Seven Keys to Improve Service with the IoT

Are These Seven Tips to Improve Service with the IoT Enough? What’s Missing?

The time for field service transformation is now. Current economic conditions make service profitability and asset longevity more important than ever. Leaders can expand on early efforts, apply lessons learned from initial projects, and drive repeatable value that they can grow over time. Those that have not started, on the other hand, likely face competitive threats from more mature organizations. We speak with Jim Brown President of Tech-Clarity who has researched the service market to hear his perspectives on field service transformation and current developments.

Improve effectiveness of the field service organization as well as improving field service profitability with digital transformation and IoT for field service.

Transcript

0:00

Welcome to Speaking of Service, the podcast that uncovers practical ways to grow service revenue, control costs, and improve customer satisfaction. If you're looking to innovate, gain a competitive edge, or just learn about the latest service trends, you've come to the right place Today, Chris Wolf, VP of Strategy partnerships, welcomes to speaking of service, Jim Brown. President of Tech Clarity to discuss the seven keys his research has identified to improve service with the Internet of

Chris Wolff: 0:27

things. Welcome listeners to speaking of service. If you're new to our podcast, we welcome you. We're here to talk about helping services professionals. Get faster time to value and the services they deliver. If you've been with us a while, then you know intrinsically that service profitability and performance is top of mind for just about every maker of complex equipment. And the technologies available to you today for condition-based monitoring and maintenance have improved leaps and bounds. But you've asked us to look into the question of how do I get to value faster and what are the guiding principles I should use? That other practitioners are using and give me some primary research that can help me shape my strategy and timeline. So with that, I'm delighted to have an expert in that research field. Join me, Jim Brown. Wonderful to have you with us. Just introduce yourself, if you would, and tell us about your firm and the research you're doing.

Jim Brown: 1:25

Yeah, thank you Wolf. I'm excited to be here. And tech clarity we focus on making the business value of technology clear. So there's lots of. Great things happening in technology. But where we really try and where we really try and focus is how does that move the needle on profitability? How does it move the needle on customer satisfaction? Sort of the business metrics. And I cover our product innovation and digital transformation practices. I'm also the founder of Tech Clarity and we're just just over two years old now

Chris Wolff: 1:54

and I have to, thank you for using my nickname. I assume with a name like James Brown, you have had a lot of fun stories and uses of your name.

Jim Brown: 2:02

I was told James the hardest working man in the software industry. Jim Brown James Brown. I get not as much anymore now that Jim Carey has his big long beard, but I used to get people used to say, I look like Jim Carey. So it was I, there's never any lack of things to to, to poke me in the ribs about, which is fun.

Chris Wolff: 2:19

We'd spoke earlier, and I know that you've been in this industry since the days where M two M. Was a big topic of consideration and kind of failure to launch there back in the early James Brown days. Where is the market today? What are, what's the adoption look like?

Jim Brown: 2:34

Yeah, no hope. I appreciate the the reference back. It I do remember exactly where I was sitting when I was talking to somebody sitting at a conference and it wasn't on the screen, it was actually the person sitting next to me that was super interesting. As conferences often are, right? It's about the people. And he was talking to me about M two M and machine to machine, and, way before now when it's become so much more practical, right? Right now having sensors the cost is dropped, the technology is so much easier. But just the ability to actually connect across networks then and get machines to talk. It was hard enough for us to get computers to talk to each other back then let alone to get machines to talk to each other and. Since then we've learned so much as an industry we can get equipment up and online and talking to each other relatively. We can tie it in enterprise systems. And so I, I think we've reached this point where the barriers have dropped. So that, that view and that visibility and the excitement about what could happen to the business. Was valid, but just not really approachable yet. Maybe that's why the failure was failure to launch happen and now we're there. And what better time? Because if you look at the economy right now people need to reduce costs. They need to get more out of the assets and maybe actually keep assets running a little bit longer than they had planned. So what better time to to come to this great point where things are really

Chris Wolff: 3:57

achievable? Jim, we've been talking a lot about condition-based monitoring and maintenance, and you've told me at Liveworks that just connecting machines doesn't do anything for the business. It's a nice destination to land there, but you really need to incorporate an ecosystem of stakeholders who can monetize that investment. Tell me a little bit more about what your research is

