Driving Service Value with Digital Transformation

During LiveWorx we asked a number of attendees about the value based service organizations are currently receiving or expecting to receive over the next 12 
to 24 months with their digital transformation projects. Listen to Chris Wolff and Anthony Moffa discuss this topic, specifically about how to drive service value and what our LiveWorx attendees answered.

Read Anthony's perspective on the The Value of Digital Transformation for Field Service: http://ptc.co/Vz8z50QjTGz

Transcript

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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. Chris Wolffe and Anthony Moffa Take Speaking of service on the road. Hear them discuss the importance of driving service value and running successful digital transformation projects. Some LiveWorx guests also share their opinions on digital transformation. This is a very special speaking of service. We had an opportunity, quite literally, to take our show on the road to the Boston Convention Center, where PTC was hosting LiveWorx for the first time since COVID. More than 5000 people attended at the packed Boston Convention Center in person, excuse me. And we had more than 3000 people attending online. One of the folks who was there is my colleague and good friend, Anthony Moffa. Welcome, Anthony. Thank you, Chris. It's good to be here again. Great to have you again. Just for folks who haven't met you yet, describe your interest professionally in the services world. Well, the services world kind of came to me through my job as an engineer, and I started to work with some of our service technicians in the field and realized there had to be a better way to do some of the service work that they were doing. And that really got me into connectivity and starting to monitor assets and then that burgeoned into a whole world of IoT. So it really came from my life as an R&D engineer, a support engineer. And since that time, it's just absolutely taken over everything I've done. It's been been very infectious. And I think of you as Mr. Smart and Connected Products and you've evangelized. Going from reactive to predictive and preventative in which order. What's the best way to think about that? Well, I mean, we're all reactive, right? And so the question becomes, how do I get to predictive as quickly as I can? And there's no magical answer to that. The more information that you have, the more data that you're able to accumulate, the more likely you can build those trends towards being predictive. But of course, you know, we want to go through we're going to go through that process. We're going to be reactive to preventative to predictive, and then eventually even get to prescriptive. Right. Predicting is when it's going to happen. Prescription is going to tell you if you do this, you can avoid a failure as opposed to I need to come out and fix it. So we had the opportunity to ask a question to every one of our guests, depending on the level of maturity. With your digital transformation in your services organization, what value are you currently receiving and what value are you expecting to receive over the next 12 to 24 months? Our first guest is Patrick Lethenet We met him at LiveWorx. He's with bioMérieux You. You may know them as producing world class in vitro monitoring solutions. At any given time, they have tens of thousands of these machines in service around the world. Let's hear Patrick talk about their services journey. Our main focus is bioMérieux is a medical device company specializing in vitro diagnostics and infectious disease. So we have a very tough 60 to 80000 systems worldwide in our customer facilities. And really our main focus today is how do you have remote offices, meaning that we are able to connect to our customers for serviceability, provide remote access software, our data, our systems, but also data connection to do preventive maintenance as well as enabling new use cases like monitoring, system conception, being able also to develop new business model like a paper test because we are doing, you know, diagnostic testing. So this is basically our focus is more on the IoT space at this stage. But to Timothy is going to combine your so with some of the Salesforce and ServiceMax capabilities that that's very interesting. Anthony I would imagine being in the medical device market, if you can prove that you're available and secure to that type of a market, you can operate in almost any market. Yeah, it's absolutely the most difficult market that we operate in because, for example, security applies to everybody, but HIPAA does not apply to everybody. EU MDR does not apply to everybody. So all the regulatory concerns about my information as a patient are really important. And of course we've seen hacks time and time again within our financial businesses. So they're very hesitant to get into this world of connectivity because in their mind it opens up another opportunity for somebody to come in and steal information. When you think about the miracle of being able to get connectivity to the health and wellness of a baby in vitro and all the benefits that that brings compared with the ongoing security concerns. Am I correct in thinking that the Europeans are really leading the way with regulatory and privacy legislation? They've absolutely been leading the way in terms of that legislation. And in fact, GDPR, you know, says very much so that you are in control of your destiny, not the people that you do business with. So I can ask you to forget everything you have about me right now, and you have to do that. We're not quite there in the United States right now because people in the US and other parts of the world, they can get your information when you sign up on a website and they sell it to everybody. And this is why you're getting all sorts of information, like emails from people you never signed up for. That's where this is coming from. So that definitely the EU is way ahead of us in that perspective. Well, I'd never want to forget everything I know about you at that kind of. I was also interested to hear