Last month, I attended PTC’s LiveWorx event in Boston, MA. Once again, this event brought together technology vendors, systems integrators, manufacturers, service organizations, the analyst community, and academia, to explore the possible as it pertains to the Internet of Things and other innovative technologies. This year was headlined by a few announcements which will be detailed by my colleague Sumair Dutta (check back for his thoughts on the event). But, I wanted to focus on the Service impact and takeaways I found from the conference pertaining to service parts management, field service, and the customer experience. Below are my three main takeaways:
Service Parts Management captured the lion share of time regarding service transformation.
This should come as little shock as over the years PTC has acquired several organizations with strong offerings in this service parts space including Servigistics, MCA Solutions, and Xelus. Though those acquisitions go back a few years, PTC is still determined to lay out the strength of their industry-specific capabilities:
o Simulation – This year’s event highlighted an increased spotlight regarding service parts simulation. During this session, an executive from Philips Healthcare which uses a PTC partner supported solution for simulation discussed not only the solution which enabled some interesting analysis techniques and modeling (i.e., Monte Carlo Simulation, network assessments) but more importantly for me was the customer talked about the team behind the data analysis. We continue to see investments being made not only in technology to support better analysis, but service-specific teams to make this data actionable for service. Recent TSC research showed that in order to improve parts focused metrics like fill rate or inventory turns, organizations needed to focus on better planning. The need to improve planning for service across a more complex service supply chain is one of the reasons that there is a great deal of interest in simulation for parts management. The emergence of analytics for service parts is a brave new world which I am interested to see evolve as machines get smarter, customers demand more flexibility in service interactions, and customer feedback comes from a higher variety of channels. With investments in teams and technology for service parts analytics, I expect to continue to see more advanced modeling and analysis come to service in future events and discussions.
o Pricing – At this year’s LiveWorx, parts pricing was centered around the connected asset with a discussion regarding supplier management and the link with pricing. A link was made between the data from parts failure gleaned from the IoT and how that could be used to not only adjust prices based on the scarcity of available replacements but also allowed service organizations to go back to suppliers to have a data-driven discussion around quality. These discussion points went well beyond the argument of moving past a cost-plus pricing model, which I believe has been settled, to explore the impact that pricing has on profitability, supplier relationships, the customer, and the field’s ability to deliver resolution.
A New Service Focus on the Manufacturing Floor Enters the Spotlight.
At past LiveWorx events, service often focused around solving an equipment failure (or predicting one) in the field. Key industries this approach focused around where heavy equipment manufacturers, medical device manufacturers, and aerospace and defense. But announced this year, PTC is looking to provide tools to support both service in the field and also move to a focus on the manufacturing floor. The PTC team feels its history in PLM, CAD, and Product Innovation will provide an integrated approach as to service needs delivered inside a manufacturing facility. There are specific requirements a facilities manager must abide by regarding servicing assets which make this focus an opportunity for PTC (i.e., quickly notifying design of failure modes). It seems like this is a natural progression to expand offerings to an install base which has unmet needs. However, I do think in this environment which is often already rich with ERP players, will demand PTC be cognizant of supplanting solutions already in place which is an area they haven’t wanted to play in. Also, a focus on the manufacturing shouldn’t mean PTC turns away from a field service market which continues to search for solutions that enable technicians and support teams to better service customers efficiently while driving the customer experience and revenues.
The Field Needs a More Prominent Role in the AR/VR Discussion.
In year’s past, field service as it relates to technicians fixing things in the field was more substantially featured. This prominence could be perceived a result of many of the customers of PTC coming from heavy equipment and manufacturing industries where equipment was out in field locations. But at this year’s event, as noted above, the focus has come inside the walls of the manufacturing facility. I see a lot of promise and activity in field service across OEMs and service organizations. In recent research tied to Augmented Reality, nearly two-thirds of organizations are evaluating AR for their service teams. These organizations are looking to improve field service performance support, diagnosis of failures, and remote support. The focus on the manufacturing floor is important, but I think the field is still a fertile ground for innovation broadly speaking but also when we specifically think about the future of AR and VR. At last year’s event, the killer app for AR was Service and PTC has the opportunity to show more use cases of service organizations using AR to promote field outcomes and value being delivered to the front line.
This year’s LiveWorx was once again a fun exploration of the future of technology for service organizations and manufacturers. I do think there is an opportunity for PTC to tie technology innovation closer to the service leader’s roadmap when thinking about getting the right information to the field team to solve more complex problems. The service story took on a lesser role at this year’s event compared to the Manufacturing use case. I would like to see more examples of how PTC service customers are leveraging the solution to deliver resolution and service outcomes. AR and VR show promise, but still being early days with this technology we need to ensure the service story connects the dots both on the manufacturing floor as well as out in the field for service.