Commit. Period.

  • Commit to your own success by being a person committed to serving others.
  • Commit to delivering the value you promise plus more.
  • Commit to your team.
  • Commit to your customers.
  • Most importantly, commit to being the person that others can and will rely on.

What do you need to commit to doing? And what do you need to commit to not doing anymore?

Repost from

Field Service : Contract Leakage

Contract Leakage: Top 5 Field Service Power Metrics

There’s no shortage of numbers field service leaders can track. But which metrics matter most? Our new series, “Top 5 Field Service Power Metrics,” describes the five most important metrics that service executives should track, what they mean, and how improving them can boost productivity and profitability. Next up is contract leakage. Pro tip: The lower it is, the more profitable your service organization is likely to be.

Technicians dread that awkward moment with the customer. You know, when the customer expects the cost of some item on the work order to be covered by their service contract, but the technician isn’t able to confirm either way.Are parts included? What about consumables? Does the customer qualify for discounts on the labor rate?

What is Service Contract Leakage?

Service contracts are designed to expand upon a manufacturer’s product warranty in a way that helps customers more effectively control their equipment maintenance costs. These agreements also create lucrative recurring revenue opportunities for service organizations.But if there is any confusion between the customer and the technician as to what’s included in a contract at the point-of-service, service contract leakage is likely to occur.“Leakage is the ‘free stuff.’ It’s the lost revenue that should be paid by the customer, but you’re giving it away without realizing it,” says Dave Hart, vice president of global customer transformation for ServiceMax.So, how do you track service contract leakage?

“Finding out the exact amount wasted can be difficult if you’re not keeping solid records,” Hart says. “It’s difficult to track leakage with pen and paper, and then educate service technicians. Service managers have to start automating the entitlement tracking process.”

What Causes Service Contract Leakage?

The root cause is lack of visibility into entitlement information, especially in the field. If your dispatchers and technicians don’t have immediate access to the latest coverage data, the odds are strong you’ll lose money on that call.

” … take the decision away from the technician with a system that determines automatically what is billable and non-billable for the customer.” — Dave Hart

“If the tech doesn’t know when the coverage period cuts off or what parts are covered in that contract at the time of service, guess what? It’s a free-of-charge service call, and you’re losing revenue,” Hart says. “Instead, take the decision away from the technician with a system that determines automatically what is billable and non-billable for the customer.”

What’s the Impact of Service Contract Leakage?

Service contract leakage can hurt your organization’s performance in these three areas:

  1. Loss of revenue and profit: A handful of instances won’t hurt too bad. But if you spread contract leakage across dozens or even hundreds of service calls, the mounting costs can be a major drag on both your top- and bottom-line performance.
  2. Poor customer satisfaction rate: Customers hate surprises. If they assume that a service is covered under contract only to find out later that they’re being billed, they likely won’t continue as customers.
  3. Lower employee morale: When customers are unhappy due to a misunderstanding with a contract, your technicians are the ones who take the brunt of their frustration. Over time, this can take a huge toll on your employees’ happiness — and productivity.

How Can You Eliminate Service Contract Leakage?

Start by equipping your technicians with mobile devices, which they can use in the field to quickly and easily access entitlement data.This way when there’s a service call for a piece of equipment, your dispatchers and service techs will know precisely what coverage, if any, is available. This ensures you won’t give away service for free and eliminates unpleasant surprises for customers.

“It’s very important to capture the entitlement information correctly and make it easily accessible to the appropriate people,” Hart says. “When the call comes in to dispatch, the rep can confirm the customer’s contract details upfront by saying something like, ‘Just to let you know, your contract entitles you to a service technician for the first hour, but after that, any parts and any additional time will be billable to you. Are you OK with that?’”

Setting the right expectations with the customer from the get-go helps ensure your organization gets paid, while allowing your technicians to avoid those awkward conversations.

The Bottom Line

According to Aberdeen research from 2014, among service organizations that earned a profit in the previous 12 months, top performers more than tripled the service margins of laggards (35 percent and 10 percent, respectively).A likely differentiator is that top organizations do a much better job of eliminating service contract leakage. With the right technology, you’ll gain the visibility you need to understand where the organization is leaking income — and how to effectively plug the leaks and boost profits.