Jim Brown: 4:17

showing. Yeah, and actually we covered a lot of this in the buyer's guide. What we start with there is to, start with a strategy. Don't start with connectivity. Yes. We have a series of seven things you need to be able to do. And one of them is connect equipment and it's important and technology plays a great role there. But the first thing is to start with the business strategy in mind. What's gonna matter to the business? We see so many, people that had an iot, OT initiative don't have an IOTT initiative, have a quality improvement initiative, have a, an uptime initiative and iot, ot, and analytics and all of the great technologies should be a part of that. But start with the business in mind. And we actually heard that pretty clearly from the people that we talked to in the research. Solve it, solve a real problem, solve something tangible, and then, Learn how to do that in, in, in a repetitive way, or expand it. Expand it to a new plant, expand it to a new product, expand it to maybe measuring some things you weren't measuring before and solving a new problem. But just, don't go blind into it. With it. Just saying, okay, we need to do this. Get operators involved, get people in there that really know. Where, hey, if you could tell us, if you could tell us in advance that this is happening, we could we could prevent a shutdown that means a whole lot more to anybody than connecting your equipment. Right.

Chris Wolff: 5:40

Which which titles of executives and owners of programs are you seeing typically spearheading these kinds of initiatives where you do have to talk with a really broad array of stakeholders?

Jim Brown: 5:52

Everyone. It is all over the map. I don't know if you've seen something different, but we definitely see everything from chief technology officers, chief innovation officers getting involved in saying, Hey, we're gonna fundamentally change our business around this. But also VPs of service people that are in any sort of an operations role. It's always interesting to talk to somebody that, whether they're on the service side or whether they're on the manufacturing side, whether it's their equipment that they're that they're, maintaining or if it's somebody else's equipment and maybe they're a third party service provider or another manufacturer everybody's got a little bit different take in terms of what the role is. It has moved up to the point where it has a lot of visibility. Hopefully not moved up to the point where it's just, somebody read something in a trade journal or somewhere in their newsfeed and they're like, oh, we have to have IOT stuff, hopefully it's and the thing that I love right now about where we are world is that it's not just, somebody read, I should do i o t. It's somebody talking to somebody at a conference and saying, Hey, you know what? We were really able to make a difference in our, In our response to in our response to service calls or our uptime or our o e or whatever it was, in good

Chris Wolff: 6:59

times, I think the conversation was all about improving customer experience and workforce experience in lean times. Everybody's talking to us today about how to save money and how to deliver service more profitably, more cost effectively. Where are you seeing that balance right now? Is one leading more than the other?

Jim Brown: 7:20

Every, everybody, cost is perennial, right? We've never, we're never every, very few times where people aren't trying to manage cost. But it gets so much more important right now when things are a little bit tighter. And, coming into this year people may have been thinking, Hey, maybe this isn't the year for that new piece of capital equipment. Maybe this is the year that we're gonna hold off and get the most out of the equipment that we have. And, in those cases, maybe there's a, maybe there's a maybe there's a way to get more out of that piece of equipment by maintaining it better again, more, or maybe even just tweaking it to get better performance out of it. On the other hand, if you're the manufacturer and you want to sell that piece of equipment, maybe it's time to start thinking about, Hey, people can't, people can't reach that capital outlay. Maybe it's time to start, giving them a product as a service and give them that package that says, we're gonna give you, whatever stamp, stampings or whatever, whatever the equipment does. We're gonna give you thousands of those per month guaranteed at this price. And you don't have to buy the capital equipment at all. And by the way, we'll maintain it when it's supposed to be maintained. And by the way, when it gets old, You know what, we'll be the ones to come in and replace it. Cuz it'll be important to us as the equipment manufacturer, cuz we're selling you throughput instead of selling you equipment. Maybe it's time to make that transition as well. That's a crafty play that gets people through a tough economic time. You

Chris Wolff: 8:44

know, I grew up in the IT industry working for a service provider and the notion of delivering capabilities as a service really required us rethinking. How we worked as a business and a lot of cultural change in addition to the front office and back office change. How are you seeing early adopters try and pursue that kind of consumption, economics and offer creation when they are standing on the shoulders of very long standing businesses?

