0 6.5% Significantly more agents 27.5% Somewhat more agents 50.7% About the same number of agents 15.2% Reduced number of agents conclusion to draw from the answers is that almost none of the survey participants is expecting investment to be reduced which means that investment is on-going in the service environment (given its very low base over the last five years, this is not surprising). The answers to question 8 are completely in line with what has been happening towards the end of 2009 and is expected to continue into 2010: certain solutions have remained very strong despite much consolidation in the service technology market place. With major players entering the service management market place, investment is only likely to increase. Question 8 illustrates the focus of solutions is to manage communication to and from the customer through an integrated solution, utilising staff and tools to optimise deployment thereby providing an overall umbrella of cost-effective support for the customer. Questions 9, 10 and 11 explore question 8 further, to examine the detail behind the answers. Question 9 considers the detail of the service
SERVICE MANAGEMENT Digital EDition 05 FIG 7: How do you anticipate investment within your service department to alter over the next 12 months? 50 40 30 20 10 0 18.4% 40.4% Significantly increased investment Slight increase 30.9% About the same as today management solutions in place and their ability to manage the service operation. What is significant is that the majority of respondents still use a system designed and built in-house. This derives from a time when service management solutions were predominantly self-built by IT and service departments keen to demonstrate their value and uniqueness. As the service software industry came of age, this uniqueness was then combined with a standard solution to produce a complex bespoke solution. Many businesses are busy reviewing their service technology strategy, to decide on how to take advantage of improving software and internal support from the rest of the business to achieve a fully integrated business solution (closed loop). Question 10 reveals the importance that is now being placed on scheduling solutions. Given the choice of mobile or scheduling the majority 11% Reduced investment FIG 8: In which area of technology will your company invest next year? 50 40 30 20 10 0 Service management software 38.7% 36.3% 29.8% Automated workforce scheduling/optimisation Mobile communications Tracking & fleet management 18.5% 16.1% 14.5% Outsourced service provision Inventory management logistics FIG 9: What type of solution do you currently use to manage your service operation? 50 40 30 20 10 0 40.4% 24.3% 24.3% Internally developed self-built solution Bespoke solution created to your requirements Best of breed service management software vendor application 19.1% Integrated module of corporate CRM/ERP solution of companies selected mobile solutions as the first step as indicated in the next set of answers. Question 10 shows that (apart from a small percentage of participants – 15%) the remaining participants not already using scheduling systems are either considering this as an option, or are actively planning an implementation. This is a significant shift of opinion from as little as a year ago. When we study question 11 which asks about mobile solutions a similar scenario is revealed – the only major difference being the increased number of those already using a mobile solution. The percentage of those that perceive see no value is still 15% - (in normal product-introduction parlance) this group is referred to as the laggard rump of the market, and difficult to influence, and will include the perennial tyre-kickers or those caught up in other time consuming business FIG 10: Do you currently operate an automated workforce scheduling/ optimisation solution? 50 40 30 20 10 0 38.2% Existing application in place 20.6% New implementation planned 25% 19.9% Considering subject to system specification and budget Of no percieved benefit 2010: Revving up the focus on revenue Sumair Dutta, senior research analyst - service management, AberdeenGroup, provides opinion on how the coming year will develop according to his organisation’s industry research More with less. We have consistently heard those words used across organisations, particularly due to the uncertain global economy. This holds true for service and manufacturing firms, that have spent most of 2008 and 2009 attaining the ‘less’ part of the equation through cost cutting exercises. For a number of organisations, these cuts have come in the way of significant workforce reductions. But as we turn the corner to 2010, we are beginning to see signs of investments in efficiency and in service-led revenue; shifting the focus to the ‘more’ part of the equation. At Aberdeen’s 2009 Chief Service Officer (CSO) Summit, 31% of assembled CSOs indicated that revenue generation was their top goal for 2010, more so than cost and customer management goals. This has also been confirmed by recent research on workforce optimisation, a function usually associated with cost cutting and cost management. Thirty-four per cent of organisations in a November 2009 survey on workforce scheduling indicated that revenue generation was a major pressure driving these organisations to improve the utilisation of their workforce. That said, cost management, particularly management of cost tied to labour, is still vital to the sustainability of the service organisations. However, in the pursuit of sustainable cost structures, organisations are three times as likely to want to do more with current resource levels in 2010 as opposed to slashing workforce and other resources.
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Service Management Buyers Guide 2010 - daruMath

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