Is Field Service Obsolete?

Field_Service_Engineer_1Let’s not explore this question from the technical perspective but rather from the interpersonal view. Let me list several of the more obvious functions performed by our technicians each and every day.

VOICE OF THE CUSTOMER. Who talks with our customers more than our field technicians? The answer is no one. More importantly, because generally they fulfill the role of trusted advisor, they gather information that would otherwise be inaccessible. As I have traveled with field technicians over the years, I have witnessed firsthand hundreds of times the value this relationship provides for our customers. I would offer the follow on question: Are we doing everything we should to capture this information from the technicians?

SOLUTIONS TO DIFFICULT PROBLEMS. One of the key roles a technician practices is being a detective. So often a difficult problem is layered within several problems. On the surface what seems to be a simple problem, when corrected, still exists. The “detective” now steps in and begins asking questions and genuinely listens and then comes back with follow-up questions. Many times the person on the customer side who has the needed information is not the person who calls the problem into our response centers. Again the “detective” will ask the questions to finally speak with the correct person.

TRUSTED ADVISOR. I have discussed this point in other papers I’ve written. My general belief is that a field technician certainly should recommend or suggest products when asked but should never be involved in a hard sell because that tactic could jeopardize their position of trusted advisor. When acting as a trusted advisor they will be viewed as part of the customer’s team which puts our company right where we would like to be when creating customer loyalty. Additionally, as a result of this trust, the entire repair process goes more smoothly and therefore takes less time to accomplish the solution.

ON SITE KNOWLEDGE AND EXPERTISE. When our companies are up against a serious problem it has been my experience that our engineering or quality groups require onsite eyes to respond to questions they need answered. Here again the technician will provide an intuitive, knowledgeable, thought provoking, solution driven person who has been involved in the problem from the beginning. My experience has also been that the technician is a greater asset to provide why a purposed solution will not work because of their site knowledge. This saves time and more quickly allows us to arrive at a solution which, of course, minimizes down time.

CALMS THE ROUGH WATERS. I have been at several customer sites where the discussion is fairly heated due to the customer’s anxiety over a line being down. (You should see a line down in a General Motor’s assembly plant or in a semiconductor fab) both of these examples equate to multi-thousands of dollars per minute. If this tech is a trusted advisor, the technician walks through the door and you can visibly experience smiles on customer’s faces and an overall calm. The customer is now convinced that the problem will be corrected soon.

TEAM BUILDER. Good things happen when field technicians build team relationships with a customer’s maintenance staff. Now, when a customer calls a problem in, the field tech can call the customer maintenance staff to ask a few questions and, many times, walk the customer through the fix/ solution; thus saving the need for an onsite visit. There is no greater relationship than between our technicians and a customer’s staff. Here the trusted advisor goes to an even higher level. Our techs can help make customer maintenance people look very professional in their company’s eyes by providing inside technical expertise. This becomes one of those beautiful win/win situations.

I have listed six common examples of the incredible advantage gained from our service professionals on site with our customers. There are dozens of great examples of the true value of these wonderful ambassadors for our company’s on site arm-in-arm with our customers. My dad told me “never say never” but I will go out on a limb here and say the day will NEVER come when we will not gain something from having these ambassadors nurturing our customers as part of every site visit.

Reporsted from: “Could Field Service Technicians Become Obsolete?”

Inspire Her Mind


A recent conversation over hamburgers and a Facebook post from LSL reminded me of this great video clip.  It reminds me of the tremendous influence we wield over our families, co-workers, and neighbors.  As a father, I remind myself that I have a great deal of influence on how our children perceive themselves.  This clip reminded me that I need to send those messages to my daughters each day.  One of the exchanges I have with my daughters is “Girls can’t do something like that” and their response is “Girls can do anything boys can do, and do it better.”  We each have tremendous impact on those around us–family, friends, and co-workers.  Aspire to be the person that others come to for support.  Inspire others to challenge themselves.










field-serviceThe “Servitization” of Manufacturing is taking the High-Tech Industry by storm!  By definition,Servitization is a transformation from selling products to delivering services.  It typically involves two components:

  1. The idea of a product-service system – an integrated product and service offering that delivers value in use.
  2. A “Servitized” organization which designs, builds and delivers an integrated product and service offering that delivers value in use

In more practical terms Servitization turns the product–service offering into a “utility” that the customer pays for on a subscription basis.   Under this model, the customer pays a monthly or annual fee equal to the amortized cost of the equipment plus the value of services provided for a specified period of time.

