Delivering field service is expensive for any organization. Gone are the days where every complaint can be answered in person. Why? A lack of qualified field service engineers to hire, the cost of those engineers, and the cost of travel. Inflationary pressures in the current climate are only making costs worse.
But the need for field service isn’t going to go away. Companies must learn how best to balance delivering in-person service and the cost of that service. Fortunately, the nascent Service Relationship Management (SRM) software market can help. SRM applies highly secure digital technologies in a way that empowers companies to optimize field service resources in many ways. SRM can:
- Alert service teams to problems, perhaps even before the customer is aware of them.
- Feed real-time data into predictive failure models.
- Enable most issues to be diagnosed before a field engineer goes on site.
- Enable some issues to be repaired with no site visit.
- Helps ensure the right parts meet the field engineer at the site.
Together, all these benefits mean:
- Shorter downtime for end-users.
- Greater customer satisfaction.
- A higher First Time Fix Rate (FTFR).
- Lower Mean Time to Repair (MTTR).
- Increased field engineer capacity (because the FTFR is higher).
- Lower service costs (less travel, fewer wrong parts shipped to sites)
Service Margin Increases: Consider a company that has 1,000 devices deployed in the field, with an average selling price (ASP) of about $250,000. Service contracts will generate about 12% per year, or $30,000. If we assume the margin of service is 66%, then the cost of delivering service is $10,000 per device. SRM has the potential to save as much as 50% of those costs, increasing service margins to 83%.
Return on Investment (ROI) is High: ROI is a function on many things. Continuing the prior example, assume that SRM software costs about $250 per device per year. For different value of service cost reduction, the ROI varies:
|
Service cost reduction |
Cost of service |
Service margin |
ROI |
|
10% |
$9,250 |
69% |
300% |
|
20% |
$8,250 |
73% |
700% |
|
30% |
$7,250 |
76% |
1100% |
|
40% |
$6,250 |
79% |
1500% |
|
50% |
$5,250 |
83% |
1900% |
Using SRM is financially beneficial even with a minimal 10% reduction in service costs.
maiLink SRM software is a service relationship management platform that helps you build a rich database about your installed devices. It also seamlessly integrates telemetry from your products and has no per-user fee (so any employee you authorize can have access to the data). To learn more about maiLink SRM, visit www.maiData.io and sign up for a free trial.