Why Capital Equipment Manufacturers are Making the Shift to Service (And How You Can Learn From Them)
Capital equipment manufacturers know a thing or two about pressure. The products they build are mission-critical for the businesses that rely on them. Whether it’s a heating, ventilation and air conditioning (HVAC) system, an ATM, or an MRI machine, unplanned downtime is not an option. When this type of equipment unexpectedly fails, it could mean loss of productivity and revenue for their customers. And in the case of medical facilities, the stakes could be life or death.
We live in a world where on-demand services like Uber, Airbnb, and Amazon have set the bar high for service. This means there’s increasing pressure for capital equipment manufacturers to provide service as sophisticated as their products. Even if you’re not a capital equipment manufacturer, read on. The demand for optimized service exists for field service providers across all verticals.
Pressures Driving Capital Equipment Towards a New Business Model
Customers today demand a level of real-time communication and visibility in their service. And they want it fast. With advances in mobile technology and the Internet of Things (IoT), this kind of service is possible. And customers know it.
For instance, Uber provides customers with a ride within minutes at the touch of a button. Customers can also communicate with their driver and track their location in real-time. If Uber can provide fast, transparent service, your customers assume you can too. They expect you to be there in minutes when their product breaks. Or at least them know you’re on your way.
Capital equipment manufacturers are moving from a product-centric business model to a “Product-as-a-Service” model to keep up with customer demands and stay ahead of the market. Products are becoming commoditized, and service has become the competitive differentiator.
Moreover, with entire businesses on the line, it’s important for capital equipment manufacturers to be proactive, rather than reactive. Any unexpected downtime of machinery could come at a great cost for their customer’s business. Let’s look at some potential scenarios:
- An ATM stops working at a busy bank branch. Transactions get lost, leaving customers furious because they can’t access their money. Meanwhile, long lines form inside the bank, slowing down productivity and upsetting more customers. If the ATM isn’t fixed soon, there will only be more inefficiency and customer dissatisfaction. And the bank could lose customers to a more functional competitor.
- A bulldozer breaks down at a construction site. The project deadline is coming up, but the workers have to halt their project until the vehicle is fixed. They’ll have to miss the deadline and add more costs to the project.
- A patient checks into a hospital and is having trouble speaking. The doctors think she might be having a stroke, but they need to perform an electrocardiogram (ECG) scan to confirm. They need to act quickly, so they can start treating the patient. But the ECG system isn’t responding, so the patient will have to wait.
In any case, it’s important that capital equipment works. Customers depend on their products to work so they can run their business and keep their customers happy. Breakdowns happen, so it’s important that capital equipment manufacturers are prepared to service these machines right away. And they should have a team ready to put out fires for their customers.
The Challenge of Building a New Service Organization
It’s not easy to build a service organization from the ground up. There’s more involved than just hiring new people. Capital equipment manufacturers must fully invest in and manage an entire service force.
Here are just a few things they’ll have to consider as they build their service team:
Determining Skill Sets
Capital equipment manufacturers build complex machinery, which requires highly skilled technicians to service and maintain. A multitude of things could go wrong with just one product. For instance, an ATM might have a problem with its computer system, which would require technical skills. The problem could also require mechanical skills if a part breaks.
But no tech has to possess every skill, as long as the collective team has the skills required. The techs who can do everything are probably the same ones aging out of the workforce, and are expensive to hire.
They should know which skill sets will be required for each type of work, and understand the frequency of each job. When that’s determined, they’ll also need to hire, train, and dispatch appropriately. This way they can avoid sending out an experienced tech, whose time is expensive, to a basic fix that a less-experienced tech could have done.
Training New Hires
Once capital equipment manufacturers hire their team, they’ll have to train them. Even if the techs have the right skills, they’ll still need to be trained in things like processes, service level agreements (SLAs), and scripts for responding to customer questions and dissatisfaction. They’ll have to be familiarized with the product, as well as the business process. The training process will take time, and capital equipment manufacturers will need to leverage the experience of their current staff.
When the team is ready and trained for dispatch, capital equipment manufacturers will have to consider how to schedule techs in a way that maximizes their efficiency. For instance, they’d want to make sure there are technicians available with the skills required for the most common jobs. And they’d probably want to avoid under-scheduling during a high demand time.
But service is often unpredictable. Things break unexpectedly, and sometimes emergencies need to be put ahead of scheduled jobs. So how can they accurately forecast demand for service?
Sophisticated mobile workforce management solutions can help by analyzing past scheduling and demand data. With this information, these solutions help create smarter, predictive schedules, and a greater understanding of capacity requirements.
The capital equipment industry might be a unique case, but customers demand excellent service from all field service organizations. There’s a lot to figure out and little time to scale up a service team fast enough for customer expectations. It might be a tough journey ahead, but field service providers know better than most how to handle a little pressure.