Effective Subcontractor Management For Field Service Delivery

By Ivan Moore, COO, Jolt Consulting Group

There is an increasing trend for service organizations to utilize third-party subcontractors as either a supplement or extension of their field service workforce.  A recent study reported greater than 75% of responding organizations use third-party networks for field service support.^[1] This is likely related to many organizations trying to operate with a reduced service workforce while simultaneously seeking improved efficiency and satisfied customers[2] with increased service workload volumes.

There are various reasons why a company may consider leveraging third-party contractors: increasing bandwidth, providing specialized skills, shifting the overhead cost to a more cost-effective workforce, and providing coverage to a new geographic area.  With these advantages, there are certainly some challenges that come with managing third-party contractors.

However, many of these challenges can be overcome by implementing certain processes, employing specific technology, as well as embracing and embedding the third-party contractor into the service organization.  Service organizations can utilize subcontractors while still meeting the expectations of customers and ensuring the quality of service delivery aligns with company standards.

Below are three key challenges and solutions organizations can enact to better utilize third-party contractors to contribute to organizational and customer perceived value.

Maintaining Consistent Service Quality

Organizations must tackle several critical factors on the path to achieving service excellence while employing third-party contractors, beginning with administering a thorough vetting process.  Service organizations must ensure that any third-party has the same necessary skills and commitment as an internal field service technician team.  Many companies institute a comprehensive “Certified Partner” program that details the framework and requirements for the third-party company to ensure the third-party has met the necessary qualifications.  On an ongoing basis, the service organization should track key metrics via a third-party partner scorecard that measures the third-party’s success.  This will also foster regular communication between the service provider and third-party to address any challenges or deficiencies.  This will help the organization respond to the same (or more complex) customer requests while maintaining a certain level of expectations.  

Timely Response to Work Requests

To ensure proper service delivery, third-party contractors must accept and perform work within customer defined SLAs.  However, some contractors may not be fully dedicated to the service provider and therefore may not respond to a work request in the optimal amount of time.  When it comes to customer SLAs and expectations, subcontractors need to be held to the same standards as internal employees.  Options to ensure adherence to customer SLAs include having multiple third-party options for a geographic area and having insight into third-party capacity to ensure work is being scheduled to those third-parties that have technician availability.

Lack of Visibility into Third-Party Contractor Activity

Subcontractors typically use their own technology tools; therefore, the service provider does not have visibility into technician status information (e.g., en-route and on-site) and cannot easily provide updates to the customer.  One way to combat this challenge is to develop standardized processes to ensure a uniform service experience.  It also sets clear guidelines for completion of tasks and gives the customer confidence that they’ll receive service commensurate with the organization’s standards.  Service organizations can leverage field service software and its accompanying tools, such as knowledge management, checklists, and providing real-time work instructions and other documentation, to its third-party network to accomplish this recommendation.

Allowing for greater transparency into the service process – such as technician location and remote support[3] – gives the customer greater confidence in the process and service visit. By providing third-party contractors with access to the same technology as internal technicians, the first-time fix rate goals increase in addition to providing a consistent delivery experience to customers.

Best-In-Class Third-Party Management

For a service organization to be best-in-class while employing subcontractors – meeting or exceeding customer expectations, plus adding value to operational efficiencies and cost savings –  transparency and visibility into the actions of third-party contractors are necessary.  By leveraging field service software, specifically subcontractor management functions that include quoting, work order management, scheduling, and real-time visibility, best-in-class organizations are able to monitor service delivery and customer satisfaction. Some key metrics to measure include:

• Customer satisfaction ratings
• Compliance to standards
• Adherence to schedules

Organizations utilizing third-party employees can reap benefits including up to five percent higher technician utilization, four percent higher SLA compliance, and three percent higher first-time fix rates,[4] provided all management and operational processes are in place to properly manage a subcontracted workforce.

To expand operational efficiencies and provide service that aligns with or exceeds customer expectations, organizations must apply a thorough vetting process, extend internal technology tools to subcontractors, proactively protect their brand, and measure results. These best-in-class providers can accomplish a competitive differentiator that yields service excellence.