Strategies for Enhancing Commercialization in Field Service
In the ever-evolving business landscape, field service operations are emerging as a significant avenue for revenue generation. No longer viewed as merely a cost center, these operations are rapidly transforming, integrating innovative technologies and strategies to drive sales and increase profitability.
For example, according to an article by PTC, "Field service revenue is typically derived from activities like repairs, installations, commissioning, preventative and predictive maintenance, and other on-site services offered by businesses. Depending on the service organization, they may sell service contracts which cover some preventative services and small repairs, or they could solely be focused on time and material work."
Here, we'll explore the process of commercializing field service operations and present a roadmap for companies to transform their field service from a supporting role to a leading actor in their revenue strategy. Let's dive in and explore the strategic shifts that can unlock the untapped potential of your field service operations.
Treat Field Service as a Revenue Generator
A critical first step in transforming field service operations into a revenue generator involves changing organizational mindsets.
For many companies, field service has long been viewed as a necessary but costly part of doing business. Instead, decision-makers must look to field service not as a cost center but as a potential source of income.
To accomplish this shift in perspective, organizations need to focus on the value their field service operations bring to their customers.
Field service technicians often serve as the face of the company, interacting with customers regularly. As such, they have the potential to deliver exceptional customer service, boost customer satisfaction, and ultimately drive revenue.
Companies should also consider how they can move beyond standard field service offerings to deliver new kinds of service products. For example, a standard offering might still operate using a break-fix model—if a machine breaks, a technician will be dispatched to fix it.
Thanks to analytics technologies, Internet of Things sensors, and artificial intelligence, companies can now offer customers new types of service contracts that are proactive and guarantee uptime. As we'll discuss in the next section, these types of contracts can be packaged and sold to generate new revenue for the business.
Integrate New Technology to Deliver New Kinds of Service
Leveraging new technology is an instrumental part of transforming field service into a major revenue generator. By integrating advanced solutions, companies can enhance their service delivery, create new modes of service, and provide superior customer experiences. Here are some key ways field service companies can harness the power of technology to create new service offerings:
- Proactive maintenance with IoT and AI: With the advent of Internet of Things (IoT) sensors and artificial intelligence (AI), organizations can now predict and prevent equipment failures before they occur. By offering proactive maintenance services, companies can help customers avoid costly downtime and improve the overall lifecycle of their equipment.
- Real-time tracking and reporting with GPS and Cloud Computing: GPS technology and cloud-based software can provide real-time updates on field service operations. This allows for better planning, resource allocation, and customer communication, setting the stage for more advanced and customer-centric service offerings.
- Remote diagnostics and repair with AR/VR: Augmented Reality (AR) and Virtual Reality (VR) can empower field technicians to diagnose and repair issues remotely. This not only reduces operational costs but also substantially increases the speed of service delivery.
In the era of digital transformation, field service organizations must evolve from traditional reactive service models to proactive, predictive, and even preemptive service models. Incorporating advanced technologies not only enables this shift but also creates opportunities for new productized service offerings that can generate substantial revenue.
Ultimately, the integration of new technology will be paramount in harnessing the full commercial potential of field service operations. By doing so, organizations can transform their field service from a cost center to a major profit center, enhancing profitability and customer satisfaction in the process.
Reconfigure Your Service Contracts for Optimal Value
If the field service organization is still operating using years-old, or even decades-old, service contracts, it might be time to revisit those in light of what is now achievable in the department.
Proactive Maintenance
Modern service contracts must be designed to deliver maximum value to both the customer and the business. Traditional service contracts, often based on a reactive break-fix model, can be reimagined to incorporate proactive and predictive services that leverage the advanced technologies we discussed earlier.
For instance, contracts could include regular maintenance and health checkups for equipment, facilitated by IoT sensors. This proactive approach can significantly reduce equipment downtime, offering substantial value to customers while creating a steady revenue stream for the business.
Outcomes-as-a-Service
Another avenue to explore is outcome-based contracts. These contracts, unlike traditional ones, are tied to specific outcomes or key performance indicators (KPIs) such as uptime, efficiency, or productivity. By ensuring their services deliver the desired outcomes, businesses can build stronger, more mutually beneficial relationships with their customers.
Customizable and Personalized Contracts
Finally, service contracts should be flexible and customizable, allowing customers to choose services that best fit their needs and budgets. This level of customization can enhance customer satisfaction and loyalty, leading to long-term revenue growth.
Start Commercializing Your Field Service Department
Commercializing field service operations is an opportunity that businesses can no longer afford to overlook. By shifting their perspective and viewing field service as a potential revenue stream, they can transform a traditional cost center into a significant profit center.
The integration of advanced technologies can usher in a new era of service offerings, from proactive maintenance to outcome-based contracts. These technologies not only enhance service delivery but also open doors to innovative revenue-generating service products.
To learn more, don’t miss Field Service Palm Springs, happening from May 6th to May 8th at the JW Marriott Desert Springs in Palm Springs, California.
Download the agenda and register for the event today.