Earlier this month, I attended the first annual PTC Live Service Exchange event in Anaheim, California. And despite not having the opportunity to meet up with a certain famous mouse, I did have the time to network with, learn from, and present to a great group of service leaders across industry.
If you weren’t able to attend this event (you missed out), but take a look at some key themes and takeaways that have stayed with me:
1. Customers Really Do Matter. It’s probably a shock that this even makes the list in today’s business culture where the customer is King, but we often forget / neglect our customers despite their importance. As seen in Aberdeen’s Field Service study and separately in its Parts Management research, the top pressure facing organizations is the customer’s desire for faster service and a reduction in spending.
Customers are more empowered than ever, and they can have a positive or negative impact on an organization through their physical and social networks. Therefore, the customer must be at the forefront of the service strategy and their needs must permeate the innovations targeted for parts and service.
Throughout the Service Exchange, a number of service leaders talked about the creative ways they were getting closer to the customer and truly establishing partnerships which in turn improved products, services, and the customer experience.
2. Service Parts Pricing and Profits. In Aberdeen’s State of Service Management research, approximately three fourths of top performing organizations manage their service business as a profit center with the goal to not only drive down costs but also generate revenue streams. On day two of the Service Exchange event, there was a very informative presentation on service parts pricing and the benefits (i.e., profits) that can be achieved through strategically managing the price of spare parts.
Many organizations still use static or cost-plus pricing models for service, however top performing companies have begun to use more sophisticated modeling (i.e., value-based, market-based), as seen in Aberdeen’s Parts Pricing research, in order to drive additional revenues from these valuable assets.
3. Transformation Should Be Measured. Often times, in our personal lives and in business, we fall into the trap of identifying an opportunity to improve and then we move full throttle without building a manageable plan for action.
One senior service executive presented on the topic of warranty management and how his organization moved from a paper-based system to an automated warranty process. This executive outlined how his organization took a very prescriptive path to successfully transform both the warranty chain and the service business. In order to successfully transform the business, the company included all relevant / affected stakeholders (i.e., dealer network), established alpha and beta testing, and created a phased approach for the technology deployment.
Major change can be difficult, but if managed appropriately the growing pains can be minimized.