Disappointing ROI on Your Field Service? Here’s Why.

“Digitalization,” “servitization,” “route optimization”: You’ve heard the list of “ations” that’ll future-proof your business. Add in some acronyms like “AI” or “ML,” and you’ll be good to go, right? If you invest in these trends, you’ll heighten your first-time fix rate, troubleshoot faster, and have smarter equipment. That’s what all the prediction blogs and surveys say! Well, according to Mike Ross, our Director of Product Strategy here at Baxter Planning, it depends. Buying into the buzzwords can give you some useful puzzle pieces, but the way you fit them together actually determines the ROI on your technology investments.

At the Copperberg US Field Service Summit, Mike drew upon his decades of experience to put the top Field Service trends into perspective. His presentation, Field Service Trends: Impacts on Parts Planning for Technician-Held Inventory, looks at the elements people tend to miss when they implement new Field Service tech. Specifically, he gets into the importance of your parts stocking and change management strategies.

We wanted to share some highlights from his presentation here in the blog, in case you missed the summit.

The Missing “P”

Let’s consider the three “Ps.” No, not a 3PL (third party logistics company). We’re talking about people, places, and parts. The biggest Field Service tech trends, and the challenges they target, intersect at these three Ps. But most of the tech tools out there only help put people in the right place, at the right time, with the right information—not with the right parts.

Take the Silver Tsunami. It refers to the exodus of experienced technicians as they near retirement age. For a few years now, service organizations have been bracing themselves to face a skills gap as their veterans retire. And many of the hottest solutions in the industry—artificial intelligence (AI), augmented reality (AR)—could address these challenges, essentially by heightening employee productivity. The goal is to get more output from a leaner workforce, as well as capture human intelligence before the highly experienced humans themselves leave. Route optimization tools help technicians spend less time driving. AR allows experienced employees to provide remote guidance as newer technicians work the field. AI tools let you harvest service call history to predict best intervention methods for future issues.

So where’s the “missing parts” part? Many new tools make it easier for onsite technicians to know which parts they need to quickly tackle the job. However, none of them ensure the technician, nearby warehouse, or third-party forward stocking location (FSL) will have the required parts in stock.

The Power of Persuasion & People

Another triple P. Sorry. This one refers to change management. As it turns out, the missing parts problem sheds light on challenges relating to the other two “Ps,” especially people.

In the “old school” Field Service Parts Planning model, technicians determined their own stock lists. They knew the products; they knew their customers. They used this knowledge to fill their vans (and sometimes their garages) with more than enough parts to meet customer demand. As long as first-time fix rates remained high, businesses stayed complacent about the excess inventory in technicians’ vans.

But eventually, many service organizations adopted a more efficient parts sourcing plan that pulled large, expensive equipment out of technicians’ vans and into shared inventory hubs. It’s a superior approach, as most of us acknowledge today; but at the time, some experienced technicians weren’t happy. They resisted this shift, as it disrupted their tried-and-true method of doing business. Listen to Mike’s presentation for some real-life examples of how this issue unfolded.

Resistance to change among seasoned employees hasn’t diminished. As technology advances, change management issues only get more nuanced, and we’re seeing them play out today. That’s why it’s essential to be transparent with technicians on the front end whenever you implement a new solution.

When your business strategies evolve:

1. Actively plan for the impact new technology will have on technicians and their stocking patterns. Let field workers know that their routes will likely change, as will their inventory mix.
2. Adjust key performance indicators (KPIs) to encourage behavior that benefits the entire organization, not just individuals. When technicians know they’re incentivized based on first-time fix rate alone, it can lead to parts-hoarding habits.
3. Use workforce turnover to your advantage. Newer employees are likely willing to embrace new tools.
4. Quickly identify issues and adjust if parts availability is causing you to fall short of your expected ROI.

In essence, you must consider the big picture when you adopt a new technology and take a proactive approach to your parts planning and change management strategies. Today’s business landscape is more dynamic and interconnected than ever before, so your planning process needs to elevate from the individual technician level to the team and territory level. Look at aggregate parts requirements and figure out how to best distribute them, while also incentivizing employees to operate as an agile team.

For a more in-depth take on this topic, listen to Mike’s full presentation here!

Lindsey Rose
Marketing Director

Lindsey is a relatively new addition to the Baxter Planning team, running the company’s marketing activities like webinars, email communication, and you guessed it – the Baxter Planning Blog.

With more than eight years in B2B Marketing, Lindsey enjoys finding unique ways for a company to not only stand out, but to bring true benefit a company’s customers and the industry as a whole. She finds the Baxter Planning team especially amazing to work with because of the deep passion and knowledge held by the subject matter experts and everyone at the company.

Lindsey stays plenty busy outside of work, spending time with her husband and their two toddlers. They spend lots of time at playgrounds and going for walks with their dog.