10 May Field Service Expert Interview – Nick Frank
As part of our Field Service Management Expert Interview Series, we ask industry experts for their views on the market and what the future of field service management holds. We recently talked to Nick Frank, co-founder and managing partner at Si2 Partners. Nick has more than 25 years international experience ranging from start-up service businesses, sales and marketing and leading transformation within large global manufacturing and technology organizations.
Having worked as an international consultant for more than six years, Nick’s focus is on service strategy development, servitization business models, ecosystems, innovation management, service operations and service business development. He works with companies in a diverse range of industries including engineering, high volume manufacturing, equipment manufacturers and technology. His expertise includes the development of strategic methodologies, initiatives, and appropriate strategic support mechanisms including technological, organizational and process redesign, as well as the delivery of service innovation and transformation, in particular how to leverage the capabilities of the Internet of Things and achieving the needs of the Circular Economy.
You’ve seen field service evolve over the years in your various roles. In what ways is field service management changing now?
The whole concept of what a field service organization does is slowly going through a fundamental re-design. Whereas field service has been about fixing and resolving customer problems, there is a slow realization that it’s now much more than this in the digitized product world. Field service is a front line touchpoint with customers but technology is enabling it to become integrated into the technical support and customer success or sales processes. We are at the beginning of a fundamental change in how we define field service — the people, processes and the tools required for success. For example, we increasingly see the trusted advisor/customer relationship role being developed as well as the use of third-party organizations. I even recently heard of some B2C companies experimenting with crowd-sourcing of field service to approved local freelancers. This really shows that we are in the middle of an evolution that will profoundly change field service
What are the strategic opportunities you’re seeing for field service organizations?
The field service organization starts to become more strategic in importance as businesses realize that it not only solves customer problems, but it is part of gaining deep insight into customer needs. So, not only can field service be an integral part of developing customer loyalty, it also can support the next generation of significant revenues and is a key element for businesses wanting to develop new service led business models such as servitization. And with the crises of 2008, business leaders have also started to experience the revenue and profit streams associated with services. Bring these two aspects together and services is increasingly seen by business managers as one of their strategic levers for growth.
What features in field service platforms are critical now and what will be necessary in the future?
Service platforms have a major role in helping companies deliver on their strategic vision for service in that they act as the data and information hub that is enabling new business models. These solutions must be able to bring transparency to the data, support benchmark processes, but above all must be flexible enough to integrate into the customers IT architecture. Hence, seamless compatibility with other support systems such as CRM and ERP is a fundamental requirement.
What role do you see the Internet of Things playing in field service management?
The Internet of Things (IoT) fundamentally changes the role of field service. No longer is field service the front line on identifying and solving problems. As more devices are designed to be integrated into remote solutions, technical support centers will become the front line for problem-solving with field service focusing more on the execution. A sign of things to come can be seen with Rolls Royce and the GE “Power by the Hour” models, where customer operations centers are the first point of contact that receives and processes the engine diagnostic data. They do the analysis and then plan the local execution. But its also important to recognize that this is a vision that is only slowly becoming a reality. Depending on how your product impacts your customer’s value chain, as well as the importance of legacy equipment, will determine the best option. We will see a whole range of options emerge along this continuum driven very much by the value that can be generated and turned into profits, which will be very different across industry sector and segments.
How are mobile technologies changing the way field service organizations interact with and serve customers?
Mobile technologies have certainly changed the way field service organizations behave and possibly the biggest change is the expectation from the customer side. We all have smartphones which allow us to immediately get answers to our questions and be informed while on the move. As consumers, we increasingly have the same expectations within the B2B world. Field service has to react to this and use mobile technologies to deliver on this expectation.
How are you seeing field service organizations use mobile technologies to drive revenue and maintain a competitive advantage?
I believe that mobile technologies are starting to make it easier for the field service team to identify and communicate leads for the sales team to close. This makes it easier for the trusted advisor role that many service organizations are currently looking to develop. That is, to not cross that important invisible line into being perceived as a seller as opposed to an advisor. Mobile technology also brings the service technician closer to the organization’s core capabilities, which it can then better leverage to solve problems more effectively.
How can field service organizations better capitalize on sales opportunities?
The sales opportunities offered by technologies like IoT and mobile is huge. However, field service is only part of the solution in liberating this potential. So, I would advise field service leaders who are really intent on transforming their businesses to see their role in this light. The largest sales opportunities will come from adapting and changing the business model. To do this, field service must integrate more closely not only with centralized technical support functions but also parts and logistics and especially the R&D function. The really big opportunities for revenue growth will come when services are designed into the product concept as a way of monetizing the technology advantages a company has.
How is the broader economy affecting field service management?
We are slowly seeing a complete redefinition or re-invention of the manufacturing industry. I guess the term is not so important. It is the fact that products are no longer physical things we can drop on our foot. With the digitization of products, they are constant sources of information which can be monetized through services. And we are now seeing the early stages of this blurring between products and services into outcome-based solutions. This is where the customer no longer buys a product such as a tire. They buy miles of tire usage. Being an integral part of the solution profoundly changes the role of field service and the people in it. No longer are they the heroes that go out into the wilderness and solve a customer’s problems against all odds. No! They are part of a solution, responsible for local execution, managing relationships and feeding back deep customer insights into the business.
How is the role of Chief Service Officer evolving?
Given this logic, I do not see the role of the chief customer service officer as being relevant to the long-term future of business. In the short term, it might make a point and bring focus to a service transformation process. But, if a business believes a CSO is critical to its long-term growth, then it has already failed to integrate “service thinking” into the DNA of their business. Again, I look to organizations like Rolls Royce who are way ahead in the way they think about service. It’s just part of what they do. They do not have a CSO as such, but rather have senior service leaders who continually drive service into their DNA, because they realize that its an on ongoing business change and even they have a long long way to go before they can say they have a service-led, customer-centric approach across all business units.
What are the top three KPIs that you recommend FSM organizations focus on? How might those KPIs change five years from now?
I am not a great believer in recommending the top three KPIs that all service businesses should have. For me, it shows a lack of understanding of why we have KPIs. KPIs should be used as a way to engage employees and steer them in the direction which is critical to the business at that moment in time. They will change depending on the context of the business so a top three just does not make sense. What I will say from personal experiences is that they should be balanced between cost, revenue and customer loyalty. They are extremely powerful and without balance you will find your organization veer towards selling and losing focus on customer loyalty, or achieving excellent customer satisfaction, but losing money. So, leaders should make sure they are linked to their own objectives, but then also dedicate significant amounts of their time to talking to team members about the expectations around the KPIs. It’s very easy to get wrong!
You can learn more about Nick and the services he provides at his company website, Si2 Partners.