We just published our 2018 Service Leader’s Agenda Report (Get it here). One of the key takeaways from this report was the refocus on Service Revenue as a metric of success in 2018 and our conclusion is that service leaders are finally putting the infrastructure in place to achieve revenue growth.
Earlier this week I had the opportunity to chat with several service leaders on the topic of revenue growth. These leaders reflected a range of industries from medical devices to facilities management and financial services. The key takeaways and actions being prioritized are:
Know Your Installed Base
In this date and time when every single movement and action can be tracked, one would assume that companies have a good handle on their installed base and the associated contract coverage. Getting insight into installed base status and coverage is a great way to identify near-term revenue opportunities.
Talk to Your Customers
What your customers will want 3-5 years from now is very different from what they expect and want today. That said, they are already envisioning what service should look like and what they will be willing to pay for. While we talk about the role of consumerized experiences in the enterprise world, the impact of true consumerization will be felt in a much more critical way in the coming years. Customers might be willing to accept that the equipment they hold today is outdated but will wonder why the next generation of available equipment is already outdated if it doesn’t come with connectivity and desired service and support resources. As one service leader put it, “Customers don’t want to have to tell us what’s wrong, they want us to tell them.” The equipment of tomorrow better be ready to enable and support changing service needs.
“Customers don’t want to have to tell us what’s wrong, they want us to tell them.”
Expand You Service Product Portfolio
While service contracts, time and material work, and service part sales, continue to be the revenue stalwarts for service organizations, there is an opportunity for the provision of new services. In instances where customers are beginning to self-maintain, there might be appetite for training, knowledge, and other information-based resources. In other industries, new service contract or agreement terms and types might address the needs of customers who interact with or use equipment in different ways.
Get Sales on Board
All the steps above can lay a strong foundation for service growth, but eventually someone needs to approach and talk to the customer. This is where the sales team’s comfort with and desire to sell service offerings becomes increasingly important. At a recent meeting with a large service company in the facilities management space, I was happy to note that the organization had finally tweaked its sales compensation models to align incentives with desired action around service products. In this, the company had put incentives in place for standard service products and services but had also put in incentives for getting customers connected. Incentives for service sales need to be paired with improved training, better service offering collateral, and dedicated resources to aid sales agents’ in their interactions with customers.
These are just a couple of the ideas discussed on the recent IdeaShare (see future events) around revenue growth. They also happened to be most foundational. Technician lead programs, self-service portals with ecommerce functionality, and multi-vendor services, were also discussed as arenas for untapped revenue.
We’re currently looking into the world of new services via a research survey (Link). The survey looks into the types of services that are being evaluated in support of service revenue growth. If interested, please do participate. We expect to share the results in the coming weeks. You can also access a copy of our Service Leader’s Trends report to learn about some of the key initiatives and focus areas for the coming 12 months.