Jim Brown: 9:12

Yeah, long-standing businesses and financial systems that weren't made to. To accommodate that, right? In the IT industry, moving over to SaaS and cloud I was on some of our very early conversations before cloud. And this is 20 plus years ago, we were trying to move to a subscription model, at the time. And we looked at it and our CFO just said, no. He said it'll tank the financials because we have we have sales revenue coming in from the, the big sale. Whether it's software, whether that's a piece of capital, equipment, everything was tied to that. How we did in a quarter was tied to that. And then all of a sudden you say you're gonna take out those big, yes, you're taking out the swings, but you're taking out those big chunks of revenue and you're, and I think now we're starting to see the financial markets, CFOs. Investors be a little bit more savvy and say, okay, we now understand what that transition looks like. But maybe a little less so in the in the heavy equipment industry, for example. It's just not as common to see financials take those kind of changes. And it changes your, how do you compensate your salespeople, right? H changes, like you said it just ripples through the entire business. When you look at those kind of things but it makes service that much more important, right? Because service is definitely not an afterthought at that point because it's your own money you're spending.

Chris Wolff: 10:30

Now, trend-wise are you seeing that users of heterogeneous heavy equipment are creating their own systems of systems to try and manage that estate? And are they looking for plug and play connectivity from their providers or do you still see that the OEMs are pre predominantly delivering? The data and analytics and some sort of a services offering platform to their end customers.

Jim Brown: 10:56

Yeah I wish I could say we're seeing one trend or the other. There's still so many people trying different things and I, I just don't think we've settled yet on what's gonna make sense and what makes sense for a larger business is probably not gonna make sense for a smaller business. But, heterogeneity is real. Nobody's gonna go out and say, oh I want to improve my service strategy, so I'm going to only have machines from this one equipment builder, right? It's, the machines are in there to do what the machine's job is and services to keep it doing its job. You're not gonna go and just rip and replace a whole bunch of capital equipment because it operates on a different network, right? It's just, it's not gonna happen. And so there's always gonna be that heterogeneity and I think. I think we're starting to see fewer people try and roll their own, build build their own solution. I think people are really starting to understand the value of a platform, the value of something that maybe doesn't come directly from the oem maybe doesn't come from, associated with any one particular piece of equipment. But it extends across those things and has connectivity and, to me, M the more we can get towards plug and play, but the more you can get towards something that allows you to have one lens and one view on that sort of wild west, hetero, heterogeneous world I think is great. And I think we're definitely heading more in that direction. Is everybody there? No. Is everybody agreed that's where they should be? No. Do I think that's where we're gonna end up? I do. I, if I was an OEM I would definitely want people on my system, but I would also, definitely understand that they're gonna be wanting to manage their own equipment as well, and maybe they'll have a third party service provider. So unless I'm, one size just never fits all right.

Chris Wolff: 12:43

I spend a lot of time with our clients and I'm seeing some of our OEM clients. Managing not just their own devices that they've manufactured, but looking to manage those neighboring devices in the same field, as to be a more captive audience of customers and for takeover purposes.

Jim Brown: 13:00

Yeah, that was one of the first one of the first interviews that I, I did early in as we started covering at Tech Clarity, started covering service and iot. It was an Irish company and equipment manufacturer, and they basically just said, We are starting to see our competitors saying, don't worry. We can monitor their equipment for you. And that scared them. They're like, wait a minute. We don't know what's going on with our equipment in our customers. And it's I wrote a blog post a long time ago about saying goodbye to your equipment. Once it's just like, all right, bye-bye. Have a nice life. And instead, now we're staying involved in it. But they were okay with that. Okay. Bye-bye. And let us know when you need a new one until they're like, oh, wait a minute. Now our competitor is watching how they're using our equipment. They know when our equipment is down and when that equipment's ready to be replaced, who are they gonna call? Are they're gonna call us? No, they would probably already have gotten an in inbound conversation from their competitors saying, Hey, you know what? We know you're not getting really out of that piece of equipment what you want, but this other piece over here and this other plant that we sold you seems to be working really well, right? They that scared them. And rightfully cuz you don't. You don't necessarily want I, I don't need to tell you wolfie, you know how strategic services become so

Chris Wolff: 14:17

If I harken back to your namesake, the football player, Jim Brown, I mean he understood. You have to play offense and you have to play defense. You need to go out and capture new business and defend your flank. But you also have to be very pragmatic. I know in your seven things, Write up. You interviewed a lot of primary stakeholders and you have some very pragmatic recommendations for our listeners on how to get started. Take me through maybe number one and two.

