In summary, a service product model minimizes the risk of unknowns by making the intangible tangible. It also provides a stronger engagement model between the customer and service provider while providing benefits to both parties.

Benefits to both parties

From the eyes of the customer

As customers stress the value of service they derive from a product rather than the product itself, a service product model enables this new focus and measurement. A service product allows a customer to concretely define the operational value of a product that belongs to the company. Having this capability is important for the customer to understand and measure the true cost-benefit of the product during its lifecycle and where it delivers value to a business.

From the eyes of the field service provider

There are three ways how a service provider can benefit from a service product model. First, by bundling the services and managing their interrelationship inside the service product as pointed out in the earlier section, the company can provide better services to the end user or customer. Second, with this model, the service provider can create multiple flavors or custom solutions of its base product thus creating profitable monetizing options that are more attractive to its customers. Finally, a service product model will allow the service provider to develop new sources of revenue by packaging and crystallizing services (e.g. after-market or after-sell services) that would have otherwise not been distinct enough to sell.

In summary, as field service equipment manufacturers and service providers strive for a higher level of service excellence, customer satisfaction, and even customer partnership, a service product model provides them with a great amount of flexibility and the ability to differentiate. Simultaneously the customer has a better understanding of the operational value of a service associated with a product and can effectively apply it to a field asset in the right context, thus benefiting from increased asset uptime and reduced cost of operations.

Enabling through digital technologies

To implement a service product model, use of the right digital technologies is key in the following ways:

• Companies are examining gig or piece-rate operating models to enable an agile workforce that can shrink and expand to meet market demand. These models bring a potential tradeoff in quality of work due to training or experience gaps. A whole new set of mobile and cloud capabilities, knowledge management, and a network of digitally enabled technicians connected to their ecosystem through IOT platforms help mitigate risks with forward-thinking operating models.

• Many companies change how they manage the equipment in the field. They monitor equipment condition, predict failures with sophisticated algorithms, and proactively service equipment before an issue occurs. This takes an orchestration of customer needs, field and back-office data, analytics, technicians, schedules, tools, and inventory. Without this holistic approach, small deficiencies turn into missed Service Level Agreement’s, unhappy customers, and increased service expense

• Software platforms are purpose-built to provide integrated field service management thus enabling the core concept of service product as outlined in this article. Many of these software platforms are available from market established companies today. There is a Gartner report available to qualify the vendor companies that are active in the field service management space.

So what does this mean to a savvy CIO? As field service management solution moves from traditional service offering portfolio to a service product model, the CIOs in the customer companies are recommended to understand the implication of this, both in terms of vendor software platforms and selective use of the right digital technologies. Moreover, a good field service management solution operates in an integrated fabric that contains supply chain, materials management, asset performance management, and enterprise asset management capabilities in the company. The CIO should consider where value is created in the larger space and the implications of it. Finally, field service product as the new avatar needs to align with the understanding, motivation, and performance of the workforce. The CIO can play a leading role in executing the transition.