Gary Jones from Service Geeni explains how cloud technology can help the plumbing and heating industry embrace the servitisation model and provide added value to customers.
Organisations around the world are adopting the servitisation business model in a bid to attract and retain customers. But what exactly is servitisation, and how can it help the plumbing and heating industry to succeed?
Put simplym servitisation is the process of providing a service offering to key product lines and one-off jobs. From regular planned maintenance contracts, to upgrades, and end of life disposal. Things like central heating and boiler servicing, gas checks, routine cleaning/repairs, and more.
By creating lasting value for the customer through the provision of ongoing support, servitisation is driving companies to compete through more than price point alone. Instead, savvy plumbing and heating companies are thinking beyond the initial sale, offering their customers longer-term benefits that forge more profound and more lasting relationships, which provide a more steady income stream.
The strategic rationale for embracing servitisation is clear, it provides a way to develop long-term relationships with customers, while helping businesses to stand apart from their competitors.
Of course, the idea is not a new one. The razor is through to be one of the earliest examples of the servitisation model where the majority of Gillette’s profits were made on replaceable blades, not the razor. And, in 1962, Rolls-Royce launched ‘Power-by-the-Hour', selling an hours-based service contract on its Viper engines.
Today, while the concept of servitisation remains the same, new and emerging technologies and evolving customer expectations are taking this approach to a whole new level.
Technologies such as automation, the cloud, and artificial intelligence (AI) are forcing organisations to redefine the way they do business to meet increased customer demands for 24/7 service excellence. For plumbing and heating businesses, this opens up real opportunities to thrive, as long as they have the tools necessary to keep up.
Let’s face it, heating and plumbing are essential to both commercial and residential customers. And today, a reactive, break-fix service model is not good enough. Instead, there is a growing demand for better quality service and less equipment downtime. And, the servitisation model is all about maximising product uptime. With cloud-based tech such as sensors, planned maintenance software and machine learning being used to enable the pre-emptive repair of equipment and parts before a break.
So, even heating and plumbing companies that already provide a service based maintenance model can do it smarter with the cloud.
But it’s not just about maintenance and repairs. When it comes to after-sales service, businesses must be able to meet customer expectations. As such, the latest developments in automation are also being used to support servitisation. For example, software can perform repetitive tasks, ensuring that processes are simplified, standardised, and streamlined. So your customer service teams spend less time on mundane tasks, and more time responding to more complex enquires.
Extracting value from data
Today’s world is digital and interconnected. There is more data available than ever before, and that is only going to increase. But this data is of little use to heating and plumbing companies if they don’t know what to do with it.
Cloud-based software exists that extracts value from big data, and this allows businesses to make informed decisions about future planning, resources, customer needs, and more. Armed with this information, such insights can help plumbing and heating companies to see where opportunities to meet current and future service requirements exist. So the cloud is a real enabler of servitisation.
As technology continues to advance we are set to see continued growth in the identification and development of service opportunities. As such, to keep up in an increasingly servitisation-focused world, businesses must do more to meet evolving customer expectations. But it’s not about products vs services. Instead, you need to find the right mix to optimise your business.
This means investing in intelligent solutions and looking at where they can add value and maximise uptime. Ultimately, such changes won’t just enhance the overall customer experience, they can also differentiate your company and lead to improvements in revenue and operational efficiency.