The concept of Servitization is nothing new. As early as the 1950’s, manufacturers provided their customers with the option to lease equipment with services attached to the lease agreement.  In the late 1990s and early 2000s, companies like ABB and GE begin to offer tperformance based service contracts to their customers.

Servitization is more than just a pricing strategy.  It is an overall business model that attempts to maximize and monetize value in use to the end-customer. This requires a manufacturer to proactively identify all the services that an end-customer may require over the lifecycle of equipment operation, understand the value that the customer assigns to these services, build this value into the subscription pricing model, and then deliver on that promise.

The trend toward Servitization has picked up steam in recent years for a number of reasons. First, market participants (i.e., OEMs and End-customers) have a greater appreciation of the strategic value of service to their overall business models.  Second, manufacturers recognize that service can generate more revenue over the lifecycle of the equipment than the actual purchase price of the equipment itself.  Third, the Great Recession forced many manufacturers to rethink the economics associated with how their customers justify the acquisition of new equipment.  Fourth, service tools and technology are now available that facilitates the design and operation of an integrated product-service system in a cost effective and real-time basis.

Ultimately, it’s the technology that is having the greatest impact on advancing Servitization business models.  There are some basic building blocks that any company will need to implement in order to deliver on the promise of Servitization. First, they’ll need a state-of-the-art service management system. It needs to perform the basic activities involved in managing a service organization (e.g., dispatch, scheduling, parts management, etc.). Second, they’ll need to have a way to connect with and monitor the condition of equipment within their serviceable installed base.  They will also need to integrate this information into to their back-end service management system. The third step is a mobility solution to communicate with people in the field. Finally, analytics are needed to evaluate what’s happening. Most companies will probably benefit by using a big data solution, as well, so they can look at unstructured data from their installed base and the customer’s environment at large, and start to analyze, predict and forecast.

In summary, Servitization is a transformational process that requires manufacturers to rethink all aspects of their business from marketing and sales, to pricing and financial management, to service delivery infrastructure.  The benefits of Servitization are great including the ability to build a multiyear annuity stream, gain account control, and create deeper and longer lasting relationships with customers.

I’d love to get your thoughts on Servitization.  Let me know if your company is pursuing Servitization.  What benefits do you expect to achieve? What obstacles remain in the way to realizing these benefits?   Last but not least, if feel free to schedule a strategy session with me if you want to discuss how Servitization could impact your business.

(reposted from


Read Receipts in Gmail — Sidekick by HubSpot

sidekick-email-logo "ron palinkas" sidekick gmail tool  Making the transition from Outlook to a Gmail based system was tough.  There are fundamental differences between how each handles e-mail and all the other tasks we on e-mail clients to perform.  Having made the transition I am still not sure that one is better than the other, but I have begun to appreciate the strengths and weaknesses of both. One feature that I had grown to appreciate in Outlook was read receipts.  A staple of inter-office e-mails, the read receipt functions internally to help the sender better understand the widespread receipt of his e-mails.  Of course, there were limitations to this system, especially outside of a domain, but I think we would all agree that using read receipt feature has come in handy more than once.

Read receipts are possible in Gmail using an extension from HubSpot called Sidekick (formally known as Signals.)  Download into Gmail/Chrome and you are off and running.  The monthly fee/premium account is a bit steep ($10/month)  but if you can encourage others to sign up via your account, HubSpot gives you a free month.  That is my pitch, because I am out of free monthly credits–check it out for a month free, and please do so through my account.  You will get the chance to try out a game-changing gmail app and I benefit from another free month.  Please use this link and I hope you enjoy using the app as much as I do.