By Scott E. Day, principal consultant & business advisor, Transformational Strategies LLC
I’m getting ready to attend another IoT conference and as I’m reading through the speaker bios and descriptions of the sessions, I notice how the dialogue in most field service circles has jumped into topics like IT/OT convergence, deep analytics, AI, AR, and DevOps success stories. As a “seasoned” field service guy, this seems like a lot of “IT speak” and it is costing companies a lot of money. The fact remains that, in 2017, 94 percent of companies actively spending on IoT deployments are not generating profits from that spend. Millions of dollars are being spent on IoT development that either aren’t paying back as quickly as promised, or are costing three to five times more than originally budgeted. Does this mean field service organizations should stop deploying IoT? Certainly not! But field service organizations may benefit from taking a more conservative approach.
The technical dialogues happening around IoT in field service are causing many companies to jump in with both feet so they don’t risk being left behind by their competition. In doing so, it’s common for these companies to overlook three basic components of an IoT project: Customer Experience (CX), User Experience (UX), and Change Management. If your company is one that is IT savvy and can keep up with what’s going on with the ever-changing development in IoT platforms, services, and how they might connect to your vintage ERP system, you might stand a chance of being one of the companies in the 6 percent who can see the light at the end of the tunnel. There are many field service companies that have started in tech and have no problem keeping that pace. The only caution I would throw out to those companies is to watch out for the Uber’s or Airbnb’s of your industry to make sure you’re the disrupter and not the disrupted.
For the remaining organizations, dipping your toe in the water with IoT takes a more conservative approach and relies on taking a strategic approach to implementing IoT in your field service business. Here are some considerations that might help to avoid spending millions and getting hundreds:
In field service, the customer has been changing dramatically over the years. Real Estate Investments Trusts (REITs) have consolidated property maps such that a building manager who managed one property 10 years ago now manages six properties. If your value equation relies heavily on customer interaction for customer satisfaction or for upgrade sales, that means your technician is six times less likely to come in contact with the customer on each service visit.
As with the aging workforce, so is the customer base. Baby boomer property managers are retiring and millennials are replacing them. In most cases, the communication protocols change drastically in that the incoming generation of property managers and homeowners would like to see information a bit differently. Instantly, companies begin to think, “we’ve got to build customer dashboards and make the information real-time for our customers to realize our value.” A good CX analyst will speak with your customers to give guidance in this area.
In my past experience at Thyssenkrupp Elevator, we spent a lot of money on dashboards that gave the customer 27 different metrics to gauge their level of elevator service. We then introduced this new approach of transparency to a few large customers with a broad demographic of property managers. We were shocked to find that most of them simply wanted to know if the elevators in their six buildings were running or not and when the technician would be there for maintenance next. We spent a lot of money and a lot of time developing something the customer didn’t even want. In most cases, more information does not equate to more value. Find a good CX analyst, hold some customer focus groups, and nail the requirements down before hiring an app developer.
After we leave the board room with a strategy that is sure to transform our business (even if we have captured the customer requirements), we often overlook the person who must do the work — the field service technician. As we always say, “there are two sides to every story.” If you explain the strategy and what a day in the life of the technician would look like under this new field service strategy, they will typically tell you how to make it even better. The environment in the board room is much different than the environment where the technician lives his/her day. I’ve seen cases where the plan seemed airtight that the new strategy would increase margins; but, after explaining the process to the technician, a fundamental reality in the technician’s environment made the strategy far less profitable. As we engage the customer in building the solution, we need to engage the user equally in User Experience (UX).
Change Management and Minimum Viable Product
Many companies feel that introducing an IoT or AR technology to field service with a Minimum Viable Product (MVP) is a way of “dipping your toe in the water” and will yield good insights to make change constant. Three cautions to this would be change management, change fatigue, and cost to the organization.
We all know that change management is probably more critical than the technology itself. If the change isn’t perceived positively by the field technician, it may turn ugly both in terms of customer facing problems and in terms of efficiency. It is difficult enough to make a change in field service processes and the digitization of them, but continual change can compound problems, make change management more of a full-time job, and delay the payback expectation of these improvements.
By introducing MVP and then making incremental improvements in the process continuously, eventually your customers and users may get change fatigue. At the root of change management is the fact that people generally don’t like change. People want to see stability so they can establish a baseline for their service (and delivery) expectations. If things are continuously changing, customers can begin to lose faith in the expertise of the organization and technicians can become frustrated with ever-changing processes.
The cost of introducing MVP to field service comes in the new buzz words we hear such as “DevOps.” This is a relatively new structure where the development teams (many times app developers) and operation teams are put together to test and release changes quickly. If you don’t have this cost in your business today, you may want to consider what that cost might be when evaluating how broadly the IoT initiative will reach in your field service business and IT landscape.
So, before “spending millions to get hundreds,” make sure all stakeholders are on board with your new strategy, and everyone is charged up about the approach. Jumping in with both feet can be very disruptive to your field service business in terms of employee and customer retention. We must always remember that culture eats strategy for breakfast (Peter Drucker).