A conversation with Michael Blumberg, president of Blumberg Advisory Group
Michael Blumberg is the president of Blumberg Advisory Group. He is a certified management consultant, a recognized expert in field service and reverse logistics, and a regular contributor to Field Technologies. I recently sat down with Blumberg to get his take on the biggest challenges field service organizations are facing, what he sees as the opportunities to seize, and his take on some of the biggest trends.
Nicastro: What do you feel are the biggest struggles today’s field service organizations are facing?
Blumberg: Field service organizations must continuously strive to maintain customer satisfaction while operating within various business constraints (e.g., cost reduction, revenue targets, labor shortages, etc.). The challenge is these objectives are often in conflict. On one hand, companies must keep customers happy; on the other, they must find ways to lower costs and do more with less. In addition, they must keep up with innovations in technology and find ways to deliver an exceptional customer experience. At the same time, they must find ways to monetize technology investments without gauging the customer on price. Meanwhile, field service leaders in these companies are bombarded by data and information about where to invest their time, effort, and resources. This of course presents a challenge of its own.
Nicastro: How would you describe the biggest opportunities FSOs should be seizing?
Blumberg: In broad terms, FSOs should be seizing opportunities that make the highest and best use of their most expensive resources, namely talent and capital. What does this mean exactly? The answer is investments that simultaneously fulfill multiple objectives such as cost reduction, quality and productivity improvements, revenue generation, and profit enhancement. While this may seem like a tall order, FSOs can achieve this outcome by leveraging technology and being more effective in creating offers that customers value. For many FSOs this also means seizing on trends like digitization, servitization, and Uberization.
Nicastro: Digital transformation is one of the hottest topics in field service. What are your thoughts on digital transformation?
Blumberg: I think it is one of the most important topics in field service. Companies who do not embrace digital transformation will become laggards at best or irrelevant at worst. Digital transformation is how companies develop innovations that lead to a better customer experience, improved operating efficiency, and increased financial value (e.g., revenue, profits, earnings, etc.) in the marketplace. Digital transformation is what makes servitization and Uberization possible.
Nicastro: Where do you see the field service industry with respect to IoT adoption? What do FSOs need to know about IoT?
Blumberg: As with many disruptive technologies, a small segment of field service is far along the adoption curve, while the majority is either in the early stage of adoption or just now beginning to consider it. At issue, IoT adoption in field service is a function of market penetration in the product/technology market. Adoption is the highest among large, Fortune 1000 companies and innovative start-ups in industrial automation, building automation, and home automation because these are the companies who are the furthest along in terms of integrating IoT into their product solution sets.
Many FSOs think that IoT is the answer to all their problems. They think it will solve all their labor, cost, quality, and revenue generation challenges. They need to understand that a great deal of planning is required to effectively roll-out IoT solutions. FSOs need to develop a vision, strategy, business plan, and road map that considers when, where, why, and how IoT will be implemented. They must consider which technology platform to use, what type of applications and analytics will be performed, what problems it will solve, and how to price and package it.
Nicastro: You’ve produced a lot of content on AR and AI. How do you see these technologies fitting into the field service space?
Blumberg: These technologies are a perfect fit for the field service space. I first became aware of them over twenty years ago and have patiently awaited their maturity and commercialization. I am bullish on them because they solve very real problems that FSOs face like labor shortage, first time fix challenges, requirements to reduce costs while improving productivity, etc. They also enable new possibilities. For example, the ability to anticipate, resolve, or avoid service events. I also like the fact they permit the creation of new income streams for service providers.
Nicastro: What other trends should field service companies be watching closely?
Blumberg: High on the list would be service marketing and sales, cognitive and predictive analytics, 3D printing, and drones. There are of course many more. You can catch more of Blumberg’s insights by visiting Field Service Insights, a subscription-based, community site bringing you thought provoking perspectives on industry trends and best practices.