Jim Brown: 14:43

Yeah, absolutely. I think the first one we talked about a little bit already, which is start with the business in mind. Do something that's important that if you're successful at your if you're successful, that you're actually gonna move the needle on the business. You're gonna, not only say, wow, we had a successful project. People are gonna be going, I. Wow, we've got better uptime, right? Or, wow, remember that acqui, that piece of machinery that used to always go down. It's not going down anymore. Or, hey, our service revenue is up this quarter. How about we give how about we give everybody bonuses? That's what you want. The thing that I think is important and we talk about this in the e-book in terms of being pragmatic, is it's not just about the software. It's a buyer guide. And we definitely talk about. Things to look for. It's not an exhaustive, r f p list of make sure that the unit of measures can cover all of your unit. It's not that. It's about the important things that make a difference between success and failure. And we have those that are software oriented. But the other thing is it's important to really make sure that you can implement. And adopt and support it over the long haul. And so there's a lot of things that go into that are not just related to the software. It's about, for example your the partner that you choose to work with, the software vendor. It's about their ecosystem. Are you going to be able to get the training that you need? Are you gonna be able to get the support that you need? Is it gonna be in all the global locations that you needed, in the languages that you needed it? And I think those things, a lot of times people get enamored by a really cool technology and they forget about the fact that they have to implement, adopt, and support it over the long haul. And that partner that you have is incredibly important and that partner should be more than just a technology provider. They need to understand your business. And they need to, they should understand your industry as well. So you know, when you find somebody and they say we've done this, for a hundred banks, that's great, but if you're not a bank, you're not that interested in it. If they've done it for, point of sales machines. Okay, they've probably learned some things about it, but I have printing presses, right? I have CNC machines, I've got Lays. Like I don't want somebody that knows how to support. A point of sales machine, I want somebody that has done what I need to do in an environment that, is not necessarily as friendly as a retail storefront. And so to me it's about getting that right partner, that they have the right ecosystem, and and all of our buyers guides focus on that. I think that's just such an important thing not to get enamored with the technology.

Chris Wolff: 17:12

You've been reading my diary. Our team has been investing in trying to build solutions that are inclusive of the edge infrastructure. With pre-validated designs for Thingworks and some of our solutions incorporating professional and ongoing support services into a bundle, ideally wrapped in a commercial wrapper that will give predictability of cost and allow our factories to procure this on an opex basis. These are early days for us, but I think we are seeing that trend of interest from our customers and building blocks that can reduce risks, speed, time to value. And it sounds like your research has shown the same thing.

Jim Brown: 17:50

Yeah, I definitely in concurrence, I think a lot of what you're, a lot of what you're doing right now is based on reacting to the market, reacting to your customers that are asking for the same things that we're seeing and and I think it shows. And yeah, I think we're very well aligned and continue we'll continue to watch what you guys are doing and excited

Chris Wolff: 18:08

about it. So Jim, thank you for being with us. Tech Clarity has been an important influencer on the PTC strategy, and I personally have appreciated your references to ecosystems. That's the we're embracing as a partnership model at PTC, is understanding our customers ecosystems and how we can play con and contribute positively to those. For our listeners, I invite you to come learn more about speaking of service and tech clarity research. If you go to ptc.com/. Speaking of service, you'll see the whole litany of these podcasts and specifically ways you can link with Jim and get more information about the tips he's given. Jim, thank you so much for being our guest.

Jim Brown: 18:49

Thank you for including me. I really enjoyed it. Wolfie. Thanks for listening to the Speaking of Service podcast brought to you by ptc. If you enjoyed this episode, please subscribe wherever you get your podcasts and leave a rating or review. And be sure to check out other episodes to hear new perspectives on improving life for aftermarket professionals, service teams, and the customers they support. If you have a topic of interest or want to provide feedback, email us at speaking of service ptc.com or visit us at ptc.com/speaking of service.