Does anyone expect to receive poor service? No. Yet at one time or another we’ve all had to endure less than perfect customer service and support.
Perhaps there was a time when we merely accepted this as par for the course, but today’s customer tends to be less tolerant of bad service experiences, very quickly taking their business elsewhere.
Competitive service organizations can take advantage of the discerning customer, providing quality experiences that drive up revenue and differentiate them from the crowd.
In a recent Aberdeen report, State of Service Management: Outlook for 2013 research, 54 percent of respondents said the top pressure driving their organizations to increase focus on service was competition both in products and service. Forty-five percent of respondents claimed that the margins on service are higher than those on products; on average margins for service were 10.7 percent higher than products.
This added interest and untapped revenue stream has led many organizations to look to service functions like field service, parts management, and the contact center to drive new profits for the overall organization.
Warranty management is a leading way businesses seek to increase their revenue stream. In Aberdeen’s Service Contract and Warranty Management: Closing the Profitability Loop report, nearly half of all respondents looked to warranty management programs to increase revenues.
But in order to maximize this revenue stream service organizations must focus on fostering an environment of collaboration and empowerment internally. Although the siloed organization persists in the current business environment, top performing organizations have been able to transcend these barriers by enabling the accessibility of quality information for all relevant stakeholders.
These leaders have implemented both process changes and other tools such as a centralized data warehouse which enables real-time data capture that can be viewed by service, engineering, sales, marketing, and quality teams. The true value in this added access is that a department like sales, for instance, can now understand which services are well suited to a given customer base. Quality teams can clearly see which products continue to have defects. And engineering teams can proactively re-design faulty products based on warranty data that is returned.
Throughout the organization added warranty insight can help lead to the manufacture of better products which in turn should lead to additional sales and happier customers. Information on its own has limited value, but when information leads to intelligence and action, organizations can drive performance gains in key metrics (i.e., utilization, efficiency, profitability).
As organizations break down walls of communication and collaboration, not only will products and services improve, but the customer will also begin to see more value in the relationship with the service organization.
The service organization has a responsibility to deliver exceptional service every time and through each engagement function. The warranty chain is no different, top performing organizations have been able to maximize this service function to uncover revenues while also improving the customer experience and the efficiency of the service organization.
To learn more about Service Contract and Warranty Management: Closing the Profitability Loop, download Aberdeen’s full report or attend the PTC Live Service Exchange this month in Anaheim, California.