about the new business model that Patrick mentioned, where they're getting paid per test as opposed to just making a device available, all you can eat. And that's shows a little bit of the maturity of their service business. Patrick and bioMérieux, you have been doing this for a while. They've been connecting assets since the early 2000 timeframe. So they're evolving from how can I change my service response time to can I get into preventative and predictive service models and even further, can I go beyond selling you equipment but sell you outcomes? Right. Which is a completely different way to look at the world. And again, it shows their maturity in this business. You don't typically see that with somebody coming in and just starting an IoT program today. How are organizations like this funding this kind of innovation? Is it a safe to invest model? Are they finding adjacencies or other ways to underwrite this experimentation? This is a chicken and egg problem because you typically say, I'm going to make a change to the organization that's going to save you X number of dollars. And if you are a service organization that is a cost center, it's very hard to get funding to do that. You're not saying, Hey, I'm taking my own funding to do this. I have to go to somebody else and say, I have a great idea on how to change service. If you are a profit and loss center, then then you are in that environment of I have control of my funding. So it depends on the organization that you're in. But yeah, I mean, you definitely at scale save a significant amount of money. So they will want to know how quickly can I get my return on investment? And now your availability, your ability to be proactive is directly tied to revenue as opposed to strictly to customer experience, which you're really starting to do is control the variability in your business. If things are unknown to me and I have to react to them, I am very underprepared to deliver that. So what I find in a service organization is spending a lot of overtime or having to over staff myself in order to react to those, you know, that variation in business. But the better you are at preventative and predictive maintenance, then now you're starting to reduce the variability. And if I can respond to you, say through a remote call or remote service event or even better, if I can teach you how to do customer self-service, I've gone that step of now even squashing that further. So that's really the goal here, is to reduce variability in the service calls that I get. Anthony Our second speaker is from Bell and Howell. I was just at Best Buy this weekend. We picked up a new TV. It was too large to fit in one of those lock box containers where you order ahead. But tell me a little bit about their business model. So in Bell and Howell’s case, they have a model and they started creating these robots, their basic they refer to mechatronics because it's a mechanical device, but it has electronics that control it. You may ask for a device or you go to pick up your component. If it's outside of the facility, you can present your sales receipt to them, a QR code effectively that they mailed you. And then that robot will go get the device that you've ordered, bring it down and put it into a box for you to bring it out. But you also have the lock boxes that you might find at Home Depot or Lowe's along those lines. So it all depends on that, the methodology. But that is their that is their tool that they're putting out there today and monitoring with IoT. And I'll just remind you, as listeners, we asked Haroon, depending on your level of maturity with your digital transformation and your services organization, what value are you currently receiving or expecting to receive over the next 12 to 24 months? Let's see what everyone had to say. Yeah, I mean, digital transformation is very important to us. It is strategically intentional for us being in the services company, free services company, we're going to move from manufacturing into services and digital transformation, especially in Internet of Things. Remote services gives us new revenue models, new business models to take our business forward and also improve the productivity of our service agents. So here again, we're hearing about new business models based on taking what was a small pilot idea, driving that to scale. Tell us about how you see customers going through that lifecycle of starting with a small project and bringing that all the way full circle to be a new business? Well, I think the interesting there are two interesting comments that he made in there that that are going to kind of leverage that they leverage for this. And one is he said it's strategically intentional, which is really important to the organization. Can't be looking at technology as a solution. It is a tool. And you have to be intentional about how you apply that tool. So that's very important to the process. That's a big one. The other one is that they need to walk the talk, which it's a you know, it's a great little catch phrase. But what he's saying is, I'm going to tell you what to do and I'm going to live that same that same lifestyle. I'm going to I'm going to follow that same rhetoric and the important part about that is when you have a strategy that everyone is aligned on, when you have a technology that you realize people process and policy will be leveraging that technology to move you forward and then you deploy it as such. That's where you become successful. That's where you can take something from an idea to a concept. What we typically see from a failure mode perspective is if you have an idea and you just assume it's a great idea and you hand it to somebody else to run with it, that kind of falls flat, right? If you go back to Patrick Lethenet from from bioMérieux, you. Patrick's been involved in that program since its inception. Right. So you have a passionate advocate in the organization who wants to see this be successful. And that's another piece of this equation. Like, I need people really invested in the concept of doing this, not just, well, my milestone is to get this done by this, this