1. In 2020, 25% of asset-intensive companies will adopt IoT and “digital twins” to optimize their services.
The Internet of Things (IoT) and so-called “digital twins” are poised to have a major impact on the service sector, reducing costs, maximizing data analytics, and extending product lifecycles. Previously, when, for example, an elevator broke down, the customer had to reactively call a service technician. This approach is highly inefficient and can lead to a low first-visit repair rate and a disappointed customer.
With IoT sensors, the asset becomes “smart,” sending data to the diagnostic center to identify potential problems within a day, week, or month. Unsurprisingly, predictive maintenance is the biggest benefit for asset-intensive companies seeking to optimize their services. The Predictive Maintenance report forecasts a compound annual growth rate (CAGR) of 39% between 2016 and 2022, with annual spending on the technology reaching $10.96 billion in 2022.
Now let's consider the concept of digital twins, which represent physical objects in the digital world. Previously, a manufacturer's knowledge of a product ended once it left the factory. But now, through IoT, it's possible to learn from the usage, behavior, and performance of these products in the real world, and even take into account customer usage patterns and make engineering changes to improve these products in the future.
This is a significant shift that helps complete the feedback loop, leading to smarter design, more efficient service, and a better-performing product. This approach is already being applied in the automotive sector, for example, where connected cars themselves send large amounts of data to analyze and design better machines, as well as to alert when and where failures are most likely to occur.
2. AI-powered service will double in 2018.
AI-powered voice assistants represent a huge opportunity for service organizations in 2018. Many calls to a help desk are simple inquiries, such as setting opening hours or determining when a technician should arrive, meaning they are simple enough to be answered by a robot. This drives significant potential for businesses to connect AI-powered voice assistants with enterprise software that has capabilities such as self-service diagnostics or scheduling optimization engines. This can make businesses more effective and lighten the workload for the team.
One company targeting this market is Amazon, which recently launched “Alexa for Business,” a catalyst for deploying voice-activated service calls. Looking further ahead, Alexa will not only provide services to the end user but will also offer a voice-activated maintenance procedure, which is invaluable for a field service technician: “Alexa, what’s the next step after removing the engine assembly?”
This last point should not be underestimated. In IFS's recent Digital Transformation Survey, which surveyed 150 decision-makers in the services industry, "recruiting/training/retaining technicians" was rated as the biggest barrier to growing services revenue, with more than a quarter (28%) of organizations stating they feel ill-prepared or completely unprepared to address the professional talent shortage.
3. Self-service will grow by 50% by 2020.
We will also begin to see many more augmented reality (AR) experiences used to put customers in control of operating or maintaining their own products. Just think of a Nespresso machine or a Dyson vacuum cleaner. Both companies have invested significant sums of money to help consumers access visual instructions on usage and repair from their smartphones using a QR code. The same type of model could be applied to more complex systems within an industrial environment, including motors, boilers, or even an entire manufacturing line, providing detailed and highly customized plans for users to work with, without the superfluous information typically found in manuals. This brings us to another benefit, as AR experiences do not require language translation.
This vision of AR shares many of the same benefits as the IoT, digital twin, and AI approaches mentioned earlier. It will help maximize service technicians' time, but also create a better customer experience. Many consumers prefer to solve the problem themselves rather than take a day off work to wait for a technician, for example. We can't underestimate Apple's impact here: with AR integrated into iOS phones, it's only a matter of time before companies democratize and monetize these capabilities through an intuitive and easy-to-use platform.
It's important not to think of technology as an end in itself. First, it's advisable to create a value-added business plan to foster a fresh approach. This could mean increasing first-visit resolution rates, offering new types of results-based contracts, or simply reducing costs by ensuring technicians are only dispatched when absolutely necessary. Ultimately, people, processes, data, and systems need to be optimized to capitalize on these emerging objectives and reap all the potential benefits.
These three trends are intertwined. Contractors must work diligently to ensure they have the right skills while considering how to implement new business models for modular buildings and integrated construction. And all of this is happening in an industry that is becoming more global and offering new forms of partnership. Those players who strike the right balance between these trends will be the clear winners in 2018.
Author: Mark Brewer
Global Industry Director for Service Management at IFS
