Taking care of customers post-sale is a big business — the global field service market is estimated to be valued at $15 billion, and a recent survey of field service executives by Worldwide Business Research (WBR) finds that 70% report that profit margins for service equal or exceed those for product sales. It’s no surprise that companies delivering on-site support to customers are looking for ways to protect and grow that revenue stream while optimizing their field service operations.
One technique that shows significant promise for field service is 3-D printing, which can revolutionize field service on its own — and when used in conjunction with the machine-to-machine (M2M) sensors that are creating the Internet of Things (IoT), field service is about to change dramatically.
Manufacturing has long used 3-D printing to create prototypes using plastic ink. Also called additive manufacturing, objects are made by adding layers together. Recent breakthroughs in additive manufacturing mean that manufacturers now can print parts using more sophisticated materials including metal — which means that 3-D printing can be used to create actual metal parts, opening up tremendous opportunities for manufacturers and suppliers.
Just think of the headaches that field service will be able to eliminate by 3-D printing. Today, companies must manufacture parts, store them, inventory them, and transport them to the appropriate location in the field at the right time. Spare parts management eats up a lot of resources in field service, and 3-D printing can make a lot of problems go away. At first, these parts will most likely be controlled by the manufacturer to ensure “certified” part replacement. However, in some cases a spare part might be more beneficial for all if it’s printed by a local supplier. This paves the way for new vendor/supplier contracts and more extensive and opportune warranties for the end client. The result? An enhanced customer experience by procuring the right part at the right time—increasing customer loyalty.
Rick Smith, President of The Additive Manufacturing Council, suggests that the future is twofold:
- 3-D printing will compress the supply chain, enabling 3-D-printed parts anywhere, any time and at any quantity.
- It will force a shift in product innovation from physical manufacturing to demand manufacturing with new objects and new materials.
On-Demand Saves Money
Some parts are so intricate that they will continue to be made using sophisticated manufacturing processes currently in place. However, 3-D printing spare parts on demand eliminates the need to forecast the volume of certain parts required, to make them, and store them. In the future, this should reduce and condense inventory management, positively impacting the particularly pervasive problem of “parts hoarding” — check a field service tech’s van, calculate the cost of parts onboard “just in case” and multiply it by the fleet to get an idea of the capital tied up in spare parts.
Just as Amazon changed our view of obtaining out-of-print books by figuring out how to cost-effectively produce them on demand, 3-D printing will change our view of spare parts management. It will alter and compress the supply chain, and that’s a good thing. But the added twist is that 3-D printing is colliding (in a good way) with another massive industry trend: IoT.
IoT is an iteration of M2M communications: sensors deployed on parts, with components of parts able to talk with each other, sharing data and prompting specific actions. In the field service world, M2M-enabled devices can capture signals that predict device failure, and communicate them. One common scenario is to populate a service request in a field service management system, which schedules a field tech onsite visit.
Now, let’s add in the 3-D printing element to this scenario:
- A sensor sends out a ping when it detects something awry with its device.
- An algorithm within the field service management (FSM) system will determine if it makes more sense to repair or replace the part.
- The FSM system will run a scan of the customer’s entitlements. Depending on the customer’s service level agreements (SLAs), the notification could trigger anything from an immediate field tech dispatch to a notification that the tech should check this unit on his next scheduled field call.
- Here’s where it gets interesting: If the part needs to be replaced, another algorithm can automate the process of sending the specs to a 3-D printer. It can choose a device based on any parameter, from one that is closest to the malfunctioning device in question, or to one that is convenient to the repair tech on the route. It could even be sent directly to the client site for the customer to install.
- If a tech has to become involved, the FS system will automate that, too, by pinging the tech’s mobile phone with dispatch instructions, and pre-populating the GPS on his truck with directions. The tech will be told where the 3-D-printed part will be — at a pick-up location en route to the customer, or at the customer site.
- The entire transaction is logged in the FSM system with minimal human intervention. In many cases, the entire process can be handled without the customer experiencing even a nanosecond of downtime. The failure data will also be integrated with the company’s ERP system to be used for everything from product design to operations cost forecasting.
- As 3-D printing becomes even more sophisticated, it opens up more and more possibilities, particularly by printing an IoT-enabled sensor right on the part.
Happy customers? You bet. This is the kind of service that can convince a customer to buy from one vendor over another. It also is something that many are willing to pay extra for, particularly in industries that have a low tolerance for downtime.
Happy manufacturers? Absolutely. More concentrated inventory management, less capital tied up in parts, fewer unhappy customers waiting for back-ordered parts. Industry research highlights the value of better fix rates: An Aberdeen report finds that companies that can fix an issue on the first call experience a significant profit increase (6.2% increase for those with first-time-fix rates of 80% or higher). Those who can’t perform lose revenue. It’s as simple as that.
Intertwining 3-D printing into a field service department can open up creative revenue streams for field service organizations by offering the ability to print spare parts and create new contracts with extended, faster service opportunities. 3-D printing coupled with IoT is creating a paradigm shift in field service. Because of the expansive opportunities and the changing landscape as standards are developed, it will be interesting to see how organizations along the supply chain focus in on customer pain points to offer better, faster, and more extensive field service.
Kris Brannock is Executive Vice President of Vertical Solutions, and is responsible for working with customers to discover solutions to enhance their field service business operations and profitability, and to build long-lasting customer relationships. She also is responsible for the strategy and direction of Vertical Solutions’ product suite, including VServiceManagement, a field service management solution that is positioned in the Gartner Magic Quadrant for Field Service Management. Kris has more than 20 years of experience in the field service and customer experience technology arenas, infusing innovative trends with after-market business understanding as VSI’s corporate blogger.