date and time. That's where success comes from this. And if you see that in organizations that have been successful today, it's all about the people because they're truly invested in making this work. Well, when it's all about the people, you know, it's going to be interesting. Many of us here at PTC are familiar with Harpak ULMA. If you come to our customer experience center, you'll see one of their shrink wrap thing packaging machines up in our customer experience center. You know, for something as kind of pedestrian as shrink wrapping, whether it's syringes and the pharma market or stakes in the food market. These guys have really invested heavily in technology and automating all kinds of cobots as well as robots and preventative maintenance. Talk to me a little bit about that client. That client is very interesting because they understand, even though they are a piece of the equation, they're there at the end of the line quite literally, and if they fail, the entire line comes down. So they understand the value that they bring to their customer right there. They're they're not just a piece of the equation. They are delivering a product to their end user. And that's literally why they've adopted technology. They're saying, I don't want to be the one that causes you to have downtime, right? It's like, you know, I don't want to be in the spotlight effectively. I want to just be part of the process. And that's really their focus here is just to stay out of the spotlight, keep it running and keep their customers happy. Well, let's hear from Harpak directly. We have their innovation manager, Alexander Ouellet , who spoke with us at LiveWorx. In terms of the value that we bring to our customers with our key solutions, kind of multifaceted. So there's a lot of low hanging fruit. So we are a large but in a manufacturer like medical food, consumer packaged goods. And for us, for example, if a machine is running at 91 versus 90% efficiency, it can be worth millions of dollars over the course of a year. And the equipment life is usually 10 to 15 years. So what we use IoT for is really to target opportunities for improvement. So for instance, if someone is loading film into the machine and it's supposed to take 5 minutes, but they're taking 20 using IoT, we can identify those issues, who is costing them and better trained and target them to realize that value. I love what Alexander has to say there. You know, think of that old Spinal Tap movie. This one goes to 11. They've gone from managing using IoT to make sure the availability of their machines was strong and they had no failures at the end of the line. But now he's talking about going from 90% throughput to greater than 90% throughput, opening up the incremental cash from stuck operations. We haven't heard much about that use of IoT here. Well, yeah, it's it goes back to Lord Kelvin. If you don't measure it, you can't improve it. Right. And that's really what they're doing now, is saying there's this awakening that happens when you connect assets. You connect them for a reason. And that might be to do service. And then your engineer starts to look at the data that's in there and you realize, hey, wait a minute, there's actually a little bit of information here that we've never looked at before. You know, it shows us how they are using this equipment. It shows us that we have downtime, that maybe we can improve upon. So now they're looking at that next level and are saying, great, we're going to get beyond downtime as it relates to us on a maintenance perspective. We're going to get to uptime as it relates to you on how where you interact with our equipment. Maybe our instructions are bad, right? Or maybe maybe your staff needs better training or training modules, but that's what it is. And that's kind of this process of it's the onion completely. You keep layering and layering and layering. You find newer things to do in service. So connecting is step one. Everything else is it's just a learning process. I had a great opportunity to hear from Harpak-ULMA directly about how a bot they use to go down and spotlight on a particular piece of goods to pick up and then drop into the shrink wrap or would get out of alignment about every 100 turns. And you can imagine this with your printer right at the printer cartridge gets out of alignment over a couple of spins. Being able to reduce that variability and reduce having to go out and realign that cartridge, they were able to enable tremendous throughput advantages that they would never have spotted had it not been for IoT. Harpak-ULMA spoke about being able to help their end customers improve actual throughput through the machines that her pack almost supplies them go from that 90% of efficiency and throughput to greater than 90%. I advise you to check out if you're interested in that topic of throughput. I had a conversation with folks from EY and Dell together with PTC. We've created a solution framework we call manufacturing throughput as a service or short form test. If you go to ptc.com/MTaaS you can listen to some of those conversations. In the meantime, let us know how you liked our conversations with clients. Speaking of service on the road. Send us a tweet or hashtag.#SpeakingofService, we'd love to get some feedback from you and we hope we can do this again soon. Anthony, thanks for being with me here today. Thank you very much, Chris. And for those of you who follow Chris, her girls who Code and Bumblebee. Great supporting organization to help women getting into what is still primarily a male dominated environment. So the inside secret here gang is I challenged Anthony if he could get the word bumblebee into our conversation, I would donate $10 to girls who code for every instance of that. So I invite you to tweet to me or send me a LinkedIn and use the word #Bumblebee. And I'll fund girls who code. I thought I set you up with that cross-pollination conversation, but we'll save that for another day. Gang, thanks for joining us. 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 speakingofservice@ptc.com or visit us at ptc.com/ speakingofservice.